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Bank with highest tier 1 capital ratio?

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sinner

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Hi guys,

The search is on, for the bank/credit union/building society/whatever with the highest tier 1 capital ratio.

I spent a while poking around last night the best I could find was Credit Union Australia at ~15%.

http://www.cua.com.au/wps/wcm/connect/website/home/sitetools/corporategovernance/prudential/

Compared to say the big 4 banks sitting at 7-8%.

I also notice the share price for CUA is only $10! Pretty cheap, I will probably switch once my uni student fee exemption status on my commbank account expires!
 
I got a letter about this from my credit union a while back, and their liquidity and capital ratio numbers were rock solid. I'll see if I can find their statement. They're not publicly listed though (thankfully). By the members for the members.
 
Gorilla, sorry, when I say share price I mean the cost of becoming a member (i.e. owning 1 share) in the credit union. CUA is not publically listed.
 
:D All banks are screwed ATM including any organisation wanting to entertain the fantasy that they have a different looking umbrella! Find a different investment option. IMVHO!
 
GumbyLearner, are you suggesting that if we agree with you that this question now becomes pointless? We should all just proclaim we are doomed and stick our heads in the sand?

No thanks, I prefer to keep learning...for one I am very curious to see how these institutions with much higher capitalisation ratios will fare over the longer term compared to banks currently at <10% ratios, and for all your negative sentiment here you don't know how they will do more than anyone else. In fact I would go so far as to say that you will be worst off out of everyone by having your opinion so set in stone.

A new one for the night guys

Tier 1 capital ratio for the Credit Union: 22.02%

http://www.sgecu.com.au/pdf/SGEPrudentialDisDoc.pdf

Can anyone beat 22% ?
 
Bit hard to compare.

Because their funding costs are so much higher compared to banks, so they need to keep the extra capital in reserve.
 
There are plenty of credit unions operating at around the 10% tier 1 capital mark, so I don't see why higher ratios than that aren't a useful indicator of capitalisation.
 
sinner said:
GumbyLearner, are you suggesting that if we agree with you that this question now becomes pointless?
Click to expand...

No not at all sinner!

All Im saying is anyone offering 22% in the current enviroment is a total bs artist. They're full of garbage! If someone offered you a smaller gain, say anything that matched the coming inflation or slighty better you might give them an audience.

The maxim is very simple : Too many people living beyond their means!

DISCLAIMER: Including the people keeping up with the "Jones" Pardon the pun!:D
 
GumbyLearner said:
No not at all sinner!

All Im saying is anyone offering 22% in the current enviroment is a total bs artist. They're full of garbage! If someone offered you a smaller gain, say anything that matched the coming inflation or slighty better you might give them an audience.

The maxim is very simple : Too many people living beyond their means!

DISLAIMER: Including the people keeping up with the "Jones" Pardon the pun!:D
Click to expand...

Obviously for some unknown reason you think the % quoted are interest on deposit and have no clue what the tier 1 capital ratio is or why people are discussing it.
 
Seriously GumbyLearner, what the hell are you talking about?

What the hell does Madoff have to do with tier 1 capitalisation ratio of Australian ADIs? For one major point, all of Madoffs companies are/were LLCs?

Are you honestly suggesting that Australian credit unions are fudging their numbers and getting away with it, with no scrutiny or cry from APRA? Do you have any evidence to back up these ridiculous claims? Just the claim that they might be fudging the numbers is :rolleyes: what would be their motivation to do it? Clearly judging by the capitalisation of the big 4 banks, consumer sentiment is not driven by those ratios, so why exactly do you think they would fudge the numbers? Do you even know what the numbers mean? I think it is pretty obvious you do not...
 
If I were you I would invest in staright-in unadultered commodities

Everything else in this enviroment sucks ass because these people want to
give you a corporate impression they know better!

They DO not know better! Invest in financials at your peril! More smacking as a result of irresponsible, imprudent and PHANTASMAL too come! IMVHO Dont give them anything!!!!!!!!!!! :D Even the steam off your own turds! ;)
 
Really, who cares if you were me? You clearly have no interest in what I am invested in, only in putting forward your own off topic and largely irrelevant view as well as making incorrect "very humble" assumptions about my personal investment strategy from the contents of this thread, which were supposed to be purely didactic.

I would not have bothered even replying to your first post if I had realised you had no idea what was being discussed.

If you are not just an arm-chair commentary type, and have actually put your money where your mouth is into "un-adulterated commodities" (whatever that means) then you must have a broker, meaning you trust some financial institution somewhere, two actually, if you want to liquefy your holdings or take profit they need to go somewhere and somehow I doubt you are redeeming into hard cash.

So what exactly is your point? Why are you posting in this thread?

EDIT:

Slightly higher

http://www.memberfirst.com.au/ssl/axs/1/assets/common/assets/Public disclosures.pdf
Tier 1 capital ratio for the Credit Union 25.33%
 
GumbyLearner said:
Find a different investment option. IMVHO!
Click to expand...

I'm sure we could call this investing. I can buy a "member share" in my credit union and that's all I get, a single share :)

From their website:

With global markets behaving as they have been recently members need to be very mindful in relation to their finances. You need to invest with an organisation that
reflects your prudence.

Denis Grehan, Chief Executive Officer, said that “Maroondah Credit Union is unusual as it funds its loan portfolio entirely from its own members’ funds. Unlike a lot of larger financial institutions, Maroondah Credit Union does not borrow funds from wholesale markets to fund its loans. Consequently the lack of funds in that market
does not impact on MCU’s liquidity or funding.

MCU is strongly capitalised (14% compared to the Prudential requirement of 8%) and very liquid (23% against a required 9%). The Credit Union is well placed to satisfy the needs of both depositors and borrowers.”
Click to expand...
 
Doesnt really matter I personally recommend anyone reading this thread should buy some GIKD meaning PHYSICAL bullion because most western governments have been so scared of each OTHER TO form of a solution, that they think they might loose what they have INDIVIDUALLY worked for....
can i have a suntan please & give every anti-pop star one TOO!!!!!!
 
GumbyLearner said:
Doesnt really matter I personally recommend anyone reading this thread should buy some GIKD meaning PHYSICAL bullion because most western governments have been so scared of each OTHER TO form of a solution, that they think they might loose what they have INDIVIDUALLY worked for....
can i have a suntan please & give every anti-pop star one TOO!!!!!!
Click to expand...

What the hell are you on? Lay off it, whatever it is. Commodities, eh? They've been doing beautifully, haven't they? :rolleyes: If the deflation scenario plays out, your gold could be as worthless as all of your exclamation points :)

Strange, but I do get the feeling you rode the banks all the way down, and then jumped on the gold-bug wagon - I could be wrong though :p: Either way, if such comments reflect your "analysis" of gold, it's probably time we all start shorting the stuff.
 
Nyden said:
What the hell are you on? Lay off it, whatever it is. Commodities, eh? They've been doing beautifully, haven't they? :rolleyes: If the deflation scenario plays out, your gold could be as worthless as all of your exclamation points :)

Strange, but I do get the feeling you rode the banks all the way down, and then jumped on the gold-bug wagon - I could be wrong though :p: Either way, if such comments reflect your "analysis" of gold, it's probably time we all start shorting the stuff.
Click to expand...

Short the media, they have been (in the recent words of Blageovic(wrong, wrong and WRONG)! And they are still wrong! Believe them and DIE!:D

Its akin to the guy that used to run Paddy Cummins Tea Shop running Parliament! And I used to look
to look outside OZ for direction! NOT ANYMORE!!!! Anyone for 2-UP?
 
Hey sinner, great topic. I don’t know much about credit unions, so besides deposits are they exposing themselves to potential loan defaults as the majors? For example too much risky business with ABC Learning, B&B, Centro, and Allco meant CBA compare to the other three resulted in it having a lower tier 1 ratio until the AUD1.6 billion capital raising last week that got their (CBA) value back to 7-8%.

How will the government guarantee that ends in three years effect tier one ratios of non-banks? The banks are currently moaning that the non-banking sector is offering ridiculous interest rates compared to the them since if they happen to collapse the government will bail out depositors. As far as the banks are concerned they’ve earned their AA ratings.

From what I’ve learnt about Basel II’s tier 1 ratio from the major financial rag that has dominated it’s financial services pages for the last couple of weeks is it was put into place to guarantee that banks didn’t over expose themselves to too many bad loans at the expense of depositors. With a ratio of 7-8% (can’t recall exact figure) being the benchmark that’s considered safe.
 
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