Posts Tagged ‘bank safety’

Texas Ratios, Capitalization Ratios, 30 Day Late Loans of Recently Failing Banks

Texas Ratios, Capitalization Ratios, 30 Day Late Loans of Recently Failing Banks

Courtesy of Mish 

Inquiring Minds just may be interested in the Texas Ratios, capitalization ratios, and percentages of 30 day late loans or higher at recently failed banks.

Texas Ratio Definition

The Texas ratio is a measure of a bank’s credit troubles. Developed by Gerard Cassidy and others at RBC Capital Markets, it is calculated by dividing the value of the lender’s non-performing assets (Non performing loans + Real Estate Owned) by the sum of its tangible common equity capital and loan loss reserves.

In analyzing Texas banks during the early 1980s recession, Cassidy noted that banks tended to fail when this ratio reached 1:1, or 100%. He noted a similar pattern among New England banks during the recession of the early 1990s.

Bank Failures 2010-04-30

Westernbank Puerto Rico: 136%
Total Capital: 8%
Total Capital% minus (30+ days late or more / Total Assets): -7%

Eurobank Puerto Rico: 213%
Total Capital: 4%
Total Capital% minus (30+ days late or more / Total Assets): -10%

R-G Premier Bank of Puerto Rico: 270%
Total Capital: 6%
Total Capital% minus (30+ days late or more / Total Assets): -19%

CF Bancorp (MI): 421%
Total Capital: -1%
Total Capital% minus (30+ days late or more / Total Assets): -10%

Champion Bank (MO): 344%
Total Capital: 2%
Total Capital% minus (30+ days late or more / Total Assets): -19%

Champion Bank (MO): 194%
Total Capital: 2%
Total Capital% minus (30+ days late or more / Total Assets): -6%

7 Bank Failures Cost FDIC About $7.4 Billion

The above 7 bank failures will take a $7.4 billion bite out of FDIC deposit fund.

Emergency Powers Stabilize Puerto Rico Banks

Inquiring minds are reading Puerto Rico Banks Seized as Regulators Waive Deposit Limits.

Regulators used emergency powers to stabilize Puerto Rico’s banks, putting almost a third of the U.S. territory’s deposits in Popular Inc. and giving control of another lender to a Canadian firm.

Deposit limits were waived to allow Banco Popular of Puerto Rico to hold $19.5 billion, or 31.4 percent of the island’s total, after its purchase of Westernbank Puerto Rico, the Federal Reserve said yesterday in a statement. Three banks on the island were shut at a cost to the Federal Deposit Insurance Corp. of $5.3


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How Safe Is Your Bank? Texas Ratios of 7,500+ Banks

How Safe Is Your Bank? Texas Ratios of 7,500+ Banks

Courtesy of Mish 

In March I posted an Interactive Map of Worst Banks in the U.S. by Texas Ratio, Non-Performing Assets, and Total Capital.

Today I have data for every bank in the report, over 7,500 banks. There are so many banks in the list, an interactive map is not possible.

Note: This post flooded the Tableau Servers – They are working on it. If you receive an error message, please try later in the day.  [Try at Mish's site directly, click here.>]

This display contains a lot of data and it may take extra time to load. Please be patient. It takes an extra 3-5 seconds on my computer. Your results may vary. If you have an inadequate memory, the display may be slow or inoperable.

Click here>>

Thanks to Ellie Fields and Ross Perez at Tableau Software for help with the display!

Usage Notes

click on chart for sharper image

I can refresh the data every quarter. First quarter 2010 will be out in a month or so. The above data is from the fourth quarter of 2009.

For an interactive map of the worst banks in the country, please click on the first link.

Mike "Mish" Shedlock


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The FDIC Anesthesia Is Wearing Off

Here are a couple articles from Elliott Wave International on bank safety, credit expansion and the FDIC. – Ilene  

The FDIC Anesthesia Is Wearing Off

Courtesy of Robert Prechter of Elliott Wave International

The following article is an excerpt from Robert Prechter’s Elliott Wave Theorist. For more information from Robert Prechter on bank safety, download his free report, Discover the Top 100 Safest U.S. Banks.

Perhaps the single greatest reason for the unbridled expansion of credit over the past 50 years is the existence of the Federal Deposit Insurance Corporation, another government-sponsored enterprise created by Congress. The coming rush of bank failures is an outcome made inevitable the very day that Congress created the FDIC. The reason is that the creation of the FDIC allowed savers to believe that their deposits at banks are “insured” against loss.

But the FDIC is not really an insurance company. No enterprise, absent fraud, could possibly insure all the banking deposits in a nation. Nor does the FDIC do so, despite its claims. The FDIC is like AIG, the company that sold too many credit-default swaps. It contracted for more insurance than it could pay upon. Because depositors believe the sticker on the door of the bank, they have abdicated their responsibility to make sure that their banks’ officers handle their deposits prudently. This abdication allowed banks to lend with impunity for decades until they became saturated with unpayable debts.

Today, most banks are insolvent, and the FDIC is broke. This condition is deflationary for three reasons: (1) Banks are coming to realize that the FDIC cannot bail them out in a systemic crisis, so they have become highly conservative in their lending policies, as described above. (2) The main way that the FDIC gets its money is to dun marginally healthy banks for more “premiums” (meaning transfer payments) to bail out their disastrously run competitors. The more money the FDIC sucks out of marginally healthy banks, the less money those banks have on hand to lend, which is deflationary. (3) The banks that have to cough up all this money will become more impoverished at the margin, so banks that otherwise might have survived a credit crunch will be thrown even closer to the brink of failure. This is another deflationary risk.

A friend of mine whose family owns a bank told me that…
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Zero Hedge

The Fed Is Stuck In QE Hell

Courtesy of Zero Hedge. View original post here.

Authored by Howard Gold, op-ed via MarketWatch.com,

Imagine doing the same thing over and over again, with little progress and no relief. Sounds like most people’s vision of hell - or the Federal Reserve’s current predicament.

Since September, the central bank, through the Federal Reserve Bank of New York, has been purchasing securities hand over fist to alleviate short-term pressures in the overnight money markets. It has used repurchase (“repo”) and reverse repurchase (“reverse repo”) agreements to provide liquidity and keep overnight borrowing rates from spiking.

...



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Phil's Favorites

Baltic Dry Continues Epic Plunge As IMF Slashes Global GDP Forecast

Courtesy of ZeroHedge

The Baltic Exchange's main sea freight index hit a nine-month low on Monday, dragged down by falling rates of capesize and panamax segments as world trade continues to slump. 

The Baltic Dry Index, which tracks rates for capesize, panamax and supramax vessels that ferry dry bulk commodities across the world, dropped 25 points, or 3.3%, to 729 (according to Refinitiv data), the lowest level since April 2019:

  • The capesize index .BACI dropped 119 points, or 16.7%, to 593 - its lowest since April 23.The index registered its 27th straight session of losses, and also its largest daily percentage loss since early April.

    ...


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The Technical Traders

Using the copy-paste formula in the Forex market

Courtesy of Technical Traders

In Forex there are many techniques available to boost up the profit factors. However, as there are millions of people trying to make a profit it is not easy to get the right tricks. There are many brokers offering high leverage trading account to the interested traders. They also provide useful insight into the market so that the traders can make a decent profit. In fact, some brokers often sell signals to their clients so that they can start earning money in the early stage of their careers.

At present, this method has earned a huge following as many investors don’t like to spend time staring at the chart. In this article, we are going to try to bust the myth about this infamous technique...



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Members' Corner

The War on All Fact People

 

David Brin shares an excerpt from his new book on the relentless war against democracy and how we can fight back. You can also read the first, second and final chapters of Polemical Judo at David's blog Contrary Brin.

The War on All Fact People 

Excerpted from David Brin's new book, the beginning of chapter 5, Polemical Judo: Memes...



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Chart School

SP500 Kitchin Cycle Review

Courtesy of Read the Ticker

The biggest known news date in the next 18 months is the US Election. The biggest unknown news date is when the US believes it is in a economic recession.

The Kitchin Cycle is still working.

We must conclude the major 900 period low is now in, and we are now in a up swing, which may top out ate 2020 or late 2021. Any future top out may only generate a 10% to 20% correction, of course this can be deemed very mild. This is expected, but the expected does always play out. 

Rolling the dice to get '7' does not always work. Post US elections seasonal's aligned with a poor start of the decade seasonal trends, add on high global recession risk, add on a stock market slump tends to occur in the years ending 9,1,2,3,4 (like 1973, 1...



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Insider Scoop

10 Biggest Price Target Changes For Friday

Courtesy of Benzinga

  • Citigroup lifted Caterpillar Inc. (NYSE: CAT) price target from $145 to $170. Caterpillar closed at $147.87 on Thursday.
  • UBS cut Twitter Inc (NYSE: TWTR) price target from $37 to $35. Twitter shares closed at $34.19 on Thursday.
  • Morgan Stanley boosted the price target for Yum! Brands, Inc. (NYSE: YUM) from $113 to $118. Yum! Brands closed at $102.16 on Thursday.
  • Jefferies lifted the price target on Ventas, Inc. (NYSE: ...


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Kimble Charting Solutions

Tesla About To Run Out Of Energy Here? Short-Term Peak Possible?

Courtesy of Chris Kimble

Tesla (TSLA) has been screaming higher of late, as very impressive gains have taken place.

Is Tesla about to run out of energy/take a break/experience some selling pressure? A unique price setup is in play, that bulls might want want to be aware of.

This chart applies Fibonacci to the 2016 lows and 2017 highs at each (1). The impressive rally of late has it testing its 161% extension level, based upon those price points.

At the same time, it is hitting its 161% extension level, it finds itself at the top of a 7-year rising channel, with momentum hitting the highest ...



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Lee's Free Thinking

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

 

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

Courtesy of  

The repo market problem isn’t the problem. It’s a sideshow, a diversion, and a joke. It’s a symptom of the problem.

Today, I got a note from Liquidity Trader subscriber David, a professional investor, and it got me to thinking. Here’s what David wrote:

Lee,

The ‘experts’ I hear from keep saying that once 300B more in reserves have ...



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Digital Currencies

Cryptos Have Surged Since Soleimani Death, Bitcoin Tops $8,000

Courtesy of ZeroHedge View original post here.

Bitcoin is up over 15% since the assassination of Iran General Soleimani...

Source: Bloomberg

...topping $8,000 for the first time since before Thanksgiving...

Source: Bloomberg

Testing its key 100-day moving-average for the first time since October...

...



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Biotech

Why telling people with diabetes to use Walmart insulin can be dangerous advice

Reminder: We are available to chat with Members, comments are found below each post.

 

Why telling people with diabetes to use Walmart insulin can be dangerous advice

A vial of insulin. Prices for the drug, crucial for those with diabetes, have soared in recent years. Oleksandr Nagaiets/Shutterstock.com

Courtesy of Jeffrey Bennett, Vanderbilt University

About 7.4 million people ...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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