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British banks may have £30bn hidden losses

British banks may be harbouring a black hole of as much as £50bn in undeclared losses that do not show up in their accounts but hamper their efforts to lend, a shareholder group has warned.

by Louise Armitstead, The Telegraph:

PIRC has calculated the amount of bad debts the banks may have to write off in coming years but have yet to subtract from profits, together with other items such as deferred bonuses [...]

Why make a loan and be forced to reserve precious capital against it when you can be assured of a gain by cutting interest expense?

Despite the government’s best efforts at pushing them to boost lending, flush U.K. banks find it easier (and less risky) to profit by paying a premium to buy back their bonds. Why make a loan and be forced to reserve precious capital against it when you can be assured of a gain by cutting interest expense?

From WSJ:

Flush with cash but wary of making any more bad loans, U.K. banks are [...]

British Banks To Collape From LIBOR Lawsuits? Will Barclays fold over this whole thing? Is the entire British Bankers Association at risk?

Barclays

Quote:

LONDON BARCLAYS PLC’s chief financial officer is under investigation by British authorities related to the bank’s 2008 fundraising activities with Middle Eastern investors, dealing a fresh blow to a bank that already this month has lost its chairman, chief executive and chief operating officer.”It is important that the right selection is made.” Barclays also disclosed on Friday that it is facing an array of lawsuits stemming from its attempted manipulation [...]

Traders At Four Banks Are Being Investigated In The LIBOR Probe, And Wall Street May Start Eating Its Own

Bloomberg’s Lindsay Fortado and Joshua Gallu report that traders at Deutsche Bank AG, HSBC Holdings Plc , Societe Generale and Credit Agricole are under investigation for manipulating the interest rate.

Specfically, regulators are investigating Michael Zrihen at Credit Agricole, Didier Sander at HSBC and Christian Bittar at Deutsche Bank because of their links to former Barclays trader Philippe Moryoussef, says the report.

So far, 34 traders have been caught up in the probe and either fired and put on probation by [...]

Paul Tucker ‘aware of move to fix Libor’… will be grilled by MPs over the Libor scandal and whether regulators decided to turn a blind eye to misconduct.

The deputy governor of the Bank of England was warned that UK lenders were manipulating interest rates a year before he allegedly gave Barclays “a nod and a wink” to rig its own, in a call with former chief executive Bob Diamond in 2008.

Paul Tucker will on Monday be grilled by MPs on the Treasury Select Committee (TSC) over the Libor scandal, where he will be asked whether regulators decided [...]

RBS-NatWest bank meltdown rolls on: Chaos to hit millions all weekend, customers STILL can’t get wages – and it may last until next week

The computer meltdown at NatWest and Royal Bank of Scotland, which left millions unable to access their salaries, could stretch into next week it emerged today.

The banking group will open 1,000 branches on Sunday, from 9am to midday, as millions of people are unable to receive money or pay bills because of an ongoing technical crash.

Doors were also kept open until 7pm on Friday and until 6pm today because a [...]

BREAKING: Moody’s expected to announce ratings downgrade for some of world’s biggest banks, incl in UK, after US mkts close tonight – Sky Sources

Even as Moody is now about a week late on its Spanish bank downgrade where the banks are rated higher than the sovereign (which obviously is kept in check to prevent yields on bonds from soaring even more), here comes the next wholesale bank downgrade:

Moody’s expected to announce ratings downgrade for UK banks this evening - Sky Sources
Exclusive: Big news – I’m told Moody’s will announce downgrades of some of world’s biggest [...]

UK banks sitting on £40bn of undeclared losses

Britain’s banks are sitting on a £40bn black hole of undeclared losses that are preventing them from making vital loans to businesses and households.

PIRC, the shareholder advisory group, has analysed the 2011 accounts of the UK’s top five banks to calculate how much they expect to write off as bad debt in the coming years but have yet to take against profits.

Royal Bank of Scotland (RBS) was in the worst [...]

The ship starts taking on more water today folks! Global slowdown worsens as China cools, Europe sinks

The world’s major economies are faltering or shrinking, with Chinese factory output barely growing, powerful European manufacturing countries falling deeper into malaise and the U.S. job market stuttering, surveys showed on Friday.

In Britain, manufacturing activity shrank at its fastest pace in three years last month as the global economic slowdown hit demand for its goods.

“It doesn’t bode well for the second quarter,” said Sian Fenner, global macroeconomist at Lloyds Banking [...]

As Spain’s economy collapses, record fall in business, with retail sales falling 4% in March and 11.3% in April:

via BBC News:

Spanish retail sales dived in April, showing the biggest fall since the figures started being collected in 2003.

Sales fell 9.8% last month compared with the same month last year, after adjusting for calendar differences, according to official figures from the National Statistics Institute.

The fall was much worse than had been expected, and marked the 22nd consecutive month of declining sales.

Sales had fallen by 3.8% in March.

Without adjusting [...]

Chief of OZ and NZ Banking Group said volatile conditions in global mkts have caused wholesale funding market for Australian banks to freeze

China Stops Buying Europe Government Debt on Crisis Concern – Bloomberg

From Bloomberg:

China Investment Corp. has stopped buying European government debt because of an economic crisis on the continent, though it continues to look for new investments there, said CIC President Gao Xiqing.

“What is happening in Europe right now is of course of concern,” Gao said yesterday in an interview in Addis Ababa, Ethiopia, during the World Economic Forum on Africa. “We still have our people looking at opportunities in Europe, even though we don’t want to [...]

Pressure grows on Government to change the law so small businesses that claim they have been mis-sold complex interest rate derivatives by Britain’s banks can take legal action.

From telegraph:

Vince Cable has been accused by Labour of doing little to help victims, even though many have been driven to the point of bankruptcy as interest rates have fallen to historic lows.

The Financial Services Authority is now working on an in-depth review of the claims, which could potentially lead to a full investigation of how lenders, including Barclays, Lloyds Banking Group, HSBC and the Royal Bank of Scotland, sold [...]

China PMI May Shrink for 4th Month: HSBC economist Hongbin Qu: “With a meaningful rebound of domestic demand not in sight, external weakness is starting to bite, adding more downside risks to growth”

By Chris Oliver, MarketWatch

Reuters

HONG KONG (MarketWatch) — A closely watched gauge of Chinese factory activity rose to a four-month high in February but remained at levels that indicate modest contraction, while underlying data showed a weakening in new export orders.

The initial “flash” estimate for HSBC’s February manufacturing Purchasing Managers’ Index rose to 49.7 on a 100-point scale, and up from a final reading of 48.8 the previous month, [...]

Euro Credit: Portugal’s government may have to partly nationalize crisis-hit banks, even as it sells assets as part of the 78 billion-euro ($102.8 billion) bailout agreement

(For more on the euro crisis, click on EXT4.)

Dec. 13 (Bloomberg) — Portugal’s government may have to partly nationalize crisis-hit banks, even as it sells assets as part of the 78 billion-euro ($102.8 billion) bailout agreement.

Portuguese lenders’ stock-market value has tumbled to historic lows amid Europe’s deepening sovereign crisis and requirements for banks to bolster capital and mark to market the prices of euro-region debt holdings. The nation’s three biggest [...]

S&P downgrades 37 global banks

FXstreet.com (Barcelona) – S&P rating agency has just downgraded 37 global banks. Goldman, BofA, Citigroup, Morgan Stanley, BNY Mellon are amongst the cuts based on a new methodology. Japanese and UK banks cut or outlook lowered as well.

(Excerpt) Read more at fxstreet.com …

Found these in a USA Today article:

Bank of America
Citigroup
Goldman Sachs Group
JPMorgan Chase
Morgan Stanley
Wells Fargo
Barclays
HSBC Holdings
Lloyds Banking Group
The Royal Bank of Scotland

Atternative Banking

#OccupyWallStreet Alternative Banking Working Group Meeting in NYC Sunday @ 3 PM

“The New York City General Assembly website has a section for a recently-formed Alternative Banking group, which has started meeting on Sundays from 3:00 to 5:00 PM. You can read the notes from last week’s session here.

Despite the title, this is NOT about moving your money. An alternative economics committee had already started on that effort and the alternative banking [...]

MARKET CRASH IMMIENT? Fitch Downgrades UBS, Many Others, Puts Morgan Stanley, Bank of America, Goldman, BNP, Deutsche Bank, SocGen And Others On Watch Negative

by ZH

Image: Wikimedia Commons

Since one can not get a downgrade of a bank during market hours for fears of springing who knows what circuit breakers, Fitch had to wait until just after the market close to release its latest market surprise which consisted of a “watch negative” announcement on the following banks Barclays, BNP Paribas, Credit Suisse, Deutsche Bank, Goldman, Morgan Stanley; others it just [...]

Richard Branson’s Virgin Holidays and Lloyds banking group suspend advertising with NOTW hacking – Reuters

Lloyds Banking Group is set to cut a further 15,000 jobs at the end of this month

Lloyds Banking Group is set to cut a further 15,000 jobs once a strategy review of the bank is published by chief executive Antonio Horta-Osorio at the end of this month.

The bank has already slashed 28,000 jobs since the ill-fated merger with HBOS and the further job cuts likely to be announced once the review is published will bring the total to 43,000. On Friday, Lloyds [...]

Moody’s Lists 14 U.K. Banks for Downgrade Review

Lloyds Banking Group Plc (LLOY) and Royal Bank of Scotland Group Plc (RBS) are among 14 U.K. lenders whose debt Moody’s Investors Service is considering downgrading because the withdrawal of government support may increase their credit risk.

Santander U.K. Plc and customer-owned lenders including Nationwide Building Society also had their debt ratings put on review for a possible downgrade, Moody’s said in a statement today. Lloyds and RBS and Santander U.K.’s [...]

6 banks shut; most in 1 day so far in 2011; largest was Superior Bank of Birmingham; y-t-d total 34

WSJ:

U.S. regulators announced the biggest bank failure so far this year by assets, Birmingham, Ala.’s Superior Bank, as well as the most failures in a single day in 2011, as five other banks were closed in Alabama, Minnesota, Mississippi and Georgia.

The Federal Deposit Insurance Corp. said in addition to Superior, Nexity Bank, also based in Birmingham, was closed, the first failures in Alabama this [...]

Joining the EU seems to have become a nightmare for Germans.

Now they have to pay off the debts of other countries like Greece as well as pay off their OWN debts – debts that incidentally add up to 150% of Germany’s GDP (look it up). Even greater debts than America’s.

Germany and America is pretty similar in its social and economic policies as well as in their political systems. So it wasn’t too difficult to predict that Germany would come [...]

Banks That Finance Terrorism

Nine banks have been caught up in the probe, and some are in discussions to settle, according to a person familiar with the case. Three have already. Last month, Barclays PLC in London agreed to pay $298 million and admitted to allowing payments on behalf of clients in Cuba, Sudan and other countries. Lloyds Banking Group in London and Credit Suisse Group in Zurichâ€”banks that operated extensive transfer systems for [...]

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