SOLID SOUTHLAND STOCK

Going strong for 140 years - The Southland Building Society. We blogged on it when it became as bank.
Since then it has attracted another $200 million in deposits...

Well done guys.

CREDIT WHERE CREDIT DUE

A wee birdy tells us that Mark Solomon raised the possibility that the banks are getting a bit touchy at the moment over the public controversy surrounding the tribes leadership ( or lack of it)at the Hui at Rehua Marae yesterday and at Kaikoura.

Ngai Tahu reputedly has a $200 million dollar credit facility ( note: credit)

Apparently Solomon suggested that all the raruraru ( arguing ) in the media was making the banks nervous.

Well for starters many companies are on notice from the banks - Credit is tight - full stop.
Secondly if they were worried it would not be because of what's in the papers or on the radio or TV or heaven forbid the Blogs. No, if they are in fact worried - it will be because they dont think that the current leadership is stable or horror of horrors maybe there some issues with financial performance or governance. We can only speculate.

But for Solomon to raise it as a big bogey is scaremongering at its worst and at best a limp attempt to make those who are opposing him feel guilty.

If the situation has got so bad that the financiers are reducing support for the tribe then, again we say that points to weak leadership.

Again we say that Solomon , for the sake of the tribe needs to step down.

And it is time for the Tau boys, Tahu Potiki and some of the other young Ngai Tahu businessmen and women to have a korero and develop a leadership plan to take Ngai Tahu into the future. It is time for them to put aside their egos ( and they all have them in spades) but put their wisdom and expertise forward.

The fate of the tribe is in their hands.

A BLOODY GOOD IDEA - FROM THE BANKS

A mortage holiday of up to a year if you are made redundant. Thats what theCommonwealth Bank in Aussie is planning - the bank is headed by Ralph Norris.

With CBA itself predicting last month that the jobless rate could blow out from its current level of 5.2 per cent to a peak of 7 per cent late next year, Mr Norris said that it was not in the bank's interest to see people "get into trouble".

"In the case of those unfortunate to be unemployed, we will provide repayment holidays for six months, and in some circumstances up to 12 months, with interest being capitalised," he said. Mortgage holders will ultimately have to pay the deferred payments, plus interest.

Mr Norris added that he could not rule out job losses at CBA because of deteriorating economic conditions.

The rest of the story in the Australian here

We think its time for the banks on this side of the Tasman to step up with someone similar.

SOUTHERN CONSERVATISM PAYS DIVIDENDS FOR HOME LOAN BORROWERS

We have always been big fans of the Southland Building Society. They have recently become a bank.
Today the NBR reports they were first out with their shingle advertising lower interest rates, (7.20 floating) in the wake of the 1.5 cut to the OCR by Bollard.

Excellent stuff. Go Smith and Smith.

BIG BANKS GANG UP ON TREASURY

The money markets are chattering over the Mexican stand off with the Big Banks who have, in an unprecedented move joined forces to talk turkey with Treasury, over the deposit guarantee scheme. The Banks want some changes. Treasury is staring them down. The banks are staying firm - they want changes to clauses they think could give non banking institutions an advantage.

THE GREAT BANK STORIES TAHI AND RUA

Funny isn't it what comes out of the wood work when time are tough.

Some of us at the prawn know a few people who don't have to worry about the price differentials of blocks of cheddar. They are the sort of people who have worked hard, had faith in themselves and their ideas and done well. Capitalists some call them, others would say just ordinary people doing good stuff. Today over a good lunch I heard two bloody good banking stories.These are true stories -no shit.

Story Tahi.

A couple who have done well - and who employ a few people and for whatever reason, they have about $250k to invest. Dark clouds form on the investment horizon so they decide that it maybe a good idea to invest said $250k in Kiwibank.

They rang Kiwi bank, talked to them about investing the money and yip Kiwibank were interested in seeing the colour of their money. So they say "can we set up an account to put the $250k in?" - Yip Kiwibank said, no probs.
Ok my mate said, can we transfer the money from bank B to Kiwibank? , No probs Kiwibank said. So can we do an interbank transfer - ah no said Kiwi bank we need cash or a bank check.
Oh, said my mates what is the closest branch ?

Paddy's Lotto shop in Courtnay Place they said.

So with a check for $250k my good mate trundled down to
Paddy's lotto shop wandered past the barbers it houses and duly, manually deposited $250k - bit third world we thought....


Until we heard bank story Rua

A close family member, on the eve of the banking crisis decided to take $150k from the National bank (which she wasn't convinced was all that secure - we disagree ) and put it is Wesptac which she thought was more secure. She was going to use it for house renovations.

Anyway same thing happened- Westpac didn't do Internet transfers for more than $1k at a time - she couldn't be bothered waiting for the bank to take two days to up the limit from $1k for her electronic transfers, or waste time going and getting a bank cheque, or carting $150k in cash to Westpac, so she sat on the computer for about an hour and duly deposited $150k in $1k lots from National bank to Westpac - Next day the builders arrived and just as they got set up a strange car pulled up the drive - it was the National Bank - they were worried that she had lost confidence in the bank and wanted to know why she had taken her money out.
They implied that they were worried that it was the start of a tide of depositors taking their money out.
She said no it wasn't the case- she just thought the Westpac was safer. But no sooner had they left than a bloke from Westpac turned up - he was just checking that it wasn't a case of fraud because they had never had someone who had deposited $150k at $1k a time and they wanted to check it was kosher. It was she told them - It was just their stuffed up system that didn't allow her to do a electronic transfers of a reasonable size that had caused the problem.

So we think that banks need to sharpen up their act and maybe they might be a wee bit nervous.

LABOURS DEPOSIT GUARANTEE SCHEME IS A CROCK

Queen Bee at Wellington Hive does some further analysis this morning and it doesnt look good.

It was as Roarprawn expected - a very badly drafted piece of legislation.

Investment guru Chris Lee said on RNZ this morning, that it will be lapped up by the finance companies and skew the market.

We also note that this issue was of so much concern to QB that she got out of bed at sparrow fart to post on the changing face of the Global Credit crisis.

Wellington Hive is a must read for all journalists and investors this morning - read it and weep.

WILL BOLLARD HAVE THE BALLS?

To do what the Aussies have done and slash a percent of the interest rate?

We reckon Bollard might cut .75 but 100 might be a bit rich for his blood.

This from the Herald