Cooperative Bank of London Bail-In

[Lin ASL Ebron]

How was this different from what happened in MF Global?  People who purchased bonds were promised a certain percentage rate of interest and now the contracts have been rewritten.  Am I understanding this correctly?

 

https://www.youtube.com/watch?v=qvNeshT-9Nw

 

Agape'

[trottigy]

 

The Co-operative Group has plunged to a £559m first-half loss as bad debts in its banking arm wiped out profits from its supermarkets.

 

The group said there would be no quick fixes as it embarked on a four-year turnaround plan, after reporting pre-tax losses of £709.4m in the Co-operative Bank in the six months to the end of June.

 

The Prudential Regulation Authority (PRA), the City regulator, said the scale of the losses did not alter its demand that the Co-op plug the £1.5bn hole in its balance sheet.

 

The Co-op, which employs more than 100,000 people, warned of job losses as it restructures the wider group as well as the bank - but did not say how many staff will go.

 

http://www.theguardian.com/business/2013/aug/29/co-operative-bank-loses-709m

 

It seems the difference is - for MF Global taxpayer money was used to "bail" it out, but here private investors (all the people in the co-op) are paying. note: by "paying" the meaning is - not getting back as much as they anticipated.

 

There is always a risk when a person invests in something - even a bank. In this case they are more than just a bank - they are a "co-op". They own supermarkets, banks, etc. When you invest in a company you invest in its managers as well as its products. In this case, the managers didn't do a very good job of vetting the Britannia Building Society when they took it over in 2009. Oops!

Edited August 30, 2013 by trottigy

[Lin ASL Ebron]

http://www.youtube.com/watch?v=fyVOJPDYp34

 

According to former regulator William K. Black (savings and loan crisis), money was taken from depositors and used to pay JP Morgan.  In addition, Gerald Celente lost money as a MF Global customer  http://www.youtube.com/watch?v=-MrYmxuz0ik

 

Please share the information about the taxpayers' participation.

 

Thanks

[trottigy]

Sorry, for some reason I thought MF Global was a bank. But I see it is not. Instead it is a brokerage and investment firm also.

 

As such, they too should not be given a "bail-out" but rather should have to go through bankruptcy due to their poor decision making.

 

I see they have and fortunately - at least for the investors - they will get 100% of their money back.

http://www.bloomberg.com/news/2013-08-22/mf-global-judge-delays-approval-of-cftc-settlement.html

 

That said, they are a good warning lesson to any one else who "invests" their money. When we "invest" in a company returns aren't guaranteed. As the old saying goes - "past performance is not a guarantee of future returns." They can go bankrupt - as this company did.

 

It is good to see that they were handled correctly - unlike Lehman brothers! To Lehamn brothers - NO ONE that I have heard has been held accountable - YET! The Kingdom is coming and it is a great equalizer and deliverer of justice!

 

May that Kingdom come soon.

Edited August 30, 2013 by trottigy

[Mei]

It is good to see that they were handled correctly - unlike Lehman brothers! To Lehamn brothers - NO ONE that I have heard has been held accountable - YET! The Kingdom is coming and it is a great equalizer and deliverer of justice!

 

May that Kingdom come soon.

We have an unfair system all-the-way-around... from political foreign policy favoritism to political corporate greed at its best... not to mention the political monetary preferential treatment given to those personally connected to some giant investment firms/corporate companies - with Bear Sterns getting the preferential government bailouts and not Lehman.

 

I read earlier reports that asserted Lehman CEO and three (I believe) other accounting managers were arrested for falsifying financial records and are being made accountable for the fall of Lehman.  Not sure of the outcome of their case(s) or if they have already faced trial.   

 

Indeed, may Jehovah’s Kingdom come very soon!

Edited August 31, 2013 by Mei

[Mei]

[Cont'd on Lehman Brothers...]

 

There are claims that while these accounting managers (at Lehman) were deceitful in their transactions, their dishonet activity was not "illegal" - but yet had managed to violate the Sarbanes-Oxley Act - go figure! In taking accounting and finance classes about five or six years ago, the educational system is teaching that the Sarbanes-Oxley (claiming it's too convoluted and difficult to implement) will be replaced with an international accounting practices act.

 

Indeed, may Jehovah’s Kingdom come very soon!

Edited August 31, 2013 by Mei

[Qapla]

... As the old saying goes - "past performance is not a guarantee of future returns." They can go bankrupt ...

 

 

So true. Who would have thought that Kodak, a company that was founded in 1888 and during most of the 20th century Kodak held a dominant position in photographic film would have, in January 2012, filed for Chapter 11 bankruptcy protection.

 

In January 2013, a court approved financing for the company to emerge from bankruptcy .... we will see how they do.

 

Yes, any company can go under and "investing" has NO guarantees.

[Musky]

So true. Who would have thought that Kodak, a company that was founded in 1888 and during most of the 20th century Kodak held a dominant position in photographic film would have, in January 2012, filed for Chapter 11 bankruptcy protection.

 

In January 2013, a court approved financing for the company to emerge from bankruptcy .... we will see how they do.

 

Yes, any company can go under and "investing" has NO guarantees.

 

The death of film has hurt the whole film industry. Many of my friends and family in the post-production labs have been laid off over the last few years. And these are people who made very good money. Some spent their whole lives working with film (editing, cutting, screening, developing, printing etc) and they can't find jobs that pay near what they were earning before digital took over! I got out of the business in 2003 when digital was just starting to make inroads into the motion picture business. It is now cheaper for the studios and theaters to produce and screen films, but have ticket prices dropped? I think not!

[Qapla]

Yes, film has had to give way to digital. My only reason for mentioning Kodak is that, such an old, prestigious, giant of a company can NOT offer any better guarantees then a startup ... investments are NOT guaranteed.