Category: Financial Institutions
JP Morgan Chase buys WaMu out
JP Morgan Chase has taken over the deposit taking subsidiary of Washington Mutual. The transaction is effective immediately, meaning it has closed. This is the biggest deal in FDIC activity yet. Note: I originally heard this story just before 9PM ET and Yves Smith at naked capitalism has her take on the news. Obviously, this
Gateway Bank sold, hurt by Frannie preferreds
When Fannie Mae and Freddie Mac went bust, a number of major players were stung as the value of Fannie and Freddie preferred shares plummeted. Principal amongst these players was Gateway Bank, which had a huge percentage of bank capital tied up in the preferreds. Now Gateway has arranged a takeover by a rival smaller
The Dummy’s Guide to the US Banking Crisis
Whenever I wade into a new topic like digital photography, gardening or what have you, I visit the local bookstore and get a "For Dummies" book to guide me. I figure that it’s the best way to get up-to-speed quickly without actually looking like a dummy. So, for those of you who want the 3-minute
Warren Buffett backs Goldman
By now, you have probably heard that Warren Buffett has made his bet and invested billions of dollars in Goldman Sachs. The market reacted positively and Goldman is now trading at near $133 a share (up 6% on the day). While I do see Buffett’s move as a vote of confidence in Goldman, Buffett does
Danish banking crisis the worst in Europe
The U.S. and the UK are not the only countries suffering from a housing bust and a credit crisis. Ireland and Spain have had massive busts as well and it is only a matter of time before we begin to see effects on the banking sector. And there are many other countries that have seen
Writedown news: 23 Sep 2008
Below are the latest major credit crisis stories from the web that I have seen. Most of these stories have more to do with raising capital, merging, and bankruptcy than writedowns. Quite honestly, I have been caught up in the bailouts so I may have missed a few, so please call me out on anything
Lehman pension shortfall is a foreshadowing
Apparently Lehman not only failed, it left a gaping hole its accounts. The UK pension scheme is missing £100 million. UK regulators certainly need o investigate whether the shortfalls are the result of criminal activity. However, pensions are certainly something lurking in the background that I have failed to discuss. As the stock market falls
Quote of the day: Investment Bank Leverage
With Goldman Sachs and Morgan Stanley becoming bank holding companies, the traditional U.S. investment banking model has come to an end. But it bears remembering that investment banks are highly leveraged institutions. Both Goldman Sachs and Morgan Stanley will have to either deleverage significantly or merge with an existing depositary institution with less leverage in
Bradford & Bingley is being shopped by the FSA
Just in case you thought the crisis was over, I have to remind you that there are still firms out there that are very concerned about their futures. Principal among them is the UK buy-to-let specialist Bradford & Bingley. The word on the street is that the FSA, the UK banking regulator, is shopping the
Goldman and Morgan Stanley are now banks
The Federal Reserve is pulling out all the stops to stop the spread of the financial meltdown contagion that claimed Lehman Brothers, Merrill Lynch and AIG. The latest move is to allow both Goldman Sachs and Morgan Stanley to become bank holding companies. By allowing the securities firms to re-designate as banks, the Fed is
How safe are your assets?
Recently I wrote a post on the safety of investment assets in the wake of the Lehman and AIG meltdowns. Even still, retail and individual investors are noticeably nervous about the safety of their funds. Last night on the radio, I heard a spot in which a consumer was asking whether to go with an
Fundamentally insolvent
Marshall Auerback here. Equity investors, perhaps unlike credit investors, don’t get the fundamental insolvency of the financial sector, an artifact of mega-leverage. This is a culture that responds to visual clues and marketing jingles. Substance is at best a second thought, and seriously, there is not time in these markets for second thoughts. It’s all