3) Read Yves Smith's piece:
The Bad Bank Assets Proposal: Even Worse Than You Imagined.
«In our view, investors would be well advised to see the outcome of Cyprus both as a reflection of how future stresses will be handled (support sovereign creditors, haircut bank creditors) and a reminder that efforts to shift the liabilities associated with legacy
bad bank assets in both Spain and Ireland onto the ESM [European Stability Mechanism] balance sheet are unlikely to be successful,» the IIF says.
Not exact matches
So while there is no doubt that Sanders» plan of putting a cap on the size of any given
bank (perhaps tied to a firm's
assets as a percentage of GDP) would be
bad for those at the top, it might not spell
bad news for the industry as a whole.
This is going to reduce the «
bad assets» the
banks currently hold while giving TRX an immediate equitable stake in properties obtained.
The report found that
banks with more than $ 10 billion of
assets generally had higher returns on
assets and equity, except during the
worst of the financial crisis.
By «clean exit» the EU means that Greece must sell off enough of its
assets to pay the ECB for the money it used to bail out
bad loans of French and German
banks and bondholders who financed tax evasion and capital flight to Switzerland and elsewhere for over 25 years.
Of course, many people now feel that big
banks don't have to worry about
bad performance being magnified because under the implicit «too - big - to - fail» guarantee of the government, they won't have to take the losses when
asset values decline.
The toxic securitized mortgage
assets were not in the Main Street
banks and savings and loans; these institutions owned mostly prime quality whole loans and could have bled down the modest
bad debt they did have over time from enhanced loan loss reserves.
Upbraiding for its chronic
bad behavior, the Fed imposed a consent order that indefinitely prohibits the
bank from growing its
assets, a severe handicap in the competitive financial industry.
The result of these structural differences was that the
worst performing
asset class in the U.S. was a source of strength our
banking system.
[64] The Independent described the entity sold as the «detoxified arm» of the
bank, while saying the taxpayers retained «responsibility for # 20bn of toxic
assets such as
bad debts and closed mortgages.»
And even those who would regard all such concepts as mythical (cosmopolitans or libertarians who do not think that their passport or citizenship involves any social membership) would probably still acknowledge that existing institutions - the British government, the Monarchy, Parliament, Barclays
Bank, Everton Football Club, etc - are inheritors not just of their history (good and
bad) but indeed of the material consequences of that (eg
assets belonging to the state, or the Royal family, or a business; or indeed debts).
When the
bank collapsed, the Icelandic government passed an emergency law splitting it into a good
bank (with
assets) and a
bad bank (with liabilities).
The financial regulator, the Financial Conduct Authority (FCA), has said it wants
banks to hold more capital and run down or sell
bad assets.
The
Asset Quality Review of
Banks conducted in 2015 shows significant vulnerability of banks to current economic conditions, and that if the affected banks were to provision fully for all bad loans, a significant number of them would coll
Banks conducted in 2015 shows significant vulnerability of
banks to current economic conditions, and that if the affected banks were to provision fully for all bad loans, a significant number of them would coll
banks to current economic conditions, and that if the affected
banks were to provision fully for all bad loans, a significant number of them would coll
banks were to provision fully for all
bad loans, a significant number of them would collapse.
The Prime Minister, speaking as ministers and officials drew up the second phase of their
bank rescue programme, said in an interview: «One of the necessary elements for the next stage is for people to have a clear understanding that
bad assets have been written off.»
If you use an
asset - back mortgage (i'm not sure if that is the term, but a mortgage where in the
worst case you give your home back to the
bank), you generally carry least risk.
Allianz did not grasp the poor
asset quality of Dresdner, particularly in the midst of a
bad market for investment
banking
3)
Asset management companies are formed to absorb the
bad debts when they become a risk to the
banks.
Yes, China has set up
asset management companies to relieve the
banks of
bad debts, and transfer the losses to the MOF.
However, if you already do your
banking with RBC and have a $ 100,000 in
assets then they are not a
bad choice.
After a
bank writes off a
bad debt, they get to remove it from their balance sheets — and report «a reduction in the value of an
asset or earnings by the amount of an expense or loss».
Additionally, unlike
bank deposits, investment accounts are not guaranteed by the FDIC and the investors bear the risk of losing the entire value of their account, or
worse, losing their
assets should the company fold.
It appears that the New York Fed is going to attempt to force
banks and mortgage lenders to buyback some of the
bad mortgages and other
assets that it acquired when it rescued Bear Stearns and AIG.
At that point, the poisoned
assets migrated to the balance sheets of the commercial
banks, depleting their capital, moving the
bad debt from the shadow
banking system — the vehicles are part of it — to the conventional
banking system.
Asking the
banks to buy more stock in the Federal Reserve would also be a possibility if things got
bad enough — i.e., where the future cash flows from the
assets could never pay all of the liabilities.
The International Monetary Fund estimated that major U.S. and European
Banks lost as much as 2.8 trillion in toxic
assets and
bad loans in from 2007 to 2010.
Considering this undertaking, purchasers would not have expected that $ 17.4 billion of their money was being spent to insure «
bad loans of international
banks» as Diane A. Urquhart said in her March speech «The Canadian
asset backed commercial paper crisis, the cause and cure,» to the Canadian Centre for Ethics and Corporate Policy.
The International Monetary Fund estimated that major U.S. and European
Banks lost as much as 2.8 trillion in toxic
assets and
bad loans in from 2007 to 2010.
With this purchase, It has voiced hopes that the NPA (non-performing
assets) and
bad loans situation of these
banks would not worsen in the future.
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Now the
banks, and
asset management agencies charged with cleaning up the
bad banks, are moving forward with sales.
Neither is necessarily right or wrong, you have to do what's right for you, but i have to say I believe there are 2 different kinds of debt - consumption debt which is
bad (e.g. student loans and credit cards), which Kiyosaki calls «doo dads» and what I consider «good debt», by using other peoples money (such as a
bank) to purchase INCOME PRODUCING
ASSETS (NOT speculative ones).
Meanwhile, the FDIC is doing its best to deal with
bad assets on
banks» balance sheets: the agency plans to auction off $ 1 billion in residential and commercial properties, though the
banks are not happy about it.