Mobility Solutions Take Banking to the Masses

The banking sector has been looking for ways to increase uptake of its retail market oriented products. Increased competition in the banking sector due to an overall increase in the number of banks is liable for this. The retail sector of the banking industry has slowed its meteoric rise in recent years. Banks have turned to the technology world seeking ways of keeping themselves relevant and carving out larger shares of the market. One of the important things, that banks have been forced to redesign in this move, has been the delivery of banking services to the population. The tradition of bank halls and the associated queues has been addressed. The intention is to enable people to access banking services in a more convenient and less time-consuming manner. This is where the current crop of banking IT solutions has played a monumental role.

Mobility solutions have enabled the banks to take their retail banking products to the doors of the masses. The proliferation of mobile computing devices caused consumers to demand easier access to banking services. The masses now want to be able to get bank services as they move around and without suffering the inconvenience of banking halls. The solutions have created mobile banking apps which have been quite popular with the increase in the number of Smartphone devices in the market. These mobile apps allow the user to conduct all of their banking transactions from wherever they are, provided they have access to the internet. Commonly required functions such as depositing, withdrawals, fund transfers, and more can all be undertaken through the average Smartphone. These mobile apps have been designed to cater to the wealth of device types out there. This is because the mobile computing sector is catered to by several different operating system designs.

Businesses have also been catered for in the mobile banking shift. Enterprise class mobility solutions enable businesses to perform essential banking tasks from the convenience of their palms. Payment processing has been shifted onto mobile platforms allowing businesses to keep functioning even when they are away from their workstations and banking halls. Credit card and debit card payments from clients of businesses can now be processed entirely from the mobile communications devices. They are a number of mobile payment solutions that are designed to undertake fund transfers entirely over the internet. Banking IT solutions have been a massive boost to the performance of the banking sector.

Did the Bank Bailout Help Small Businesses?

Just as owning a home was assumed to be a positive financial strategy for individuals, small companies owning commercial real estate was typically seen as a routine and constructive piece of their commercial financing during the period leading up to the most recent financial crisis. Both of these assumptions start to fall apart very quickly when it is difficult or impossible to obtain the underlying real estate loans from banks. Real estate continues to be a major component of the overall economy, and ongoing difficulties involving either obtaining or refinancing commercial mortgage loans presents severe problems for both societal economics in general and small business economics in particular.

Did the Bank Bailout Help Small Businesses?

One of the primary arguments made in favor of bailing out banks in 2008 was that it would permit the restoration of “normal financing” to businesses of all sizes everywhere. Seven years later most small businesses are still waiting for bailout funding to “trickle down” to them. Working capital loans and commercial mortgages are missing in action for many commercial borrowers.

Real estate has regularly been in economic news for both good reasons and bad reasons during the past several decades. Starting around 2005, concerns began appearing about the financial health of both real estate and the overall economy. What we did not know at the time was that banks began making speculative investments in financial derivatives tied to real property at about the same time. Some of these investment practices produced massive losses that precipitated the public banking crisis emerging in 2007 and resulting in a widespread bank bailout program in 2008. Even the few instances in which these derivatives produced profits for the banks proved to be controversial because the profitable investing was frequently at the expense of banking customers.

Zombie Banks and Troubled Banks

Here are two of the real estate and banking problems that are still very actively impairing the small business economy:

  • Zombie Banks are still operating – a Zombie Bank is one with a negative net worth (liabilities exceeding assets).
  • The FDIC (Federal Deposit Insurance Corporation) Troubled Banks List still has more than 200 banking institutions on the list.

It is worth noting that the FDIC does not publicize the problem bank list or name specific banks on the list – probably fearing a “run on the banks” if they did so. The recent “bank holiday” in Greece illustrates how quickly bank depositors can lose confidence in banking institutions. But the FDIC does release the number of banks on their troubled bank list on a quarterly basis. For example, the March 2015 total of problem banks as defined by the FDIC was 253. In comparison, the total was more than 850 banks at the peak of the recent financial crisis – but there were less than 50 troubled banks before the 2008 bank bailouts.

What to Do When Banks Say No

Small business owners must draw their own conclusions about the current financial health of banks, but it seems unlikely that a “Troubled Bank” will be able to make a “normal” level of small business loans. If banks are still saying “No” to routine commercial financing for creditworthy small businesses, what is the recommended response? Small business owners should actively review alternatives that include non-bank financing, reducing business debt and increasing sales with cost-effective solutions such as business proposal writing. At some point the practical need to fire their bank and banker will by necessity become one of the realistic actions by a commercial borrower in need of business financing but unable to obtain it from their current banking institution. In such a scenario, “You’re fired” can quickly become another example of life imitating art.

Fractional Reserve Banking is a Fragile Pyramid Scheme

When you deposit money into your checking account at a bank, you have the justified expectation that the money you deposited will be used to honor the drafts (checks) you write against that account. You may be surprised, however, to learn that the bank does not. The bank expects to pay your drafts with money borrowed from other accounts, counting on the probability that not every account holder will write big checks all at once.

In fact, the bank believes so strongly in that probability that at any given time it has 90% of the deposits entrusted to it out on loan. If only 10% of the depositors suddenly withdrew their money, the bank would be forced to borrow money or declare bankruptcy.

Since most banks have deposits flowing in as well as out on any business day, this fractional reserve system normally works very well for banks. If more money flows out than in on a given day, however, the reserves of the bank are depleted and they must take immediate steps to replenish them.

This is illustrated annually in the United States in December. Individual depositors have a tendency to withdraw more than they deposit in December due to Christmas gift-giving. To maintain their currency reserves, the banks have to sell a portion of the securities they hold, either on the open market, or to the Federal Reserve Bank. In January, as deposits exceed withdrawals, the banks are able to repurchase the securities to draw down their reserves.

The danger of a fractional reserve banking system is that it is entirely dependent on the confidence of depositors in the banking system. If depositors were to suddenly lose confidence in the solvency of their bank, they will rush to withdraw their deposits before the bank collapses. Since the bank only has enough reserves to cover 10% of funds deposited with them, rumors of bank insolvency can quickly become self-fulfilling prophecies.

To prevent a frenzy of deposit withdrawals, termed a bank run or run on the bank, banks have developed mechanisms to insure bank deposits and borrow money from other banks and the Federal Reserve. The mere presence of these curbs speaks to the fragility of fractional reserve banking, and when the curbs go in they fuel the erosion of confidence as much as they quell it.

To prevent widespread bank panic about their pyramid scheme, banks are ultimately forced to use government guns funded by taxpayers. The government can declare a “bank holiday” to allow banks time to replenish their reserves; in effect, this makes it a crime for you to access your deposits or for a bank to give you access. The other hammer the government can use is the printing press.

Since the loans which precipitated the bank panic are still in place, when the government turns on the printing presses and begins cranking out currency the money supply becomes greatly inflated. As the new currency hits the streets the overall prices of goods and services begin to rise, meaning any deposits left in the banks are worth less in real terms than they were. This, of course, leads to a new round of withdrawals.

To be fair, as the currency becomes debased, some of the new money is used to pay off loans, thereby decreasing the money supply as long as new loans are not issued. Preventing the issuance of new loans, however, exposes the true cause of the bank panic: fractional reserve banking. That cannot be permitted so the inflation and debasement of the currency continues, eventually leading to hyper-inflation.

Since the dawn of fractional reserve banking and government issuance of fiat currency, this scenario has been replayed over and over. Just since the 1980s, Angola, Argentina, Belarus, Bolivia, Bosnia-Herzegovina, Brazil, Georgia, Israel, Madagascar, Nicaragua, Peru, Poland, Romania, Russia, Turkey, Ukraine, Yugoslavia, and Zaire have battled bouts of hyperinflation due to this fragile system. As of this writing, Zimbabwe is projected to have inflation anywhere from 11,000% to 1.5 million % in 2007.

It is important to note that no economy based on fiat currency has ever expected hyperinflation and all governments have denied the existence of hyperinflation until the currency completely collapsed. Note also that, despite the massive human suffering and disruption that result from the collapse of a fiat monetary system and fractional reserve banking, governments return to a fiat system and protect fractional reserve banking as a matter of course.

Fractional reserve banking, much as a fiat monetary system itself, is a fragile pyramid scheme favored not because of its stability, but because of its ability to rob political power and wealth from depositors and taxpayers. In no other field of human interaction is a fraud of this magnitude considered the normal course of business.

Bank Account For Canadians

Banking in Canada is effortless and uncomplicated, as there are very few rules and regulations. Canada’s banking sector is similar to that of the United States of America. Almost all Canadian banks offer online banking accounts to their customers.

Customers can also avail the service of Automated Banking Machines (ABM) all over the country, which is similar to the ATMs in America. These quality banking services has made the life easier for Canadians in terms of handling their bank accounts.

If you are migrating to Canada for any purpose and need to bank, then you will need to open a bank account here. In the long run, you will definitely require a bank account, if you have shifted to Canada for work purposes to deposit your salary. Next, you will again require a bank account for gas, electricity, phone connection, renting or buying an accommodation, and for few other basic requirements, while staying in Canada.

Safety Side:

All Canadian Banks are government certified. The Canada Deposit Insurance Corporation (CDIC) is a centralized firm offering depositary cover, and thus providing solidity to the monetary organization. They are involved in these operations, since 1967 and are similar to that of Federal Deposit Insurance Corporation (FDIC) of America.

FDIC differs from CDIC in a way they cover your total cash. FIDC handles individual bank account deposits up to $100,000, whereas CDIC covers around $60,000 individual deposits.

There are many options for opening a bank account in Canada. It is always advisable to ask for help to explore many things. Every bank has different processing fees.

After selecting a bank, visit its nearby branch. Always choose a bank, which offers security, close by in terms of location, and good products. Also, check if any bank is providing some reasonable worthy package, and special concessions for the university or your office. This will be useful, as you will have to pay minimal banking fees to operate your bank account there.

Complete all the required formalities and documentation procedure to open a bank account. Choose the kind of service and facilities you require. Both, temporary and permanent residents need to offer identification proof.

You can offer any two identification proofs recognized by the Government such as Canadian driving license, Social Insurance Card, Passport, or Provincial Health Card. The bank may also ask for any residential proof in the form of any utility bill. If you are an immigrant, then the bank might ask for reference from your firm or university. 

You can open a bank account without any prior deposits in Canada. Even those who are unemployed can open an account in the bank of their choice. For day-to-day banking affairs, it is good to have a Checking account. The bank will provide you a debit card, which will contain a PIN number to withdraw cash from your account through ABMs.

You have to pay certain fees such as check fees, monthly account fees, and withdrawal fees. Monthly account fees might range from $2 to $15. It is important and beneficial to keep a track of the following things, if you are planning to open an account in a Canadian Bank.

  1. Always prefer to withdraw cash from your bank’s ABM.
  2. Always prefer online transactions. They are mostly free of charge.
  3. It is advisable to keep a track on your bank account on a monthly basis.

Banks to Consider:

Royal Bank of Canada, Bank of Montreal, Bank of Nova Scotia, Canadian Imperial Bank of Commerce, and, TD Canada Trust are some of the leading and prevalent banks in Canada. 

You can also find some international banks in Canada such as HSBC, ING Bank, and Citibank. Finally, there are several regional banks and credit unions banks in Canada.

How to Fish Bare Banks

Bare banks exist in virtually all reservoirs and lakes in the country. They are void stretches of clay, sand, mud or gravel or composites of these materials. Bare banks may border creek embankments, main river channels or islands. Some run for short distances; others stretch for hundreds of yards. Still, the thread that ties all bare banks together is their lack of obvious features. The degree to which bass use bare banks varies from lake to lake and even from one bank to the next. Bare banks in deeper and/or older lakes tend to attract more fish than do similar banks in shallow, newer lakes. The latter waters usually have other, higher quality structure to draw the fish. Bare banks aren’t as important in lakes that have timber or grass or lots of up and down bottom structure. Even in lakes with plenty of other structure, some bare banks still hold bass, and these can be honey holes because they are rarely fished. The only way to learn which banks are good is to test fish them. This takes a lot of time, and this is why fishing bare banks is more practical for anglers on their home lakes than for pros, who move around from one lake to the next.

Bass are more prone to hold along bare banks during seasonal migrations. The best times to fish these banks are spring and fall. In spring, the bass move into the creeks to spawn, and a lot of times they follow banks back to shallow water. And in the fall, shad swim into the creeks, and bass come in behind them. Much of the feeding activity during September and October takes place close in to shore. Sometimes bass also feed along bare banks in summer and winter, usually in main lake areas where wind or currents push shad up shallow. Bare banks have the potential to produce fish all year long. Wind is one of the main keys. Fishing along a bare bank is 100 times better if there’s a wind blowing on it, especially on a clear lake. The waves ‘blow in’ baitfish. They stir up the bottom and expose crawfish. They break up sunlight penetration. Overall, wind blowing on a bare bank creates prime feeding conditions, and it causes the bass to be shallower and more active. One more note about bare banks: They hold an extra attraction to smallmouth and spotted bass. If a lake only have largemouths, plain banks will be good sometimes. But is spotted and smallmouth are present, they can be great virtually anytime.

Bass Locations along Banks:

Actually, the term “bare banks” contradicts the actual makeup of these void looking structures. A bank may look bare if you’re running down the lake at 50 mile per hour. But if you stop and really study and fish it, there’s almost always something that will attract bass. It’s just a matter of knowing what to look for and how to find it. You can find bass near subtle changes or isolated features along bare banks. Examples include where a bank’s makeup changes (i.e., gravel gives way to clay), where a creek channel swings near the bank, where a bank becomes flatter or steeper, or where a bank makes a slow turn. Also, underwater features along a bank are like beacons that draw bass. A stump, log or large rock can have a magnetic effect on fish swimming alongshore. Also, a lot of people sink brushpiles along bare banks. A brushpile along a bank that doesn’t have any other features is almost a sure bet to draw some fish, plus it’s not as likely to be found by other fishermen because of the lack of fishing pressure.

Knowing what to look for along bare banks and being able to find these spots are two different matters. A visual check is simple enough. An angler can see bank composition changes, shoreline turns or dark shadows of underwater stumps or logs. (Polarized sunglasses are vital in seeing below the surface.) He can also study a topo map to find where channels angle near the bank. However, most fish attracting features along bare banks are hidden from view and not shown on maps. Fishermen have two methods for finding them: electronic inspection with a depthfinder; and test fishing. Start out checking a bank by idling along it and watching your depthfinder. Zigzag in and out to scan different depths. Mainly, look for cover down the side of the bank, and also watch for contour changes and baitfish returns. If a bank is 200 yards long, cover it all. Then if you see anything that looks promising, turn around and fish it. It’s common to idle part way down a bank and see nothing, then to begin detecting features or fish. Another approach is to start at one end and fish it all. This way you can really cover the whole bank effectively. Invest the time to go down it and check different areas and depths. That way you can do a thorough job of eliminating thinks and develop a reliable pattern. As you fish along, constantly monitor your depthfinder for objects or changes in the bank’s contour. Look for little shelves or places where the first break occurs closer to the shore. Again, these are the subtle, little changes where bass are more likely to be. Sometimes the only way to find these places is by fishing the whole bank.

Baits For Bare Banks:

For fishing bare banks you can rely on a small selection of dependable lures: crankbaits, spinnerbaits, jerkbaits, topwaters, grubs, jigs and plastic worms. Diving crankbaits are top choices for prospecting along bare banks from early spring through fall. Also, because you can cover water quickly with them. In addition, you can cast them right to the waterline, then bump them back down the bank’s subsurface slope. This facilitates a check of depths ranging from a few inches to deeper than 10 feet. Another good bait for searching bare banks in early spring is a jerkbait. Fishing a jerkbait is a good way to catch suspended bass. It’s especially effective when the water first starts warming up (low to mid 40s). When fishing this bait move along the bank while making 45 degree casts to the shoreline. Cast right to the water’s edge, and crank the bait four or five times to start it down, then begin a “jerk pause jerk jerk” retrieve. Repeat this all the way back to the boat. The colder the water, the slower you want to work the bait. A spinnerbait is a third option for prospecting along bare banks in the prespawn and spawning periods. A spinnerbait should be cast shallow, then pulled down the slope with a middepth retrieve. Many times, if bass are actively feeding, they will be drawn in by the flash and vibration, and they will hit from below or beside the bait. Alternate among crankbaits, jerkbaits and spinnerbaits to see which the bass prefer on a given day. This is just a matter of trial and error. One day the fish will hug bottom, and the diving crankbait works best. The next day they may be suspended, and the jerkbait is best. And the third day they might be roaming and feeding, and the spinnerbait is the trick. You just have to analyze the weather and water conditions and try to figure out how active the bass are and whether they’re shallow, deep or suspended. Then pick the bait that will work best under those conditions. But if that bait doesn’t work, try the other two type. Sometimes bass are hard to second guess. Jigs, grubs and worms (so called slow baits) are deadly along bare banks. These baits are good under three distinct circumstances.

If you’re working a shoreline with a crankbait and hit a piece of cover without a bite, pick up your jig or worm rod and work the cover a little slower and more thoroughly. If the bass aren’t too active, it’s not uncommon for them to pass up the crankbait or a spinnerbait but to hit a jig or worm. The second case for using a slow bait is when a bank has yielded some fish to one of the faster baits, and the angler wants to make another pass down the bank and offer remaining bass a different option. And the third case for using grubs, jigs and worms is when a pass down a bank with faster baits yield no action, but the angler believes bass are present and just not in a chasing mood. Topwaters are excellent baits for fishing bare banks after the water temperature rises into the 70s. This is just another alternative. Topwater baits fished along bare banks early and late in the day are a good pattern for heat-of-the-summer fishing. This may not be the most consistent pattern in the world, but sometimes it will produce some big fish.

Banking in India

The Banking sector in India has spread its wings fully by the galvanizing economic reforms introduced in 1980 and 1990. Since then the sector has seen rapid and unbridled growth with many new national and foreign players entering the arena. Banks remain segregated mostly as per their area of functioning, ownership and category of customers sought.

A brief introduction as to their separate characters and features is listed below:

As per ownership

In India there are basically three types of banks under the control of Reserve Bank of India, they are, public sector banks in which government has stakes, private sector banks which are privately owned companies with public listing of shares and a scheduled bank category.

Public sector banks

Public sector banks are the banks in which Government of India has stakes. State Bank of India, the oldest bank of India established in 1806 along with other thirteen banks constitute the public sector banks in India.

Private sector banks

Private sector banks also come the peripheral of RBI but the government does not have any control in the management and stakes of the bank. ICIC is a leading private bank in India with a pan India appeal.

Scheduled banks

The schedule banks are the banks which have been brought under the surveillance of the criteria laid down vide section 42 (6) (a) of the RBI Act of 1934.

The banks have also a similar rate of differentiation in its place of operations as some of the banks cater only to urban population while some others engage in rural banking needs. The public and scheduled banks however have clear contours for operation and allocation of funds in line with the government policies and strategies.

There are three types of mostly used accounts in Indian Banking:

Current account

Also known as the corporate account, the no interest account is for facilitating the smooth business transactions which happen in substantial amount on a daily basis. It doesn’t provide any interest as its intention is not savings but business transactions on the basis of cheques. The account is used by most corporate houses, small and big entrepreneurs and firms for their business related financial needs.

Bank Fixed Deposits

The most common and safe mean of savings for the Indian population remains a fixed deposit. It is an account in which the sum is generally kept untouched for a fixed time period which varies from 15 days to even 5 years. The reasonable rate if interest provided by the banks act as clinchers for the saving minded Indians. This is the main source of income for the banks which is then utilized for various investment purposes as per the duration of the period. The excellent performance by the banks in India has gained a greater margin of the saved incomes.

Savings Bank account

Savings bank account or the more popular SB is the layman’s gateway into banking sector in India. These have both minimum balance category with a marginally higher interest and the zero balance category. The zero balance account has been popular with the youth and student folks.

The burgeoning working class in India has contributed a lot in the trajectory of the banking sector. Today they have moved ahead from a mere lender and guardian of money into huge investment pundits attracting foreign capital flows.

Spank the Bank! Confronting the Biggest Bully in the Neighborhood!

It is an unspoken reality that for those of us making our living in the real estate industry, we unfortunately continue to have to work in the “short sale” arena. I say unfortunately for a number of reasons, but first and foremost is the fact that as realtors we see firsthand how traumatic it is for the homeowner and the buyer when a short sale transaction becomes a casualty of disorganized corporate banking staff and understaffed bank short sale offices.

The issues of the short sale “nightmare” were, and continue to be, promulgated almost specifically by the banks themselves. It has created a growing and aggressive stealth movement towards forcing the banks to start being good neighbors with the real estate industry.

Anecdotally, in two very recent short sale transactions with major banks, (the lien-holders of the respective properties), none of the professionals on the realty side involved with the transaction, (realtors, title agents or closing coordinators), could get anyone at the bank’s short sales offices to respond to communications or queries of any sort. Phone calls, emails, faxes, and even an outreach by courier… “Holy Foreclosure Batman, I smell a rat!”

In one case the short sale price had been approved by the bank, the buyer had made a full price offer, the contract was fully executed, the home was vacant, (on a very short leash for foreclosure), and we still could not get the bank to respond! For two months we could get no answer of any sort from the bank or their representatives! It is an extremely unfortunate, but well known issue, (there is no doubt that all of the realtors out there are shaking their heads with the same nightmare stories of their own)… it’s got to stop!

Approaching the point at which this particular home was about to go on the chopping block at the county courthouse, the selling agent, (and myself on the buyers side), decided to take matters into our own hands and become more “proactive” at getting the bank’s reps to respond. We made a very aggressive effort to reach out to the people at the bank’s senior management level who COULD make a decision, while also convincing them of the need to respond.

Drafting an email to the CEO of the bank, along with a number of members of his board of Directors, VP of Short Sales, and numerous other banking officials, we started moving forward in short order to alert these officers to the shenanigans of their local office. After looking over that email with a fine tooth comb and making a number of changes, the email was sent to all of the bank officials and board members, copying the local bank short sale reps, (remember, the ones who refused to respond to our queries).

In a matter of hours, literally, after sending that email, we had numerous calls from the bank CEO’s office wondering why we were having problems and what they could do to help. Due to this “re-energized” focus on this case we ended up closing the sale only days later… after two months of senseless inactivity and non-response on the part of the bank office assigned to handle the case.

This particular situation ended up working out for the buyer and seller, but unfortunately it was just one of thousands of these cases occurring daily nationwide. The big banks and their short sales offices literally BULLY everyone involved in a short sale transaction, from realtors to title and closing agents, to the homeowners themselves! Why?… well, for the same reason a dog chases its tail, because they can! They know they can just refuse to answer any queries in reference to a particular transaction, and there is very little, if anything, that anyone in the real estate industry could do about it, (up till now). Think about it. What other phone numbers would you call? What other fax number would you use? What other contact point do you have? You all know the drill, and it’s not pretty.

Remember how we hated bullies in grade school? To be more specific, who do you know that doesn’t hate a bully? I always have and always will. Realtors and others in industries dependent on real estate sales must come together as a group to put pressure on our elected representatives to create better legislation to force banks to behave! We cannot continue to allow the biggest bullies on the real estate block to continue making their own rules to the detriment of the rest of the country and entire industries.

Obviously, the banking industry hasn’t received the message loud and clear that the citizens of this country are sick and tired of the crass, unresponsive way in which banks are handling their affairs… and specifically in this case, the administrative issues and transactions with short sales.

Short sale homeowners are certainly not happy that big corporate banks earning billions of net profit per quarter, are having their homes foreclosed on, in many cases, due to the shoddy, unprofessional work ethic, and haughty bank employees simply refusing to respond to realtors, title agents, closing coordinators and homeowners.

Obviously not all bank employees are “haughty” and / or have a poor work ethic. Unfortunately, I haven’t worked a short sale yet, nor have I spoken with a realtor who doesn’t agree that in almost every case at some point in the game one of those “special” bank employees ends up being an integral part of why the transaction is not moving forward.

Referencing the aforementioned net profits of the banks, and for some speculative insight, here are the 3Q 2011 net earnings for three of the major banks, Bank of America – $6.2 Billion, Chase – $3.1 Billion, Wells Fargo – $4.1 Billion. (These banks, just coincidentally, also have huge numbers of short sale properties on their books).

That’s just three months earnings folks. Think about it.

Why do we allow banks to bully the parties involved in a real estate transaction? Individual realtors and brokerage firms are just the tip of the iceberg. All of the tangential businesses that revolve around a real estate sale realize a huge negative impact from laggardly bank employees just simply refusing to do their job professionally and in a timely manner.

Contrary to some populist belief patterns, the men and women of senior management running large corporate banks are not stupid! Neither are our elected representatives, (although some of you may disagree with that latter point). Why is it then, seemingly, that none of those individuals can see what we in the real estate industry see on a daily basis.

For instance, if a particular short sale is neglected by the bank and continues to be denied any attention for months, the buyers in the transaction most probably walk from the contract. The home then ends up being put back on the market, forced to continually lower its sale price to sell, or the bank moves in to foreclose on it.

Due to the recalcitrant bank staff, not only does that particular home’s price get lower and lower, (in order to sell prior to foreclosure), so then do the values of the homes around it become diluted. Previously where there were only one or two homes in a sub-division that were possible short sale candidates, the callous, maybe even devious inattention of bank “professionals” has diluted the equity in the surrounding homes so much, they now become short sales themselves. It’s a virus and this never ending idiocy goes on and on, simply because bank employees refuse to do their jobs! Any suggestion that this was bordering on criminal… would be an understatement.

Everyone in this country took a tremendous negative impact to their financial health over the last five years, and it is becoming tiresome to continue to listen to bank CEO’s whining responses to congressional queries with, “we just don’t have the manpower to handle all of those cases”. Really? A reasonable person would submit that if your corporation earns $6.2 Billion in net profit in just three months, you might be able to hire the staff necessary to process those short sales, or at the very least answer your phones.

After discussing these issues with a number of colleagues concerning some method with which to reconcile the plethora of problems manifest in a short sale transaction, we all came to the same conclusion. Banks will not start to be professional business partners until they have some reason to be.

Discipline is a necessary element of any behavior modification program, and the type of discipline needed now is parent-to-child type of discipline! Ipso-Facto – if you act like a child, you should be disciplined like a child… until you start to behave appropriately.

Not being a fan of “big government”, I would submit in this case, that our government is going to have to oversee some parenting responsibilities and to that end, a number of proposals surfaced that we believe will work.

First, a bank has to be held accountable for its inactivity in a transaction. In other words we’re going to have to “Spank the Bank” if they don’t behave. This disciplinary action should have some monetary impact on the bank’s bottom line attached to the individual transaction. For instance, if the bank is supposed to get back to you, the realtor, in ten days on a decision to accept or deny an offer, or send you an approval letter to sell, then they should take a hit on a daily basis for that refusal to respond by perhaps a fine of $250 per day, (taken off their bottom line from the sale).

Second, the bank’s team, office, or group handling that transaction, should receive some internal disciplinary financial action for their substandard time and resource management, that would come from that team or group’s budget,… $100 per day?, ( added to the upcoming total).

Third, the individual(s) working for the bank, assigned to work directly with that particular case should receive job or financial action for their delay and inaction… $50 per transaction per person?

Those three financial deductions would be totaled and taken off the bank’s bottom line for that short sale.

Here’s the best part, 90% of whatever money the bank ends up being fined on a daily basis due to its inattentive, slovenly attitude and unprofessional response time goes straight to the closing costs of that transaction, (taken off the final number of the HUD), to be split evenly between buyer and seller! The other 10% could go to fund short sale and foreclosure counseling programs. Let’s see how THAT sits with the bank. I would suggest that with those legislative requirements in place, all “short sales” would become “instant sales” overnight.

We could see bank employees finally start to answer their phones, respond to homeowners, get the right file to the right person, and finally “find” the financial packet that had been sent in months ago, THREE separate times!

The bottom line is that until this country’s legislators create some very strong language to actually hold the banking industry accountable, and we in the real estate industry along with other concerned groups and citizens make our voices heard forcing the banks to comply and cooperate, we will not realize any positive movement towards ending the short sale fiasco with the large corporate banks and their callous, haughty, unresponsive short sale departments.

Do NOT allow yourself to be bullied by a bank’s financial legerdemain and lack of professionalism! Think outside the box!

Let’s not watch our country continue to dig the “short sale” hole for another decade. For many people, doing nothing is doing something! In this case doing nothing is an invitation for the bullies to become even more aggressive.

Get involved! It’s time to take a stand!

Bob Cox

by Robert Cox 12/28/11

Bankers’ Banks- The Role of Central Banks in Banking Crises

Central banks are relatively new inventions. An American President (Andrew Jackson) even cancelled its country’s central bank in the nineteenth century because he did not think that it was very important. But things have changed since. Central banks today are the most important feature of the financial systems of most countries of the world.

Central banks are a bizarre hybrids. Some of their functions are identical to the functions of regular, commercial banks. Other functions are unique to the central bank. On certain functions it has an absolute legal monopoly.

Central banks take deposits from other banks and, in certain cases, from foreign governments which deposit their foreign exchange and gold reserves for safekeeping (for instance, with the Federal Reserve Bank of the USA). The Central Bank invests the foreign exchange reserves of the country while trying to maintain an investment portfolio similar to the trade composition of its client – the state. The Central bank also holds onto the gold reserves of the country. Most central banks have lately tried to get rid of their gold, due to its ever declining prices. Since the gold is registered in their books in historical values, central banks are showing a handsome profit on this line of activity. Central banks (especially the American one) also participate in important, international negotiations. If they do not do so directly – they exert influence behind the scenes. The German Bundesbank virtually dictated Germany’s position in the negotiations leading to the Maastricht treaty. It forced the hands of its co-signatories to agree to strict terms of accession into the Euro single currency project. The Bunbdesbank demanded that a country’s economy be totally stable (low debt ratios, low inflation) before it is accepted as part of the Euro. It is an irony of history that Germany itself is not eligible under these criteria and cannot be accepted as a member in the club whose rules it has assisted to formulate.

But all these constitute a secondary and marginal portion of a central banks activities.

The main function of a modern central bank is the monitoring and regulation of interest rates in the economy. The central bank does this by changing the interest rates that it charges on money that it lends to the banking system through its “discount windows”. Interest rates is supposed to influence the level of economic activity in the economy. This supposed link has not unequivocally proven by economic research. Also, there usually is a delay between the alteration of interest rates and the foreseen impact on the economy. This makes assessment of the interest rate policy difficult. Still, central banks use interest rates to fine tune the economy. Higher interest rates – lower economic activity and lower inflation. The reverse is also supposed to be true. Even shifts of a quarter of a percentage point are sufficient to send the stock exchanges tumbling together with the bond markets. In 1994 a long term trend of increase in interest rate commenced in the USA, doubling interest rates from 3 to 6 percent. Investors in the bond markets lost 1 trillion (=1000 billion!) USD in 1 year. Even today, currency traders all around the world dread the decisions of the Bundesbank and sit with their eyes glued to the trading screen on days in which announcements are expected.

Interest rates is only the latest fad. Prior to this – and under the influence of the Chicago school of economics – central banks used to monitor and manipulate money supply aggregates. Simply put, they would sell bonds to the public (and, thus absorb liquid means, money) – or buy from the public (and, thus, inject liquidity). Otherwise, they would restrict the amount of printed money and limit the government’s ability to borrow. Even prior to that fashion there was a widespread belief in the effectiveness of manipulating exchange rates. This was especially true where exchange controls were still being implemented and the currency was not fully convertible. Britain removed its exchange controls only as late as 1979. The USD was pegged to a (gold) standard (and, thus not really freely tradable) as late as 1971. Free flows of currencies are a relatively new thing and their long absence reflects this wide held superstition of central banks. Nowadays, exchange rates are considered to be a “soft” monetary instrument and are rarely used by central banks. The latter continue, though, to intervene in the trading of currencies in the international and domestic markets usually to no avail and while losing their credibility in the process. Ever since the ignominious failure in implementing the infamous Louvre accord in 1985 currency intervention is considered to be a somewhat rusty relic of old ways of thinking.

Central banks are heavily enmeshed in the very fabric of the commercial banking system. They perform certain indispensable services for the latter. In most countries, interbank payments pass through the central bank or through a clearing organ which is somehow linked or reports to the central bank. All major foreign exchange transactions pass through – and, in many countries, still must be approved by – the central bank. Central banks regulate banks, licence their owners, supervise their operations, keenly observes their liquidity. The central bank is the lender of last resort in cases of insolvency or illiquidity.

The frequent claims of central banks all over the world that they were surprised by a banking crisis looks, therefore, dubious at best. No central bank can say that it had no early warning signs, or no access to all the data – and keep a straight face while saying so. Impending banking crises give out signs long before they erupt. These signs ought to be detected by a reasonably managed central bank. Only major neglect could explain a surprise on behalf of a central bank.

One sure sign is the number of times that a bank chooses to borrow using the discount windows. Another is if it offers interest rates which are way above the rates offered by other financing institutions. There are may more signs and central banks should be adept at reading them.

This heavy involvement is not limited to the collection and analysis of data. A central bank – by the very definition of its functions – sets the tone to all other banks in the economy. By altering its policies (for instance: by changing its reserve requirements) it can push banks to insolvency or create bubble economies which are bound to burst. If it were not for the easy and cheap money provided by the Bank of Japan in the eighties – the stock and real estate markets would not have inflated to the extent that they have. Subsequently, it was the same bank (under a different Governor) that tightened the reins of credit – and pierced both bubble markets.

The same mistake was repeated in 1992-3 in Israel – and with the same consequences.

This precisely is why central banks, in my view, should not supervise the banking system.

When asked to supervise the banking system – central banks are really asked to draw criticism on their past performance, their policies and their vigilance in the past. Let me explain this statement:

In most countries in the world, bank supervision is a heavy-weight department within the central bank. It samples banks, on a periodic basis. Then, it analyses their books thoroughly and imposes rules of conduct and sanctions where necessary. But the role of central banks in determining the health, behaviour and operational modes of commercial banks is so paramount that it is highly undesirable for a central bank to supervise the banks. As I have said, supervision by a central bank means that it has to criticize itself, its own policies and the way that they were enforced and also the results of past supervision. Central banks are really asked to cast themselves in the unlikely role of impartial saints.

A new trend is to put the supervision of banks under a different “sponsor” and to encourage a checks and balances system, wherein the central bank, its policies and operations are indirectly criticized by the bank supervision. This is the way it is in Switzerland and – with the exception of the Jewish money which was deposited in Switzerland never to be returned to its owners – the Swiss banking system is extremely well regulated and well supervised.

We differentiate between two types of central bank: the autonomous and the semi-autonomous.

The autonomous bank is politically and financially independent. Its Governor is appointed for a period which is longer than the periods of the incumbent elected politicians, so that he will not be subject to political pressures. Its budget is not provided by the legislature or by the executive arm. It is self sustaining: it runs itself as a corporation would. Its profits are used in leaner years in which it loses money (though for a central bank to lose money is a difficult task to achieve).

In Macedonia, for instance, annual surpluses generated by the central bank are transferred to the national budget and cannot be utilized by the bank for its own operations or for the betterment of its staff through education.

Prime examples of autonomous central banks are Germany’s Bundesbank and the American Federal Reserve Bank.

The second type of central bank is the semi autonomous one. This is a central bank that depends on the political echelons and, especially, on the Ministry of Finance. This dependence could be through its budget which is allocated to it by the Ministry or by a Parliament (ruled by one big party or by the coalition parties). The upper levels of the bank – the Governor and the Vice Governor – could be deposed of through a political decision (albeit by Parliament, which makes it somewhat more difficult). This is the case of the National Bank of Macedonia which has to report to Parliament. Such dependent banks fulfil the function of an economic advisor to the government. The Governor of the Bank of England advises the Minister of Finance (in their famous weekly meetings, the minutes of which are published) about the desirable level of interest rates. It cannot, however, determine these levels and, thus is devoid of arguably the most important policy tool. The situation is somewhat better with the Bank of Israel which can play around with interest rates and foreign exchange rates – but not entirely freely.

The National Bank of Macedonia (NBM) is highly autonomous under the law regulating its structure and its activities. Its Governor is selected for a period of seven years and can be removed from office only in the case that he is charged with criminal deeds. Still, it is very much subject to political pressures. High ranking political figures freely admit to exerting pressures on the central bank (at the same breath saying that it is completely independent).

The NBM is young and most of its staff – however bright – are inexperienced. With the kind of wages that it pays it cannot attract the best available talents. The budgetary surpluses that it generates could have been used for this purpose and to higher world renowned consultants (from Switzerland, for instance) to help the bank overcome the experience gap. But the money is transferred to the budget, as we said. So, the bank had to do with charity received from USAID, the KNOW-HOW FUND and so on. Some of the help thus provided was good and relevant – other advice was, in my view, wrong for the local circumstances. Take supervision: it was modelled after the Americans and British. Those are the worst supervisors in the West (if we do not consider the Japanese).

And with all this, the bank had to cope with extraordinarily difficult circumstances since its very inception. The 1993 banking crisis, the frozen currency accounts, the collapse of the Stedilnicas (crowned by the TAT affair). Older, more experienced central banks would have folded under the pressure. Taking everything under consideration, the NBM has performed remarkably well.

The proof is in the stability of the local currency, the Denar. This is the main function of a central bank. After the TAT affair, there was a moment or two of panic – and then the street voted confidence in the management of the central bank, the Denar-DM rate went down to where it was prior to the crisis.

Now, the central bank is facing its most daunting task: facing the truth without fear and without prejudice. Bank supervision needs to be overhauled and lessons need to be learnt. The political independence of the bank needs to be increased greatly. The bank must decide what to do with TAT and with the other failing Stedilnicas?

They could be sold to the banks as portfolios of assets and liabilities. The Bank of England sold Barings Bank in 1995 to the ING Dutch Bank.

The central bank could – and has to – force the owners of the failing Stedilnicas to increase their equity capital (by using their personal property, where necessary). This was successfully done (again, by the Bank of England) in the 1991 case of the BCCI scandal.

The State of Macedonia could decide to take over the obligations of the failed system and somehow pay back the depositors. Israel (1983), the USA (1985/7) and a dozen other countries have done so recently.

The central bank could increase the reserve requirements and the deposit insurance premiums.

But these are all artificial, ad hoc, solutions. Something more radical needs to be done:

A total restructuring of the banking system. The Stedilnicas have to be abolished. The capital required to open a bank or a branch of a bank has to be lowered to 4 million DM (to conform with world standards and with the size of the economy of Macedonia). Banks should be allowed to diversify their activities (as long as they are of a financial nature), to form joint venture with other providers of financial services (such as insurance companies) and to open a thick network of branches.

And bank supervision must be separated from the central bank and set to criticize the central bank and its policies, decisions and operations on a regular basis.

There are no reasons why Macedonia should not become a financial centre of the Balkans – and there are many reasons why it should. But, ultimately, it all depends on the Macedonians themselves.

When an Offshore Bank Fails

Introduction – What we are going to do is describe the legal and mechanical process relating to offshore bank failures. We will discuss what leads up to them, what happens if they fail, and how do the depositors get their money back. The terms and scenarios we depict are generally what happens in the world of offshore banking. In some jurisdictions the terminology and procedures may be slightly different but the general way things proceed will be in line with the scenarios depicted in this article.

Offshore Banks – A brief definition of this term is in order. These are banks that are located in various countries around the world many being in Caribbean Island Nations. These banks have a license that enables them to only do business with people and entities (trusts and corporations) that are not from that country. The offshore jurisdiction does not trust the offshore bank to accept deposits from its citizens or corporation filed in that country. This right away should tell a moderately astute investor that he or she is perhaps not exercising the correct amount of caution when it comes to selecting a bank and an offshore jurisdiction. So the first warning sign is be careful of offshore banking licenses. A bank can be in an offshore jurisdiction and not have an offshore banking license, instead be a regularly licensed bank. Offshore bank licenses can be had in some jurisdictions with as little as a $50,000 deposit with the country issuing the license. Usually this amount is never more than $500,000 and many countries require less. As a point of comparison a regular bank operating in Panama is required to post $10,000,000 cash deposit and the owners go through a rigorous background investigation.

Bank Failure – This is a term relating to the offshore bank being unable to fulfill the demand for funds from their depositors. This can occur for a number of reasons, some bad and some not so bad. The offshore bank may have been found to be below its protective ratios and the government bank auditors or financial ministry may decide to shut the bank down in terms of money going out for a limited period of time to see if the bank can return their ratios quickly to an acceptable level. In the event the ratios return to an acceptable level the bank operation resumes normally and the depositors may not even know anything occurred.

Complaints – The way offshore bank failures generally start is with complaints to the licensing authority of the country where the bank is located stating that requests to withdraw funds are not being met by the bank. To document this the account holder generally retains legal counsel in the country where the offshore bank is located and files a formal demand for the funds to bank with a very short deadline. When this demand is not met the law firm will file a formal complaint to the offshore bank licensing authority who will generally conduct an investigation. They may have their own auditors or hire an independent team of auditors to go through the offshore bank records. They will look to see if there are any loans on the books that do not meet the guidelines for lending such as writing uncollateralized loans is usually considered an offense. Loans to the principals of the bank are another red flag. Real estate acquisitions like mansions on the island where the offshore bank is located for the bank executives to live in is another red flag as well. Usually without loans the bank would not fail to meet its ratios. When these loans go bad and there is no collateral to go after then the banks get into trouble. The complaint process is possibly the only way the government is going to know their offshore bank is in trouble and by then it may be too late, but it may not be too late. Remember we are talking about offshore banks here, not regularly licensed regular banks which are audited and watched way more closely by the government and usually by a different government agency than the agency supervising offshore banks. We as a Panama Law firm do not introduce clients to offshore banks which should tell you something.

Loss of Correspondent Bank – Sometimes the offshore bank has just lost one or more of its correspondent banks and can not execute wire transfers until it replaces the correspondent with another correspondent bank which may take several weeks. When the complaints hit the government they will investigate, see that the funds are in place and allow the offshore bank a reasonable period of time to secure another correspondent bank, checking with them for progress reports. This is a not so bad problem that will only serve to scare and inconvenience the depositors.

Offshore Bank Receivership – This is a process whereby the government agency that licenses the offshore bank takes over the offshore bank to control its operation with an eye towards saving the bank. Sometimes they are successful and well sometimes not. Often a team of professionals from a large auditing or accounting firm are brought in. Receivership practices can frequently mean that a percentage of your funds will be unavailable for withdrawal for sometime. This is to prevent a run on the offshore bank which would for sure topple it and thus cost the depositors substantial losses. You may be only able to take out say 25% of your funds. What can often happen is the depositors lose faith and take as much money out as they can and avoid putting in any more money. This usually results in the offshore bank failing totally and being shut down.

Suing the Offshore Bank – What often happens in these offshore bank receivership scenarios is some depositors get scared and act jumpy and sue the bank. The lawsuits generally involve having the court encumber or tie up an amount equal to their deposit. To accomplish this the depositors generally have to resort to deceit or twisting the truth minimally, to make the court think they were not ordinary depositors or the amount in question consisted of funds to be handled in a special exceptional manner. The way the depositors are playing their hand is get the court to hold my money before the bank goes down completely and then my funds get mixed in with all the depositors in the fracas. If one files such a lawsuit they are generally excluded from filing claims as regular creditors (depositors) of the bank in the event of a liquidation and if they lose their lawsuit (an expected occurrence if based on fraud or deceit) they can lose all. Usually several depositors will file such lawsuits if there is any official action taken against the offshore bank and this could push the offshore bank into greater difficulty and if there is a bank liquidation it will be a most complex one with a lot of depositors funds eaten up in legal fees.

Offshore Bank Liquidation – This is of course the sword of gloom in the world of offshore banking. For things to reach this level the government had to have felt that the offshore bank is not salvageable. Generally a bunch of depositors filing lawsuits and jamming up the court system of some island jurisdiction is going to encourage the government there to liquidate the offshore bank in hopes of freeing up their courts. Imagine an offshore tax haven island court system. A small building with one to three courtrooms and maybe three or four judges. These courts hear divorce, child custody, personal injury as in auto accidents, bankruptcy, collection cases, resident disputes with building contractors, traffic court cases, and criminal cases. The court is there to enable the island jurisdiction to function as an independent governing state. It is not going to jam up its courts increasing the wait times for its citizens that are trying to deal with vital matters like child custody where one of the parents is an abusive drunk hurting the children. When the offshore bank gets put into liquidation generally the court cases can be disposed of quickly or even by summary dismissal. The government knows that the people behind these lawsuits are trying to get more money than they would if they just waited for the liquidation to proceed and are not amused by their litigious behavior.

The Offshore Bank Liquidation Process – So now the bank is in liquidation. What does this mean? Basically a liquidator will be appointed to determine what assets the bank has, liquidate what can be profitably liquidated and then see how much money is left. The remaining money will be divided up amongst the depositors fairly depending on how much they had on deposit in the offshore bank. They will get a percentage of their deposit back. What would be a good return in a liquidation, 75%. What would be a bad return well there was a liquidation in Latvia a few years ago where the depositors got 2%. What is a typical return? There is no number but it should be 33% to 60% unless the bank has been really mismanaged.

The Offshore Bank Liquidator – This is generally a person with an accounting, legal or banking background. They can understand the books of the offshore bank and the laws pertaining to the offshore bank and the liquidation. If the offshore bank had secured loans that went bad (payments not be made according to written loan documents) they will analyze the worth of going after the collateral. If there was a farm in Argentina posted as collateral for a three million dollar loan he may order an appraisal of the farm to see if it really worth that much. If the value of the farm is more than the legal expense of securing and liquidating the asset the liquidator should go ahead and liquidate it. This process may take a year or longer. If a loan was made to a trucking company in Belgium for a fleet of trucks the same liquidation process may occur. This sort of liquidation may take even two or three years depending on what type of liquidation processes may need to be followed. The borrower may file bankruptcy making the liquidation of the secured assets difficult and time consuming in some countries. The bankruptcy court might let the borrower continue making payments and keep the asset which can make for a rather problematic liquidation because now the loan must be sold to reduce it to a net value. Generally such a loan is going to go for a deep discount at best. The liquidator may have to sell the banks real estate, computers, office equipment and furniture, cars, boats, planes etc. All this is time consuming and the assets should be sold at an auction to keep things fair avoiding accusations of selling under the market for kickbacks. There is an inherent conflict of interest in the liquidation process. The bank liquidator generally gets paid handsomely. Think perhaps $150 to $300 an hour or maybe $10,000 to $30,000 per month. It is in his best interest to keep things going for as long as possible. The lawyers the bank liquidator uses are also under this same conflict of interest. How honest and upright these people are going to be is something for which there is no rule but there is generally a control element in the form of a creditors committee. In an honest liquidation the liquidator may elect to distribute the readily available assets the offshore bank has right away. These assets would be the actual cash deposits. This is an encouraging sign to the creditors. Money would usually be held back to allow the liquidation to proceed further allowing for legal expenses etc. Then as real estate and other assets are sold further distributions would be made. Not all liquidations are done so directly.

The Ugly Side of Offshore Bank Liquidations – Sometimes the offshore bank assets are deposited by the liquidator in another bank. Whether or not this is in an interest bearing account is always a good question. If there is $12,000,000 in cash in a bank the interest at 4% a year is a serious amount of money that will tempt people. Legal fees can be padded and kickbacks made to the liquidator from the law firm located on the island jurisdiction the offshore bank is in. Some of these islands where these offshore banks are have less than 100,000 people living in the country. You are foreigners and don’t expect such honest treatment in these tourist island jurisdictions. They may view these offshore bank liquidations as a feast for the locals courtesy of all the rich foreigners. Excessive travel can be run up by the liquidator. He can travel abroad going first class all the way even bringing the lawyers along, all on the clock. The liquidator can reach crooked settlements with people who posted collateral for loans with the offshore bank. Depositors of the offshore bank can file lawsuits for special treatment and the liquidator can settle with them in a crooked manner for an illegal kickback and then they get all their back while you only get a fraction back. Real estate owned by the offshore bank can be sold under market value for a kickback to a friend or relative of the liquidator. Same can be done with cars, computers etc. The liquidator can elect to chase assets not worth chasing to continue his high paying job some years longer than it should require. Remember offshore bank liquidations do not come along every day and the liquidator has no idea where his next job is going to come from. There is a check and balance usually in the bank liquidation process which is described below.

Offshore Bank Liquidation Creditors Committee – A creditor of the offshore bank is generally a depositor but it could be the electric company or the phone company. Generally, the employees are considered priority creditors when it comes to their wages and they get paid off first and fast. The depositor is owed money by the offshore bank based on their deposits, thus he or she is a creditor as far as the offshore bank liquidation is concerned. An offshore bank liquidation is sort of like a bankruptcy proceeding. In an offshore bank liquidation a creditors committee is formed which is something done in many bankruptcy proceedings. The creditors committee could possibly have been formed before the liquidator came into office and they appoint the liquidator with or without the approval of the court, rules vary some depending on the offshore jurisdiction involved. The creditors committee generally is voted into existence by the creditors, the creditors with the most dollars on deposit having the most votes is one way to look at it. All creditors are generally not treated equal. The creditors committee members are all on the same side and that side is interested in getting as much money back as they can. Decisions as to how to spend money chasing assets or potential assets are usually made by the liquidator but the creditors committee can exert control over the liquidator even replacing the liquidator in extreme circumstances. Some bank liquidations have taken place without creditor committees in place. These are generally less than above board liquidations.

Creditor Claims in Offshore Bank Liquidations – When the liquidator is in office the depositors are generally required to file claims. The claims process involves filing identity documents with the liquidator and identifying your account and how much money was in it. Offshore bank liquidations are conducted in open court and these claims wind up as exhibits in the public domain. What I am saying is bank secrecy is not in place once the bank is in liquidation. What one can expect to see is a fair number of depositors failing to file claims because of various reasons often relating to bank secrecy. Of course this means a greater recovery for those who do file the claims while the other folks walk away with a total loss of their funds by choice.

What to do if you are in an Offshore Bank Liquidation – If you are already involved in a bank liquidation you made a mistake and you are going to get hurt. How badly hurt is the question so you should be trying to mitigate your damages. If a creditors committee is forming try to get involved actively, even try to sit on the committee. If the liquidator has not yet been appointed do get involved in that process. Try to find ways to meet other depositors. Call lawyers on the island and ask them to represent a group of creditors collectively. Rest assured other depositors will be calling lawyers on the island and the lawyer can be a contact point to form a creditors committee. The idea may not occur to a lot of these lawyers so help them out a bit. If you can get a creditors committee in place and have it appoint a liquidator you will probably have a honest liquidation, probably. That having been said one must still leave room for the offshore bank itself having been intrinsically dishonest and the bank owners have since ran away with the funds. When you read the offshore bank liquidation horror stories you see that the money trail goes from country to country, bank to bank and then it ends up with a large cash withdrawal which is usually the end of the trail. The offshore jurisdiction may fail to ever prosecute them or file charges which of course make one wonder what was going on. So the key here is to get involved actively. It is real important to open communications with other creditors and get organized.

How to Avoid Being in Offshore Bank Liquidations – The answer is of course simple, avoid offshore banks. Stick to banks with full banking licenses that can conduct banking business with the residents of the country as well as with entities not located in the country.

Offshore Bank Alternatives – The best alternative to these tax haven island offshore jurisdictions is Panama. Panama is a solid offshore tax haven jurisdiction that does not tax offshore derived income and has no capital gains tax or tax on stock market gains. Panama has fully anonymous bearer share corporations where the owners are not recorded in any registry or database. Panama has anonymous foundations which are able to have generally non-freezable bank accounts. Panama has no tax treaties with any country so fishing expeditions are not going to happen. Panama has the tightest bank secrecy laws in the world and when coupled with an anonymous bearer share corporation it becomes the most secure and private structure one could have in the world today. Panama has 400,000 corporations registered there as well as many of the merchant marine vessels and cruise ships in the world. Panama has about 150 banks many of which are large multi-billion dollar international conglomerates, yet the banking operation in Panama is a separate bank corporation operating under Panama bank secrecy laws. Panama has not had a bank failure in over five years. Panama has had only a few bank failures in its history whereas Switzerland had over 15 bank failures during the years 1999 to 2000. Panama tightly regulates its banks. Every Panama Bank must submit monthly auditing reports to Panama’s Banking Superintendent, which is under direct supervision by the Banco Nacional de Panama (BNP), the National Bank of Panama. A list of prominent international banks in Panama includes: Citibank, HSBC, Dresdner Bank, Bank of Tokyo, Bank of Boston, Banco Nacional de Paris, International Commercial Bank of China, Societe Generale, Banque Sudameris, BBVA, Banco Uno, Banco General, PriBanco, Banco del Istmo, Global Bank, MultiCredit Bank, PanaBank, ABN Amro, Banco Aliado, Banco Continental, BancoLat, BIPAN, Lloyds TLB Bank, and the Bank of Nova Scotia. Many of the Panama banks own office building skyscrapers 40+ stories tall with their name on the building. These are not grocery store sized banks found in the island jurisdictions. The Panama Stock Exchange has an average trading volume of $900,000,000.

Panama is free of hurricanes, volcanoes, tornadoes, and earthquakes which is why the Panama Canal was built there. Panama uses the US dollar as their national currency. Panama has modern telephones, cell phones and internet being a country having been built by the Americans which left Panama in 2000. Panama has a treaty with the USA calling for the USA to protect the Panama Canal if it was threatened. This means the peace and security of the Republic of Panama is protected by the USA which could have jet fighters there in minutes. Panama is the new Switzerland of the world.

Banking Services for Better Business Efficiency

Delivering consistent, accurate and effective banking services are critical to any bank or financial institution! Often times, effective banking instruments and solutions help businesses to grow exponentially. Today, due to rapid pacing competition, businesses have less time to afford the time, cost, risk, and business disruption that come with complex and high-cost processes. Here, the major role of banks comes into play. Banks are unleashing their power to create suitable instruments that significantly reducing the costs and dissolving potential risks to the businesses.

In order to give apparent benefits to the business houses and industries, banks are lavishing finest services that help to streamline business processes. They are giving the facilities of transaction accounts, savings accounts, credit cards, lending & finance and other reliable and flexible payment solutions. They provide a broad range of flexible finance options to help budding and established businesses to grow their business in a seamless fashion, in and around the region. They also provide exquisite services that help manage cash flow and fund flow. Banks and financial institutions also merge their services and financial products for aided benefits and complete flexibility.

For utmost flexibility of the customers, banks offer them an opportunity to combine their transaction account and loan account and allow them access their funds in a wide variety of ways. They not only provide online banking services for uninterrupted convenience, but also give them variable interest rates without monthly repayments. They offer key lending and finance solutions that foster businesses to move towards prosperity. Besides, lending and finance solutions they tend to provide effective payment solutions to keep businesses running efficiently. Whether you are a small trader, big IT giant or a store keeper, banks and financial institutions offers a great range of payment solutions to meet individual requirements. One of the primary things that banks focus on is eliminating the need for cash and manual processing. These facilities are perfect for fixed physical locations, such as retail shops, etc.

In addition to that, banks are providing internet banking to the businesses in order to make their work simple, fast and easy. Through these solid banking technology and integral services banks have apparently streamlined the navigation for improved online banking experience. This has enabled people to perform banking operations easily through their home computer or a smart phone.

The features of Internet Banking Services:

1. Continuous banking operations
2. Minimized banking fees
3. Convenient and super fast
4. Easy bill payments options
5. Transfer funds to anyone
6. Set Short Message Service (SMS) & Email Alerts

Today, for banking and finance, security is one of the major concerns and this is the reason they are shifting their gears towards cloud computing. They are constantly moving their data to the cloud for safety and fast accessibility. The essence of the story is, banks are offering unlimited services to the individuals and business houses so that they can unwind their wings for sky heights of success.