Here We go...............The Domino Affect
- Thread starter betterinvestmentthanshare
- Start date
I'm sure some financial institutions will find themselves being squeezed by current and future economic conditions associated with Covid-19, but when I had a quick look at this story...sorry I don't trust CNN to report the facts correctly, I found a Reuters article on same. Extract below.
https://www.reuters.com/article/us-...west-virginias-first-state-bank-idUSKBN21L35X
Business News
April 4, 2020 / 8:02 AM / 2 days ago
FDIC announces closure of West Virginia's First State Bank
1 Min Read
WASHINGTON (Reuters) - The U.S. Federal Deposit Insurance Corporation announced on Friday that West Virginia’s First State Bank had failed and its accounts were being taken over by MVB Bank, Inc., also of West Virginia.
The regulator said the bank had been closed on Friday by state regulators after “longstanding capital and asset quality issues.” Financial reports from the end of 2019 showed the bank operating with too little capital to legally stay open, the FDIC said.
The bank, which had $152.4 million in assets, is the first U.S. bank to fail since the coronavirus pandemic spread nationwide.
Reporting by Pete Schroeder; Editing by Sandra Maler
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The reason for the forced sales to MVBank appears driven by the financial position of First State Bank long before Covid-19 became an issue in Feb 2020.
In having a look at FSB's financials for 2017,2018 and 2019, this very small regional bank was going backwards (for 3 years prior) in a rising market with a shrinking balance sheet, a rapidly declining capital position (sub USD2.5m) during this time and losses in all three years....This bank was buggered long before Covid-19 came along and I suspect the FDIC had been watching them for a while and probably even arranged the partial buyout by MVBank
https://www.ibanknet.com/scripts/callreports/reportlist.aspx?ibnid=usa_627425&per=20191231&actn=open
This may cause some mum's and dad's / SME's pain but given this bank's small size I doubt this will create ripples in the US financial system. CNN linking this to coronvirus is irresponsible, untrue and lacks material facts such as the bank's poor past trading history which caused it's forced asset sale.
https://www.reuters.com/article/us-...west-virginias-first-state-bank-idUSKBN21L35X
Business News
April 4, 2020 / 8:02 AM / 2 days ago
FDIC announces closure of West Virginia's First State Bank
1 Min Read
WASHINGTON (Reuters) - The U.S. Federal Deposit Insurance Corporation announced on Friday that West Virginia’s First State Bank had failed and its accounts were being taken over by MVB Bank, Inc., also of West Virginia.
The regulator said the bank had been closed on Friday by state regulators after “longstanding capital and asset quality issues.” Financial reports from the end of 2019 showed the bank operating with too little capital to legally stay open, the FDIC said.
The bank, which had $152.4 million in assets, is the first U.S. bank to fail since the coronavirus pandemic spread nationwide.
Reporting by Pete Schroeder; Editing by Sandra Maler
---------------------------------------------------------------------------------------------------------------------------------------------------------------------
The reason for the forced sales to MVBank appears driven by the financial position of First State Bank long before Covid-19 became an issue in Feb 2020.
In having a look at FSB's financials for 2017,2018 and 2019, this very small regional bank was going backwards (for 3 years prior) in a rising market with a shrinking balance sheet, a rapidly declining capital position (sub USD2.5m) during this time and losses in all three years....This bank was buggered long before Covid-19 came along and I suspect the FDIC had been watching them for a while and probably even arranged the partial buyout by MVBank
https://www.ibanknet.com/scripts/callreports/reportlist.aspx?ibnid=usa_627425&per=20191231&actn=open
This may cause some mum's and dad's / SME's pain but given this bank's small size I doubt this will create ripples in the US financial system. CNN linking this to coronvirus is irresponsible, untrue and lacks material facts such as the bank's poor past trading history which caused it's forced asset sale.
isn't CNN FAKE NEWS?!
With the support the big Australian banks are getting from the federal government I believe they will definitely sale through this unscaved. It makes me wonder if bank shares at the moment would be a bit of a safe Harbour for part of a share portfolio?
Read. It's CCN not CNN.
Their site/logo/brand image used to be deceptively similar to CNN, for spruiking junk crypto coins.
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Fair point Roswell....my blind disdain for anything resembling CNN shining through.
Good morning and Good Friday to you all.
I would like to share a brisk morning discussion with a very dear friend; and see if you guys may care to comment:
=================
AgSt: All market fundamentals tell us the market is still expensive, studying market cycles of the past tell us we are due for more pain ahead.
But President Trump declared 2 days ago that they would not let businesses fail. They will pump them up, even buying their stock, to keep the market from crashing. Can anyone/anything oppose the might of the US self-centred Idiot?
So what would you do?
StockChaser: Trillions pumped into the markets worldwide. Where would this money land?
StockChaser: In the stockmarkets.
AgSt: OK. Best to chase stocks then?
StockChaser: Choose the right sectors.
AgSt: Ya. It will be a long while before I can do any chasing. By then, the market would have boomed past any credibility; or I will be one of very lucky few to pick the bottom. Haha
AgSt: With so many pricks around, I would bet that more and more bubbles will be busted in coming months/years.
StockChaser: The Stockmarket always factor in the risk. Always ahead of the economy. Fortune favours the brave.
StockChaser: Market is about mass psychology. The traders and investors form a view and enter or exit on this expectation.
AgSt: Only manipulated markets can factor in unknowns. Free markets can only factor in what is known (of the economy; not political, monetary or fiscal policies). What if the "whales" are manipulating "mass psychology"? Just another conspiracy theory....
I would like to share a brisk morning discussion with a very dear friend; and see if you guys may care to comment:
=================
AgSt: All market fundamentals tell us the market is still expensive, studying market cycles of the past tell us we are due for more pain ahead.
But President Trump declared 2 days ago that they would not let businesses fail. They will pump them up, even buying their stock, to keep the market from crashing. Can anyone/anything oppose the might of the US self-centred Idiot?
So what would you do?
StockChaser: Trillions pumped into the markets worldwide. Where would this money land?
StockChaser: In the stockmarkets.
AgSt: OK. Best to chase stocks then?
StockChaser: Choose the right sectors.
AgSt: Ya. It will be a long while before I can do any chasing. By then, the market would have boomed past any credibility; or I will be one of very lucky few to pick the bottom. Haha
AgSt: With so many pricks around, I would bet that more and more bubbles will be busted in coming months/years.
StockChaser: The Stockmarket always factor in the risk. Always ahead of the economy. Fortune favours the brave.
StockChaser: Market is about mass psychology. The traders and investors form a view and enter or exit on this expectation.
AgSt: Only manipulated markets can factor in unknowns. Free markets can only factor in what is known (of the economy; not political, monetary or fiscal policies). What if the "whales" are manipulating "mass psychology"? Just another conspiracy theory....