Posts Tagged: banks

31 banks prepare for Fed tests

24 October 2014 - 8:50 am
 

Global banks will have to show how they can withstand a spike in oil prices, a rise in the US unemployment rate and an increase in risky corporate loans as part of the 2015 Federal Reserve stress tests.

Passing the stress tests and related capital planning review is a top priority for banks, because this determines whether they can pay additional dividends or buy back shares. Companies that fail the test, which is aimed at showing how a bank would deal with a crisis situation, can also take a reputational hit.

Citigroup suffered an embarrassing blow when it failed to pass the last review, and executives are determined not to repeat that mistake in 2015. The US units of HSBC, Royal Bank of Scotland and Santander, which took the tests for the first time last year, also failed.

Fed officials have warned they will continue to raise the bar on expectations for banks, putting additional pressure on them. >> Read More

 

Spanish news agency Efe has reported that 11 banks from 6 European countries are looking like failing the stress tests. There are 4 from Greece, 3 from Italy, 2 from Austria and one each possibly from Belgium, Portugal and Cyprus.

None were named and the news was gathered from several sources.

It’s likely that the banks failing are once again smaller regional entities rather than any of the big boys, which would rock markets if they fail the tests. We’ve long maintained that this was going to be the worst kept secret as there’s no way you can lock down every bank and employee in the know from spilling the beans.

Sunday is D-day for the banks as that’s when the results will be made public but banks have been given an idea of the outcome in advance.

Full details from Reuters here 

Today ,Watch 2 Things From US

08 October 2014 - 11:55 am
 

Wednesday:
• At 7:00 AM ET, the Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

• At 2:00 PM, FOMC Minutes for the meeting of September 16-17, 2014.

 

Simply put, as Citi noted, unless Fed head Janet Yellen goes full-dovish, risk assets face tremendous downside potential.  As ConvergEx’s Nick Colas notes, Yellen receives a “B” grade from financial professionals, fewer than half (49%) of those surveyed approve of the job the Federal Reserve is doing. A clear majority (59%) of respondents describe the Fed as being “behind the curve” with respect to interest rates. Despite better-than-expected data whereever one looks in the US (apart from wages and housing), any hint of seni-dovish, or contingent dovish… or heaven forbid hawkish comments and the massive consensus trade that the Yellen Put has an ever-increasing strike price will fall rapidly by the wayside… though Draghi could come in later and save the day. With S&P so close to 2000, we suspect any hint of word ‘slack’ and algos will run stops and USDJPY will break 104.

Pre-Yellen: S&P Futs 1986, 10Y 2.407%, JPY 103.77, Gold $1278, Oil $93.35

*YELLEN: LABOR MARKET HASN’T FULLY RECOVERED EVEN AMID JOB GAINS

*YELLEN SAYS THERE’S `NO SIMPLE RECIPE’ FOR APPROPRIATE POLICY

*YELLEN: FOMC SHIFTING TO QUESTIONS ON LEVEL OF JOB-MARKET SLACK

*YELLEN SAYS GAUGING LABOR-MKT SLACK NEEDS TO BE `MORE NUANCED’

 

The Kansas City Fed’s annual Economic Policy Symposium kicked off on Thursday.

For many, the main event will be the appearance of Federal Reserve Chair Janet Yellen, who will offer opening remarks at 10:00 a.m. ET.

Other heavy hitters at the event include European Central Bank President Mario Draghi and Bank of Japan Governor Haruhiko Kuroda.

Here’s the full schedule via the Kansas City Fed.

Thursday, August 21, 2014

6 p.m.

Opening Reception and Dinner

Host:Esther George
President and Chief Executive Officer,
Federal Reserve Bank of Kansas City

Friday, August 22, 2014

Chair:Peter Blair Henry
Dean, Stern School of Business,
New York University

8 a.m.

Opening Remarks

Janet L.Yellen
Chair,
Board of Governors of the Federal Reserve System

8:30 a.m.

Churn and the Functioning of Labor Markets

Authors:Steven J. Davis
Professor,
University of Chicago
John Haltiwanger
Professor,
University of Maryland
Discussant:Richard Rogerson
Professor,
Princeton University

9:05 a.m.

General Discussion

9:30 a.m.

Job Polarization

Author:David Autor
Professor,
Massachusetts Institute of Technology

10:15 a.m.

Discussant

Discussant:Lisa M. Lynch
Professor,
Brandeis University

10:30 a.m.

General Discussion

10:55 a.m.

Panel on Demographics

Panelists:Karen Eggleston
Professor,
Stanford University
David Lam
Professor,
University of Michigan
Ronald D. Lee
Professor,
University of California, Berkeley

11:55 a.m.

General Discussion

12:30 p.m.

Luncheon Address

Speaker:Mario Draghi
President,
European Central Bank

2 p.m.

Adjournment

Saturday, August 23, 2014

Chair:Christina D. Romer
Professor,
University of California, Berkeley

8 a.m.

Scars From the Crisis

Author:Till Marco von Wachter
Associate Professor,
University of California, Los Angeles
Discussant:Antonella Trigari
Associate Professor,
Bocconi University

8:35 a.m.

General Discussion

9 a.m.

Wage Dynamics

Author:Giuseppe Bertola
Professor,
EDHEC School of Business

9:45 a.m.

Discussant

Discussant:Mark Bils
Professor,
University of Rochester

10 a.m.

General Discussion

10:25 a.m.

Overview Panel: Labor Markets and Monetary Policy

Panelists:Ben Broadbent
Deputy Governor for Monetary Policy,
Bank of England
Haruhiko Kuroda
Governor,
Bank of Japan
Alexandre Antonio Tombini
Governor,
Central Bank of Brazil

11:25 a.m.

General Discussion

2 p.m.

Adjournment

 

In a phone call with Barack Obama, Vladimir Putin has said that imposing sanctions on Russia is counterproductive and affects international stability. The two presidents agreed that the current situation is not in the interests of their countries.

Both Obama and Putin has emphasized the importance of an “immediate and sustained ceasefire” in eastern Ukraine, but at the same time noted that “significant differences” remained between Moscow and Washington over Ukraine, a Kremlin statement said.

Besides Ukraine, the two leaders touched upon the recent rounds of sanctions imposed on Russia by the US.

The Russian head of state described the line of increased Washington’s sanctions as counterproductive, causing serious damage to bilateral cooperation and international stability as a whole,” the Kremlin’s statement, posted on its official webpage, said. >> Read More

 

The EU sanctions come into effect tomorrow and they have officially announced the details.

The Russian banks cited in sanctions are Sberbank, VTB bank, Gazprombank, Vnesheconombank and Rosselkhozbank. They will be prohibited from selling bonds or shares in the EU but permitted to carry out other operations in the EU.

If you like your legal guff fill your boots with the official EU release here 

 

ATMs in Hindi-speaking states will now generate receipts in Hindi, along with English, as the Home Ministry has asked the Reserve Bank of India to direct banks to procure only those ATMs that can print receipts in Hindi. 

The ministry has also instructed two major foreign suppliers of ATMs to upgrade the software in the existing ATMs to ensure printouts in Hindi. 

The Department of Financial Services has written to the Home Ministry, saying the matter is under consideration. “We will be perusing this matter… the issue is that the printout of the receipt (from the ATM) should come in the language in which the transaction is being made,” a Home Ministry spokesperson said. 

At present, only ATMs procured by the Union Bank of India from Diebold firm have the facility to print in Hindi. 

>> Read More

 
bojThe Bank of Japan held its aggressive monetary policy intact on Wednesday but again disappointed investors who have been searching for hints of further monetary action to bolster the economy.

The BoJ has repeatedly said it will adjust policy as it sees fit, but in recent months it’s adopted an optimistic view that has drained hopes of further easing.

In Wednesday’s decision to hold steady the BoJ said the economy “has continued to recover moderately” – the same words it used a month earlier.

If there was a surprise, it’s that the bank didn’t express more optimism about the economy.

Nomura analysts noted earlier this week that the BoJ was expected to kick up its economic assessment, thwarting expectations of near-term easing. >> Read More

 

Bad debts of public sector banks have surged to a nine-year high, with the corporate sector accounting for the biggest increase. This will be one of the key challenges before the new government.

Indeed, the current favourite to form the new government, the Bharatiya Janata Party, had in its manifesto expressed concerns over the bad debt situation. It promised “necessary steps to reduce non-performing assets (NPAs) in the banking sector” if it comes to power.

According to provisional data complied for 19 public sector banks by the Finance Ministry for the last meeting between Finance Minister P Chidambaram and public sector bank chiefs scheduled for Tuesday, the gross NPAs as a ratio of gross advances have reached 4.44 per cent against 3.84 per cent in 2012-13. Though less than 5.07 per cent as on December 2013, the gross NPAs are still at their highest level since 2004-05 when they touched 5.5 per cent.

Reasons for rise >> Read More

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Technically Yours,
Team ASR,
Baroda, India.