Comments on: Canadian Banks Are Going Bankrupt http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/ This is where your finance takes place Mon, 13 Oct 2008 05:13:00 +0000 http://wordpress.org/?v=abc By: jfranklin http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-3082 jfranklin Sat, 23 Aug 2008 15:24:33 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-3082 Here's the latest financial scandal... "Losses at Dresdner Kleinwort, the investment banking arm of German issuer Allianz, deepend in the second quarter on the back of a $1.2 billion trading hit, which comes ahead of the separation of the business from Dresdner Bank and a possible sale. The US operation, formerly headed by Craig Schiffer, posted a second quarter operating loss of $820 million, adding to a $660 million loss in the first quarter." Here’s the latest financial scandal…

“Losses at Dresdner Kleinwort, the investment banking arm of German issuer Allianz, deepend in the second quarter on the back of a $1.2 billion trading hit, which comes ahead of the separation of the business from Dresdner Bank and a possible sale. The US operation, formerly headed by Craig Schiffer, posted a second quarter operating loss of $820 million, adding to a $660 million loss in the first quarter.”

]]> By: Arctec http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2947 Arctec Sun, 10 Aug 2008 23:33:27 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2947 A list of US banks that may fail and go bankrupt. http://bankruptbanks.blogspot.com/ A list of US banks that may fail and go bankrupt.

http://bankruptbanks.blogspot.com/

]]> By: Dividends4Life http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2222 Dividends4Life Mon, 07 Apr 2008 18:52:59 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2222 As a recent investor in RY, I must admit your article's title got my attention. :) I am very impressed at how well run the Canadian banks are. Best Wishes, D4L As a recent investor in RY, I must admit your article’s title got my attention. :) I am very impressed at how well run the Canadian banks are.

Best Wishes,
D4L

]]> By: Carnival of Personal Finance #147: Q1 Financial Advice Edition | Personal Finance Blog by Money Ning http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2221 Carnival of Personal Finance #147: Q1 Financial Advice Edition | Personal Finance Blog by Money Ning Mon, 07 Apr 2008 14:56:21 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2221 [...] Financial Blogger thinks Canadian Banks are Going Bankrupt!! Not a good [...] [...] Financial Blogger thinks Canadian Banks are Going Bankrupt!! Not a good [...]

]]> By: Saturday weigh-in and linkstuff - April Fool’s Edition http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2204 Saturday weigh-in and linkstuff - April Fool’s Edition Sat, 05 Apr 2008 13:09:35 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2204 [...] The Financial Blogger says that the big Canadian Banks are going out of business. [...] [...] The Financial Blogger says that the big Canadian Banks are going out of business. [...]

]]> By: The Financial Blogger http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2171 The Financial Blogger Thu, 03 Apr 2008 00:30:05 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2171 CR; You just made a good summary of how banks manage their business. Especially in Canada, there are rules in place so that banks can't turn into another Bear Stearn. This is a great proof that regulation might slow down productivity but will surely ensure a more stable economic system! CR;
You just made a good summary of how banks manage their business. Especially in Canada, there are rules in place so that banks can’t turn into another Bear Stearn. This is a great proof that regulation might slow down productivity but will surely ensure a more stable economic system!

]]> By: Customers Revenge http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2170 Customers Revenge Wed, 02 Apr 2008 13:26:46 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2170 I think that banks normally fail when they don't have sufficient liquidity to conduct business, not when they are worth less than zero (i.e., when their liabilities are greater than their assets). I think that as bank assets become more and more risky in the form of bad loans or investments then they sell off those assets to convert into less risky assets. They have to do this well before the value of the assets approaches a bankruptcy low level. Liabilities to a bank are its deposits and some short term loans from other banks or the govt. I don't even know what other liabilities a bank might have ... can't imagine it needs to borrow any other money. No private company would ever buy a bank that was worth a negative amount. So if a bank didn't have enough assets to cover deposits then that bank would be irreversibly dead. Usually, however, I think that banks fail because their assets are too risky and incoming cash flow is threatened to the point that the bank is having trouble operating. Then the bank is still worth a lot except it's all tied up. At that point all you need is another bank or company with enough cash to keep the ailing bank operating to buy it (at a big discount of course). I think that banks normally fail when they don’t have sufficient liquidity to conduct business, not when they are worth less than zero (i.e., when their liabilities are greater than their assets). I think that as bank assets become more and more risky in the form of bad loans or investments then they sell off those assets to convert into less risky assets. They have to do this well before the value of the assets approaches a bankruptcy low level.

Liabilities to a bank are its deposits and some short term loans from other banks or the govt. I don’t even know what other liabilities a bank might have … can’t imagine it needs to borrow any other money.

No private company would ever buy a bank that was worth a negative amount. So if a bank didn’t have enough assets to cover deposits then that bank would be irreversibly dead. Usually, however, I think that banks fail because their assets are too risky and incoming cash flow is threatened to the point that the bank is having trouble operating. Then the bank is still worth a lot except it’s all tied up. At that point all you need is another bank or company with enough cash to keep the ailing bank operating to buy it (at a big discount of course).

]]> By: The Financial Blogger http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2167 The Financial Blogger Wed, 02 Apr 2008 02:08:46 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2167 Soham; The government could let another bank or companies in good financial standing (like Power Corporation for example) to buy a bank that has major financial trouble. However, banks are still making profit for now so there are absolutely no worries on that side ;-) Soham;

The government could let another bank or companies in good financial standing (like Power Corporation for example) to buy a bank that has major financial trouble.

However, banks are still making profit for now so there are absolutely no worries on that side ;-)

]]> By: Soham Das http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2166 Soham Das Wed, 02 Apr 2008 01:45:37 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2166 Will even mergers save two flagging entities? I mean isnt it natural, to think that even liabilities increase when you acquire a non performing unit. In times of recession, who acquires liabilities? :) Unless government forces your hand to, but then will it not be detrimental to the economy at large? Just my thoughts though! I blog at jumpup.wordpress.com on global economics, Indian economics and investments Will even mergers save two flagging entities?
I mean isnt it natural, to think that even liabilities increase when you acquire a non performing unit. In times of recession, who acquires liabilities? :)
Unless government forces your hand to, but then will it not be detrimental to the economy at large?

Just my thoughts though!

I blog at jumpup.wordpress.com on global economics, Indian economics and investments

]]> By: Customers Revenge http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2163 Customers Revenge Tue, 01 Apr 2008 15:28:59 +0000 http://www.thefinancialblogger.com/canadian-banks-are-going-bankrupt/#comment-2163 Canadian banks can't go bankrupt unless Canadians themselves go bankrupt. That's because banks make their money lending to other people who have money in banks. Since a bank lends many times more than they have on deposit they would really have to be greedy and incompetent to fail that badly and make so many bad loans. Hmmm, maybe it's not so impossible :) It could be possible for one or two banks to fail but not all of the banks at the same time because all the money in Canada is held in banks. If the banks failed then it means that foreigners have bought Canada. Canadian banks can’t go bankrupt unless Canadians themselves go bankrupt. That’s because banks make their money lending to other people who have money in banks. Since a bank lends many times more than they have on deposit they would really have to be greedy and incompetent to fail that badly and make so many bad loans. Hmmm, maybe it’s not so impossible :)

It could be possible for one or two banks to fail but not all of the banks at the same time because all the money in Canada is held in banks. If the banks failed then it means that foreigners have bought Canada.

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