• Or whoever. Disasters, etc., is the point.


    Federal Reserve Hints That Maybe Banks Should Hire Jerry Bruckheimer To Help Write Their Stress Test Scenarios

    Today the Fed released a paper making fun of banks for their lame responses to the Fed’s stress tests, both on prudential-regulatory and on literary grounds. For instance, the banks were supposed to come up with their own stress scenario and see how they’d do in that scenario, and a lot of banks apparently phoned […]

    / Aug 19, 2013 at 4:21 PM
  • Antony Jenkins one day you might find a place in my heart to rival Bob Diamond but you're not there yet.


    Barclays Asks Shareholders If They’d Mind Terribly Chipping In Just A Bit More Cash

    Barclays today announced a fancy new capital plan that illustrates the subtle cultural differences between US and UK banking. When U.S. regulators want banks to raise more capital, they tell them to do it by 2018, and the banks spend the intervening five years whining about it. When UK regulators want Barclays to raise more […]

    / Jul 30, 2013 at 5:52 PM
  • This is an acceptable use of red. Share repo = bad, in context.


    Banks Will Have To Buy Slightly Less Stock, Which They’re Not Very Good At Anyway

    One way to characterize US regulators’ new leverage ratio rules is that they require big banks to raise some $80-odd billion of capital, but that’s perhaps more alarmist than necessary. The banks don’t have to raise that money in the sense of going out and selling $80bn of stock or whatever. They make money every […]

    / Jul 10, 2013 at 9:36 AM
  • Unsurprising: BofA, best stock price performance, second-worst ROE.


    Bank Shareholders Are Selfish Jerks

    We talked last week about how shareholders are really the last people you’d want running a bank, if you’re the sort of person who doesn’t like banks. Conveniently Jesse Eisinger is that sort of person, and he’s pissed at shareholders for how they’re running banks: Shareholders can’t be counted on. That’s the message from the […]

    / May 29, 2013 at 6:14 PM
  • Tarullo does surprisingly well on Google Images.


    Fed Governor Wants Everyone To Remember That It’s Not Just Banks That Are Too Big To Fail

    One reason that a lot of people are enamored with the Brown-Vitter approach to bank regulation is that it’s very simple, and everyone deep down sort of thinks that the simple answer has to be better than the complicated one. “You don’t need risk-based capital or stress tests or liquidity coverage ratios or VaR models […]

    / May 3, 2013 at 3:23 PM
  • Brown and Vitter, though don't ask me which is which.


    Bill To Make Banking Boring Actually Might Be Kind Of Fun

    There are a lot of things you can read about the Brown-Vitter bill recently, though it’s a really nice day out and you probably shouldn’t. It’s not … it’s not like a real thing is it? When the text of the bill, which would raise the equity capital requirements on big banks to ~15% on […]

    / May 1, 2013 at 5:22 PM
  • We ... love ... raising ... capital


    Deutsche Bank Goes Back To Improving Its Balance Sheet In The Traditional Ways

    I’m beginning to get the hang of how Deutsche Bank works, which seems to be: When they lose money, that strengthens their capital position, and When they make money, that weakens their capital position, requiring them to sell shares. Maybe? Three months ago we talked about how … well, I said “Deutsche Bank Improved Its […]

    / Apr 29, 2013 at 4:14 PM
  • Still not a lot of  pictures of him but he's working on it.


    Mike Corbat Gets An A- For The Quarter From Mike Corbat

    Citi announced its quarter this morning and there are various ways to tell that it was good, of which “the stock was up” is probably the main one. A possibly less objective test is that, back in March, Mike Corbat told everyone how he would grade himself, if he was grading himself. As he put […]

    / Apr 15, 2013 at 3:23 PM
  • The units are weird I guess? They're "pre-crisis standard deviations," meaning the standard deviation of each statistic measured up to 2007.


    Senate Bill May Solve Too-Big-To-Fail By Shrinking Banks By 70%

    The Brown-Vitter bill, which two senators plan to introduce in an effort to dramatically raise bank capital requirements, has caused a range of fairly predictable reactions, and a few strange ones. Here, for instance, is a lobbyist complaining about “raising required capital to comically high levels,” but the comedy is perhaps elusive. But one stylized […]

    / Apr 8, 2013 at 3:20 PM
  • vitter brown capital 2


    Some Senators Think Big U.S. Banks Could Use An Extra Trillion Dollars Or So Of Capital

    There’s a surprisingly large and vocal group of people who think that capital ratio requirements for large banks should be much higher than they are now (like, 15+%), and that those ratios should be based on total assets rather than any sort of regulatory risk-weighting. It’s surprising not because those are especially bad or counterintuitive […]

    / Apr 5, 2013 at 5:46 PM
  • Find the synthetic CDOs.


    Everybody Wins With Bespoke Synthetic CDOs

    Bloomberg this week had an article about how bespoke synthetic CDOs are coming back in vogue, and various people have fretted about that, because synthetic CDOs are scary, financial crisis, etc. And, sure, it’s certainly possible that the next financial crisis will be exactly like the last, only with more Cyprus.1 But today let’s talk […]

    / Mar 22, 2013 at 1:20 PM
  • One obvious interpretation of my Basel pictures is: I need a vacation.


    Banks Getting Less Risky And/Or More Tricksy

    It’s a good day to be wholly cynical about banks so let’s be mean to the Basel III monitoring exercise. This is a thing where periodically the BIS looks into how far away banks are from meeting their Basel III capital requirements, with about a nine-month lag. The answer is always “pretty far away,” which […]

    / Mar 19, 2013 at 1:46 PM
  • I have no idea what the boxes are?


    Goldman Analysts Hint That Deutsche Bank Should Consider Just Packing It Up And Going Back To Germany

    I realize it doesn’t actually work this way but I always imagine that sell-side analysts at big banks who cover other big banks enjoy sabotaging each other a little. “Take that, you Deutsche Bank jerks!,” Jernej Omahen might have thought as he hit send on this one: Deutsche Bank AG fell the most in more […]

    / Mar 1, 2013 at 1:07 PM
  • Hmm. Anyone got any other ideas?


    Mourn For The Derivative On Its Derivatives That Credit Suisse Wrote To Itself

    You may not believe this, but a few weeks ago I spoke to a business school class about the financial industry, and a student asked me “what would you say to someone who’s considering a career at an investment bank?” Somehow it did not occur to me to congratulate her on her humanitarian impulses. Instead, […]

    / Feb 27, 2013 at 1:23 PM
  • I've  missed you Bob! This is totally unfair, it was before his time; John Varley was CEO. Still.


    When No One Else Would Invest In Barclays, Barclays May Have Just Invested In Itself Itself

    We’ve talked a lot about bank capital today but there’s still time for one quick addendum. First, though, two rough-and-ready equations: Capital = cash paid in by shareholders plus retained earnings Capital ratio = capital divided by assets The first equation explains my puzzlement at the claim that Deutsche Bank “book[ed] a loss to boost […]

    / Jan 31, 2013 at 6:14 PM
  • Banks

    Survey: Investors Expect Banks To Meekly Over-Comply With Regulations Without Pushing Back On Anything

    On Monday, as a bevy of banks were settling a zillion dollars of mortgage lawsuits and putting themselves on a path to (1) certainty and (2) giving money back to shareholders, Goldman released a research note with the results of a survey of investors’ expectations of bank capital return.1 Here is what some sample of […]

    / Jan 9, 2013 at 11:03 AM
  • more cow


    Turns Out Global Regulators Are Fine WIth Using Credit Ratings To Decide What Banks Can Do

    It’s popular to say that financial markets and regulators have extremely short memories and so let’s say it about these new Basel liquidity coverage ratio rule changes out today. But not in an annoying sneery way. I mean, in an annoying sneery way, but not the obvious one. The story is that among the post-2008 […]

    / Jan 7, 2013 at 4:53 PM
  • not to scale


    Bank Of England, Everyone Else, Thinks Banks Are Lying About Capital

    Aaahhh I love the Bank of England’s latest Financial Stability Report. I mean: I haven’t read it, per se. But it follows the wonderful official-sector-report layout of blandly apocalyptic text running down the right side and lovely charts running down the left, so you can close one eye and it’s a delight. The charts are […]

    / Nov 29, 2012 at 12:00 PM

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