All non-credit activities of universal banks(equity trading and investing, asset mgt, insurance real estate . ..) should be split from regulated normally protected banking activities, the sole business of deposit, credit, interest rate and payments!
JP Morgan quarterly loss of 2 billion dollars announced May 10 by Jamie Dimon, CEO of the most conservative and well-respected U.S. bank, following the annoucment of further expected losses at Dexia this year following the 11.5 billion shareholders blood bath for 2011, reopens the question of the urgent necessity to split banking.
Dexia announced on MAy 9th. a net loss of 431 million euros for the first three months of the year, shareholders hold now Dexia shares worth 0.18 euros which represents a market capitalization of 350 million euros, less a thousandth of its balance sheet, which is weighting currently around 400 billion euros. At Dexia, whose board of directors unanimously threw money away by paying Pierre Mariani, the friend of President Sarkozy and BNP Paribas, more than € 1.2 million euros for 2011, including a special ” function premium” included there no more than managing a bankruptcy. Bankers remain all fooolish about pay and the appointment of Karel De Boeck, former Belgian CEO of Fortis, as Dexia Director and perhaps CEO in place of Pierre Mariani is just miserable national politics on a well paid job.
The JP Morgan brokerage losses “could still cost one billion dollars or more” and “the risk will remain for several quarters.” It is especially astounding that JP Morgan boss admitted that he discovered these risks following a Wall Street Journal in early April, from rumors at the London City on massive positions taken by a French trader of the bank, Bruno Michel Iksil, dubbed the “whale of London.”
After the BArclays, HSBC, JP MORGNA, Crédit Lyonnais, Kerviel’s Société Générale, Madoff’ UBS, Natixis, bankrupcies in Germany and the UK waiting for further Spanish and othe bankruptcies to come, the inability of the best universal bank executives to see the whale that lurks in their own accounts should lead every honest man to end this dangerous model which we blame since fifteen years.
Proxinvest May 11 th. 2012
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