Australian (ASX) Stock Market Forum

Australian Banks: Any Concern following SVB Collapse?

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Garpal Gumnut said:
I do sometimes mix with Mr and Mrs Shopping-Trolley and their children of varying ages, sexes, genders, disgusting habits such as travel to Bali and Thailand for sex and booze, tendency towards dishonesty and avarice, dependence on Centrelink, RSL Club gaming machines, television shows and political commentary telling them how and when to vote and laugh, ability to bother god in large numbers in the suburbs in a trance-like state while being conned by persons called Brian, who shout at referees and umpires in their chosen sport whether in the local oval or in stadia unfilled built for obscene amounts of money, who display enormous generosity and feeling for their fellow Australians and those overseas in tragedy or misfortune, who work hard and diligently, who serve for the common good and who deliver services and healthcare to the unwell and disadvantaged and who are covered by the $250,000 fallback on their monies in banks and financial institutions.

While this is gratifying I had hoped this thread would concentrate on the SHARE PRICE AND FUTURE OF AUSTRALIAN BANKS and not on the money opened by a politician turning a spigot to rescue these creatures and heroes from a life of penury.

It may not have penetrated that after the ASX closed on Friday one bank dealing in crypto, start-ups and media went A-up on the West Coast of the USA and subsequently all markets trading up to their close saw a fall in bank shares and other financial instruments.

So to summarise there is a Government guarantee on deposits, but where will the Banks' Share Price go tomorrow, next week and next month is the question I posited.

Should any poster mention the $250,000 again other than in relation to the share price or the nation's economy I will climb in through my screen with a baseball bat and soundly biff them about the head with it.

gg
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GG not a baseball bat. But a friend used to say he would severely land blows about the head and shoulders with a wet train ticket.
 
I would anticipate that the ASX banks will dip on Mon open. MQG will probably dip more than the others but I'm going to be buying this dip in a longer term conservative portfolio.

I'll also be monitoring US bank ETFs (FAS, XLF, KRE, KBE) for short term reversal trading opps.

On a brighter note gold is going higher.
 
So to further get this thread back on track

CBA
NAB
ANZ
WBC

The Big Four.

Any guesses on the drop ( if any ) in the SP tomorrow of these mangy certified robbers and recently confirmed bandits on the common purse by a Royal Commission.

gg
 
Garpal Gumnut said:
So to further get this thread back on track

CBA
NAB
ANZ
WBC

The Big Four.

Any guesses on the drop ( if any ) in the SP tomorrow of these mangy certified robbers and recently confirmed bandits on the common purse by a Royal Commission.

gg
Click to expand...
Well GG it would be great to see them flatened to their collective backsides on the floor as perhaps as a wake up call. But then pgs may also fly.
 
Of course, some of the damage has already been done.

Major Australian banks fell on Friday, 10 March. Commonwealth Bank slid 3.3 per cent to $96.51, Westpac fell 2.6 per cent to $21.79, ANZ was off 2.6 per cent and National Australia Bank was down 3 per cent.
 
Dona Ferentes said:
Of course, some of the damage has already been done.
Major Australian banks fell on Friday, 10 March.
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There, that didn't hurt too much. ..a bit of a decline today, but generally less than 1% for each of the 4. Most of the declines were on Friday (remember the SVB news broke well and truly on late Thursday in US).

CBA in green and financial index in orange;
Screenshot_20230313-164304_CommSec.jpg
 
Just a point, deposits technically can be securitized before any deposit guarantee scheme kicks in. Also, in law you are an unsecured lender to these institutions.

Caveat Emptor.
 
wayneL said:
Just a point, deposits technically can be securitized before any deposit guarantee scheme kicks in. Also, in law you are an unsecured lender to these institutions.

Caveat Emptor.
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Not bad isn't it. take and hold our hard earned then turn out to be an unsecured lender.
 
moXJO said:
Is it really covered if it came to the crunch?
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the only way to find out , is watch what happens during the crunch ( some commentators have strong doubts , and that was before 'bail-in' options were added )
 
farmerge said:
Not bad isn't it. take and hold our hard earned then turn out to be an unsecured lender.
Click to expand...
NO, NO , NO ! in most banks you are already designated as an unsecured lender , that is why Kevin Rudd stepped in to prop the regionals during the GFC

my bank ( Heritage ) is different as each dollar deposit is already is an unlisted share in the bank , so in theory you have already bailed it in , but get some benefits as shareholders
 
peter2 said:
I would anticipate that the ASX banks will dip on Mon open. MQG will probably dip more than the others but I'm going to be buying this dip in a longer term conservative portfolio.

I'll also be monitoring US bank ETFs (FAS, XLF, KRE, KBE) for short term reversal trading opps.

On a brighter note gold is going higher.
Click to expand...
i was hoping for some more MQG at $20 but no luck so far ( i guess 2011 was a once in a lifetime buy )
 
farmerge said:
So I surmise that if you had $100 in the bank and the payback was only 50% then as usual the peasants would suffer.
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The depositors will receive all their funds, it’s the share holders that will be wiped out, while the bond holders take a large haircut.

There is a lot of layers of capital at risk in line to take the hit before depositors.
 
sptrawler said:

List of authorised deposit-taking institutions covered under the Financial Claims Scheme | APRA

The authorised deposit-taking institutions (ADIs) listed at the bottom of this page are all covered under the Financial Claims Scheme (the FCS).
www.apra.gov.au www.apra.gov.au
The authorised deposit-taking institutions (ADIs) listed at the bottom of this page are all covered under the Financial Claims Scheme (the FCS).

The FCS protects money held by an account-holder with an ADI, whether in one or more protected accounts, up to a total value of $250,000. Click here to find out more about which types of accounts are protected under the FCS.
This list below contains ADIs and their trading names and was last updated on 9 February 2023.

  • Alex Bank Pty Limited
  • AMP Bank Ltd
  • Arab Bank Australia Limited
  • Australia and New Zealand Banking Group Limited
  • Australian Central Credit Union Ltd (trading as People's Choice Credit Union)
  • Australian Military Bank Ltd
    • RSL Money
  • Australian Mutual Bank Limited (trading as Endeavour Mutual Bank and Sydney Mutual Bank)
  • Australian Settlements Limited (provides industry services)
  • Australian Unity Bank Limited
  • Auswide Bank Ltd
    • Queensland Professional Credit Union Ltd
  • Avenue Bank Limited*
  • B&E Ltd (trading as Bank of us)
  • Bank Australia Limited
  • Bank of China (Australia) Limited
  • Bank of Queensland Limited
    • BOQ Specialist (BOQS)
    • ME Bank
  • Bank of Sydney Ltd
  • Bendigo and Adelaide Bank Limited
    • Adelaide Bank
    • Alliance Bank
    • AWA Alliance Bank
    • BDCU Alliance Bank
    • Bendigo Bank
    • Circle Alliance Bank
    • Community Sector Banking
    • Delphi Bank
    • Nova Alliance Bank
    • Rural Bank
    • Service One Alliance Bank
  • Beyond Bank Australia
    • Nexus Mutual
  • BNK Banking Corporation Limited (previously Goldfields Money Limited)
    • Goldfields Money
  • Cairns Penny Savings & Loans Limited (provides general banking services)
  • Central Murray Credit Union Limited
  • Central West Credit Union Limited
  • Challenger Bank Limited (previously MyLifeMyFinance Limited)
  • Coastline Credit Union Limited
  • Commonwealth Bank of Australia
    • Bankwest
  • Community First Credit Union Limited
  • Credit Union Australia Ltd (trading as Great Southern Bank)
  • Credit Union SA Ltd
  • Cuscal Limited (provides industry services)
  • Defence Bank Limited
  • Dnister Ukrainian Credit Co-operative Limited
  • Family First Credit Union Limited
  • Fire Service Credit Union Limited
  • First Choice Credit Union Ltd
  • First Option Bank Ltd
  • Ford Co-operative Credit Society Limited (trading as Geelong Bank)
  • G&C Mutual Bank Limited
  • Gateway Bank Ltd
  • Goulburn Murray Credit Union Co-operative Limited
  • Greater Bank Limited
  • Heritage Bank Limited
  • Horizon Credit Union Ltd (trading as Horizon Bank)
  • HSBC Bank Australia Limited
  • Hume Bank Limited
  • IMB Ltd (trading as IMB Bank)
    • The Shire
  • Illawarra Credit Union Limited
  • in1bank Ltd*
  • Indue Ltd
  • ING Bank (Australia) Limited (trading as ING)
  • Judo Bank Pty Ltd
  • Laboratories Credit Union Limited
  • Lithuanian Co-operative Credit Society "Talka" Limited
  • Lutheran Laypeople's League of Australia
  • MacArthur Credit Union Ltd (trading as The MAC)
  • Macquarie Bank Limited
  • Macquarie Credit Union Limited
  • Maitland Mutual Limited (trading as The Mutual Bank)
  • Members Banking Group Limited (trading as RACQ Bank)
  • MyState Bank Limited
  • National Australia Bank Limited
    • Ubank
  • Newcastle Permanent Building Society Limited
  • Northern Inland Credit Union Limited
  • Orange Credit Union Limited
  • Police Bank Ltd (trading as Border Bank)
  • Police Credit Union Limited
  • Police Financial Services Limited (trading as BankVic)
  • Police & Nurses Limited (trading as P&N Bank)
    • bcu
  • Pulse Credit Union Limited
  • QPCU Limited (trading as QBANK)
  • Qudos Mutual Ltd (trading as Qudos Bank)
  • Queensland Country Bank Limited
  • Rabobank Australia Limited
  • Railways Credit Union Limited (trading as MOVE)
  • Regional Australia Bank Ltd
  • South West Slopes Credit Union Ltd
  • Southern Cross Credit Union Ltd
  • South-West Credit Union Co-Operative Limited
  • Summerland Financial Services Limited (trading as Summerland Credit Union)
  • Suncorp-Metway Limited
  • Teachers Mutual Bank Limited (trading as Firefighters Mutual Bank, Health Professionals Bank, Hiver Bank, Teachers Mutual Bank and UniBank)
  • The Broken Hill Community Credit Union Ltd
  • The Capricornian Ltd
  • Traditional Credit Union Limited
  • Transport Mutual Credit Union Limited
  • Tyro Payments Limited
  • Unity Bank Limited (trading as Reliance Bank, Bankstown City Unity Bank and Unity Bank)
  • Victoria Teachers Limited (trading as Bank First)
  • Warwick Credit Union Ltd
    • Dalby Credit Union
    • Gympie Credit Union
  • WAW Credit Union Co-Operative Limited
    • BankWAW
  • Westpac Banking Corporation
    • Bank of Melbourne
    • BankSA
    • St George Bank
  • Woolworths Team Bank Limited
Click to expand...
And, as I mentioned above, before that $250,000 government guarantee even comes into play there is multiple levels of capital that protect the deposits.

So a bank will fail when the total assets it holds is no longer large enough to cover its debts (including amounts it owes depositors and bonds holders)

But, depositors have first claim on that big pile of assets, and then if the asset pile isn’t enough to cover their full deposit the government back insurance comes in to make up the difference.

So the order that different classes take losses is.

1. Share holders - all losses are absorbed by shareholders capital until there is no more equity and share holders are wiped out.

2. Junior unsecured capital notes - next any unsecured capital notes or bond holders take hits until they are wiped out.

3. Senior bond holders - are next get wiped out, along with any other capital securities issued.

4. Then the government backed insurance begins to take a hit.

5. Only once all those levels above have been wiped out will the depositors begin to take a hit.
 
farmerge said:
Not bad isn't it. take and hold our hard earned then turn out to be an unsecured lender.
Click to expand...
Wayne’s comment is a bit misleading there, even though bank deposits are technically “unsecured” because they don’t has a specific asset held as security against them, they are technically also the most secured debt the bank has, because the deposits out rank all other capital holders in the system, plus have some government insurance.
 
The whole Banking sector is negative as Credit Suisse wobbles as the worry spreads. Australian Banks are a bit distant but in this situation the whole sector worldwide will be affected. A return to gold with a lower inflation forecast looks a place to consider. Saudi National Bank affected as it withdaws foreign Bank support.
www.reuters.com

Credit Suisse stock slump triggers close monitoring by regulators

Credit Suisse shares slumped by as much as 30% on Wednesday after its largest shareholder said it could not provide further support, prompting the Swiss bank's CEO to make new assurances on its financial strength.
www.reuters.com www.reuters.com

The Saudi National Bank has withdrawn from supporting Credit Suisse as the crisis spreads.
www.theguardian.com

More than £75bn wiped off FTSE 100 amid Credit Suisse crisis

Swiss bank’s shares fall to record low as top shareholder Saudi National Bank rules out more funding
www.theguardian.com www.theguardian.com
 
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