Margin of Safety
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Category: Bank balance sheets
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As I wrote on CFO.com on Tuesday, China’s domestic banks may face problems during the “great moderation” of China’s economic growth. A recent S&P report said that the majority of China’s top banks, and many regional and national banks, “remain vulnerable to credit shocks stemming from a hard-landing scenario for the Chinese economy.” They are not…
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What a week for Anchor Bancorp of Wisconsin. Its holding company declares bankruptcy, then the SEC comes out today with fraud charges against the CFO. (The case was settled.) A bad earnings report just added icing to the cake. Anchor owed the Treasury $139 million in TARP debt. Like Anchor’s other creditors, Treasury settled for…
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Is there any end to banks’ easing of standards on business loans? Loan underwriting is getting pretty loose. The Federal Reserve’s Senior Loan Officer Survey for July shows banks easing standards (yet again) for industrial & commercial loans. The percentage of domestic U.S. banks easing actually was near the highest its been since 2011. Demand…
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My latest story on CFO.com: merchant banking physical commodities warehouses aluminum derivatives price manipulation Goldman Sachs.
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Yep, you guessed it, the federal government. The Financial Times reported today that Freddie Mac will sell a new kind of derivative that will get private investors to take on the risk of default of $22.5 billion in mortgages. From the story: Freddie is selling a new financial product it calls structured agency credit risk,…
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Listening to two Anglo Irish Bank execs joke about a 7 billion euro bailout is nauseating, but are we really surprised conversations like this went on? This recording of an internal phone conversation between the head of the bank’s capital markets area and its director of retail banking was uncovered by The Irish Independent. The…
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Ok, so this new study from the Federal Reserve Bank of Boston is from, um, the Federal Reserve, but the results are still compelling: Our study indicates that the capital depletion during the recent financial crisis at large U.S. financial institutions was extensive and often rapid. Specifically, of the 26 large institutions examined in this…
Margin of Safety 