Tag: bank losses

US

FDIC aggregate bank losses masked by trading gains Q1 – 2009

Colin Henderson

The latest FDIC QBP is out and contains some sobering information on the impact of the recession on bank results. FDIC Quarterly Banking Performance – 31st March 2009 INSURED INSTITUTION PERFORMANCE Net Income of $7.6 Billion Is Less than Half Year-Earlier Level (61% less than previous period) Noninterest Income Registers Strong Rebound at Large Banks Aggressive Reserve Building Trails Growth in Troubled Loans Industry Assets Contract by $302 Billion Total Equity Capital Increases by $82.1 Billion Looking behind the apparently positive net income of $7.6Bn we see that first quarter earnings were $11.7 billion (60.8 percent) lower than in the … Continue reading FDIC aggregate bank losses masked by trading gains Q1 – 2009

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Bank asset revlauation – unfortunately its the next mortgage crisis

Colin Henderson

In keeping with the theme that bank assets need to be properly valued before confidence can be returned to the system, this piece summarises the next immediate problem.  As you read this, bear in mind that the American system for most states employ the non-recourse system.  This little known implication just came known to me recently, and further explains the extent of the fear on bank asset value.  Non-recourse means the homeowner can walk away from a home where the mortgage exceeds the home value with no recourse from the bank back to that homeowner for the shortfall.  This is … Continue reading Bank asset revlauation – unfortunately its the next mortgage crisis