The Swedish banking system comprises four categories. For anyone considering a career in banking in Sweden, this list is a helpful guide on where to start. To learn more, see our lists of financial institutions.
The sometimes eccentric views of John Hempton Tuesday, July 29, Hookers that cost too much, flash German cars and insolvent banks: It helps if you read my post on the Norwegian bank collapse before you read this.
But otherwise enjoy a post that breaks all the rules. I am loudly calling the likely collapse of a politically sensitive country. Its one of those circumstances when shouting fire can cause the tragedy.
To some extent I take comfort in my low readership. I promised when I started this blog to have a global focus. But I hope to remedy that in this post as I give you, dear readers, a financial tour of Sweden, Latvia, Estonia and Lithuania.
The title is a little sensational too — but not unfair. Before I start I need to introduce you to a model of bank collapse. The fixed currency model of bank collapse First observation: See Australia or New Zealand for examples. See my post on 77 Bank for an example. This happens as follows: They do this by borrowing the target currency or by withdrawing lending in the target currency.
In doing so they reduce domestic money supply causing short term interest rates to rise. If they do this enough they induce a recession ugly. This creates pressure political and otherwise for a deviation.
However if they continue to do this they will run out of foreign currency reserves — and the fixed exchange rate collapses anyway. Many a fixed currency has been broken this way.
George Soros did it with the pound. Nameless speculators did it across Asia. The currency crisis morphs into a run on bank wholesale funding. Past currency crises have been associated with bank collapses. In Thailand which was precisely to this model the finance companies actually collapsed and the banks almost collapsed.
In Korea both the banks and currency collapsed. But you need to be really careful of countries with fixed exchange rates and huge, unsustainable current account deficits.
Never much fun shorting the banks in such countries If you had picked the collapse of the Thai Banks you might have cleverly shorted the stocks. It would not have helped much.
The only problem is that you have the profit in the pre-crisis exchange rate. That is fine-and-dandy but it is not much reward for effort of picking a system that is about to collapse.
You would of course be much better just shorting the currency — or shorting the ADRs of the target stock the ADRs being priced in a hard currency.
The real exception is that if you find a bank in a hard currency that is totally exposed to the debacle country you can make a fortune. You can guess now that Swedbank is my bank.
It is not the only one — but is very spectacular.
Current account deficits, fixed exchange rates and Eastern Europe Eastern Europe is full of vulnerable currencies. Most of the countries have fixed their exchange rate to the Euro hoping I guess for Euro membership at some stage and have massive current account deficits. Latvia is particularly bad.The financial sectors in the Baltic countries have developed quite rapidly over recent years Tuuli Koivu Banking and Finance in the Baltic Countries Bank of Finland / Institute for Economies in Transition BOFIT Online 11/ the country but the two biggest of them – Hansabank and Eesti Ühisbank – control about.
The International Fund for Agricultural Development (IFAD), a specialized agency of the United Nations, was established in as an international financial institution. Hansabank Group is the largest financial institution in the Baltic countries with total assets exceeding EUR billion and shareholders equity over EUR billion (based on the September results).
Hansabanka’s headquarters in Riga. 4 Population, mil A Overview of Hansbank the Largest Financial Institution in the Baltic Countries. words.
Hansabank has since acquired Ventspils UBB in Latvia and more recently the Lithuanian Savings Bank, making the Group the largest retail bank in each of the three Baltic countries. Nordic Investment Bank (NIB) is a multilateral financial institution founded by the five Nordic countries (i.e. Denmark, Finland, Iceland, Norway and Sweden) in the year of Jul 29, · Manifestations of the Baltic Madness in bank balance sheets. The largest Baltic bank is Hansabank – a wholly owned subsidiary of Swedbank. The last Swedbank annual report contains this fascinating summary table: For the currency challenged – there are about 6 Swedish Kroner to the USD. The deposits are billion kroner, loans billion.
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Nordic Investment Bank (NIB) is a multilateral financial institution founded by the five Nordic countries (i.e. Denmark, Finland, Iceland, Norway and Sweden) in the year of It's hard to find a better school than University of South Carolina - Columbia if you want to study Slavic, Baltic & Albanian Languages.
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