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Chase Bank loss...another case of cooking the books?
Rank: Elder Joined: 6/23/2009 Posts: 13,487 Location: nairobi
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murchr wrote:gk wrote:Run, run, run..... Not every other massive withdrawal will cause a bank to collapse. Equity did not lose much relative to its total deposit base n its was not a one day drainage. Even last yr after Imperial's fall most smaller lenders had a run but survived just as Chase would have remained afloat had they managed to plug the huge n sudden hole by the following morning.
So long as you can honour your settlemnts at CBK,,, there is a lifeline.
Methinks Chase had some few heavy depositors who jumped ship on the day.... coz they could have survived a run by retail depositors. Sports Pesa Seconded.. That movement caused the collapse
HF 30,000 ABP 3.49; KQ 414,100 ABP 7.92; MTN 23,800 ABP 6.45
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Rank: Veteran Joined: 9/21/2011 Posts: 2,032
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So if those tweets are anything to go by, it means these published financial statements are just paper exercises and nobody really looks at them? What does nsisi & cbk do? And now that we're here, can someone re-check and explain like a 2 yr old how even tier 1 banks have been declaring double digit growths year in year out when economy is growing sub 5%?
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Rank: Member Joined: 3/23/2011 Posts: 503
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limanika wrote:So if those tweets are anything to go by, it means these published financial statements are just paper exercises and nobody really looks at them? What does nsisi & cbk do? And now that we're here, can someone re-check and explain like a 2 yr old how even tier 1 banks have been declaring double digit growths year in year out when economy is growing sub 5%? Yes. Creative. Its like dating online. And yes, i write from a point of knowledge. Even a BrOKeN clock is right twice a day
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Rank: Elder Joined: 4/22/2010 Posts: 11,522 Location: Nairobi
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A solution has been found... possunt quia posse videntur
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Rank: Elder Joined: 9/20/2015 Posts: 2,811 Location: Mombasa
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limanika wrote:So if those tweets are anything to go by, it means these published financial statements are just paper exercises and nobody really looks at them? What does nsisi & cbk do? And now that we're here, can someone re-check and explain like a 2 yr old how even tier 1 banks have been declaring double digit growths year in year out when economy is growing sub 5%? They do declare double digits growth annually by understating provision for bad debts . IMF warned them last year. If provision for bad debts, bad debts and NPLs were looked into properly, growth rate in the banking industry will hinge on single digit in tandem to economic growth. Opus Dei will continue implementing policies till normalcy is restored in the financial sector. John 5:17 But Jesus replied, “My Father is always working, and so am I.”
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Rank: Veteran Joined: 9/21/2011 Posts: 2,032
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Rollins wrote:limanika wrote:So if those tweets are anything to go by, it means these published financial statements are just paper exercises and nobody really looks at them? What does nsisi & cbk do? And now that we're here, can someone re-check and explain like a 2 yr old how even tier 1 banks have been declaring double digit growths year in year out when economy is growing sub 5%? Yes. Creative. Its like dating online. And yes, i write from a point of knowledge. So if I could ask hypothetically - a player that could have cheated their way online the last 5-10 years, what will it take to correct? Report flat growth for next few yrs?
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Rank: Veteran Joined: 9/21/2011 Posts: 2,032
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Spikes wrote:limanika wrote:So if those tweets are anything to go by, it means these published financial statements are just paper exercises and nobody really looks at them? What does nsisi & cbk do? And now that we're here, can someone re-check and explain like a 2 yr old how even tier 1 banks have been declaring double digit growths year in year out when economy is growing sub 5%? They do declare double digits growth annually by understating provision for bad debts . IMF warned them last year. If provision for bad debts, bad debts and NPLs were looked into properly, growth rate in the banking industry will hinge on single digit in tandem to economic growth. Opus Dei will continue implementing policies till normalcy is restored in the financial sector. By the way, I started smelling a big fat rat those days when member started doubling profits ever year. But the rat was not in member, but other players that had to 'increase speed' so member doesn't catch up, or to keep pace. It's been a roller coster ever since but reality slowly creeping in...
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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Chase Bank was an internal coup that went wrong. http://www.nation.co.ke/...18/-/9tl34d/-/index.htmlLife is short. Live passionately.
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Rank: Veteran Joined: 9/21/2011 Posts: 2,032
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[quote=sparkly]Chase Bank was an internal coup that went wrong. http://www.nation.co.ke/...8/-/9tl34d/-/index.html[/quote] Why would anyone do a coup for such difficult job? Unless intentions weren't good either?
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Rank: Elder Joined: 7/22/2009 Posts: 7,452
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gk wrote:Much Know wrote:Just to correct this bullshit idea being sold here that "no bank can withstand a run", hio ni ujinga ya 19th century. A modern bank should be able to withstand run, and often carries out tests on it's own called "stress tests", these are simple tests that can be carried out by any serious banker and central bank (it is apparently what they are doing now). Those who were keen during the 2008 financial crisis will remember banks like JP Morgan emphasizing they are ready for a run. There are credit risk analysis, liquidity analysis etc to ensure in any case you can quickly convert some assets to cover "mass withdrawas", lakini kama umeweka pesa Panama ama in speculatory burotis and apartments in Nairobi shauri yako. THERE IS NO WAY ON EARTH social media can bring down a bank! CBK governor ongeza stress!!!! I will take that as a joke! I am also hoping it is a joke. Social media has brought down governments as we watched and this fellow is saying it cannot bring down a bank??? Seriously??? Those who were not born in 2010 need to read about the Arab Spring to see the power of Social Media. They also need to talk to Obama and ask him how he raised record breaking campaign funds and won his first election against all odds and the will know the power of Social Media. In the Chase story, the directors and management created the mess, social media caused the run, the run made meeting obligations impossible, inability to meet obligations necessitated the receivership!!! Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Elder Joined: 7/22/2009 Posts: 7,452
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sitaki.kujulikana wrote:were bank runs during the gold era same as today, most transactions are electronic nowadays. I thought a run should be easier to manage as opposed to when everyone would come to collect their gold or promissory notes or whatever paper money is. How do you manage??? Refuse to give people their money?? Jam systems?? Do you know the consequences of these actions?? Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Elder Joined: 7/22/2009 Posts: 7,452
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sitaki.kujulikana wrote:Much Know wrote:alma1 wrote:murchr wrote:Much Know wrote:Just to correct this bullshit idea being sold here that "no bank can withstand a run", hio ni ujinga ya 19th century. A modern bank should be able to withstand run, and often carries out tests on it's own called "stress tests", these are simple tests that can be carried out by any serious banker and central bank (it is apparently what they are doing now). Those who were keen during the 2008 financial crisis will remember banks like JP Morgan emphasizing they are ready for a run. There are credit risk analysis, liquidity analysis etc to ensure in any case you can quickly convert some assets to cover "mass withdrawas", lakini kama umeweka pesa Panama ama in speculatory burotis and apartments in Nairobi shauri yako. THERE IS NO WAY ON EARTH social media can bring down a bank! CBK governor ongeza stress!!!! Why cant you just name one bank that you know has undergone this kind of "stress test". Is that JP Morgue the same bank that imposed withdrawal limits? He can't name one. Even his Waiguru did not survive a run. Ziko zimefanya hii Kenya for sure!!! And they can't collapse! Hata social media iseme aje! I remember sometime back when rumors were doing the rounds that equity was collapsing and a lot of guys started withdrawing cash, I wonder how member handled that, even my folks got out their pension money. It was by word of mouth. The effect was not that much. But when someone purporting to be an authority publishes stories with half truths online and the links to those stories forwarded all over, it is a thousand times worse. Look at the stories that were doing rounds on social media. They originated from less than 5 fellows. And they reached millions by the end of the day because of Facebook, WhatsApp groups etc. A fellow in three groups with 50 members each forwards to each of the groups. Each of the 150 members forwards to 3 other groups with 50 members each; we are at 150 * 150 = 22,500 (from 1) by the second forward. And that can take less than 2 minutes. Do the math for the third, fourth, fifth forward... That therein is the power of Social media. Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Elder Joined: 11/5/2010 Posts: 2,459
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Rollins wrote:limanika wrote:So if those tweets are anything to go by, it means these published financial statements are just paper exercises and nobody really looks at them? What does nsisi & cbk do? And now that we're here, can someone re-check and explain like a 2 yr old how even tier 1 banks have been declaring double digit growths year in year out when economy is growing sub 5%? Yes. Creative. Its like dating online. And yes, i write from a point of knowledge. It will be interesting to see how ceos of tier 1 bank's will explain the dramatic fall in profits. Dr. Njoroge has forced all of them to undertake an IT systems audit by June this year. Some of the shenanigans they have been up to. A huge loan say 1bn is not performing and the client is in arrears of say 3 instalments. On 20th December, the loan is restructured and all arrears moved back to the main loan account. By 31st Dec, they understate the npls and provide for less than they should. Another one is number of accounts. The number reported is way higher than the actual active accounts. With the IT audit, the party is over.
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Rank: Veteran Joined: 4/27/2010 Posts: 951 Location: Nyumbani
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[quote=Mike Ock]A good summary of Manwa Magoma's tweets on the matter. Read from bottom to top: https://storify.com/Manw...financial-records-story[/quote] Wow brilliant , and this guy says he is not even an auditor ! and someone calls himself an auditor after going to school for sijui how long and does not even come 20% to such a summary.
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Rank: Elder Joined: 12/25/2014 Posts: 2,300 Location: kenya
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FRM2011 wrote:Rollins wrote:limanika wrote:So if those tweets are anything to go by, it means these published financial statements are just paper exercises and nobody really looks at them? What does nsisi & cbk do? And now that we're here, can someone re-check and explain like a 2 yr old how even tier 1 banks have been declaring double digit growths year in year out when economy is growing sub 5%? Yes. Creative. Its like dating online. And yes, i write from a point of knowledge. It will be interesting to see how ceos of tier 1 bank's will explain the dramatic fall in profits. Dr. Njoroge has forced all of them to undertake an IT systems audit by June this year. Some of the shenanigans they have been up to. A huge loan say 1bn is not performing and the client is in arrears of say 3 instalments. On 20th December, the loan is restructured and all arrears moved back to the main loan account. By 31st Dec, they understate the npls and provide for less than they should. Another one is number of accounts. The number reported is way higher than the actual active accounts. With the IT audit, the party is over. Depends on who will be doing the IT audit.of it's the same guys who did financial audits ,then expect machokorio too
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Rank: Elder Joined: 2/26/2012 Posts: 15,980
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"There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
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Rank: Elder Joined: 11/5/2010 Posts: 2,459
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enyands wrote:FRM2011 wrote:Rollins wrote:limanika wrote:So if those tweets are anything to go by, it means these published financial statements are just paper exercises and nobody really looks at them? What does nsisi & cbk do? And now that we're here, can someone re-check and explain like a 2 yr old how even tier 1 banks have been declaring double digit growths year in year out when economy is growing sub 5%? Yes. Creative. Its like dating online. And yes, i write from a point of knowledge. It will be interesting to see how ceos of tier 1 bank's will explain the dramatic fall in profits. Dr. Njoroge has forced all of them to undertake an IT systems audit by June this year. Some of the shenanigans they have been up to. A huge loan say 1bn is not performing and the client is in arrears of say 3 instalments. On 20th December, the loan is restructured and all arrears moved back to the main loan account. By 31st Dec, they understate the npls and provide for less than they should. Another one is number of accounts. The number reported is way higher than the actual active accounts. With the IT audit, the party is over. Depends on who will be doing the IT audit.of it's the same guys who did financial audits ,then expect machokorio too An international consultant hired by cbk but paid by the banks themselves. It's really hot in the bank's kitchens. I know someone whose huge loan has been non-performing from 2009. It's been restructured so many times mpaka they don't know which letter of offer is valid. Btw that story of three local banks overtaking multinationals, let's wait for this year.
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Rank: Elder Joined: 12/25/2014 Posts: 2,300 Location: kenya
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FRM2011 wrote:enyands wrote:FRM2011 wrote:Rollins wrote:limanika wrote:So if those tweets are anything to go by, it means these published financial statements are just paper exercises and nobody really looks at them? What does nsisi & cbk do? And now that we're here, can someone re-check and explain like a 2 yr old how even tier 1 banks have been declaring double digit growths year in year out when economy is growing sub 5%? Yes. Creative. Its like dating online. And yes, i write from a point of knowledge. It will be interesting to see how ceos of tier 1 bank's will explain the dramatic fall in profits. Dr. Njoroge has forced all of them to undertake an IT systems audit by June this year. Some of the shenanigans they have been up to. A huge loan say 1bn is not performing and the client is in arrears of say 3 instalments. On 20th December, the loan is restructured and all arrears moved back to the main loan account. By 31st Dec, they understate the npls and provide for less than they should. Another one is number of accounts. The number reported is way higher than the actual active accounts. With the IT audit, the party is over. Depends on who will be doing the IT audit.of it's the same guys who did financial audits ,then expect machokorio too An international consultant hired by cbk but paid by the banks themselves. It's really hot in the bank's kitchens. I know someone whose huge loan has been non-performing from 2009. It's been restructured so many times mpaka they don't know which letter of offer is valid. Btw that story of three local banks overtaking multinationals, let's wait for this year. The highlighted is a funny statement. Though you know how it rolls in kenya. Should anything happen like auction their stuff ,they will run to courts and depending of whose there eg tonoi then your case will be squashed .but I love the CBK move .
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Rank: Member Joined: 1/22/2015 Posts: 682
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Blogger Owaahh, who thoroughly researched the Imperial Bank case, now has come with another good analysis, not only of the current banking situation, but of the history of bandia banks in Kenya. I'm sorry Chase Bank depositors, directors have been fleecing banks since the 80s and so far no restitution or jailtime: http://owaahh.com/kenyan-banks-fail/
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Rank: Chief Joined: 5/9/2007 Posts: 13,095
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maka wrote:A solution has been found... Eish bana...si utoe at least a clue of this solution. Does it include re-opening? If so how will a continuation of the run be avoided? Will it be swallowed by an existing bank?
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Chase Bank loss...another case of cooking the books?
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