Spanish
Banks Risk Loan-Book Losses as Economy Shrinks, IMF Says - (www.bloomberg.com) The International Monetary Fund said Spain’s recession is putting the
country’s lenders at risk of a further deterioration on their loans. “The macro
downsides could trigger a negative feedback loop between credit and the
economy, with deteriorating loan books and pressure on profits,” the IMF said
in a report today. Banks should continue to “reinforce the quality and quantity
of capital, including by being very prudent on cash dividends.” Spanish banks’
bad loans rose in April to 10.9 percent of their total lending from 10.5
percent a month earlier as companies and individuals are buffeted by a
contraction that pushed unemployment to
27 percent. Economy Minister Luis de Guindos said yesterday lenders will need 2
billion euros ($2.7 billion) of capital to offset losses related to new rules
that demand higher provisions for refinancing and restructured loans.
China
cash crunch deepens as PBOC withholds funding - (www.ft.com) China’s
cash crunch deepened yesterday/WEDNESDAY after the central bank withheld
funding from the financial system, putting pressure on overextended lenders. Short-term interbank
rates jumped more
than 200 basis points to a record high of nearly 8 per cent for loans of one
month or less, in the latest indication of how tight credit has become in
China. The main reason for the lack of liquidity has been the central bank’s reluctance to pump liquidity into the money market, wrongfooting banks that
had expected Beijing would continue to support them with large cash injections.
Signalling that the cash crunch could persist for a while, the China Securities
Journal, a major state-run newspaper, ran a front-page commentary saying China
was at a turning point in monetary policy. “We cannot use as fast money supply
growth as in the past, or even faster, to promote economic growth,” the
newspaper said. “This means that authorities must control the pace of money
supply growth.”
CMBS
Sales Face $15 Billion Drop on Interest-Rate Jump, S&P Says - (www.bloomberg.com) Rising interest
rates may
trim issuance of commercial-mortgage bonds by $15 billion this year, according
to Standard & Poor’s.
An increase of 55 basis points on 10-year
Treasury yields coupled with a rise of 30 basis points on relative yields on
top-ranked securities linked to property loans will put a damper on the
resurgent market, S&P analysts led by Howard Esaki said yesterday in a note
to clients. The analysts estimate 2013 sales of $65 billion after adjusting for
the rising rates. Commercial-mortgage bond sales that Credit Suisse Group AG
says are poised to climb as much as 50 percent to $70 billion are being checked
by investor concern that the Federal
Reserve will
soon pare $85 billion of monthly bond purchases. The unprecedented stimulus has
suppressed interest rates and pushed investors into higher-yielding assets.
Bernanke
Exit Signaled by Obama Means Tapering, Feldstein Says - (www.bloomberg.com) President
Barack Obama clearly signaled this week that Federal Reserve chairman Ben S.
Bernanke will
be leaving the central bank when his term ends in January and that looming
departure means Bernanke will want to begin tapering asset purchases this year,
said Harvard University economics professor Martin
Feldstein.
The Fed has been making $85 billion in monthly bond purchases in an effort to
spur job growth and galvanize faster U.S. economic expansion. The policy making Federal Open Market Committee is meeting today in Washington, with four
more FOMC meetings scheduled before the end of the year.
6
Indicted for Scam Involving Inflated Appraisals and Kickbacks - (www.mortgagefraudblog.com) According
to the 21 count indictment, Tibakweitira was a real estate agent forCentury
21 Advantage Realty and its successor, Elite Real Estate Group.
Tibakweitira recruited his wife Makundi, and others, including Wambura,
Mwihava and Boas, to act as straw purchasers of homes. Johnson owned CJ
Lending and Able Estate & Company which provided credit
repair services. The indictment alleges that from March 2007 to November 2008,
the defendants sought mortgages for properties at values in excess of the
properties’ actual market values. Tibakweitira allegedly procured
inflated appraisals and created false addendums to the sales contracts
requiring large amounts of loan proceeds to be disbursed for renovations or
repairs. The defendants allegedly used stolen or false identities, false
documents – including W-2 forms, earnings statements, and bank statements – and
false credit information to induce lenders to provide residential mortgage
loans to the straw buyers. Large amounts of the proceeds of the fraudulently
obtained loans were allegedly disbursed from escrow accounts to Destiny
Property Management, LLC andDestiny Property Management Company, which
were shell companies owned byTibakweitira, for repairs and renovations that
were never made.
Kuroda
Says BOJ Can Ease More If Conditions Change Significantly - (www.bloomberg.com)
PBOC Sacrifices Growth as Bank Curbs Invert Swaps - (www.bloomberg.com)
PBOC Sacrifices Growth as Bank Curbs Invert Swaps - (www.bloomberg.com)
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