Posts Tagged Banking industry
More Investors, Chastened by Stock Losses, Settle for Municipal Bonds
Posted by David in Banking news, Finance news on May 22nd, 2009
THE historic lure of most municipal bonds has been their tax-free returns. But the recession and the rash of corporate troubles have widened their appeal to investors wary of the stock market who want to settle for a steady if unspectacular return.
Municipal bonds are still the terrain of high earners, who like their safety and higher tax-adjusted return than Treasury bonds. But increasingly average retail investors have been buying them to fill out their bond allocations. “Our average account has increased their asset allocation in fixed income to 52 percent and most of that is in munis,” said Robert Everett, director of fixed income at the Boston Private Bank and Trust Company. He said that was an increase of 15 percentage points from last year.
Even though the major stock markets have risen in the last month, uncertainty about the rally abounds. Suddenly, the return on a municipal bond of 6 to 7 percent, including the tax exemption, seems great.
The other draw has been safety. Historically, the default rate on investment-grade munis is less than a quarter of a percent, compared with almost 2 percent for corporate bonds. And the difference in yield between United States Treasuries and munis has recently been as much as 2.5 percent.
Given the pressure on city and state coffers, the default rate is likely to rise closer to 1 percent. But that is far lower than the yields on munis suggests, said George Strickland, a managing director at Thornburg Investment Management of Santa Fe, N.M. “The market thinks 20 percent of investment grade issuers will default in the next 10 years,” he said. “The major muni issuers are doing well.”
Being selective with munis is key. The first risk investors need to understand is the difference between general obligation and revenue bonds. General obligation bonds are sold to finance the daily operations of a municipality. Legally, that entity is obligated to do whatever it needs — from cutting services to raising taxes — to make its bond payments.
A revenue bond is sold to finance particular projects like hospitals, utilities and stadiums. The receipts from such projects are used to make the bond payments, and many investors have started to wonder how these will hold up.
“Stay away from revenue bonds, backed by projects like a parking lot at a university,” warned Gregg S. Fisher, chief investment officer of Gerstein Fisher, an investment advisory firm in New York. “If cars stop showing up, then you could have trouble getting your money.”
Hospital bonds also need to be evaluated carefully. “Community hospitals with A and BBB ratings are feeling the pinch because people without insurance go to them and can’t pay,” said Ronald J. Sanchez, director of fixed income strategies at Fiduciary Trust, a unit of Franklin Templeton Investments. “You need to avoid certain segments with greater risk.”
This points to another issue: liquidity. Roughly $360 billion of new bonds are sold annually. New York and California are the benchmark issuers and their bonds are traded often. But there are scores of municipalities that sell bonds that buyers may have to hold for their duration because of illiquid markets.
Munis are traded in an over-the-counter fashion, which means finding a price quote, let alone a buyer, can be difficult at times.
For those aware of the risk, there are investing opportunities. During the first quarter, few municipalities sold bonds because they were waiting to see what the stimulus plan would bring them. Now, cities and states are making up for lost time.
Several portfolio managers advise that shorter-dated munis are safer. “The longer the duration the more volatility,” said Mr. Strickland, who likes the two- to three-year range.
Diversification is also being pushed for munis. Historically investors have concentrated on bonds from their state to get the full tax deduction. But owning bonds from other states could give them a greater return, as in the case of California, where a fiscal crisis has pushed up yields.
The recession has brought about new securities, known as Build America Bonds, to help ailing municipalities raise money. They allow municipalities to sell taxable bonds for capital projects while receiving a rebate from the federal government for a portion of their borrowing costs. The program is meant to attract institutional investors who typically do not buy munis. But they could also suit a retail investor who wants to put them in a taxable retirement account.
Source NYT
Teaching Young People About Personal Finance
Posted by David in Banking news, Economy news on May 3rd, 2009
April is National Financial Literacy Month in the United States. As the country faces a deep recession, Americans are paying closer attention to personal finance. Some critics partly blame the crisis on Americans’ low savings rate and high personal debt.
But efforts to increase financial knowledge have grown in the last ten years. Government, community and business leaders have pushed for teaching young people about the importance of saving, budgets and the true cost of credit.
The Jump$tart Coalition for Personal Financial Literacy is based in Washington, D.C. It is an organization of about one hundred eighty groups, government agencies and businesses. Its goal is to provide financial knowledge to children and young adults before they get into debt.
Jump$tart’s Executive Director Laura Levine says many young people misuse credit cards without meaning to. She says they often start by making the lowest payment required. Over time, their credit limit is increased, but they do not pay off their debt. Laura Levine says young people can take on more debt than they can deal with.
The government says forty-five percent of college students have credit card debt. The average amount owed is more than three thousand dollars.
High credit limits are especially dangerous for college students. John Ninfo is a bankruptcy judge in Rochester, New York. He started the Credit Abuse Resistance Education Program.
It provides resources on its Web site for parents, teachers and students about financial issues. Judge Ninfo says he often sees people in their late twenties seeking bankruptcy protection in court. He says the combination of credit card debt and big student loans is burying young people in debt and driving many of them to bankruptcy.
The results of bad credit can be serious. Seventy percent of employers look at the credit histories of job candidates. In some fields, like law enforcement, bad credit means you cannot get a job.
Former President George Bush formed the President’s Advisory Council on Financial Literacy last year. That group has called for students at all grade levels to receive financial education. Currently, only seventeen states require personal finance to be taught at least as part of other courses.
And that’s the VOA Special English Economics Report, written by Mario Ritter. Transcripts and archives are at voaspecialenglish.com. I’m Steve Ember. (VOA News)
US Treasury Details Plan to Rescue Banks
Posted by David in Banking news on May 3rd, 2009
This week American Treasury Secretary Tim Geithner announced details of a plan aimed at removing billions of dollars in bad debts from American banks.
The government program has two parts. One involves buying groups of loans, like home mortgages. The second involves buying securities or financial investments tied to loans. Under the plan, the federal government will partner with private investors to buy bad loans made by banks.
These bad loans, also called toxic assets, have weakened American banks and interfered with normal lending. The Treasury Department says it will offer low interest loans to private investors so they will buy billions of dollars in toxic assets and get American banks lending again. The Obama administration says if the plan is a success, it could remove as much as one trillion dollars in bad loans.
No one knows how much government money might be needed. But during the past six months, more than seven hundred billion dollars has been committed to cleaning up the bad loans in the banking system.
The plan was first announced last month without many details. The stock market fell. However this week, news of the plan sent prices higher on the American and international stock markets. Following the announcement Monday, share prices of thirty major American industrial stocks increased almost seven percent. This was the biggest one-day gain since October. Mister Geithner said it will take several weeks for his plan to be properly judged by financial markets.
The deep international economic slowdown began in August, two thousand seven. That is when failures in the American home mortgage market caused financial markets to decrease lending.
First the American and then the world economy slipped into recession. Since then, several efforts to unlock credit have failed. Some experts say there will be no other choice but short-term nationalization of troubled banks if the Geithner plan fails to help the financial system.
This week Secretary Geithner also called for increased powers to control other financial businesses, like the insurance company American International Group. Mister Geithner said the Obama administration will continue working with Congress on details of the proposal.
And that’s the VOA Special English Economics Report, written by Brianna Blake. Transcripts, MP3s and podcasts of our programs are at voaspecialenglish.com. I’m Steve Ember. (VOA News )
4 banks in U.S closed within one day ?
Posted by David in Banking news on May 2nd, 2009
U.S. authorities as dissolution procedure 4 banks on 04/24 , the total banks in this crash in 2009 to 29 banks. U.S. banks poured into less than 4 months this year exceeded the bank “closed” in this country in the last year.
Cause costly for fund deposit insurance agency’s deposit insurance (FDIC) are the flows break bank First Bank of Beverly Hills is headquartered in California. Founded in 1979, bank assets are 1.5 billion USD and the amount sent by customers of 1 billion USD.
Do not be found any bank acquired First Bank of Beverly Hills, FDIC has to pay the deposit insurance for all customers with deposit accounts are insured in this bank.
We tried to find customers the First Bank of Beverly Hills, but the brand name of this bank not high, while most of the deposit there is a deposit (broker), a new language member of FDIC. The banks do not want to redeem their deposit broker (broker deposit) in bank flows broken because this is not a capital interest as low deposit directly tradition.
Since the beginning of this year, unable to find customers break bank flows occur quite frequently, making FDIC pay more than money to resolve. Of deposit at the First Bank, only U.S. $ 179,000 is not subject to coverage. Estimated break this flow of funds caused the FDIC to 394 million USD.
However, in the three closed banks left this time, the accountability of all successful in finding customers again.
Office Monitoring saving America (OTS) closed bank First Bank of Idaho Idaho under the state and transfer the entire deposit accounts are not brokers (non-brokered deposit) bank to bank U.S. Bank is headquartered in Minneapolis states. First Bank of Idaho is the first bank in this broken state within 20 years.
Founded in 1997, First Bank of Idaho has 7 branches, assets and USD 489 million deposit of the USD 374 million. Besides the number of deposit are not brokers, U.S. Bank bought only 17.8 million assets bank flows break.
FDIC said the number of deposit brokers 112.8 million in First Bank of Idaho is not U.S. Bank acquisition. Instead, FDIC will have to pay directly for the insurance money to the broker.
American Southern Bank Bank of Kennesaw in Georgia, the state is the state responsible for the implementation of this procedure dissolution. This bank has only 1 correct branch, 14 employees, assets and USD 112.3 million of deposit customer is 104.3 million USD.
After receiving American Southern Bank of Kennesaw, FDIC has sold about half the savings in this bank to bank Bank of North Georgia is headquartered in the state.
At Michigan State, the accountability of state also has closed bank Michigan Heritage Bank. This is a bank with U.S. $ 184.6 million of assets and 151.7 million USD deposit customer, with 3 branches. The whole number of savings account brokerage fees by the bank was sold to Bank Level One Bank is headquartered in the state.
FDIC estimated four times the flow break this fund will make of this reduction Lose total USD 698.4 million. Fund deposit insurance by the FDIC are going quickly and the U.S. Congress are efforts through laws allow FDIC temporary increase by funds borrowed from the Ministry of Finance amounts up to USD 500 billion.
So, has 29 banking flows into the U.S. this year, up 4 bank compared with the number 25 bank poured into last year. Two states go first Georgia bank with 5 being dissolved and California with 4 banks. (Wall Street Journal, CNN)
Pressure for Kenneth Lewis CEO of BoA and Citigroup
Posted by David in Banking news, Economy news on May 1st, 2009
Managing Director (CEO) of the two with leading the U.S. is Bank of America (BoA) and Citigroup are standing in front of the seat if the amount of USD 90 billion that the U.S. government has pumped into BoA and Citigroup not enough to up two of this bank.
Pressure for Kenneth Lewis, CEO of BoA, and Vikram Pandit, CEO of Citigroup, are each at an increase after a Wall Street Journal on U.S. 28 / 4 two loan information bank may have to raise capital. The result is an unnamed source that, on receiving from the results of tests financial capacity 19 largest banks in the U.S.. According to initial plans, the results will be officially announced on 4 / 5 to, but now is back again slower than a few days.
Not long ago, the analysis and investors that some banks area is large-scale test will be capital growth. However, to this time has been that of the shortage of capital in U.S. banking sector is more serious than initially forecast.
The observations also show that for, evaluation of Lewis and Pandit capacity exceeding degradation of banks that leadership is wrong, cause prestige of their leaders is dropping and falling of the Board have reason to search people they replaced.
“I guess both people will have to go before summer this year,” Professor Charles Geisst finance under Manhattan’s comment. “They are so stuck. They just have to draw a beautiful picture for investors. But that world really need is the thắn comment directly about the status of BoA and Citigroup. Meanwhile, the two leaders again this does not make such comments, “the professor said this.
At the Citigroup has not made comments about the survey financial capacity to do the responsible conduct, but the statement still achieved a new step in improving business operations. Sources that a Wall Street Journal quoted, said that Citigroup might have to raise capital if the U.S. Government without adding capital to banks through the expansion plan the conversion of preference shares worth 52, 5 billion into common stock.
Similarly Citigroup, BoA also declined comment about the test of financial resources. On 29 / 4 this, BoA will hold annual meeting in Charlotte, California. At this meeting, the shareholders of the BoA will vote to decide CEO Lewis have to continue sitting in the Board of Directors, or at least leave the chairman position today.
Those who oppose the Lewis continued leadership BoA is to emphasize the problems that this bank incurred after the acquisition of Merrill Lynch. Today 28 / 4, a large pension fund in America, named California Public Employees’ Retirement System (CalPERS), was up against Lewis continued to hold the chair of the Board of BoA.
Although the observation that, will not bank any of the 19 largest banks in the U.S. was “sliding” in tests of financial resources, investors may see the bank being the Government to to increase capital requirements within 6 months to as “sliding.” Currently, investors and analysts have different opinions when evaluating Pandit see Lewis and see who has taken the higher.
To Pandit at Citigroup on 12/2007 and “inherit” a series of problems at the corner thistly this bank. Meanwhile, Lewis is the “architect” of the most current BoA, and understand the CEO’s with this since 2001.
“Lewis having trouble larger Pandit, because he is responsible for too much for the current status of BoA, and the Pandit to the” investor Ralph Cole, a pouring capital to 2 billion USD company management Wellman Capital Management fund in Oregon state, comment.
My Government is determined that the force from the CEOs of the enterprises receive capital assistance from people’s tax money. Not long ago, CEO Rick Wagoner of General Motors car manufacturer (GM) have been forced to stop. Previously, CEO Robert Willumstad of AIG insurance also arrested from the seat only after 3 months of that.
Managers list Walter Todd investment company under the management of funds Greenwood Capital Associates in South Carolina state that the U.S. government has found that the attitude ready to make big changes at Citigroup. “The Vikram Pandit is the only force is larger. But certainly, the Government may also cause pressure to Ken Lewis, “he said.
From 10 last year to now, the U.S. government has pumped for BoA and Citigroup each bank 45 billion USD. The U.S. government also guaranteed 118 billion USD assets toxic for BoA and USD 301 billion bad asset for Citigroup. Plan to convert preference shares by the U.S. Government to hold common shares may increase the share of government banks in the U.S. on this level 36%.
In the annual meeting of Citigroup last week, CEO Pandit declared to shareholders that Citigroup will “pop up” and returned the money aid of the Government. Meanwhile, Lewis, the CEO statement, the bank he does not need half the amount of USD 20 billion that the U.S. government for pouring from last 1 month.
Both BoA and Citigroup can raise capital by selling assets. BoA is for sale banking department called First Republic Bank, while Citigroup break up selling parts of investment banks and brokers in Japan with more than 5.2 billion USD. However, the mobilization of capital today is a difficult task, particularly for those banks having problems. In this bank, the U.S. government can and who will form the more influence and dilute the rights of existing shareholders.
Many lawyers and investors believe that Lewis was wrong in the hearing before the state Attorney General Andrew Cuomo New York, the CEO was almost revealed that President Department Thirty (Fed) Ben Bernanke and former Minister of Finance Henry Paulson has convinced his merger Merrill Lynch to BoA and not publish the number loss in Merrill to protect financial system.
“BoA will have to push Lewis from chair of the Board, but this may he be as difficult in the CEO chair, because he still is considered his first jam in BoA báng bear”, he Michael Mullaney, a fund management company under Fiduciary Trust in Boston, to. (Reuters)
Stock of America gets more than 2%
Posted by David in Stock news on April 30th, 2009
On 29 / 4, Wall Street has been the increase of the Fed that the U.S. economy are positive changes more.
But Wednesday, the U.S. Department of Commerce said the country’s GDP in quarter 1 / 2009 grew 6.1% negative, as export and investment decline drastically.
Value of GDP in quarter 1 / 2009 reached 14,075.5 billion USD - in which consumption expenditure reached USD 9955.7 billion, invested by the private sector reached 1579.8 billion USD, the value of net export / import is negative USD 337.7 billion and spending - the investment reached 2877.7 billion USD.
This rate reduction greater than predicted by the analysis made previously. In quarter 4 of 2008, U.S. GDP growth was negative 6.3%.
In a remarkable turn in the day, Department of Thirty U.S. (Fed) has issued the decision to stay with basic interest rate from 0-0,25%.
In the meeting took place on 28-29/4, Fed did not have a specific action is to support the market. Fed also said that the U.S. economy are positive changes more.
In the most recent meeting took place on 17-18/3, Fed announced plans to pump U.S. $ 1.15 thousand billion into the economy.
The number increased from 2,1-2,3% value
On 29 / 4, Time Warner Group, said sales in quarter 1 / 2009 decreased 7% over the same period last year, down 6.9 billion, profits reached 555 million USD, equivalent to 46 cents / stock - with the profit level achieved the same period last year.
Structure led to revenue including revenue from business units such as cable TV HBO, CNN, TNT … increased 6% to USD 2.8 billion, revenue from AOL decrease of 23% to USD 867 million, revenue from Warner Bros. films decreased 7% to USD 2.6 billion, the remaining sales of the units business publishing.
Time Warner also said profit per share by manufacturers this year will be 1.98 USD, equivalent to 2008. End session, shares of Time Warner (TWX-NYSE) increased 0.96% to 21.97 dollars per share.
U.S. stocks up points today Wednesday after Fed optimism that the prospects of the economy in this country.
While U.S. economic growth negative 6.1% in quarter 1 / 2009, but the spending of people has increased rapidly. This is an important factor to support stock market points to the session.
Stock blue-chip industrial volume, energy has increased rapidly, in which Boeing shares up 4.4%, shares in United Technologies added 2%, Exxon Mobil shares increased 2% and Chevron shares nhich 2.4 %.
Stock banks have the recovery again after nearly 3% decrease the previous session. KBW’s the bank increased 5%, in which JPMorgan Chase shares up 5.2%, shares in Bank of America added 6.5%, Citigroup shares increased 7.96% …
Chart place by just three stocks on the U.S. 29 / 4 - Source: G. Finance.
Points through transactions results on 29 / 4: Dow Jones index increased 168.78 points, equivalent to 2.11%, core at 8185.73.
NASDAQ’s session up 38.13 points, equivalent to 2.28%, core at 1711.94.
Finally, the S & P 500 advanced 18.48 points more, equivalent to 2.16%, closing at 873.64.
Volume of transactions on the floor New York reached 1.48 billion shares, with 2560 market shares increase and decrease of stock 484 points. Volume of transactions on the floor of the NASDAQ reached 2.4 billion shares, with 2073 market shares increase and decrease of stock 604 points.
* The information is noted in weeks:
Thursday: Report figures who apply for unemployment benefits the first time, data on expenditure and income of the American people; results ExxonMobil’s business, Cardinal Health, Colgate-Palmolive, Ericsson, Motorola, Viacom and MetLife.
Friday: U.S. data on sales cars; data on the ISM manufacturing sector industry, the order from the factory in the U.S.; University of Michigan and Reuters news published survey results of trust by consumers, business results by Chevron, Clorox, MasterCard and Simon Property.
European stocks up to the highest level in 11 weeks
European stocks Wednesday the increase was strong, bringing all three of the areas to the highest level within the last 11 weeks.
Stock volume banking, energy, mines and increase strength, created the momentum drag on the market.
Barclays shares up 10.4%, shares Banco Santander and BNP Paribas were 6.1 %…; increased volume of stock as Petroplus energy, StatoilHydro STL.L, Dana Petroleum and ENI up from 1,9-4 % share of the mines as Anglo American, Rio Tinto and Vedanta up from 5,7-7,5%.
End transaction date, the UK’s FTSE 100 increased 93.19 points, equivalent to 2.27%, core at 4189.59. Volume of transactions reached 2.37 billion shares.
DAX index in Germany to 2.11%, the volume of transactions reached 41.4 million. Only 40 of France’s more advanced 2.16%, the volume of transactions reached 172trieu stock.
Asian stocks recovery
Increased shares of the basic goods and consumer goods, has contributed to important increases in this session.
MSCI’s Asia - Pacific Ocean (not including Japan) increased 1.9% to 267.74 points, after having lost 4% in the previous two sessions as concerns flu in pigs and U.S. banks .
Transferred to South Korea market, Central Bank has said surplus anonymous account of this in 1 / 2009 reached USD 6.64 billion, from 4.09 billion USD in 2 / 2009. Surplus should anonymous by South Korea has increased the second month and is a positive signal indicates that the most difficult period of economic South Korea have gone through.
On the stock market, the KOSPI has been the strong increase, the make up session before. End date transaction, KOSPI index increased 38.18 points, equivalent to 2.94%, core at 1338.42.
Stock market China has increased the points again after the 4 consecutive points reduction previously. Health by increasing the stock banks and energy markets have pulled away on the day of transaction.
Stocks Bank of Communications increased 4.8% after the bank notified this profit exceeds predictions of the analysis. Shares of manufacturers than most countries - China Shenhua Energy increased 6.4%, after the carrier announced profit after tax quarter 1 / 2009 increased 17% over the same period last year.
End date transaction, Shanghai Composite Index increased 66.75 points, equivalent to 2.78%, core at 2468.19 - 35% increase compared to the beginning of 2009.
Points in the other market: the Taiwan weighted Taiwan increased by 0.31%. Straits Times index in Singapore by adding 2.7%. BSE 30 index India increased by 2.21%. ASX index of Australia down 0.27%. Hang Seng Index of Hong Kong up 2.76%.
Ray from the U.S. banking industry?
Posted by David in Banking news on April 30th, 2009
Only less than 3 months, several leading banks in the U.S. are living longer flickering with the support of the Government.
However, recently, the U.S. banking industry has come to signal a positive recovery.
On 16 / 4, the bank’s second largest U.S. as JPMorgan Chase reported profitsexceeding expected in quarter 1. Previously, the two banks Goldman Sachs and Wells Fargo also nuc to investors to the good benefit plan. Loss rate USD 966 million that common shareholders of Citigroup Ganh suffered by 1 in your report that this corporation announced today 17 / 4 is not currency as previously predicted by the market.
The reported profit was lambency promote the recovery of further stock market, and world - first rehab start since 5 weeks ago, when two banks suffered serious impact in times khủng This hoảng Citigroup and Bank of America predicts the period of crisis bad worst has ended.
It can be said that the profit wave of fresh new bank in the U.S. is the result from the efforts of the Government in this country to the financial sector back from “death cõi. The interest rate very low now prompted a number of large customers to find the loan the new flags. Scope of investment banking activities and transactions flourishes again many thanks to the U.S. to launch only with credit markets. Before the test results financial capacity of 19 U.S. banks were announced, some banks, including Goldman Sachs, have tried to pay money to aid the Government.
However, there are only traces am lonely on a dark color picture. Millions of customers loan bank in the U.S. continue to fall in failure. These loss in lending new business start process clamber. Crisis on the housing market began to spread market commercial real estate, with the bankrupt corporation’s business and retail space General Growth Properties, marked the largest bankruptcy in history of U.S. real estate .
“Housing markets have overcome the period of bad worst. But for the market of real estate and commercial lending business, the situation is still sound, “the analysis of the banking sector under Gerard Cassidy from the RBC Capital Markets commented.
Profit JPMorgan Chase’s 1 in the last quarter was 2.1 billion USD, exceeding the forecast of the previous observations. Sales of banks in this quarter increased 45% to 25 billion level, from 16.9 billion the same period last year. Besides the loss rate can be as modest 966 million, revenue quarter 1 / 2009 by Citigroup has doubled over the same period to 24.79 billion USD.
However, business results by JPMorgan still reflect the situation continues to stabilize in the array as service credit, which occurs in loss. This shows that the negative impacts of degradation for economic activities by consumers and the credit market.
Many banks are in the process of preparing for the unfavorable situation can occur by increasing for bad debts. Banks and regional banking community - the subject of capital under special risks before many states fail to business loans and real estate - are bringing tens of million of cash resources to reserve. While the large banks such as JPMorgan, the additional billions of USD.
“The situation not available to the extent as what people say. Once the price is not to settle back and unemployment have not reached the top, we will continue to bear the pressure loss, “Director of Finance Michael J. Cavanagh of JPMorgan said. However, if interest rates continue to be maintained low and the U.S. Government continues to support policies for the financial sector bank, the water table will hopefully earn enough profits to prevent cú Item from the shock loss is predicted above.
Some experts said that the worry about the nationalize banks was subdued, but ask questions is whether the profit account published recently or are not sustainable in the economic degradation My place is worse. “Banks can a student. Next issue is sustainability to the benefit on account “, the analysis of financial services under Charles Peabody consulting firms Partner Portales comment.
The caution is not without reason. With the adjustment in accounting rules recently in the U.S., the profits of banks in this country may have been partially inflated blowing. Besides, there are banks suspend operations by the execution policies of the U.S. government applied in many areas in recent years will end when a bank account to the loss from capital of bad debts is not small.
In addition, recently, banks have benefited from good results in unusual activities and transactions the interest rate low to help the value of investing in market lending their flags are raised.
Test results of financial capacity of 19 largest banks in the U.S. expected to be announced on 4 / 5 may help the investors in the stock market the U.S. found some banks have ability in the level sufficient to offset the loss account occurs when the economy this place is worse.
Conclusions of investors when test results are given may not the best with what they identified the business results you 1 of the bank were announced, because the test capability financing to bring a vision of the health of banks in the next 2 years. Also in nature, reported quarterly profits look back is what took place.
The authorities have engaged in activities to check the capacity of finance for U.S. banks or, very likely a bank will need to mobilize new capital. However, the officials also emphasized that the bank so will not necessarily need to cash aid from the government. In addition to finding sources of capital investment the private banks also have access to a large capital through conversion of preference shares that the government holding the common stock as of the current Citigroup.
The officials concerned said they want the banks need to raise capital immediately announced plans to do this after the test results to the financial published. However, even stars, before the test results above are made, the price of shares of U.S. banks in the transaction are recent witnessed a strong recovery.
First week, Goldman Sachs that, they will mobilize U.S. $ 5 billion fund to return money to aid the U.S. Government. Mid-week, Chairman cum Managing Director (CEO) Jamie Dimon of JPMorgan Chase declared corporations will pay 25 billion fund that the Government has to pump as soon as permission of the authorities. New York Times
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