net interest margin

Moodys Slashes Ratings On 6 Canadian Banks, Fears Asset-Quality Deterioration, Soaring Household Debt

Amid Poloz-described "unsustainable prices" in various cities, and just days after the collapse of Canadian mortgage lender Home Capital Group and our discussion of the dire state of Canadian savers (and their record household debt), Moodys has cut the rating son six of Canada's largest banks because of "ongoing concerns that expanding levels of private-sector debt could weaken asset quality in the future."

In Today's Fiat Money Financial System, 'The House' Always Wins

Perhaps the rules of the game have always favored the bankers.  Loaning out deposits at a higher interest rate than the yield paid is cornerstone to fractional reserve banking.  However, the extreme maltreatment of individual depositors and borrowers that has persisted following the 2008 credit crisis is a downright disgrace. 

Gary Cohn Backs Reinstating Glass-Steagal, Breaking Up Big Banks

The former Goldman Sachs Group Inc. executive who is the top White House economic adviser told lawmakers he could support legislation breaking up the largest U.S. banks, according to people familiar with the matter, a development that bolsters congressional efforts to reinstate the Depression-era Glass-Steagall law.

Frontrunning: February 16

  • Futures dip as Wall Street navigates unchartered territory (Reuters)
  • Trump's Russia crisis deepens (Reuters)
  • Government Landlord Pays Millions Each Year to Trump Company (WSJ)
  • Protests call for U.S. immigrants to stay home from work, school (Reuters)
  • Trump Hates Trade Deficits, But Which Ones Really Matter? (BBG)
  • French Election Puts ‘Frexit’ on the Agenda (WSJ)

DV01 Update: A 1% Rise In Yields Will Lead To $2.1 Trillion In Govt Bond Losses

The effective duration on Bank of America’s global government bond index climbed to an all-time high of 8.23 in 2016, from 5 when it began in 1997. A one-percentage point increase in interest rates equates to about $2.1 trillion in losses for global investors, based on a Bloomberg Barclays sovereign-debt index.

Step Aside London Whale: Goldman Is Now Using Retail Deposits To Fund Investments

Goldman has been using the proceeds from the new deposits to directly fund speculative activity such as trading and investments, as well as more conventional activity such as creating looans. Goldman Sachs built up its consumer bank, led by 40-year-old Goldman partner and credit trading veteran Gerald Ouderkirk, whose job is to use consumer deposits and other types of funding for trades, investments and loans.

8 Reasons Why One Hedge Fund Is Keeping A Long VIX Position On

At least according to one advisor, GS Banque's Loic Schmid, it is prudent to keep some volatility protection on after the recent risk-off episode. As a reminder, in mid-July Schmid suggested buying the VIX, a trade that has been profitable ahead of the Friday surge and while he says that he is taking profits on half the position, he is also keeping the other half on for the following reasons.

Incompetent But Not Weak: "The Fed Doesn't Know Whether To Shit Or Go Blind"

The outlook for the US economy is deteriorating, yet the Fed is trying to raise overnight rates to keep unseen inflation from rising. Success in its strategy could force consumption lower, unemployment higher, and exacerbate real output contraction. The market, however, should not underestimate the Fed’s power based on its apparent incompetence.

Bank of America Profit Tumbles 19% As NIM Hits Record Low, EPS "Beat" On Surge In Cost-Cutting

Moments ago Bank of America joined the parade of "beating" banks despite declining earnings, when it reported adjusted Q2 EPS of $0.37 (excl. DVA), "higher" than a sharply reduced in recent weeks consensus estimate of $0.33, even as profits tumbled 19% from the $0.45 a year ago on sliding revenues of $20.6 billion ($20.4bn reported), vs consensus of $20.4 billion: the top line was $1.6 billion lower than a year ago if $0.9bn higher than Q1.

When Energy Loans Go Bad: Why America's Largest Bank Is Sliding

Wells' long overdue admission that it is woefully under-reserved for what may be a deluge of loan defaults should oil fail to rebound strongly... and certainly if oil continues to decline, has finally arrived in the form of this chart showing its LTM loan loss provision expense. It is, in a word, soaring.