Exam 1 articles - FIN408 Articles for Exam I B of A readies...

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FIN408- Articles for Exam I B of A readies the knife -largest U.S. bank by assets -$5 billion cut in consumer-related expenses by end of 2013, and 30,000 jobs (want to cut efficiency ratio from 63 to 55%, which is costs/revenue)… 74% industry avg. -Wells Fargo plans 12% cost cut by end of 2012 -PNC will trim 6% in 2012 -new global capital requirements go into effect 2013 Debit or Credit? Citi Places Its Bet -346 million card offers in mail for 3Q.. $240 million (at upwards of 70 cents per) -Durbin amendment to Dodd-Frank act will limit fees collected by banks from merchants every time a DEBIT card is swiped, making debit cards less attractive for banks Citi wants customers to use credit cards instead -more debit card than credit card transactions in 2009 (38 billion to 21.7 bill) Europe Lending Woes Deepen -banks tap European Central Bank for more dollars for loans to U.S. customers -need the U.S. currency to fund existing loans and to repay past borrowings made in dollars, such as loans from U.S. money-market funds -Moody’s downgraded Societe Generale and Credit Agriole -17 eurozone countries. -European banks have lost access to +$700 billion in U.S. dollar funding because of worry about exposure to Greece and other troubled economies European Bank Shares Slump -caused by weak economic data, litigation, sovereign debt exposure, possible non- performing loans -market value per share < book value per share -some European banks being sued by U.S. housing agency Fed Examines Capital One- ING Deal
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