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Posts tagged ‘Loan’

Mario Draghi’s Nightmare Gets Worse: European Loans Decline At Record Rate

By Tyler Durden

Back in July we posted “What Keeps Mario Draghi Up At Night, And Why The European Depression Has A Ways To Go” in which we presented “Europe’s annual change in M3, alongside the far more important bank lending to the Euro area private sector. It is the latter which [then had] just dipped to a record low, indicating once more that Europe’s monetary transmission mechanism is not only clogged up (a rising M3 should have a favorable impact here) but hopelessly broken. In other words, it is the brown line in the chart below that is what is giving the ECB chairman nightmares, and is leading to such secondary effects as record high unemployment and negative GDP growth virtually across the entire Eurozone.” Needless to say, in a Keynesian a world in which credit growth and only credit growth leads to economic growth (see Ray Dalio for more), and in which the ECB is a net extractor of liquidity (and thus debt), this means that the European depression will simply get worse as soon as the current episode of foreign capital flows tapers out and the “current account” injectors realize that it was nothing but another case of greater fool risk-chasing in Europe.


full artical at source: http://www.zerohedge.com/news/2013-09-26/mario-draghis-nightmare-gets-worse-european-loans-decline-new-record-pace


Your Home, your Emotional Wellbeing and Security, that is what the Courts affect when they facilitate the Banks by ruling in their favour at repossession hearings, in almost 100% of cases the entire merits of the case are decided on three simple questions,

  1. Did the borrower, borrow the money?
  2. Is the Borrower making payments?
  3. If not, when was the last payment made?

That is it in a nutshell, the process is started by the Bank’s with the sole objective of steering the Court proceedings to a point where the Borrower is either not present or stands in the intimidating environment of the Court, alone, unprepared and unrepresented. There is not a snowball’s chance in hell of the outcome being anything other than the Borrower losing their home.

The Judge will not consider any evidence, motion or pleading which is not presented to him in a certain fashion which complies with the Court rules, so hope on the part of a borrower is non-existent.

Now we must consider the Bank, which is applying to the court for an order to take the home from the distressed Borrower, the very Bank which was complicit in creating the conditions which gave rise to the domino effect of degenerating personal finances and eventual inability to pay that culminated in the Borrower being in Court

full article from our friends over at “Awaken Longford” link here http://awakenlongford.wordpress.com/2013/02/04/what-does-your-home-mean-to-you/


Are peer-to-peer lenders the future of banking?????

This article titled “Are peer-to-peer lenders the future of banking?” was written by Josephine Moulds, for The Observer on Saturday 9th June 2012 23.01 UTC

“Never lend money to friends or family,” the saying goes. But how about complete strangers? Websites that match up borrowers and lenders are enjoying a new wave of interest after a series of high-profile endorsements.

First came Andy Haldane, executive director for financial stability at the Bank of England, who said peer-to-peer lenders could eventually replace high street banks. “At present, these companies are tiny,” he said. “But so, a decade and a half ago, was Google. If eBay can solve the ‘lemons problem’ [substandard products] in the secondhand sales market, it can be done in the market for loans.”

Then the government said it would channel £100m to small businesses through alternative lending channels, including peer-to-peer lenders, hoping to bypass the mainstream banks, which are reluctant to lend. The news caused a flurry of excitement among the few established players in the field, including Zopa, for personal loans, and Funding Circle, for small businesses.

These websites act as a kind of broker between lenders and borrowers. The idea is that without expensive branches and the weight of regulation, they can offer better rates to both sides. For a loan of £5,000 over three years, Zopa certainly comes out cheapest on moneysupermarket.com, offering 7.3%. And it says lenders on the site can expect returns of 5%-5.5% after fees and bad debts, which beats most easy-access savings products out there. The model is, however, not without risks

full article at source: http://stateofglobe.com/2012/06/10/are-peer-to-peer-lenders-the-future-of-banking/#more-3759

Frank Daily Reveals some of NAMA’s secrets

Saturday, I had the time to listen The Marian Finucane talk showon RTE 1
Marian was talking to the NAMA chairman Frank Daily Listen here to show .What I
found most surprising was after nearly 15 months NAMA still has to approve one
business plan and even this one “was close to finality” This is surprising to
say the least Then we heard that NANA wrote to the Government last year about
Upward Only Rents and leases, to highlight the effects any change would have on
NAMA,(presumably negative). Anyway listen and learn here
NAMA chairman Frank Daily

Privacy law may delay Nama property sales

Privacy law may delay Nama property sales

JACK FAGAN Irish Times 25th. May 2011

A RECENT ADMISSION by the chairman and chief executive of Nama that they are precluded from giving information, to interested parties, on assets acquired could seriously delay the sale of distressed property loans, say senior property industry figures.

The disclosure is likely to come as a surprise to some Government ministers who are anxious to see Nama speed up its disposal programme. To date the State asset management company has spent €30.5 billion on buying loans from participating banks with a nominal value of €73.4 billion. Under current legislation, the National Asset Management Agency can only release details of property loans it has bought if the borrower gives consent to it or where a receiver has been appointed.

Both the chairman and chief executive of the Nama, Frank Daly and Brendan McDonagh, told a meeting in Cork last week that under Sections 99 and 202 of the Nama Act, as well as the Data Protection Acts, they could not provide prospective buyers with information about the underlying property assets in any particular property portfolio.

The admission was greeted with surprise and dismay by property managers who question how anyone can purchase a loan book or a bundle of properties without knowing what exactly they are buying. A leading property manager said it was like trying to sell your house and not being able to tell prospective buyers what the address was, how many bedrooms it had or what price was expected.

“No one will buy a pig in a poke. This is legislative madness which needs to be changed,” he said.

The unusual restriction will clearly put Nama at a significant disadvantage to non-Nama banks which can offer loan books and property assets for sale on the open market.

Mr Daly and Mr McDonagh told the Cork meeting that given hardly a week goes by without some comment or other being made about the alleged secretiveness of Nama they thought “it may be appropriate to talk briefly about the whole area of openness and transparency as it relates to Nama and to set out the current legal constraints under which we operate”.

In their address, they said members of the Nama board and Nama officers were prohibited under Section 202 of the act from disclosing confidential information.

Confidential information was specifically defined to include information relating to debtors. Furthermore, Section 99 of the act provided that, on acquisition of a loan, Nama took over the obligations of the participating institution under the loan, one of which was the contractual duty of confidentiality which the debtor enjoyed while still a customer of the participating institution.

For these reasons they considered they could not disclose details about debtors because to do so would leave them open to litigation. Information about individual debtors or guarantors was protected against disclosure by the Data Protection Acts which Nama must comply with as a data controller.

The Nama executives said a change in the law would be required to enable Nama to disclose information about a debtor. “However, even if the law were to be changed, there is still no certainty that the amended legislation would survive constitutional challenge if a debtor initiated proceedings to protect what he would perceive to be his right to confidentiality and to privacy.”

The two executives said they were not in a position to have discussions with potential investors, or others, about assets which were under the control of debtors who were meeting their repayment obligations or who were still negotiating with Nama on their business plans.

This was no different from the reasonable expectation that any of us might have that our bank would not enter into negotiations with a third party about the sale of our property unless we were in serious default. “That is not to say that we cannot facilitate buyers and debtors who share a common commercial objective. I should add that many of the disclosure constraints that apply to property assets under the control of debtors do not apply to property assets that are controlled by receivers engaged directly or indirectly by Nama.”

Property managers will be sceptical about the danger of introducing a minor amendment to the law that would enable Nama to provide full information on distressed property assets for sale. One property manager said it was “laughable” that a Government threatening to outlaw existing legal agreements on upwards-only rent reviews would hesitate about making a simple change in the Nama law to allow it to recover billions of badly needed euro spent on distressed property assets.


Something stinks and this has all the hallmarks of deals been done for the benefit of the insiders and the golden circle .The government should immediately put in motion a regime that will ensure total transparency of the process of disposing of these properties. NAMA must provide full information on distressed property assets for sale. The notion that they could hide behind Sections 99 and 202 of the Nama Act, as well as the Data Protection Acts, prohibiting them to provide prospective buyers with information about the underlying property assets in any particular property portfolio is preposterous.

I suspect that the choice pieces are been creamed off to the benefit of possible the very same developers that are now in trouble. It is not acceptable that we the taxpayers should now allow this kind of blatant attempt to fleece us once again .

If the megabanks are so big on lending, why do their loan books keep shrinking?

Stingy megabanks swimming in cash

Posted by Colin Barr

April 21, 2011 6:17 am

The biggest U.S. banks tell us they have spent the past quarter writing loans, renewing credit lines and generally being upstanding economic citizens. Bank of America (BAC) says it provided consumers and businesses with $144 billion in credit in the first quarter, Wells Fargo (WFC) ponied up $151 billion and JPMorgan Chase (JPM), swinging for the PR fences, claims to have lent out an improbable-looking $450 billion.These guys are our economic heart?Yet loan balances actually shrank from a year ago at all three banks in the first quarter, just as they did at their old pal Citi (C). This at a time when the too-big-to-fail four are being drenched with new deposits (see chart, right).All told, average loans outstanding at  the fearsome four dropped 7% from a year earlier – a decline of $210 billion — even as deposits rose 5%.If this is what the bailed-out captains of the financial sector call supporting the recovery, no wonder the economy is going nowhere fast.

The banks, of course, protest that there are good reasons that their loan balances are dropping even as they wrap themselves in the flag of credit extension.

Good customers aren’t exactly banging down the door demanding loans, they say, and won’t till the recovery really gets rolling. And making loans for the sake of it doesn’t pay off, as we may have learned during the financial meltdown.

“We got to where we are today by making good loans and making sound credit decisions,” Wells Fargo’s chief financial officer, Tim Sloan, said in an interview Wednesday.

And yes, even with all that shrinkage there are pockets of loan growth at the banks. JPMorgan Chase says loans to midsize companies rose every month last year, and Wells points to strength in auto dealer and commercial lending, along with the oft-questioned commercial real estate sector. “We love that business,” says Sloan.

But mostly, loans are shrinking. That’s partly because banks must put the worst mistakes of the bubble era in the rearview mirror, by taking losses on bad loans and letting other low-quality portfolios run off. Both those moves lead to lower loans outstanding. All four banks are taking their lumps on that front. BofA is running off loans from the beyond-lax Angelo Mozilo era at Countrywide, JPMorgan is dealing with the sales-at-any-cost (see a shining example, below right) mindset of Kerry Killinger & Co. at Washington Mutual, and Wells Fargo is trying to rid itself of the worst Pick-a-Pay dross it picked up in its acquisition of Wachovia. Citi, of course, has its own issues.How to make bad credit decisions

Still, it’s clear the banks are not lending quite as freely as their press release claims would have you believe. And the declines are all the more striking because they come when the banks, like their perk-addicted CEOs, are swimming in cash.

Average deposits at the four biggest banks rose by $154 billion over the past year, with Bank of America breaking $1 trillion in deposits for the first time and JPMorgan falling just $4 billion short of that mark.As a result, all the big banks now have at least $1.06 in deposits for every dollar in loans outstanding. At this time a year ago, only JPMorgan was above $1 in deposits for each dollar in loans.There is something to be said for banks having a lot of cash on hand, of course. As everyone but Dick Fuld learned from the crisis, running out of money makes it hard to persuade others of your firm’s franchise value. And of course it is hard to grow a business without reaching out to new users.

“We are glad to have a highly liquid balance sheet,” says Sloan. “Deposit growth gives us a chance to bring in new customers and cross-sell our products.”

Given the banks’ penchant for cooking up rosy-looking credit creation numbers at a time when their loan books are actually shrinking, maybe those products should come with a grain of salt.

source: http://finance.fortune.cnn.com/2011/04/21/stingy-megabanks-swimming-in-cash/?section=magazines_fortune


I still expect to see the high for the Dow this year about 1000 points away from where we are right now at least and then see a full retracement all the way down to 9750 at least .Euro Dollar, Well we have reach my expected 1.4250 target and now I am looking for the 1.50 BAC I am hedged and so I don’t real y care. If we get to 10.90 I will again buy .Citi I am hoping to tack on some more stock at 4.00$ or under but I am not so sure it will get down there .

What now for NAMA 2 and NAMA 3?


By Namawinelake

To date, NAMA has acquired €71bn of loans for which it has paid €30bn. Up to last week, there were some €17bn of additional loans to acquire from the banks. That changed yesterday.
The €17bn of loans remaining to be absorbed by NAMA comprised two elements:  sub-€20m exposures at Bank of Ireland and AIB which were estimated to be worth a total of €12bn at nominal value and secondly €5bn of loans in respect of Paddy McKillen and other NAMA objectors. The €12bn of smaller loans at AIB and BoI are commonly referred to as “NAMA 2”, the €5bn of objectors’ loans would be regarded as part of the original “NAMA 1”. NAMA 3 was the codename for dealing with problem non-NAMA loans at the banks and certain categories of lending such as tracker-mortgages and non-NAMA commercial property lending were cited as examples of what might be included in NAMA 3.
Yesterday, the Labour/Fine Gael Programme for Government cements the commitment made by both parties in their respective manifestos. The document says “we will end further asset transfers to NAMA, which are unlikely to improve market confidence in either the banks or the State”. And last night on RTE’s “This Week in Politics” the following exchange took place:
Sean O‘Rourke (RTE presenter): You say that you will end further asset transfers to NAMA, which are unlikely to improve market confidence in either the banks or the State , in other words nothing else is to be moved to NAMA. Is that the idea?
Pat Rabitte (Labour party negotiator) Neither the transfers envisaged under NAMA 2 or NAMA 3 will happen. Because that’s not helpful in the overall crisis situation that we’re in.
This would all seem to hammer the nails into the coffin of NAMA 2. And a further implication is that the €5bn of outstanding loans in NAMA 1 will also remain with the banks as these loans, which include Paddy McKillen’s reported €2.1bn of loans as well as others, are understood to be “cherry assets”. Absorbing “cherry assets” and making an even bigger hole in the banks’ balance sheets is hardly going “to improve confidence in the banks”.
So what now for NAMA 2 and NAMA 3? It seems that the smaller land and development loans that would have been in NAMA 2 are every bit as toxic as the larger loans already absorbed by NAMA which have attracted average haircuts for AIB and Bank of Ireland combined of over 50%. If NAMA 2 is not to happen how will AIB and BoI instil confidence that the value of these sub-€20m land and development loans are adequately provisioned? What I believe is likely, is that the banks themselves will set up internal transfers which will seek to value and ring-fence these supposedly toxic loans. And that too would appear to be the solution to NAMA 3, an internal good bank/bad bank split where the valuation and management of troubled assets takes place internally in the banks themselves. From this distance it is difficult to see how such an internal transfer and split into good bank/bad bank is very different to NAMA valuing the loans and then managing those loans. It may prevent the crystallisation of losses at the banks today but the markets will still suspect the toxicity of these retained loans. So we end up with a bit of a dog’s breakfast with an expensively-run NAMA plus we have good/bad bank splits plus suspicion about the values of loans retained by the banks.
I wonder if the apparent change in policy towards NAMA 2 and NAMA 3 is akin to the FG commitment on quangos – merge certain quangos to reduce the headline number but overall they still employ the same people and cost roughly the same – and is just juggling the same loans but avoiding the optics of the unpopular NAMA expanding its remit? I also wonder what the EU/IMF will think of the policy as it is a term of the bailout agreement that the sub-€20m exposures be valued and moved off the banks’ balance sheets. Our lenders have already advanced €15bn and can’t be very happy at this and other recent developments such as the uncertainty of the commitment of the government to recapitalise the banks.

source URL: http://wp.me/pNlCf-18r


What we see here is nothing more than accounting gimmickry and double speak or fork tongue  as the Red Indians said about the white mans promises. The new boys are now looking down the black hole and still cant see any light and are contemplating a few more tricks to con the general public into believing that it is still a good idea for the taxpayers to pay for a dead horse
they should close down Anglo Irish and Allied Irish and even Bank of Ireland and create a entirely new commercial bank ASAP
and of course stop the bull**** spin

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