Even as President Obama’s financial reform looks all set to make a place for itself in the economic fabric of the country, critics within political circles say that these changes will still not address the risks posed by “too big to fail” institutions. [Read more…]
Once Again Citigroup in Question Over Posted Profit
Earlier this week, Citigroup reported earnings of $4.4 billion for the last quarter, along with its best turnover for the last couple of years. It managed to leave behind JP Morgan and Bank of America, its closest competitors, in terms of earnings. The management of the bank claimed that it is now out of all the difficulties that it faced during the recession, because of which it had to be rescued using taxpayers’ money. [Read more…]
Citigroup on Their Way to Recovery
Even as the Obama government initiates plans to stop hand holding Citigroup and move out of their bail out program for the banking giant, the company is taking its first steps forwards after a particularly bad phase which threatened its survival. The man being hailed as the one who achieved the near impossible and turned around the group is the Citigroup chief executive Vikram S. Pandit. [Read more…]
Lehman Brothers Investigation Causes a Stir
The report on an investigation into wrongdoing at Lehman Brothers before the company collapsed has caused quite a stir among regulators and the financial industry.
The comprehensive report, which was authored by Anton R. Valukas, an examiner appointed by court to investigate the company’s bankruptcy has blamed Lehman’s top management and auditor Ernst and Young of using accounting gimmicks to hide troubled assets. The most controversial was the use of an accounting trick known as Repo 105 that allowed the company to shift a massive $50 billion of toxic assets. [Read more…]
Report on Lehman Brothers Collapse Blames Executives
The report on the collapse of Lehman Brothers has come out and it has blamed the company’s executives, its auditors and its rivals of wrong doing. The 158 year old Wall Street bank went bankrupt in 2008, triggering a huge financial crisis.
Anton R. Valukas, who was appointed by the court as an examiner to understand what went wrong in the last few days of the company authored a 2,200 page report detailing his findings. He claims that the senior management of the company indulged in balance sheet manipulation to hide its insolvency. [Read more…]
Federal Reserves Role in Banking
In the wake of the financial crisis, the Obama administration had promised sweeping reforms that would prevent a similar crisis in future. One of the key areas of concern was supervision of banks, and the role that the Federal Reserve should play in that. But even after months of bickering on the issue, no clear solution seems to be in sight on which any kind of political consensus can be achieved. [Read more…]
