Kenya’s credit boom that saw banks hit the streets to hawk consumer loans is coming to a painful close following the peaking of the number of defaults to a record high and difficulties of mobilising deposits in an economy that is grappling with the challenges of runaway inflation.
Industry insiders say, most banks have changed course from aggressive marketing of loans to chasing defaulters and tightening lending conditions to consumers.
More recently, top bankers have been sounding warning bells over the risk to the financial industry of high level inflation and the accompanying slowdown of the national economy.
Source
Monday, December 1, 2008
Monday, November 24, 2008
Company dives into lending pool
Like other industries whose fortunes are yoked to the health of the ailing housing market, swimming pool construction has suffered dramatic declines in the past two years. The number of pools built nationwide this year will amount to about half the production of 2005.
Pool Corp. of Covington has endured the decline without significant erosion to its bottom line because it derives much of its revenue from maintenance and repair. But the swimming pool supply distributor has also tried to sustain the construction side of its business by starting an in-house brokerage, Pool Corp. Financial Mortgage, to connect potential pool buyers with loans at a time when many banks are wary of extending credit for such projects.
Pool's executives blame the fall-off in new construction largely on the drought in the credit markets. During the real estate boom, consumers often borrowed against the rising value of their homes to finance major improvements like new swimming pools. Pool's chief executive told investors in New York last month that home equity loans all but vanished as values caved and banks started to view housing as fool's gold.
Source
Pool Corp. of Covington has endured the decline without significant erosion to its bottom line because it derives much of its revenue from maintenance and repair. But the swimming pool supply distributor has also tried to sustain the construction side of its business by starting an in-house brokerage, Pool Corp. Financial Mortgage, to connect potential pool buyers with loans at a time when many banks are wary of extending credit for such projects.
Pool's executives blame the fall-off in new construction largely on the drought in the credit markets. During the real estate boom, consumers often borrowed against the rising value of their homes to finance major improvements like new swimming pools. Pool's chief executive told investors in New York last month that home equity loans all but vanished as values caved and banks started to view housing as fool's gold.
Source
Monday, November 17, 2008
High street credit charges soar
Worried lenders have hiked rates for hard-up consumers by as much as 9% in the past four weeks, threatening to speed up the exodus of shoppers from the high street.
Research from comparison website uSwitch.com revealed that eight providers have increased the cost of unsecured personal loans by up to 9%, while the number of loans available has dropped to 52 from 56.
Lloyds unit Black Horse upped rates for loans of 1,000-2,999 by 9% to 36.9% APR and to 25.9% APR for loans of 5,000-7,499. Bank of Ireland, Bradford & Bingley, Lloyds TSB, Marks and Spencer, Barclaycard, Asda and Sainsbury's Finance have also upped their rates.
"As the news agenda overflows with the global financial meltdown, a plethora of loan rate increases have been implemented in the past four weeks, said Louise Bond, Personal Finance manager at uSwitch.com.
Lenders have increased unsecured personal loans by as much as 9% APR making borrowing even more costly for consumers.
Source
Research from comparison website uSwitch.com revealed that eight providers have increased the cost of unsecured personal loans by up to 9%, while the number of loans available has dropped to 52 from 56.
Lloyds unit Black Horse upped rates for loans of 1,000-2,999 by 9% to 36.9% APR and to 25.9% APR for loans of 5,000-7,499. Bank of Ireland, Bradford & Bingley, Lloyds TSB, Marks and Spencer, Barclaycard, Asda and Sainsbury's Finance have also upped their rates.
"As the news agenda overflows with the global financial meltdown, a plethora of loan rate increases have been implemented in the past four weeks, said Louise Bond, Personal Finance manager at uSwitch.com.
Lenders have increased unsecured personal loans by as much as 9% APR making borrowing even more costly for consumers.
Source
Monday, November 10, 2008
Link Loans joins Brilliant’s panel
Secured loan products will now be available with rates which are fixed for the term of the loan starting from 12.4%, and with LTVs up to 80%.
John Maclean, Managing Director of Link Lending, said: “We are delighted to offer brokers access to Link Loans via Exclusive Connections member firms. While the supply of funds remains limited in the current marketplace, we are very optimistic about the opportunities that the secured loan market represents. We are confident that our business partnership with Exclusive Connections will continue to deliver mutual benefits along by making our attractive secured loans available to a wider range of brokers.”
Matthew Arena, Managing Director of Brilliant Loans, added “At Brilliant Loans we constantly strive to make sure that we are offering the best of what the market can offer and we are pleased to welcome Link Lending to our lending panel. They offer an exciting mix of products and their commitment to the needs of the intermediary market confirmed to us that the new relationship will be a valuable addition."
Source
John Maclean, Managing Director of Link Lending, said: “We are delighted to offer brokers access to Link Loans via Exclusive Connections member firms. While the supply of funds remains limited in the current marketplace, we are very optimistic about the opportunities that the secured loan market represents. We are confident that our business partnership with Exclusive Connections will continue to deliver mutual benefits along by making our attractive secured loans available to a wider range of brokers.”
Matthew Arena, Managing Director of Brilliant Loans, added “At Brilliant Loans we constantly strive to make sure that we are offering the best of what the market can offer and we are pleased to welcome Link Lending to our lending panel. They offer an exciting mix of products and their commitment to the needs of the intermediary market confirmed to us that the new relationship will be a valuable addition."
Source
Monday, November 3, 2008
Horizon Bancorp Announces Increase in Third Quarter Provision for Loan Losses
Horizon Bancorp announced that it has taken a provision for loan losses of $3.137 million for the third quarter of 2008. This compares to a provision of $1.490 million for the second quarter of 2008. This increase is primarily due to the deterioration of three commercial loans in Horizon's loan portfolio. Horizon's commercial loan portfolio totaled approximately $305 million as of September 30, 2008.
Horizon assesses the adequacy of its Allowance for Loan and Lease Losses ("ALLL") by reviewing the performance of all of its loan portfolios. As a result of the current assessment, we determined that there has been recent deterioration in the commercial and indirect loan portfolios.
Source
Horizon assesses the adequacy of its Allowance for Loan and Lease Losses ("ALLL") by reviewing the performance of all of its loan portfolios. As a result of the current assessment, we determined that there has been recent deterioration in the commercial and indirect loan portfolios.
Source
Monday, October 27, 2008
Quick Student Loans for all the Expenses of Students
A college degree is an important goal for all the students, and they should have the opportunity and ability to pursue higher studies. For this purpose they need a good and helpful guide and above all a good bank balance, sometimes which is not possible. In these circumstances quick student loan can help them.
Student loans provide you with funds to complete your further education. These funds include the student’s tuition fee; cost of purchasing books, computer, their academic expenses etc. There are lots of banks, private and government institutions which provide student loans at low rates of interest. These loans can be availed by individuals like those who may be planning for higher education, post graduate students, gap semester, disabled students and many more. One can find such loans till 54 yrs of age.
You can get loan from some private institutions where you need to takeover job for sometime after completion of your education. You can keep some collateral to the lender from whom you are going to get quick student loans and these are the loans which we call secured loans. With secured kind of loans one can expect loans at low rates of interest.
There are also loans where you need not keep any collateral and these are mentioned as unsecured student loans. Rates of interest will be higher compared to secured loans.
Source
Student loans provide you with funds to complete your further education. These funds include the student’s tuition fee; cost of purchasing books, computer, their academic expenses etc. There are lots of banks, private and government institutions which provide student loans at low rates of interest. These loans can be availed by individuals like those who may be planning for higher education, post graduate students, gap semester, disabled students and many more. One can find such loans till 54 yrs of age.
You can get loan from some private institutions where you need to takeover job for sometime after completion of your education. You can keep some collateral to the lender from whom you are going to get quick student loans and these are the loans which we call secured loans. With secured kind of loans one can expect loans at low rates of interest.
There are also loans where you need not keep any collateral and these are mentioned as unsecured student loans. Rates of interest will be higher compared to secured loans.
Source
Monday, October 20, 2008
Debt-Laden General Growth Properties Pursuing Financial, Strategic Alternatives
Story Behind GGP's Debt Predicament, the State of its Portfolio, and the Investment Market's Appetite for U.S. Malls
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GGP said it will "actively pursue several sources of financing for the company's near-term maturing obligations," until mid to late November, when it expects to be in a position to "offer a long-term fixed-rate portfolio mortgage financing to lenders."
Further, GGP said it is considering generating additional capital through the sale of both core and non-core assets, the sale of joint venture or preferred equity in certain assets, a corporate-level capital infusion, or strategic business merger.
The day of GGP's announcement, Bank of America equity research analyst Christy McElroy said in a published note, "GGP’s pursuit of strategic alternatives is an incremental positive here, in our view."
Source
Monday, October 13, 2008
Local man accused in loan scheme
A large national bank has sued a local man, alleging he is at the center of a large mortgage fraud scheme that has led to a number of abandoned homes throughout Fort Wayne.
Washington Mutual Bank and its subsidiary, Long Beach Mortgage Co., filed suit in Allen Circuit Court this week accusing Jeffrey L. Radabaugh of spearheading the complicated scheme, which the bank said cost it millions of dollars.
According to court documents, Radabaugh and other “real estate insiders” deceived Washington Mutual into making millions of dollars in under-secured loans, submitting more than 100 fraudulent mortgage loan applications based on falsified appraisals indicating the properties were worth far more than the market value.
Along with Radabaugh and his mortgage company, J.T. Real Estate Investments LLC, the lawsuit names a number of area appraisers, appraisal companies, mortgage brokers, closing agents and title companies. The lawsuit also lists a number of individuals as “sellers,” those who owned the properties identified by Radabaugh for the scheme, according to court documents.
J.T. Real Estate Investments has no connection to J.T. Fields Realtors Inc. of Fort Wayne.
Documents allege Radabaugh would identify low-valued and distressed rental properties in the Fort Wayne area and then make a connection with the owners of the properties. He would negotiate a price with each seller, but rather than buy the properties himself, Radabaugh would take out an option on the property,
Source
Washington Mutual Bank and its subsidiary, Long Beach Mortgage Co., filed suit in Allen Circuit Court this week accusing Jeffrey L. Radabaugh of spearheading the complicated scheme, which the bank said cost it millions of dollars.
According to court documents, Radabaugh and other “real estate insiders” deceived Washington Mutual into making millions of dollars in under-secured loans, submitting more than 100 fraudulent mortgage loan applications based on falsified appraisals indicating the properties were worth far more than the market value.
Along with Radabaugh and his mortgage company, J.T. Real Estate Investments LLC, the lawsuit names a number of area appraisers, appraisal companies, mortgage brokers, closing agents and title companies. The lawsuit also lists a number of individuals as “sellers,” those who owned the properties identified by Radabaugh for the scheme, according to court documents.
J.T. Real Estate Investments has no connection to J.T. Fields Realtors Inc. of Fort Wayne.
Documents allege Radabaugh would identify low-valued and distressed rental properties in the Fort Wayne area and then make a connection with the owners of the properties. He would negotiate a price with each seller, but rather than buy the properties himself, Radabaugh would take out an option on the property,
Source
Monday, October 6, 2008
`Race to Bottom' at Moody's, S&P Secured Subprime's Boom, Bust
In August 2004, Moody's Corp. unveiled a new credit-rating model that Wall Street banks used to sow the seeds of their own demise. The formula allowed securities firms to sell more top-rated, subprime mortgage-backed bonds than ever before.
A week later, Standard & Poor's moved to revise its own methods. An S&P executive urged colleagues to adjust rating requirements for securities backed by commercial properties because of the ``threat of losing deals.''
The world's two largest bond-analysis providers repeatedly eased their standards as they pursued profits from structured investment pools sold by their clients, according to company documents, e-mails and interviews with more than 50 Wall Street professionals. It amounted to a ``market-share war where criteria were relaxed,'' says former S&P Managing Director Richard Gugliada.
``I knew it was wrong at the time,'' says Gugliada, 46, who retired from the McGraw-Hill Cos. subsidiary in 2006 and was interviewed in May near his home in Staten Island, New York. ``It was either that or skip the business. That wasn't my mandate. My mandate was to find a way. Find the way.''
Wall Street underwrote $3.2 trillion of loans to homebuyers with bad credit and undocumented incomes from 2002 to 2007. Investment banks packaged much of that debt into investment pools that won AAA ratings, the gold standard, from New York-based Moody's and S&P. Flawed grades on securities that later turned to junk now lie at the root of the worst financial crisis since the Great Depression, says economist Joseph Stiglitz.
Source
A week later, Standard & Poor's moved to revise its own methods. An S&P executive urged colleagues to adjust rating requirements for securities backed by commercial properties because of the ``threat of losing deals.''
The world's two largest bond-analysis providers repeatedly eased their standards as they pursued profits from structured investment pools sold by their clients, according to company documents, e-mails and interviews with more than 50 Wall Street professionals. It amounted to a ``market-share war where criteria were relaxed,'' says former S&P Managing Director Richard Gugliada.
``I knew it was wrong at the time,'' says Gugliada, 46, who retired from the McGraw-Hill Cos. subsidiary in 2006 and was interviewed in May near his home in Staten Island, New York. ``It was either that or skip the business. That wasn't my mandate. My mandate was to find a way. Find the way.''
Wall Street underwrote $3.2 trillion of loans to homebuyers with bad credit and undocumented incomes from 2002 to 2007. Investment banks packaged much of that debt into investment pools that won AAA ratings, the gold standard, from New York-based Moody's and S&P. Flawed grades on securities that later turned to junk now lie at the root of the worst financial crisis since the Great Depression, says economist Joseph Stiglitz.
Source
Monday, September 29, 2008
Swedbank sees no provision on secured Lehman loan
Profile, Research, Stock Buzz) said on Thursday he still saw no need to make provisions on a $1.35 billion secured loan to Lehman Brothers that is backed by commercial real estate.Chief Executive Jan Liden was speaking to Reuters after the bank's shares fell on a report that led to speculation about the Swedish bank's exposure to the loans.
"We see no reason to change our policy for not provisioning for this facility," Liden said.Shares in Swedbank had fallen after a report in the Wall Street Journal, which was later picked up by a Swedish business Web site, that focused on commercial real estate and referred to Swedbank's loans.
Liden also said the bank was sticking to guidance it had given on loan losses in the Baltic region in both 2008 and 2009.
Source
"We see no reason to change our policy for not provisioning for this facility," Liden said.Shares in Swedbank had fallen after a report in the Wall Street Journal, which was later picked up by a Swedish business Web site, that focused on commercial real estate and referred to Swedbank's loans.
Liden also said the bank was sticking to guidance it had given on loan losses in the Baltic region in both 2008 and 2009.
Source
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