I am not a sheep, I have my own mind
I have had enough of being told what and how to think
Whilst we are still allowed the remnants of free speech, I will speak out.
I also reserve the right to discuss less controversial matters should I feel the urge.
As a very experienced banker with a deep knowledge of finance. markets etc. I would take issue with that diagram:
1. Barclays took a loan from the BoE when their funding got tight. Not an equity injection, but still a bailout.
2. NR & B&B were both casino banks inasmuch as their business model relied on them taking a lot of liquidity (funding) risk. They basically tried to improve profitability by playing the yield curve, lending long term and borrowing short term, in the expectation that they would be able to refinance. When the market stopped taking their paper they got burned.
3. HBOS took big risks in property (high gearing / low security cover / uncovered residual), and they took the same sort of risks in aircraft and ship finance, taking uncovered residual positions. That is fine if you are ILFC or any7 other experience operating lessor, but not if you are a bunch of plonkers from Yorkshire or Edinburgh.
5. Lloyds was a conservative bank but took the biggest risk of all when they took on HBOS, not knowing the extent of the possible losses. They bet the whole bank on black, and the ball landed on red.
Casino banking isnt simplistic. Most of the banks wont accept funds to transfer to casino sites. Only few sites like neteller, moneybookers only accept casinos.
If you have any questions, get back to me. I can explain you better. Thanks. regards, Henry
As a very experienced banker with a deep knowledge of finance. markets etc. I would take issue with that diagram:
ReplyDelete1. Barclays took a loan from the BoE when their funding got tight. Not an equity injection, but still a bailout.
2. NR & B&B were both casino banks inasmuch as their business model relied on them taking a lot of liquidity (funding) risk. They basically tried to improve profitability by playing the yield curve, lending long term and borrowing short term, in the expectation that they would be able to refinance. When the market stopped taking their paper they got burned.
3. HBOS took big risks in property (high gearing / low security cover / uncovered residual), and they took the same sort of risks in aircraft and ship finance, taking uncovered residual positions. That is fine if you are ILFC or any7 other experience operating lessor, but not if you are a bunch of plonkers from Yorkshire or Edinburgh.
5. Lloyds was a conservative bank but took the biggest risk of all when they took on HBOS, not knowing the extent of the possible losses. They bet the whole bank on black, and the ball landed on red.
Actually I did think it a bit simplistic. I wondered if you'd post a comment clarifying...
ReplyDeleteCasino banking isnt simplistic. Most of the banks wont accept funds to transfer to casino sites. Only few sites like neteller, moneybookers only accept casinos.
ReplyDeleteIf you have any questions, get back to me. I can explain you better.
Thanks.
regards,
Henry