Economics Finance

One thing that the financial meltdown has show in crystal clear relief is that among the many contributing factors, there can be no doubt that Risk Management didn’t adequately manage risk. Why this was so is going to be the subject of much debate in the coming months and years. Were Risk Managers constrained by the executive suite who wouldn’t hear the warnings, or were Risk Managers not answering or not even able to answer the basic questions of their trade? Whatever the reason the profession of Risk Management has some deep soul-searching to do.

Now, all of a sudden, that the economies of many countries, not to mention the banking industry, is in tatters, we have dozens of articles and blogs all bemoaning the state of risk management and what we need to do to get everything right again; as if there is some elixir, or some magic wand that will put it all right.

All these blogs and articles are pounding away on the same old drum; all are documenting how badly everyone has done in managing risk and all are extolling bank boards, senior management, regulators and rating agencies to do better next time.

Where were all these authors and bloggers in the good times? Where were they in the heady days prior to the summer of 2007 when the banks and the rest of the financial industry was gaily acting if the only way forward was “up”; when the “old” economy had been declared dead as a dodo and the mantra of the “new economy” was “profits”, “bonuses” and “innovation”. Like the “old economy”, “risk” in all its forms had, by the invocation of all the new hedging and derivative strategies been declared dead too.

True there were some (all too few) who sounded dire warnings of where this was going to end – but who wants a Jonah in their midst when there is a never-ending beach party on the go?

Continue reading ‘Risk Management in a Post-Financial Crisis World’ »

With the advent of ways to transfer money online easily, and the addition of the Internet to nearly every cell phone, it is no wonder that many people now send money from their phones. However, the ability to send money online to friends and family from anywhere could be helping to increase the growth of the very idea of mobile finance. The fact that cell phone sales are up even in this economy, as well as an interest in mobile banking, could be an indication that the two are related to each other. The ability to get online fast using Smartphones enables people to perform tasks like transferring money at any time, which is certainly good for the mobile finance industry.

Smartphones have grown in popularity due to their ease of use when it comes to the Internet, as well as fast web services that come with many, such as 3G networks. Studies have shown that most people do not get online through their phone anymore just to play a game or message a friend. Instead, they perform everyday tasks that they would normally do at their computer. Long commutes home from work, slow-moving lines at lunch, and the simple convenience of the cell phone all help contribute to the growing interest in completing myriad tasks through it. The faster the service can be performed, such as the ability to send money online, the better.

Continue reading ‘The Popularity of the Ability to Send Money Online May Be Attributed to Smartphones’ »

“Although banks have always charged fees for overdrawing your account, they have been struggling with the negative publicity every since the Reserve Bank revealed the banks reaped $1.2bn through penalty fees last year,” Canstar Cannex financial analyst Peter Arnold said.

The research group said more banks were expected to follow suit.

The decision by NAB to axe its overdrawn fee is part of its efforts to improve its relationships with customers.

It should also put the bank on a more even footing with credit unions and building societies, who are generally more forgiving when it comes to customers being accidentally overdrawn.

“Many credit unions and building societies give you a period of grace – say 5 days – to rectify the error and they seem to charge a fee only as a last resort,” Arnold said.

Continue reading ‘More Bank Fees Could Go – Cannex’ »

The government of Canada has improved disclosure regulations for consumers who purchase principal protected notes (PPNs) issued by federally regulated deposit-taking institutions such as banks.

Jim Flaherty, Minister of Finance, announced on 2nd June that regulations aimed at improving disclosure have been approved and will come into force on 1st July, 2008.

“Adequate disclosure is needed to help investors make informed financial decisions,” explained Minister Flaherty, adding that: “Our Government believes a principles-based approach to regulation is the best way to ensure transparency in today’s rapidly evolving and innovative marketplace.”

The regulations deliver on a commitment made in ‘Creating a Canadian Advantage in Global Capital Markets,’ released in March 2007, to introduce a new disclosure regime for banks issuing PPNs.

Principal protected notes guarantee the invested principal and offer returns linked to returns on an underlying investment product, which can range from a relatively straightforward basket of equities to more complex investments such as hedge funds.

In recent years, the increased variety and complexity of PPNs has raised concerns about whether previous disclosure regulations provided consumers with enough information to make informed decisions.

Continue reading ‘Canada Improves Transparency Of Principal Protected Notes’ »

That the Central Bank of Nigeria (CBN) has sacked the executive management of five commercial banks [Afribank, Finbank, Intercontinental bank, Oceanic bank and Union bank] operating in the country is no longer news. As shocking as it appeared, it was not unexpected. It looked in no way like anybody was out to settle any personal issue; the reasons were clear and tenable.

Making a comment on this incident would not have been a top priority but with the crop of poor analysts that Nigeria has and its largely illiterate population, the tendencies are numerous for the news to cause undue and unreasonable public commentary. These unintelligent attentions would on the long run affect the banks, and indeed the whole industry, in a more negative way than the news itself. For instance, people are already planning to make a run [withdraw their deposits] on the affected banks.

Apart from the population been seriously illiterate about virtually everything and anything, another set of people that would have to share in the blame if this incident turns out to have a negative effect on the banks is the media. Reports of the sack in the Nigerian media are already being seriously twigged. One such newspaper says the boards of directors of the banks have been sacked; another says the CBN has taken over five banks, when the CBN governor explicitly said the banks were not being nationalized and only the Managing director and executive directors were removed.

Back to why I think the sack was expected, the reasons were pretty clear. Some questions some persons would be asking now are: was the CBN right in sacking these executives considering the fact that some of them are the most respected in corporate Nigeria and even in Africa? Based on the reasons given, the apex bank is very right. Are these CEOs poor managers? Looking strictly at the situation of their banks, they were management failures. Did this mess start recently? Hell no. Are they solely to be blamed for their banks current position? Of course not.

Continue reading ‘CBN: Superstar Pontiff or Criminal Accomplice’ »

Most people in Germany, I think that would lead to a credit card to indulge in more debt and the financial crisis. But these cards are very useful and beneficial for those manner.There that in a right-hander take advantage of many benefits of using a credit card. A major advantage is that there is no need to put your friends and family when you need money. It helps you to solve unforeseen costs. It also helps the amount paid for a couple of hotels, airlines and tour operators who do not accept payment in cash. How this can be many benefits of credit cards from the right purposes.As the number of people who enjoyed require a credit card in India is increasing day by day, several banks and private companies entered the market and the credit is started with credit cards with different amounts, interest rates and repayment plans.Among these banks, Axis Bank is one of the leading banks in India, with good performances in the Indian banking sector for many years. Offers different types of credit cards that fit the needs of all types of people. All credit cards Axis Bank as a high card utility known. Provides for its customers, the bank trust, even the large amount of low interest credit card credit rates.Some most common are from Axis Bank Axis Bank Credit Card Silver, Axis Bank Gold Plus card credit, Axis Bank Corporate Credit Card, Axis Bank and Axis Bank Platinum Credit Card Secured Credit Card (Gold). Continue reading ‘Axis Bank Credit cards: maps very reliable and useful’ »

After witnessing the massacre caused by liquidity crisis, considering the committed credit facilities for a good cause could be taken only as a dream. Most likely yes, because, after the chaos caused by the global crisis, the negotiation of claims in any form, will be a tough fight. This great challenge for the trading of credits, in turn, the show really need a credit card that has led to phenomenal growth reported in the recent past, compared to debit cards. The remarkable success after a lean patch has helped gain a strong position in the field of credit cards. When the economic crisis forced an entrance into the economy, declined to the whole banking sector to ensure liquidity to keep the business of loan application-centric. All this has come the weakness of small and medium-sized businesses with a means to save the capital. This created a gap between the alternatives of capital and traders who turn instead to be a unique opportunity for all credit agencies, who have seized and used with great success. Yes, it revealed the credit card that a friend needs these needy class, responding quickly enough to recognize the importance of this channel of funding. What was the only channel that is in adverse economic conditions mediated currently on their business. The same applies for the generation of Axis Bank Credit to seek perfection in person, an efficient transfer of credit agency. Axis Bank Credit cards offer a wide range of credit cards for their customers. Axis Bank, a rich offering that wonderful products and banking services, which have been specially designed to suit almost all types of debts on behalf of customers to include features. Continue reading ‘Axis Bank Credit Cards, Credit Lethal Shot provides for the elimination of all financial insurrections’ »

The main advantage of the realization of a map is that it is easy to carry and is also safe. What is most remarkable is that these cards with a certain line of credit, that pre-installed by the issuer. Anyone who uses, is also liable to repay the amount spent on their respective banks, with interest, within a specified period of time. Sometimes it is back with different offers, such as points “frequent flier, gift certificates and the offered money. Come to the market point of view, a number of banks have created an alternative payment system that may be. For example, credit cards Bank and ICICI Bank Credit Germans a great response from people because of their deals are varied and easily accessible. As for the race, except that it is a long list of lucrative offers emergency services worldwide, for life cards, discounts on travel, etc., it has, but also offers great deals such as EMI monthly payments, the insurance plans, like a family than it is flexible enough to support all members of your family. Sometimes it is exclusive discounts on branded products. Example, offers a 50% discount on shoes Reebok. In fact, ICICI Bank credit cards a wide range of almost all areas of sport, jewelry and food from places PVR .. One of the most famous offering, has created the titles for its long list of terms and conditions of profit as the Titan offers from golf. With this offer, anyone with an ICICI card can only be sustained by a guest from time to time. What is the value most is the fact that you want to have no limit to the number of days of each cardholder. Nor need reservation or cancellation fees. This map is easily accessible and can be booked only two days in advance. In addition to the services, there are also various other value-added, such as the payment account, health insurance, business services, etc. In contrast to the ICICI bank credit cards, some other banks have also come out with such these options with special offers. In this context, the German Credit Bank, which with a good atmosphere, the waves created in the market may occur. Continue reading ‘ICICI Bank Credit Cards: tenders received Feasible Terms’ »

By far the most interesting outcome of the recent reductions announced by the National Australia Bank, Westpac and Commonwealth Bank is exactly how much the industry has been fleecing its customers every time it has imposed one of these unpopular charges.

Thanks to the fact that publicly listed companies have to announce to the sharemarket any material changes to their financial positions, a great deal of light is beginning to be shed on the sums that have been flowing directly to the banks’ bottom lines.

To that end, we have to be fair to Westpac and Commonwealth, which followed up their announcements of wide-ranging fee reductions (note, not abolitions) with statements to the ASX about the effect on their bottom lines.

In the case of Westpac, whose cuts from $40 to $9 in a variety of overdraft, dishonour, missed and late payment charges were the biggest of the lot, $210 million of an estimated $300 million ”lost” revenue would be carved from its 2010 bottom line.

The Commonwealth, which undercut Westpac in some areas but didn’t go as far in others, will give up $200 million of income and $135 million of cash profits.

Contrast that with NAB, which sought to be ”whiter than white” by starting the ball rolling, but which, in fact, got rid of only one fee: its $30 overdraft charge, and only as it applies to its personal customers, not businesses like the other two.

NAB estimated that its move would affect $100 million of revenue but wouldn’t disclose how much profit would disappear, presumably because it didn’t want to reveal the real cost of imposing the fee and therefore just how much of a money-spinner the charges are.

However, thanks to its rivals and some quick back-of-the-envelope calculations by banking analysts at UBS and Deutsche Bank, we now have a better idea.

The admissions by the two biggest lenders, Commbank and Westpac, show that between 67 and 70 cents in every dollar earned from the penalty fee harvest was pure profit.

That represents about 5 per cent of Westpac’s cash profits, which UBS now estimates will fall to $4.1 billion from $4.3 billion in the 2010 financial year, which starts on October 1.

Continue reading ‘Banks Rush to Cut Penalties’ »

Net Banking solutions offered by both ABN AMRO Bank and ICICI are rated as the best in the segment. Loaded with the best services, these banking organisations are best when it comes to providing Online banking services.

Undoubtedly, Online banking has surfaced as a boon for the Indian banking customers. This changed aspect of banking functionality has helped the banking institutions big time in strengthening their business ties & relationship with customers.

But before delving any further it is important to know what actually is net banking?? Net Banking is nothing but the Online issuance and provision of banking solutions & services to the end-customer. Quite obviously, Internet banking fulfils every criteria of the most sophisticated yet hassle-free facility that offers people a kind of direct access to their bank accounts and other related solutions just by sitting at a place.

Presently, the Online channel of providing banking service has caught the fancy of almost every organisation which is established or is willing to foray into this segment. Leading banks like ABN AMRO Bank and ICICI have their Online banking solutions provider platform that caters to the demand of their Online users, round the clock.

Factually speaking, ICICI Bank has got an Interactive net banking website that provides the real-life banking experience to the customer.

On the other hand, the ABN AMRO bank allows its customers to perform RTGS Fund transfers and even 3rd Party ABN AMRO Fund Transfers. That is not all, the bank even disburse rewards to their customers via Online too.

Continue reading ‘Net Banking solutions by ABN AMRO Bank and ICICI bank’ »