Do Banks Wait Until Economic Downturns to Build Up Loan-Loss Reserves?

first_img Demand Propels Home Prices Upward 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago Home / Daily Dose / Do Banks Wait Until Economic Downturns to Build Up Loan-Loss Reserves? in Daily Dose, Featured, Market Studies, News Brian Honea’s writing and editing career spans nearly two decades across many forms of media. He served as sports editor for two suburban newspaper chains in the DFW area and has freelanced for such publications as the Yahoo! Contributor Network, Dallas Home Improvement magazine, and the Dallas Morning News. He has written four non-fiction sports books, the latest of which, The Life of Coach Chuck Curtis, was published by the TCU Press in December 2014. A lifelong Texan, Brian received his master’s degree from Amberton University in Garland.  Print This Post Servicers Navigate the Post-Pandemic World 2 days ago The Best Markets For Residential Property Investors 2 days ago November 9, 2015 1,321 Views Do Banks Wait Until Economic Downturns to Build Up Loan-Loss Reserves? “In all likelihood, banks were increasing their loan-loss provisions at a time when it was more difficult and costly for them to do so,” the authors said.The authors compared the numbers on loan-loss provisions, which are a bank’s expectations of future loan losses, with net charge-offs, which are actual losses, from three different periods and found that the elevated level of loan-loss provisions as a percentage of net charge-offs during the 2008 crisis (187 percent) was still well below the ratio during the savings and loan crisis from the mid-1980s until the mid-1990s. The ratio of loan-loss provisions as a percentage of net charge-offs in 1987 during the middle of that crisis was well above 500 percent, according to the authors. By comparison, in the 10 years prior to the 2008 crisis, the ratio averaged 110 percent.The authors announced that new rules for loan-loss provisioning by the Financial Standards Accounting Board (FASB) are currently in the works.“The old approach (incurred loss), which does not allow banks to recognize loan losses until the actual default has occurred, will be replaced with a forward-looking, expected loss approach,” the authors wrote. “While the size of the losses will not likely change, the timing of their appearance on the balance sheet will. The new expected loss approach will entail more discretion on the part of bank managers.” The Best Markets For Residential Property Investors 2 days ago Demand Propels Home Prices Upward 2 days ago Previous: Citigroup Plans to Issue $421 Million Securitization Bundle Next: Freddie Mac Plans to Use Proven Formula for Assisting HAMP Borrowers With Rate Increases About Author: Brian Honea One subject of much debate since the financial crisis has been what determines how much money banks keep in their reserve accounts to offset losses from loans that default, known as loan loss provisions.A report from the Federal Reserve Bank of Cleveland written by Constantine Madias and Lakshmi Balasubramanyan discusses the issue of how banks determine their reserve levels for loan-loss provisions. The authors found in the data on U.S. banks covering the last several decades, banks tend to undercontribute to the reserves during periods of prosperity, which forces them to build up reserves during less-than-prosperous economic times.Rules are in place to prevent bank managers from manipulating the timing (level) of the bank’s reported earnings by using the reserve accounts. The allowance for loan and lease losses (ALLL), which is the balance of the reserve account, does not impact the bank’s earnings; however, reported earnings are reduced when banks engage in a practice known as loan-loss provisioning, which is adding to the reserve account. As a result of the earnings being reduced, the shareholders’ equity is also reduced.“The accounting profession prefers this approach because it produces financial statements that reflect companies’ current situations more accurately,” the authors stated. “But financial regulators, who are more focused on the safety and soundness of banks, prefer an approach that helps banks accumulate an adequate supply of reserves before they are needed.”The authors noted that the typical scenario for economic downturns is for the number of problem loans to rise, along with loan-loss provisions. During the financial crisis of 2008 and 2009, commonly known as the Great Recession, net charge-offs totaled more than $50 billion, a historically high level. Meanwhile, the provisions for loan and lease losses more than tripled from 2007 to 2008 at the onset of the recession—from less than $20 billion to more than $70 billion in just a year.“In all likelihood, banks were increasing their loan-loss provisions at a time when it was more difficult and costly for them to do so.”Cleveland Fed Servicers Navigate the Post-Pandemic World 2 days ago Banks Cleveland Fed Loan-Loss Provisions 2015-11-09 Brian Honea Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Tagged with: Banks Cleveland Fed Loan-Loss Provisions The Week Ahead: Nearing the Forbearance Exit 2 days ago Related Articles Data Provider Black Knight to Acquire Top of Mind 2 days ago Share Save Sign up for DS News Daily Subscribelast_img read more

The Best and Worst States for Property Taxes

first_img The Best Markets For Residential Property Investors 2 days ago According to the U.S. Census Bureau, the average American household spends $2,197 on property taxes for their homes each year. That’s no small chunk of change for many households, so property taxes are inevitably a factor when homebuyers are trying to decide where to buy, or where to move. WalletHub recently examined all 50 states and the District of Columbia to determine which states were best and worst when it comes to property taxes.The good news is, you’ll get plenty of sun and beaches along with the money you save in Hawaii, which ranks as the state with the lowest effective tax rate at 0.27 percent. However, the state’s median home value of $538,400 might offset that a bit, even for potential homebuyers keen to leave the mainland. For a median-priced home in Hawaii, the annual taxes would amount to $1,459.Next on the list is Alabama, with a median home price of $128,500 and an effective property tax rate of 0.43 percent, meaning the owner of a median-priced Alabama home would pay $550 in taxes. Rounding out the five states with lowest property tax rates are Louisiana (0.51 percent effective property tax), Delaware (0.55 percent), and, surprisingly, the District of Columbia. Like Hawaii, D.C. has a high median home value at $506,100, but a low effective property tax rate at only 0.56 percent.What about the other end of the scale? New Jersey takes home the trophy for highest effective property tax rate at 2.40 percent. Jersey homeowners with a median-priced home worth $316,400 would be paying $7,601 in annual property taxes. Coming in second is Illinois, with a 2.32 percent effective property tax rate, which works out to $4,058 in taxes on a median-priced home worth $174,800. The rest of the five states with highest effective property tax rates are New Hampshire (2.19 percent), Connecticut (2.02 percent), and Wisconsin (1.95 percent).You can read WalletHub’s full breakdown of state property tax rates by clicking here. The Best and Worst States for Property Taxes Demand Propels Home Prices Upward 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Home / Daily Dose / The Best and Worst States for Property Taxes  Print This Post Tagged with: Property Taxes taxes WalletHub Related Articles Demand Propels Home Prices Upward 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Property Taxes taxes WalletHub 2018-03-01 David Wharton March 1, 2018 2,839 Views The Week Ahead: Nearing the Forbearance Exit 2 days ago Subscribe The Best Markets For Residential Property Investors 2 days ago Share Save Data Provider Black Knight to Acquire Top of Mind 2 days ago About Author: David Wharton Data Provider Black Knight to Acquire Top of Mind 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago in Daily Dose, Featured, Headlines, Journal, Market Studies, News Servicers Navigate the Post-Pandemic World 2 days ago Sign up for DS News Daily Previous: Puerto Rico Receives Mixed Messages From Treasury, FHA Next: Improving FHA Foreclosure Processeslast_img read more

Where Underwater Homes are Concentrated

first_img Data Provider Black Knight to Acquire Top of Mind 2 days ago Tagged with: Equity Home Prices loans The Best Markets For Residential Property Investors 2 days ago February 6, 2020 1,664 Views Servicers Navigate the Post-Pandemic World 2 days ago Related Articles Share Save Where Underwater Homes are Concentrated  Print This Post Demand Propels Home Prices Upward 2 days ago Seth Welborn is a Reporter for DS News and MReport. A graduate of Harding University, he has covered numerous topics across the real estate and default servicing industries. Additionally, he has written B2B marketing copy for Dallas-based companies such as AT&T. An East Texas Native, he also works part-time as a photographer. Home / Daily Dose / Where Underwater Homes are Concentrated Previous: How Fannie and Freddie Work to Prevent Foreclosures Next: How Americans Feel About Mortgage Debt Governmental Measures Target Expanded Access to Affordable Housing 2 days ago The Best Markets For Residential Property Investors 2 days ago The Week Ahead: Nearing the Forbearance Exit 2 days ago Equity Home Prices loans 2020-02-06 Seth Welborn Data Provider Black Knight to Acquire Top of Mind 2 days ago Sign up for DS News Daily About Author: Seth Welborn Servicers Navigate the Post-Pandemic World 2 days ago Subscribe Governmental Measures Target Expanded Access to Affordable Housing 2 days ago According to a new report, 14.5 million residential properties in the United States were considered equity-rich as of Q4 2019. The ATTOM Data Solutions Home Equity & Underwater Report reveals that around 26.7% of U.S. mortgaged homes hold loans that are 50% or less of their estimated market value, but a high volume of seriously underwater homes were concentrated in the South and Midwest.Louisiana topped ATTOM’s list of seriously underwater homes with 16.8% seriously underwater, followed by Mississippi (16.0%, West Virginia (13.9%), Iowa (13.5%) and Arkansas (12.9%). Similarly, states with the lowest percentage of equity-rich properties were Louisiana (13.6% equity-rich), Oklahoma (14.9%), Illinois (15.3%), Arkansas (16.3%) and Alabama (16.5%).On a zip code level, out of the 8,262 U.S. zip codes with at least 2,000 properties with mortgages in the fourth quarter, 149 zip codes were at least a quarter of all properties with a mortgage were seriously underwater. The largest number of those zip codes were in the Cleveland, Ohio; Philadelphia, Pennsylvania; Milwaukee, Wisconsin; Rockford, Illinois, and St. Louis, Missouri, metropolitan statistical areas.“Homeownership continued boosting household balance sheets across the United States in the fourth quarter of 2019, as people paying off mortgages were much more likely to be in equity-rich territory than seriously underwater. That marked yet another sign of how much the country has benefited from an eight-year housing-market boom,” said Todd Teta, Chief Product Officer with ATTOM Data Solutions. “Some big gaps in equity levels persist between regions and market segments. But as home values keep climbing, financial resources keep building for homeowners, which provides them with leverage to make home repairs, help their children through college or take on other major expenses.”The most equity-rich states were California (42.8% equity-rich), Vermont (39.2%), Hawaii (38.8%), Washington (35.4%) and New York (35.1%).According to First American Deputy Chief Economist Odeta Kushi, the high amounts of tappable equity nationwide could be key to preventing recession, providing a cushion to “withstand potential price declines.”“Today, it’s reasonable to expect homeowners to stay where they are if the economy wavered and wait until they feel more financially confident to move, or tap into home equity for recurring expenses, or sell and pay off their mortgages if necessary,” Kushi said.Though equity levels are high, ATTOM also notes that over half of all properties were equity-rich in 451 zip codes. Among 8,262 U.S. zip codes with at least 2,000 properties with mortgages in the fourth quarter of 2019, there were 451 zip codes where at least half of all properties with a mortgage were equity rich. The top 25 were all in California, with most in the San Francisco Bay area. They were led by zip codes 94116 in San Francisco (82.6% equity-rich), 94040 in Mountain View (81.7%), 94122 in San Francisco (80.6%), 94112 in San Francisco (80.1%) and 94087 in Sunnyvale (79.5%). Demand Propels Home Prices Upward 2 days ago in Daily Dose, Featured, Newslast_img read more

Donegal milk producers warned they could face EU superlevy

first_img Twitter Three factors driving Donegal housing market – Robinson By News Highland – July 6, 2011 Previous articleDonegal group claims 1,000’s of penalty points go unawardedNext articleUpdated: Major oil laundering plant discovered in Castlefin News Highland Twitter Pinterest WhatsApp Pinterest Facebook Some Donegal dairy farmers are faced with the threat of incurring very serious superlevy fines if their milk production exceeds their quotas.Some milk processors are 15% up on milk supplies compared to this time last year, in 2010 Ireland only narrowly escaped incurring superlevy fines.Farmers are being warned that going ‘over-quota’ could lead to them incurring the kind of financial penalties that could devastate their income and trigger a cash flow crisis.Pat McCormack, the Chairman of the ICMSA Dairy Committee, says farmers need to take a collective responsibility approach:[podcast]http://www.highlandradio.com/wp-content/uploads/2011/07/patr1milkpm.mp3[/podcast] Help sought in search for missing 27 year old in Letterkenny Newsx Advertscenter_img Calls for maternity restrictions to be lifted at LUH Donegal milk producers warned they could face EU superlevy RELATED ARTICLESMORE FROM AUTHOR Facebook Google+ NPHET ‘positive’ on easing restrictions – Donnelly WhatsApp Google+ 448 new cases of Covid 19 reported today Guidelines for reopening of hospitality sector publishedlast_img read more

Donegal searches follow seizure of Seven million contraband cigarettes

first_img Facebook Donegal searches follow seizure of Seven million contraband cigarettes Almost 10,000 appointments cancelled in Saolta Hospital Group this week Facebook Google+ Pinterest By News Highland – March 11, 2011 Previous articleDonegal man recounts Japanese earthquake experienceNext articleRoads passable despite snowfall News Highland WhatsApp Google+ Three factors driving Donegal housing market – Robinson Newsx Advertscenter_img RELATED ARTICLESMORE FROM AUTHOR WhatsApp Seven million contraband cigarettes have been seized by Revenue’s Customs Service as part of Operation Marble.They were found in a 40 foot container which had arrived at Dublin Port from China via Rotterdam and were described as Ceramic Tiles.The truck was later stopped in Co Louth and follow up searches were carried out at two private premises in Co Donegal.It’s believed the cigarettes have an estimated retail value of three million euro and represent a potential loss to the exchequer of around two and a half million euro.Several individuals in both Co. Donegal and Co. Louth have been interviewed. Twitter Twitter LUH system challenged by however, work to reduce risk to patients ongoing – Dr Hamilton Calls for maternity restrictions to be lifted at LUH Pinterest Guidelines for reopening of hospitality sector published Business Matters Ep 45 – Boyd Robinson, Annette Houston & Michael Margeylast_img read more

‘Can’t Pay Won’t Pay’ Group have their facts wrong – Senator O’Domnhaill

first_img LUH system challenged by however, work to reduce risk to patients ongoing – Dr Hamilton Calls for maternity restrictions to be lifted at LUH Almost 10,000 appointments cancelled in Saolta Hospital Group this week Minister McConalogue says he is working to improve fishing quota Twitter By News Highland – November 25, 2011 Previous articleDerry man who abused four schoolgirls jailed for six yearsNext articleNo Donegal TD’s show for NoWDOC meeting organised by IMPACT News Highland Google+ ‘Can’t Pay Won’t Pay’ Group have their facts wrong – Senator O’Domnhaill WhatsApp Twitter WhatsAppcenter_img RELATED ARTICLESMORE FROM AUTHOR Google+ Guidelines for reopening of hospitality sector published Need for issues with Mica redress scheme to be addressed raised in Seanad also Pinterest Facebook Pinterest Fianna Fail Senator Brian O’Domnhaill has rejected out of hand suggestions that his party proposes septic tank legislation with charges greater than currently proposed by government.Today, the Can’t Pay Won’t Pay Group said it understood  that Fianna Fails proposals include a 200 euro charge on every household, every seven years.The Groups spokesperson, Danny Brown, said if these proposals were true,  they are even worse than the current Government proposals of a one-off 50 euro charge:But Senator O’Domhnaill said the group have the facts wrong and that no charge was ever proposed by Fianna Fail:[podcast]http://www.highlandradio.com/wp-content/uploads/2011/11/slug1pm.mp3[/podcast] News Facebooklast_img read more

No evening Bus Eireann service from Dublin to West Donegal

first_img WhatsApp RELATED ARTICLESMORE FROM AUTHOR Pinterest News No evening Bus Eireann service from Dublin to West Donegal It’s emerged that there is now no evening return Bus Eirean service linking Dublin and West Donegal. Previously, there was a service from Dungloe via Glencolmcille early in the morning, and then a return service from Dublin at 5 o’clock.However, since last Monday, the latest available return bus to Dungloe leaves Dublin at 1 o’clock, and the 5 o’clock service terminates in Donegal Town.Cllr Brendan Byrne says that puts people in an impossible position……..[podcast]http://www.highlandradio.com/wp-content/uploads/2010/07/byrne530.mp3[/podcast] Previous articleRamelton townpark named – Pairc Ui GhallchobhairNext articleNew council manager to continue with ‘Whole System Of Work’ News Highland Facebook Dail hears questions over design, funding and operation of Mica redress scheme Dail to vote later on extending emergency Covid powers Man arrested in Derry on suspicion of drugs and criminal property offences released Google+center_img By News Highland – July 9, 2010 Twitter Pinterest HSE warns of ‘widespread cancellations’ of appointments next week Facebook Twitter 70% of Cllrs nationwide threatened, harassed and intimidated over past 3 years – Report Google+ WhatsApp PSNI and Gardai urged to investigate Adams’ claims he sheltered on-the-run suspect in Donegallast_img read more

Police confirm 13 weekend arrests in Derry

first_img WhatsApp Police confirm 13 weekend arrests in Derry By News Highland – August 13, 2012 There were 13 arrests in Derry over the weekend in relation to public order offences in the city during and after the August Apprentice Boys Parade.Petrol bombs were thrown in the Bogside last night and on Saturday, but no major incidents have been reported and the parade passed off peacefully.Six juvenilles have been arrested arrested and charged, with seven others arrested in connection with what police are terming “minor public order offences”.According to police, a 20 year-old man has been charged with disorderly behaviour and is due to appear at Derry Magistrates Court on 5th September. An 18 year old man was also charged with disorderly behaviour and is due to appear in court on the same date.A 16 year old male youth has been released from police custody pending a report to the Public Prosecution Service, along with two 32 year old men and a 27 year old woman.Meanwhile, a 23 year old man was issued with a Fixed Penalty Notice. Google+ HSE warns of ‘widespread cancellations’ of appointments next week Facebook WhatsApp Google+ News Man arrested in Derry on suspicion of drugs and criminal property offences released Twittercenter_img Pinterest Pinterest Previous article“Bolt visit will happen” – Patsy Mc GonagleNext articleGovernment looking for people interested in joining Udaras board News Highland Twitter PSNI and Gardai urged to investigate Adams’ claims he sheltered on-the-run suspect in Donegal RELATED ARTICLESMORE FROM AUTHOR Facebook Dail to vote later on extending emergency Covid powers Dail hears questions over design, funding and operation of Mica redress scheme Man arrested on suspicion of drugs and criminal property offences in Derrylast_img read more

Letterkenny General’s Emergency Department re-opens after flooding

first_img Pinterest Letterkenny General’s Emergency Department re-opens after flooding Facebook 365 additional cases of Covid-19 in Republic Google+ Main Evening News, Sport and Obituaries Tuesday May 25th Further drop in people receiving PUP in Donegal Pictures taken this morning show clean-up progress The Emergency Department at Letterkenny General Hospital returned to normal at 11pm last night after a clean up following last evening’s flooding.The reception and administrative areas experienced a low level of flooding due to water leaking into these areas but clinical areas in the ED and hospital services in general were not affected.The hospital’s ED went off call for three hours from 8pm to 11pm to expedite the clean up.Flooding in the roadway and car park has partly abated and people are advised to use extreme caution if coming to the ED.The emergency services remain at the scene in anticipation of more heavy rainfall.An investigation into the cause of the flood has already started.This is the 3rd major flood at the new wing of Letterkenny General Hospital, Councillor and HSE West member Gerry McMonagle has called for an inquiry into the sustainable future of the facility:Audio Playerhttp://www.highlandradio.com/wp-content/uploads/2014/08/gerryfoood.mp300:0000:0000:00Use Up/Down Arrow keys to increase or decrease volume.Meanwhile, the public is reminded that visiting the Short Stay Ward in the hospital has been suspended for the time being due to cases of norovirus on the ward.If relatives are concerned about patients on this ward, a nominated person from each family can liaise with the Clinical Nurse Manager on the ward regarding planned visiting. The contact number is 074 912 5888, extension 4084.People who have vomiting and diarrhoea symptoms should not attend the hospital but should contact their GP in the first instance if they have serious concerns. Twitter Facebook WhatsApp Twitter By News Highland – August 6, 2014 WhatsApp 75 positive cases of Covid confirmed in North RELATED ARTICLESMORE FROM AUTHOR Man arrested on suspicion of drugs and criminal property offences in Derry Homepage BannerNews Google+ Pinterest Previous articleSouth Donegal air lifted to hospital in Dublin with severe burnsNext articleBig performance needed if Celtic are to stay in Champions League News Highland Gardai continue to investigate Kilmacrennan firelast_img read more

Derry City Traffic and Car Parking 3pm update

first_imgNewsx Adverts Main Evening News, Sport and Obituaries Tuesday May 25th Pinterest Gardai continue to investigate Kilmacrennan fire Facebook Facebook Twitter WhatsApp Further drop in people receiving PUP in Donegal 365 additional cases of Covid-19 in Republic Previous articleTwo due in Glasgow court in connection with Donegal man’s deathNext articleGardai searching for another person recover man’s body in Killybegs News Highland By News Highland – January 20, 2012 center_img Google+ Google+ Pinterest Derry City Traffic and Car Parking 3pm update 75 positive cases of Covid confirmed in North RELATED ARTICLESMORE FROM AUTHOR Disruption continues in Derry this afternoon following last night’s double explosion in the City.One device went off close to the Tourist Office on  Foyle Street, a second device went off outside the Council offices on Strand Road.Strand Road, Queens Quay, Foyle Embankment and Johns Street are now open to through traffic.There are traffic restrictions remaining in place between Foyleside Roundabout and Orchard Street.Foyleside East and West Car Parks are now open for customers to retrieve their vehicles. A further update on the opening of the Car Parks for shoppers using the centre will be provided as soon as possible.Derry City Council Offices will remained closed to public and staff today while a temporary Tourist Information Service is available at the Tower Museum tomorrow from 10.00am-3.00pm. . Twitter WhatsApp Man arrested on suspicion of drugs and criminal property offences in Derry last_img read more