This page has been archived and commenting is disabled.
The Corporate Bank Run Has Started: Siemens Pulls €500 Million From A French Bank, Redeposits Direct With ECB
In a shocking representation of just how bad things are in Europe, the FT reports that major European industrial concern Siemens, pulled €500 million form a large French bank, which is not BNP and leaves just [SocGen|Credit Agricole] and deposited the money straight to the ECB. The implications of this are quite stunning, as it means that even European companies now refuse to work directly with their own banks, and somehow the ECB has become a direct lender/cash holder of only resort to private non-financial institutions! As Bloomberg reports further on the FT story, in total, Siemens has deposited between 4 billion euros and 6 billion euros, mostly through one-week deposits, with the ECB, FT says, cites the person. It isn’t clear from which bank Siemens withdrew its deposits, per the FT... but it is hardly difficult to figure out. BNP Paribas isn’t the bank involved, FT reports, cites unidentified person familiar with the bank. This story should be having far more impact on the EURUSD than any rumors about Greece lying it will fire all of its public workers only to make sure Eurobanks can survive one more day.
More from the FT:
The company’s move came almost a year after Europe’s largest engineering conglomerate prepared itself for a future financial crisis by launching its own bank, an unusual move for an industrial group outside the car sector, where companies run big car financing and leasing businesses.
In an interview last December, Roland Châlons-Browne, chief executive of Siemens’ financial services unit, said its banking business would enable the group to tap the central bank for liquidity and deposit cash at the ECB.
“In the case of another financial crisis, we will be able to broaden our flexibility and take out risk with our own bank,” Mr Châlons-Browne said at the time.
Siemens does not only use the ECB as a haven; it also gets paid a slightly higher interest rate than it would get from a commercial bank.
The ECB paid an average interest rate last week of 1.01 per cent for its regular offers of one-week deposits, under which it withdraws from the financial system an amount of liquidity equivalent to the amount it has spent on eurozone government bonds.
Update: reader Arnold informs us that Siemens was lucky enough to be the functional equivalent of a Goldman Sachs ATM (you know, Goldman as an FDIC insured "depository" organization) when back in 2010 it got a bank license:
At the end of 2010, Siemens was granted authorization by the German Financial Supervisory Authority (BaFin) to operate banking business in Germany.
Through its loan business, Siemens Bank expands the product range of Siemens’ Financial Services unit, especially in sales financing. In addition, the deposit business of the bank increases flexibility in the area of corporate financing and provides the opportunity for the further optimization of risk management.
Siemens Bank is based in Munich and will be located in Germany only for the time being. Cross-border activities are planned in future. European countries will be the initial focus of such activities. Select emerging markets are additional focal points.
Siemens Bank is a subsidiary of Siemens AG and acts as an independent company. Nonetheless, it profits from its inclusion in the network of Siemens Group’s financial services companies. The bank employs about 100 people, mainly experts from the areas of risk management and risk controlling as well as specialists from loan origination & structuring.
»
- 37273 reads
- Printer-friendly version
- Send to friend
- advertisements -
"The moment government money stops, the renewable business will crash and burn. Without subsidies, it is a joke."
But, but, but Solyndra has done wonderfully, haven't they?
Isn't this considered a run on a bank?
a bank with runs
Well yea, unless they call it 'priced in' instead. And today, isnt armageddon already priced in?
Rock on, total insanity markets.
No because Socgen is going to pull their funds from themselves and deposit them with the ECB as well.
/sarc
Makes you wonder where all that USA Corporation cash is hiding.....what bank is it invested ...parked in...hmmmmmm....It also makes you wonder if Seimans was on that call today..a little insider information...hmmmmmm II....so we have a country where over 50 % work for the government..can retire at 52...have all the bennies....but the country is losing GDP daily....revenues are reducing....and the ECB is going to give them another 8 billion in Euros......yep....its crazy ...totally crazy
Normal day in the EU-wonderland. If there's a mistake to be made, they will make it. Just like they started to build this plutocrat's paradise in the first place and proceeded with the monetary union Shangri La even when it was destined to be an epic fail.
Boom!!!!!
Shame they put it with a bankrupt central bank. :)
Fiat money has no place to go but gold -Alan Greenspan-
Won't the ECB soon be insolvent ?
Everything will be insolvent, soon...
Some real world cold water dumped on the ruling banking elite.
We all know Greece lies, so bankers can survive yet one more day.
This is a real world wake up call, but sadly nobody in government will pay any attention.
From ZH twitter:
http://finance.siemens.com/financialservices/global/en/products_solution...
That's interesting.. "GmbH" means "Ltd." - now that's something for a BANK.
....depends who are the " Gesellschafter(s)".... In this case obviously the company itself, and I tell you, I'd like to have them in my books.....
it is my understanding that a old satellite will be falling out of its orbit this week. i think there ia a strong possiblity that it will fall on the zerohedge server farm.....oh nooooooo..........
I'm aggravated. I hope that skylab junk hits me right in the face.
Where should I stand?
On a raft in the middle of the Pacific Ocean.
Markets are up, sorry folks no doomsday today. Maybe tomorrow or perhaps the day after. Avoid jumping off a building just yet.
up ya sure, no green on spy, iwm, qqq, xlf, xrt etc that i can see.
love the biting condescension btw... keep buying those dips!
Maybe this is the private participation we have all been hearing about....or maybe Siemans had to pay off some cds......oR MAYBE THE ECB HAS SOME PICTURES of some of the management at the Bunga Bunga party and they needed to make them disappear.....
is there a link to the Siemens deposits with ECB story?
Don't bother searching the MSM.
Siemens have always done little to hide their contempt for banks. I'm assuming it was because the bank refused to lend to them at Euribor minus 30 bps....
What the hell do you think will happen if the Repatriation of Profits from large corporations, like the bobble-heads from CNBC keep cheering about will do. You pull out a couple of trillion from foreign banks to repatriate and the race to the bottom by the banks will look like a god-damn looney tune cartoon.
The bank employs 100 people?!?!?!?
Are you kidding me?
PMs lower. Run into the dollar going on, against expectations. Remember end of QE2? "US default". Never came. S&P downgrade? "US default". Never came. On the contrary. Game is changing: QE3 will send PMs even lower, enforcing a further flight into the dollar and bonds, not out of. People just want cash and bonds, all the rest is too risky. Dollarcollapse is a myth. So. No gold at $12.000, no silver at $300. No Armageddon. Boring world we live in.
repetative troll is so fucking repetative, die a horrible death please.
At least be creative if you're going to troll. Robo at least puts a slightly different spin on his trolling.
For example, NFLX detonated so he doesn't mention them anymore. Work with that.
Sometimes he even throws in a nice picture of a girls with a killer rack. Everyone loves boobies, even the trolls.
Don't be deceived by the financial engineers.
and did you see that ? The bow of the titanic just lifted a little bit.. the ships not sinking what's everyone panicking about ?
Mish says it too: No Hiding Spots Except Despised US Dollar. "I expect gold to hold up in a major decline, but I could easily be wrong."
http://globaleconomicanalysis.blogspot.com/2011/09/no-hiding-spots-except-despised-us.html
Does not sound like Armageddon. More like Japan: a slow death. Boring death, so to speak.
Mish talks his book like everyone else. Here are the facts YTD:
1. 30 yr bond: +16.5%
2. Gold: +27%
3. S&P 500: -4%
Reality > rhetoric when you're having to make real decisions with real money.
YTD but the rest of 2011 and thereafter?
If you're advising the dumb money and they're just starting today, a portfolio of 1/3rd gold, 1/3rd diverisified bonds, and 1/3rd defensive equities (utils, telecom, pharma, staples) is a pretty good way not to completely fuck up.
More to the point, I think we'd all love to hear what you're actually invested in and/or recommending as a course of action. I hear a lot of empty rhetoric and nothing to work with as far as an objective/neutral way to judge whether you actually know what the hell you are talking about.
Some stocks: Brazilian gold mines and gold juniors. Not doing well actually, but maybe in the near future. I took the advises of goldbugs and bought the "undervalued" gold mines.
The Euro is going to have a bad time of it, which means Bernanke has room to print much more to drive the USD even lower. There can only be one at the bottom. They're all being devalued against gold. Boring but true.
Siemens is a Bank (also) since a year ago....
ECB pay better interest rate (1.01 for the one week) and EONIA is 0.95%
Ziemenz and Areva have been in the throes of a corporate divorce for several years now. Seems that the checks that "Madame Non" wrote on Sarkozy's treasury (you know, the more cultured way to do "soverign loan guarantee", n'est ce pas?) were being cashed out. Ziemenz didn't want to be in those frag patterns at Flamanville 3 and FIN-5.
So, in part, get the money out of gay Paree before it is, ... er ... "included in the project's finances in strict accord with the long-standing Partnership between our two great companies."
Just a guess ;-)
- Ned
It sounds funny to hear siemans PULLED OUT.
Siemans usually makes a deposit that sticks
I hear condom sales go down when Seimans pulls out.
Yeah, and if they are acting as a bank...
Seimens Savings and Splooge.
'There's Something About Money' Or was it Mary?
you must mean "Semens"...
Talking about a "run" I read that the Perth Mint "sold out" of their 1 oz 2012 dragons in about 8 hours.
Is this true?
I just checked APMEX and they are sold out of one ounce silver and one ounce gold BU 2012 dragons. Not sure if they will have more coming in? Dragons are atypical however as they are the most sought after of the Australian Lunar Series.
Thanks Tuco. I went to APMEX and saw the 2000 dragons are over $2,600....incredible....you would think they are made of gold....
Hey, wait, they ARE gold!
Let's get this party started.. The market shrugs off bad news everyday,i wonder how much longer they can keep the game going ?
There is nothing special about Siemens having a bank. Volkswagen has one too. So does the Brenninkmeijer family (of C&A fame).
Oh its a big deal - think about what it would take to get that elephant to dance on cue. This is timed with the bullshit in Greece - Euro's gotta go first for Ben cause Ben's reach exceeds his grasp. He's got just enough in him to hold on but the knuckles are white and the fist is shaking.
If you're invested in Siemens, and they're running away from SocGen to the ECB, what's that say about where your money should(n't) be?
Tick...tick...tick...
I flew cross country 13 years ago with the chairman of Siemans ... Asked him what his most profitable division was. "Currency exchange," he told me. "We have software that's right 55% of the time.
Where's Reggie????
Gettin all spiffed out for his Max Headroom...er Keizer thang. Likely
and somehow the ECB has become a direct lender of only resort to private non-financial institutions!
Did I not read that Siemens has deposited funds with the ECB?
That'll mean Siemens is lending TO the ECB, rather than the other way round. Oh ZH, why are you becoming 'all sensationalist' these days.
Bad read, dude. Bad read.
So when the ECB and the Fed have all the bad debts and are then collapsed, Siemens will get their money back right?
This is all just a confidence game (think BSC). It's not like Siemens sent a truck over to a bank and loaded up some cash and then drove it over to another bank and filled out a deposit slip. These are just digital transfers. So the confidence comes from who is the gurantor/counterparty of your digital deposit. Greece, EU, Euro, et al... are all toast. This move by Siemens is confirmation that there is no confidence. The house of cards is about to tumble. (imho)
i agree, i don't think it is a positive sign that leaves me a a warm fuzzy feeling.
I understood falak perfectly. Devil take the hindmost is right. When there is a tiger after a group you don't have to outrun the tioger, you just have to outrun the guy next to you.
Siemens "pulled €500 million form a large French bank" after pulling out of the joint-venture with Areva to build EPR nuclear plants...
That's the second time Siemens double-cross the French and oh boy that's a couple of bad decisions... (puff puff) OMG they're actually right!!
Becoming like the little boy who cried wolf!
Fidelity ain't scared.
Yall smell smoke?
All it will take is for one counterparty to default for the entire $1,500,000,000,000,000.00 in worldwide derivatives to implode. Think LTCM X 100. Yikes!
The gift that keeps on giving. Thank you Eddie George and Alan Greenspan for your bequeathal of the CondomNation
I'm not sure it's smoke, but that canary looks pretty sick.
Even more stunning when one considers the nature of the European structure of close association between corporations, governments and money center institutions. The loss of special relationship is hitting new levels. Additionally, we now see clearly that central banks have been active in direct support to corporations and not just money centers and sovereigns. The three legs are now indeed in complete ripple.
Stupendous collapse of all sorts of things.
MK - you could not be more on target. Very few Americans have any understanding of the role and importance of these special relationships, many of which go back generations. They are the underpinnings of the entire European business community. When they go, there is nothing left to hold the center together. These special relationships are the reason that European companies can do business with each other on the basis of trust. Of course they have contracts, but when there are disagreements they are settled far more often by pointing to the relationship rather than to the contract. This is something that Americans will never understand.
These special relationships are the envy of the aware world and are the foundation upon which the current experiment both seems to be floundering and will be salvaged. Provided they rise to supremacy, once again, within the ultimate circles of decision making rather than the seeming ascendance of Kissinger's axiom of no greater interest than self interest [near horizon myopia]
Warmest regards-
If they put 500 large in the ECB, imagine what they are putting in le suisse and other traditional forms of barbarity?
This could mean the IMF is no longer funding Greece and by default the French Banks.. ouch! This is an ex. of First class passengers (siemans) getting into the lifeboats first....
I love the smell of french toast in the morning.
If Siemens doesn't think their money is safe with a French bank then why should anybody else? Sign of things to come. Everybody has had their eye on the exits, now they're starting to run for them.
porn spoiler alert...it ends with Siemens on her face
So thats why they call it the "money shot".
bullish!
WAit wait...this makes total sense...ECB giving away free Blu-Ray player with each 10 Mil Euro deposit. Nothing to worry about here.....
Ach, zo you think you vill use our money to fund your little games? Vell, ve vill see about that! Gunther, hand me that vidthdrawal slip!
Sour-krauts, eh?
Can someone please explain why Gold and Silver prices are falling?
I am guessing it's just more squeeze play to get as many people out of it as possible.
Seimens gives half a billion to the ECB to keep it safe.
The obvious next step, if it hasn't already been done, is for the ECB to give the same half billion to the same bank.
The ECB is too big to fail.
500 MILLION is a drop in the bucket, chump change. Hell a rookie trader misallocates 2.3 billion. and nobody noticed.
Did shit just get real?
typical of ALL LIBERTARIAN pseudo self reliant idiots
Time to replace the word CONFIDENCE with what this has been about since day one...namely TRUST. Say goodbye EU. You're done.
When this whole game comes apart, it will be sudden and brutal.
350 billion euros to keep Greece's head out of water between now and 2018. Just to keep it afloat and pay its interest on debt in the meantime, which it can't do as of next month, and even less so in 2012 as its economy deflates by 5%/year! That's being optimistic. They have to leave sooner or later, OR else, EU has to mutualise their debt via Euro bonds AND the banks ACCEPT SOME DEBT RELIEF. For the remaining sovereign debt, either its ALL in and we go federal or its break up EU time. I'm repeating myself as I have said it time after time. AND, this is just ONE country and its sovereign debt. The whole of the PIGS scene is 2.5 trillion over ten years....Merkozy, calling Merkozy....the whole world calling Merkozy...Decision time ONE WAY OR THE OTHER. NO HALF WAY MEASURES. Do we have an EFSF for this amount and a Eurobond mecanism imposing fiscal union or not...? To be or not to be EU of the 21 st century...
The Siemens CEO is a Bilderberger.