A little buying power?
Posted on October 28, 2009 at 7:48 amNational Healthcare Corp. (Ticker: NHC) has renewed its $75 million line of credit with Bank of America for another year. The Murfreesboro-based operator of long-term care and senior-living facilities said the available money will help it take advantage of growth opportunities in the senior care market.
permalink | Comment on this post
Moody’s: No end yet to banks’ credit troubles
Posted on September 10, 2009 at 1:01 pmThe ratings agency this morning reiterated its negative rating on the banking sector, saying it does “not believe asset quality deterioration for the US banking industry has reached its peak.” Commercial real estate in will be a particular thorn in the side going forward, Moody’s analysts said.
permalink | Comment on this post
The RTC to rise again?
Posted on September 9, 2009 at 8:11 am
Investment Dealers’ Digest says banking regulators are seriously considering creating a bad-asset management entity modeled on the Resolution Trust Corp. from 20 years ago.
“They are very, very keen to ensure it does not repeat itself,” says the industry participant who attended meetings with the FDIC about the RTC. “My guess is they’ll have the spirit of the PPIP investment plan where the investors share both upside and downside with the U.S. government.”
permalink | Comment on this post
Two reasons why CRE is the next domino to fall
Posted on September 1, 2009 at 6:44 am
The first, say the Journal’s Lingling Wei and Peter Grant, is bad underwriting — the commercial equivalent of making mortgages to people who couldn’t afford them — that already is making its way through the system. The second factor will take a little longer to fully manifest itself.
By the end of 2012, some $153 billion in loans that make up CMBS are coming due, and close to $100 billion of that will face difficulty getting refinanced, according to Deutsche Bank. Even though the cash flows of these properties are enough to pay interest and principal on the debt, their values have fallen so far that borrowers won’t be able to extend existing mortgages or replace them with new debt. That means losses not only to the property owners but also to those who bought CMBS — including hedge funds, pension funds, mutual funds and other financial institutions — thus exacerbating the economic downturn.
permalink | Comment on this post
Banking’s worst-case scenario
Posted on August 18, 2009 at 7:51 amYou may not buy all of the points made here by financial planner John Lounsbury, but there is plenty to agree with, including this thought:
We need one hell of a recovery here to prevent disaster. Muddle through will not do it. A return to 3% GDP growth may not do it. We need a couple of years at 4% (or higher) GDP growth to have any chance that some of these banks can earn their way out of the quagmire.
Piling on the plastic
Posted on June 8, 2009 at 8:07 amTennesseans posted the third-fastest growth rate in credit card balances during the first quarter, says TransUnion.
permalink | Comment on this post
Banks begin facing up to CRE trouble
Posted on June 5, 2009 at 7:06 amThis is what many market watchers have been saying is the next shoe to drop in the financial world: The number of nonperforming office, industrial, apartment and retail loans jumped 40 percent during the first quarter.
permalink | Comment on this post
No new credit from the banks
Posted on April 13, 2009 at 12:55 pmNew figures from the Fed show that U.S. banks’ commercial loan portfolios shrank 2.9 percent during the first quarter. Commercial real estate exposure – seen by many as the next domino to fall – fell by 0.5 percent.
For a glass-half-full take on these numbers, check out hedge fund manager Gary Townsend’s opinion that “banks are not only able to lend, but that they’re taking ample market share from non-bank financiers and the shadow banking system.” For the glass-almost-empty approach, read the first few comments to Townsend’s piece.
permalink | Comment on this post
Analyst action: CHS, Tennessee Commerce
Posted on April 8, 2009 at 10:02 am
Goldman Sachs has kicked Community Health Systems off its Conviction Buy List. Shares of the Franklin-based company (Ticker: CYH) are down about 6 percent today and close to break-even for the year.
Over at Howe Barnes, analyst Jeff Davis has slashed his rating on Tennessee Commerce to ’sell’ after the bank said it will write down the value of its owned real estate by almost $3 million and further beef up loan loss reserves. Davis, who is based in Nashville, said CEO Art Helf and his team will have to slow loan growth to maintain their capital ratios. He expects Tennessee Commerce shares (Ticker: TNCC) will struggle in the coming months.
Our investment thesis assumed for the shares to rise from a pedestrian valuation that TNCC would have to prove to investors that it could manage through the deep recession and remain profitable… With this quarter’s loss, the shares will likely remain in the penalty box until the economy strengthens and/or the company strings together several quarters of profitability.
Almost 90 minutes into today’s session, Tennessee Commerce’s very thinly traded stock has yet to change hands.
permalink | Comment on this post
Small biz doesn’t need the help
Posted on March 17, 2009 at 8:20 amJeff Cornwall says the Obama administration’s plan to pump credit to small businesses might not be in everyone’s best interest.
The last time the government pushed bad debt on us we ended up with a real estate bubble pumped up in large part by the subprime lending that banks issued due to intense government pressures.
SEE ALSO: Time to help small biz
permalink | Comment on this post
Time to help small biz
Posted on March 16, 2009 at 11:10 pmThe Obama administration on Monday raised some eyebrows with its plan to help get the small-business lending market going again. Central to the idea are higher loan guarantees and $15 billion of TARP money to add liquidity to the secondary market for SBA loans.
“There were two things I liked: the help for the securitization markets, and the President’s call to make the banks report how much lending they are doing,” said Keith Ashmus, a Cleveland-based attorney and chairman of the National Small Business Assn. “We are seeing business after business with a history of promptly paying their bills just get their credit lines canceled.”
Kent Hoover has a different take on just how much of an impact the plan might have.
Given the weak state of the economy, however, it is not clear how many small businesses want to borrow money at this time. A survey of small business owners conducted last month for Discover Financial Services found that 23 percent said they would be very likely to apply for an SBA loan if they became easier to get. Another 17 percent said it was somewhat likely they would apply for an SBA loan.
The survey found, however, that 90 percent of small businesses had never applied for an SBA loan.
permalink | Comment on this post
Credit line completes LP’s financing spree
Posted on March 11, 2009 at 9:03 amLouisiana-Pacific has signed a deal for a $100 million asset-backed credit line with Bank of America and Royal Bank of Canada. The agreement follows a recent debt issuance and the loosening of certain terms of an existing series of notes. LP shares (Ticker: LPX) are up 6 percent in the first half hour of trading.
“These transactions are an important part of our overall effort to strengthen our financial position and extend the maturities of our debt,” said Curt Stevens, LP’s chief financial officer. “We believe that this capital availability, along with our previously announced actions to reduce costs and conserve cash, will allow us to get through these poor market conditions and position ourselves to take advantage of the economic rebound as it occurs.”
permalink | Comment on this post
Why the credit crisis will last
Posted on March 10, 2009 at 11:18 pmSeveral important market indicators have regressed to their worst levels from late last year, which means cash will remain hard to get for many companies and individuals – and that any stock rally is short-lived.
“With those four things showing more and more strain, there’s a disconnect with equities rallying the way they are,” Lutz says. “If they keep trading this way it’s definitely an indication that there could be another leg down in stocks.”
See also: Short sellers, not Citi, spurred the rally and Even solid firms feel pinch as lending remains tight
permalink | Comment on this post
Vanderbilt goes to bond market with $250M deal
Posted on February 23, 2009 at 11:17 pm
Fitch Ratings says another $330 million sale is on its way relatively soon and, in a lovely financial boilerplate kind of way, makes the late-summer days of scrambling to make payroll seems oh so far away.
The university also has substantial balance sheet resources. Fiscal 2008 available funds, defined by Fitch as unrestricted and temporarily restricted cash and investments, were $3.6 billion, and covered operating expenses of $2.8 billion and pro forma debt of $1.5 billion by 128.2% and 238.9%, respectively. While the university’s endowment has declined in value since fiscal year end 2008, due to the current financial market turbulence, its liquidity position remains strong and is consistent with the current rating category.
permalink | Comment on this post
With refinery still down, Delek tweaks debt deal
Posted on at 7:51 amThe parent of Mapco has agreed with its lenders to amend an asset-based lending agreement because of the fatal accident that shut down its Texas refinery last November. Among the terms is a clause that lets the company (Ticker: DK) shift assets from one division to another and a Sept. 30 deadline to get the refinery back up and running. The company last month said it was shooting for a May restart.
Recent Comments
We don’t know the final...
This report shows that the downfall started when the...
What an ego, the next thing you know the unio will want to consult prior...
Wow HCA pays its Employee’s to...
Another SEIU power play to show how important they are. Their...
Taxation caused the moves to Mexico. In an upcoming...
This reports shows that the downfall started under Bush....
In this era, the government jobs are created at...
Added government jobs are also the hardest to...
Interesting question, oatka, and here is a...