Showing posts with label kiwibank. Show all posts
Showing posts with label kiwibank. Show all posts
Friday, January 16, 2009
Revisting Kiwibank (to be done...)
It will be interesting to revisit the question of banks and adequecy given the apparent meltdown in the global financial markets over the past period of time - not least to contrast the movements of this "pillar" in the NZ market versus the exposed international banks; but also versus my pet favorite TSB. Not least to see whether the inclusion of KiwiBank by the media in the "major banks" categorisation is warranted, as versus the exclusion of both TSB and HSBC from this reporting...
Sunday, August 10, 2008
KiwiBank - the safest haven. Tui Ad in the making
I have been intrigued by the rumors being floated recently - mainly seeming to originate from the political left about how Kiwibank is the one safe bank at the moment; especially in this time of sub prime debt.
However putting aside the point that the only registered bank to have previously become bankrupt in New Zealand was the BNZ while it was a Labour Government controlled SOE, I decided to do a bit more digging.
And find that according to the Reserve Banks own data Kiwibank actually has the worst without exception level of capital reserves. Kiwibank only hold 7.2% of Tier 1 assets and 9.5% of Tier 2; in comparison to 14.94% and 15.58% for RaboBank and a huge 17.66% for both Tier 1 and 2 held by the TSB.
Going even further Kiwibank doesn't even have a provision for impaired assets - so despite the current marketing downturn they are providing for no losses due to -ve equity. This is comparison to the smallest provision by any other bank being the ASB at over 3% of profit; with most banks allowing for between 5 - 8%. Personally the bank I would see as most susceptible to housing loan shocks would be the one making absolutely no allowance nor financial planning for it whatsoever...
Also of curiosity has to be the 5.3% of Kiwibanks credit exposure that is across only 13 people?
So really one has to question how the least profitable, lowest profit on assets, lowest capital reserves, no provisions bank is the safe one? But when it comes to political left and KiwiBank it seems logic isn't really necessary - hence why we have the white elephant in the first place.
However putting aside the point that the only registered bank to have previously become bankrupt in New Zealand was the BNZ while it was a Labour Government controlled SOE, I decided to do a bit more digging.
And find that according to the Reserve Banks own data Kiwibank actually has the worst without exception level of capital reserves. Kiwibank only hold 7.2% of Tier 1 assets and 9.5% of Tier 2; in comparison to 14.94% and 15.58% for RaboBank and a huge 17.66% for both Tier 1 and 2 held by the TSB.
Going even further Kiwibank doesn't even have a provision for impaired assets - so despite the current marketing downturn they are providing for no losses due to -ve equity. This is comparison to the smallest provision by any other bank being the ASB at over 3% of profit; with most banks allowing for between 5 - 8%. Personally the bank I would see as most susceptible to housing loan shocks would be the one making absolutely no allowance nor financial planning for it whatsoever...
Also of curiosity has to be the 5.3% of Kiwibanks credit exposure that is across only 13 people?
So really one has to question how the least profitable, lowest profit on assets, lowest capital reserves, no provisions bank is the safe one? But when it comes to political left and KiwiBank it seems logic isn't really necessary - hence why we have the white elephant in the first place.
Friday, June 01, 2007
KiwiBank - the real one
Hattip: Stuff
TSB Bank has yet again shown what an incredible waste of taxpayers money the white elephant of KiwiBank truely is.
It "has posted a $34.8 million after-tax profit for the year to March, 11.3 per cent ahead of last year and its 20th successive record profit."
While still retaining "the lowest two-year fixed interest rate on the market for the past seven months."
In terms of risk and return:
TSB's capital adequacy ratio of 16.08 per cent was the highest of any bank in the country and more than double the international standard of 8 per cent.
Return on average assets of 1.28 per cent compared with the benchmark of 1 per cent.
And that is right, while returning a return to the community - not continuing to bleed the poor NZ public for more and more capital injections. Go to Taranaki at some point and see the levels of public infrastructure funded by the TSB and you'll get the idea. The TSB does more for Taranaki than the local body council (although that's hardly surprising - they are too busy building themselves new offices and water features).
But of course without KiwiBank we wouldn't have a(nother) monument to the stupidity of Jim Anderton and the failure of left wing dogma.
TSB Bank has yet again shown what an incredible waste of taxpayers money the white elephant of KiwiBank truely is.
It "has posted a $34.8 million after-tax profit for the year to March, 11.3 per cent ahead of last year and its 20th successive record profit."
While still retaining "the lowest two-year fixed interest rate on the market for the past seven months."
In terms of risk and return:
TSB's capital adequacy ratio of 16.08 per cent was the highest of any bank in the country and more than double the international standard of 8 per cent.
Return on average assets of 1.28 per cent compared with the benchmark of 1 per cent.
And that is right, while returning a return to the community - not continuing to bleed the poor NZ public for more and more capital injections. Go to Taranaki at some point and see the levels of public infrastructure funded by the TSB and you'll get the idea. The TSB does more for Taranaki than the local body council (although that's hardly surprising - they are too busy building themselves new offices and water features).
But of course without KiwiBank we wouldn't have a(nother) monument to the stupidity of Jim Anderton and the failure of left wing dogma.
Friday, May 18, 2007
KiwiBank Home Loan Sale
Anyone else fascinated by the KiwiBank home loan sale on at the moment?
In that the only bank currently discounting rates in the face of the rhetoric of the housing market causing inflation seems to be the Government owned bank?
So the questions would have to be -
Has KiwiBank been given the OK because the Government really does acknowledge that it is their spending that is inflationary, not just the housing market?
Is KiwiBank the only bank that can sustain these squeezed margins, because at it's heart the money returned to the Reserve Bank via the OCR still has the same shareholder...
Does KiwiBank know something about the future direction of NZ's monetary policy that the other banks don't?
In that the only bank currently discounting rates in the face of the rhetoric of the housing market causing inflation seems to be the Government owned bank?
So the questions would have to be -
Has KiwiBank been given the OK because the Government really does acknowledge that it is their spending that is inflationary, not just the housing market?
Is KiwiBank the only bank that can sustain these squeezed margins, because at it's heart the money returned to the Reserve Bank via the OCR still has the same shareholder...
Does KiwiBank know something about the future direction of NZ's monetary policy that the other banks don't?
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