homeBee.png

Banks Haircutting Bank Accounts.

  • Post reply
2 replies [Last post]
16 July 2011 - 10:56pm
Peter Skinner
Peter Skinner's picture
Offline
Joined: 29 Jan 2009
EmailEmail
Recommend

Hi

A friend told me about some law comming in to allow that gives the government or bank,s control of their clients bank accounts to the extent the banks can take (hair cut) a persentage of the cash from accounts. It did in Demark with the amagerbanken bankruptcy.

Does anyone know about this law?

There is some material relating to it here

http://www.rbnz.govt.nz/finstab/banking/4335146.pdf

Thank you..

Top
17 July 2011 - 1:27pm
#1
Phil Astley
Phil Astley's picture
Offline
Joined: 11 Feb 2006

Didn't know about it - and having skimmed it don't know that its a law or a policy that doesn't require legislation.

I note it says "On balance, it is recommended that all locally incorporated banks with retail funding over $1 billion be required to pre-position." Not being up with the play, this leaves me with two uncertainties. How far down does ths come? (e.g. I assume Kiwibank is affected? Who else?)

The other and potentially more worrying thing is what does it mean by "locally incorporated banks". I seem to recall (going back well over a decade) that not all banks (and I think that the Government's own banker - Westpac - is one) are incorporated here. Instead they are simply branches of Aussie (or further offshore) banks.

I guess the alternative could be pretty bad - but shows the importance of sound controls on credit, etc. I don't know how Lloyds is affected these days - but since they sold National to ANZ all our major banks are owned in Australia or NZ and seem to have survived the meltdown pretty well. Let's just hope this never gets tested.

Phil Astley
www.businessacademy.co.nz

Top
  • reply
18 July 2011 - 12:03am
#2
Peter Skinner
Peter Skinner's picture
Offline
Joined: 29 Jan 2009

I just have a bad feeling about the USD. I feel that its got to fail. Maybe I should feel bad about the NZD too. Perhaps I should buy some silver and Bury it out back..

P.S Where can I buy Silver?

Top
  • reply

Post new comment

CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.
1 + 2 =
Solve this simple math problem and enter the result. E.g. for 1+3, enter 4.
To prevent automated spam submissions leave this field empty.