90 Banks on FDIC's problem watch list

Discussion in 'Wall St. News' started by The Kin, Jul 12, 2008.

  1. jasonjm

    jasonjm

    maybe someone on this site can backwards engineer it using FDIC methodology?

    http://www.thought-criminal.org/article/node/1655

    "Texas Ratio: Cassidy and his colleagues have developed an early-warning system for spotting future trouble at banks called the Texas Ratio. The ratio is calculated by dividing a bank’s non-performing loans, including those 90 days delinquent, by the company’s tangible equity capital plus money set aside for future loan losses. The number basically measures credit problems as a percentage of the capital a lender has available to deal with them."
     
  2. m22au

    m22au

    The article you listed specifically mentions IMB (done), UCBH, STSA, CNB and EWBC.

     
  3. jasonjm

    jasonjm


    wow the shorts have already dug in deep to those 4. EWBC looks the least shorted of the 4, but still 20% of its 52 week high

    Ouch.
     
  4. m22au

    m22au

    For what it's worth, the charts of DSL, FED and BKUNA suggest that these three are very close to failure. BKUNA recently announced a stock offering that sent the stock price below 1.
     
  5. Hundreds of small irrelevant banks went under in the S&L crisis. This is part of the clean-up. However, it will get critical if big boys like C, WB, JPM, BAC go under.
     
  6. BTPicker

    BTPicker

    "Texas Ratio: Cassidy and his colleagues have developed an early-warning system for spotting future trouble at banks called the Texas Ratio. The ratio is calculated by dividing a bank’s non-performing loans, including those 90 days delinquent, by the company’s tangible equity capital plus money set aside for future loan losses. The number basically measures credit problems as a percentage of the capital a lender has available to deal with them."

    R = ratio
    NPL= Non performing loans including 90 days delinquent
    TEC = tangible equity capital
    FLLC = Future loan loss capital

    R = NPL/(TEC + FLLC)

    Now, where to easily find the data to plug into equation?
     
  7. Altius

    Altius

    @jasonjm Thanks ..I was looking for Texas Ratio.. it's very helpful...
     
  8. It will be fun when Wikileaks discloses the Swiss bank numbered a/c details of people involved in tax evasion and money laundering.
     
  9. jokepie

    jokepie


    This text book Economics in any B school. Consolidation every 10 or so years. big deal. Just learn to use it in you advantage. Next time all TV channels talk about CRISIS go buy some puts and save you 401K.
    Get rich next time.
     
    #10     Oct 28, 2010