Skip to main content

why the banks are stressing ?

There  has been a lot of noise going around off stress tests and all  for the past few days..  SO then  what happens from here ? what if they  fail the test ? will it have a lasting effect  on the current surge in stock prices.

What  is this bank stress test all about ?

Its basically a test of the Big american banks to see how they are faring and the results are in .The nation's biggest banks are regaining their health, but some need to replenish their coffers to withstand any new difficulties, the government said in an upbeat report Thursday.
The Federal Reserve's highly anticipated "stress tests" found that 10 of the 19 largest banks needed to bolster their capital by a combined $75 billion. Most of that must be raised by two banks with a large California presence -- Bank of America Corp. and Wells Fargo & Co. -- highlighting the role of the state's housing market meltdown in the recession.

The Fed led the stress-test process, which applied to U.S. banks with total assets of more than $100 billion. Geithner said the results "bring a level of disclosure that goes well beyond what you typically see

Well what about the australian Banks ?

There does not seem to be much  stress here with our australian banks  bringing in nice profits , but offcourse  setting aside some for bad debts  which was expected anyways.

Westpac, Commonwealth Bank, ANZ and National Australia Bank generated a combined $8.83 billion profit in the first half of their financial years, compared with $9.27 billion the year before.

They reported bad debt impairments of $6.5 billion, the highest figure since the recession in the early 1990s.

And all four said defaults among businesses had weighed on their profits and warned that personal borrowers faced a similar threat in coming months.

Three of the big banks reduced their dividend payouts in a bid to conserve cash to buffer their balance sheets in strained lending markets.

CBA, the country's biggest lender, improved its profit by nine per cent, although its reporting period finished in December, three months earlier than the other banks.

Popular posts from this blog

Best Australian stock forums online ( finance forums)

Many traders and investors use forums to share ideas, learn from the more experienced, or simply to stave off boredom during long hours at the computer. Here we list the known universe of forums, complete with costs, member numbers, extra benefits and popular forum topics. Please post a message on Your 2 Cents if your favourite forum isn't listed here, or if you feel that there's more to add about the day-to-day goings on in your online community.Forum
Cost
Stock comps
Forum areas
Comments
AussieStockForums.comFreeASX by share code, General, Beginners, Derivatives, Commodities, International, Strategies/SystemsEasy to use, independent forum. Aussie Stock Forums has a group of very active and knowledgeable traders. Private messaging available. Australian forum.
Chimes in ExileFreeASX stocks, fundamental analysis, technical analysis, commodities, economics, investment tools The forum has a small group of regular contributors that form a genuine community of investor…

The diggers and dealers forum meet 2011

The diggers and dealers forum has just begun August 1. Its a three day annual event happening every year  at the WA country town of kalgoorlie.2011 Diggers & Dealers forumBig name brokers  keenly watching the event will be MacquarieDeutsche BankBell PotterGoldman SachsRBS MorgansEvans & PartnersHartleysBlack Swan Euroz.Well most other websites will give you the  finer details of the annual meet and greet that happens at kalgoorlie , so we will just stick with the bare minimum of details  and focus on the more enjoyable bits  of information that the dealers require to strike a good deal while in town.Bare detailsWebsite : Diggers & DealersEvents : Program and scheduleWatering holes and entertainment at Diggers and dealers forumPubs , clubs  and skimpy (barmaids) culture in kalgoorlie . There are about 25 pubs in Kalgoorlie-Boulder area and for a city that stretches just 67sq km the number of pubs makes for  a good choice on drinking holesand entertainmentExchange Hotel ( Pa…

Stock market and High frequency trading

High frequency and computerised trading androgue trading is again  in the news with  trader Mr Adoboli working for UBS  who was arrested at his desk, is alleged to have lost £1.3 billion through his rogue trades  according to the company , now also annoucing that they might go into a loss in this quarter. According to some reports in the media it was said that Mr Adoboli Himself had reported the  trade when the trade went bad before the computers picked up the loss.
Not so long ago in 2008 Jérôme Kerviel, the Paris-based Société Générale trader lost £4 billion in rogue trades, but fought it out in court contesting that the trading firm knew about his trades with large amounts.

High frequency computerised trading in Australia HFT drives the wild swings in global markets and in co-relation influences the local assets, the intensity is expected to rise with online exchange Chi-X to  begin operating in Australia soon with a limited number of stocks in November. The ASX will launch its Pur…