• The Entrepreneur Forum | Startups | Entrepreneurship | Starting a Business | Motivation | Success
  1. Trading Life for a Weekend?
    Build a Business, Build a Life.
    Unleash the Dream.

    Become an UNSCRIPTED™Entrepreneur.

    UNSCRIPTED™ Entrepreneurship is an entrepreneurial business strategy that unleashes dreams, frees time, and explodes your incomes—but more importantly, it changes your life forever. Make no mistake; this isn’t something you “try”— this is something you live.

    FREE Download (Unscripted) FREE Download (Millionaire Fastlane)  Register
    Registering for the forum removes this block!

FORUM SEARCH


Need answers about entrepreneurship? Search FIRST! More than likely your entrepreneurial topic has already been discussed.
Powered by Google Site Search.

Next bank to fail: HSBC

Discussion in 'General Entrepreneur Discussion' started by andviv, Sep 15, 2009.

  1. andviv
    Offline

    andviv Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass

    Messages:
    5,378
    Likes Received:
    2,020
    Joined:
    Jul 27, 2007
    Location:
    Washington DC
    Rep Bank:
    $2,508
    I remember a couple of years back when I had an account with Wachovia. It was a great bank. Suddenly they started to delay longer to cash my checks. I'd deposit a check and then they would take extra days to make the money available in my account.

    The excuses were varied, from "new policy" to "making sure the cash is available from the check's owner account" for a cashier's check (yup, a certified check, can you imagine?).

    Well, it is Deja Vu all over again... this time with a different bank.

    This time the one that is having the same type of situation seems to be HSBC.

    We deposited a check on Thursday night from a different city than where the account resides, using an ATM. The check wasn't that big, a little bit more than $2K.

    They made $500 available the next day.

    And then on Monday the account showed a negative balance for the amount we deposited on Thursday. The $500 they had made available are now gone as well.

    When we called the bank they said that "Security had put a hold on the check" and no more explanations. The hold would last for 5 business days.

    An hour later, after listening to stupid excuse after stupid excuse we were finally transferred to a manager who told us it was a policy from Security to make sure the check was correctly funded, to "protect you". Protect me from having my money in my account? wow.

    So, it started to sound like Wachovia again, and we all know what happened to Wachovia, right?

    Today the excuse has been similar... really obscure... Security put a hold on the check cause they were not sure who had signe the check. When we asked them if the check had funds and the paying bank was OK with it they said yes.

    Oh, but now they told us that the money would be available next Monday. That is more than 5 business days ni my books, but hey, they are the bank, I guess they know better, right?

    Anyway, still dealing with this issue, and we still don't have the money in the account. And we are in overdraft.

    So, again, these are the same symptoms I started noting with Wachovia, well earlier than when they started talking about its demise.

    Have you noticed similar behavior from any bank these days?

    I wonder if it is time to short HSBC in particular at this time....
     
  2. MJ DeMarco
    Online

    MJ DeMarco Raving Lunatic Staff Member Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

    Messages:
    24,041
    Likes Received:
    61,805
    Joined:
    Jul 23, 2007
    Gender:
    Male
    Location:
    Phoenix, AZ
    Rep Bank:
    $238,414
    Admin Post
    I doubt HSBC goes insolvent. It is a Chinese owned bank. Sounds like just typical corporate BS strategies to increase fees and surcharges.
     
  3. Runum
    Offline

    Runum Platinum Contributor Read Millionaire Fastlane Speedway Pass

    Messages:
    5,907
    Likes Received:
    3,988
    Joined:
    Aug 8, 2007
    Location:
    DFW
    Rep Bank:
    $10,947
    Isnt' this called check kiting? They get the use of the money for a few more days before paying off.
     
  4. andviv
    Offline

    andviv Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass

    Messages:
    5,378
    Likes Received:
    2,020
    Joined:
    Jul 27, 2007
    Location:
    Washington DC
    Rep Bank:
    $2,508
    Yes, it is. The thing is, they didn't do it before, and now they are...

    like I said in the OP, I noticed the same pattern with other bank 6 months before they were in big trouble and ended up being bailed out by us.

    This change in policy is what makes me believe they are starting to have liquidity issues.
     
  5. JLaw
    Offline

    JLaw New Contributor

    Messages:
    42
    Likes Received:
    12
    Joined:
    Dec 3, 2008
    Location:
    Bay Area | Hong Kong
    Rep Bank:
    $21
    HSBC was founded in Hong Kong, but headquartered in London, I wouldn't exactly classified it as a Chinese bank. It is the world's largest banking group and top ten company in the world. I don't think you have anything to worry about. MJ, HSBC just has a huge chunk of its operations in China.
     
  6. andviv
    Offline

    andviv Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass

    Messages:
    5,378
    Likes Received:
    2,020
    Joined:
    Jul 27, 2007
    Location:
    Washington DC
    Rep Bank:
    $2,508
    This sounds just like Citibank a year or so ago...

    Just in case I'm moving my account to another bank.
     
  7. JLaw
    Offline

    JLaw New Contributor

    Messages:
    42
    Likes Received:
    12
    Joined:
    Dec 3, 2008
    Location:
    Bay Area | Hong Kong
    Rep Bank:
    $21
    Little different, Citibank is an American bank, HSBC is a British/Hong Kong bank. You can thank American rules and regulations for all the bank failures and credit crisis.
     
  8. randallg99
    Offline

    randallg99 Bronze Contributor Speedway Pass

    Messages:
    1,390
    Likes Received:
    175
    Joined:
    Aug 9, 2007
    Location:
    NJ
    Rep Bank:
    $154
    I personally had similar experiences with Santandar/Sovereign as well as TD Bank N.A. The same run around you received is similar to the one I got. Banks are changing the rules as they go along and their policies have cost me significant sums. Funny thing is that everytime I threaten to move my deposits they beg for me to stay and waive the excessive fees.

    Banking institutions have recently put customer service behind "staying alive" and "screwing the masses."

    It's easy to blame American banks for the mess, but European banks had laxer standards than American banks and almost doubled leverage ratios. From an article one year ago:

    >Dr Daniel Gros, director of the Centre for European Policy Studies and co-author of the study, says that the "overall leverage ratio" of Europe's 12 largest banks - that is, the measure of total assets to shareholder equity - is 35 to 1, compared with less than 20 for the largest American banks. Highly-leveraged bets were widely blamed for the demise of Lehman Brothers, which held almost $700 billion in assets despite having shareholder equity of just $23 billion (a ratio of 30 to 1). <

    High leverage ratios could mean Europe's big banks are in deep trouble - The Irish Times - Wed, Sep 24, 2008
     
  9. hatterasguy
    Offline

    hatterasguy Bronze Contributor Speedway Pass

    Messages:
    2,090
    Likes Received:
    190
    Joined:
    Jul 29, 2008
    Rep Bank:
    $279
    This is why I use local banks.
     
  10. Chitown
    Offline

    Chitown Silver Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

    Messages:
    587
    Likes Received:
    753
    Joined:
    Apr 14, 2009
    Location:
    Culver City
    Rep Bank:
    $4,024
    Hatterasguy,

    I'm right there with you, my man.