Tag Archives: Banking Services

Clerk Drained €224 Million From Bank by Momentarily Fell Asleep

This is another one of those stories that leaves you hanging, not knowing quite what to make of it because some crucial information is missing. But falling asleep and make a transfer of 224 million, without knowing anything about it, is indeed rather strange.But  the fact that the claim of one person examining 603 payments in 1,4 seconds is considered completely normal, is undoubtedly disturbing.


A German bank employee appeared before an industrial tribunal in the state of Hesse, recently,.as a witness in a case of being unfairly dismissed from work. The clerk had gotten of the “mistake” of transferring €224 million instead of €54 with a slap on the wrist, but the bank sacked his college instead – a 48-year-old woman who was responsible for the approval of all outgoing payments. 

While the mistake was eventually noticed and corrected, the on-duty supervisor originally approved the payment request, allowing the funds to go through.

So she sued tha bank, of course. And won. Arguing that when you have to examine more than 600 payments in 1,4 seconds. accidents happens.

The judges said she was not guilty of wilfully damaging the interests of the bank and that although she had made a “serious mistake” she should have been cautioned rather than sacked.

 17222The clerk momentarily fell asleep” on the job and accidentally held down the number 2 button on his keyboard for a little too long — think 222,222,222.22 — causing that much money to be transferred out of the bank was merely admonished by the court.


Just one thing –  to where exactly  was the money transferred?


Possible related:

1 Comment

Filed under International Econnomic Politics, Laws and Regulations, Technology

China: Still Pumping Up The Economy

Fitch Ratings today published a special report stating that credit growth in China has not even begun to slow down, and is booming just as rapidly as in 2009. According to the special report from Fitch. there’s a “burgeoning of channels” outside China’s banking system through which credit is flowing and being hidden.

“Credit conditions remain extremely loose, which helps explain why inflation and property prices remain stubbornly high.”

Charlene Chu

Fitch Ratings  says that Chinese banks have been offloading trillions inof CNY loans in 2010 by artificially reducing their holdings of discounted bills and by re-packaging the loans into investment products for sale to investors.

“Talk of a substantial slowdown in credit growth in China is premature, but understandable given the visible drop in official figures on net new loans,” Charlene Chu, head of financial institution ratings in China, says in a statement.

“However, in reality lending has not moderated, it has been diverted into other channels.”

The report examines discrepancies in Chinese banks’ portfolios of discounted bills and acceptances in 2010, and provides an update on recent trends in informal securitisation, i.e. the re-packaging of loans into wealth management and trust products.

According to the report, the balance of Chinese banks’ discounted bills was understated by as much as CNY1.65 trillion (USD250bn) at end-Q310.

Meanwhile, by end-November 2010, upwards of CNY2.5 trillion (USD 375bn) in credit was sitting off bank balance sheets in credit-related wealth management products.

“Adjusting for these factors, the amount of new credit extended through end-Q310 is on par with the CNY9.3trillion extended through end-Q309. Credit conditions remain extremely loose, which helps explain why inflation and property prices remain stubbornly high,” says analyst Charlene Chu.

The agency states that even if Chinese authorities set a conservative target of CNY6-7 trillion in new loans for 2011, credit conditions are likely to remain loose until the problem of leakage is effectively contained and/or the cost of capital rises significantly.

“An economy that will have received more than CNY11 trillion in new credit for two consecutive years cannot get by with trillions less overnight in this type of environment without seriously stunting growth. We expect that hidden channels will continue to fill this gap,” Chu says.

According to the report, in recent years there has been a burgeoning of channels outside China’s banking system through which credit is flowing and being hidden.

Whereas in the past nearly all non-capital market funding was provided by banks, today scores of trust, finance, guarantee and leasing companies have joined the fray, in addition to 1,940 new micro lenders that have been established since late-2008.

The agency states that in this new environment even if regulators take a harsh stance against both activities in the coming months, new pathways and innovations are likely to take their place, leaving regulators and analysts chasing new channels of leakage.

“As long as Chinese policymakers continue to focus on managing credit supply, issues of credit leakage are likely to remain at least over the near term,” Fitch writes.

“However, the more serious inflation becomes, the less leeway there is to deal with large breaches in credit quotas,” she concludes.

Here’s a copy of the full report.

Related by The Swapper:

1 Comment

Filed under International Econnomic Politics, National Economic Politics

Equities: A Reason For Consern

The market has obviously moved its focus away from the earnings and is now closing in the on the FED meeting Wednesday – the expected launch of QE – and the US labor market report on Friday. So far, it has been a strong earnings season, but there are at least one reason to be concerned.

“Most companies have so far been very reluctant in giving any guidance as to how they expect the sales in 2011 to perform. And this should raise concern.”

Christian Tegllund Blaabjerg

There are  few earnings releases of importance Monday, but tomorrow we have some major releases that have potential to move the market. In broader terms, markets have priced most of the earnings results in by now, and it has been a surprisingly strong earnings season with massive surprises to the upside and growth in terms of EPS, but also  remarkably on the sales side.

“The surprise in terms of sales is flat, but the average growth of almost 10% in sales year-over-year is good news. The less good thing is that most companies have so far been very reluctant in giving any guidance as to how they expect the sales in 2011 to perform. And this should raise concern,” market strategist Christian Blaabjerg at Saxo Bank writes in Monday’s Wake-Up Call.

“We have a very busy week ahead of us and we start out with US ISM Manufacturing report day. We expect the index to decline to 53 in October (consensus: 54) from 54.4 as the growth in the manufacturing sector slows. This will also bring the national index more in line with the regional reports, which has been signalling weaker ISM Manufacturing for quite a few months now; and they still do despite the mostly positive regional reports released so far for October,” Blaabjerg notes.

Chinese PMI figures rose to 54.7 and 54.8 in October from 53.8 and 52.9, respectively, which have fuelled risk appetite in the Asian session.

It is the fastest growth in manufacturing in six months in China, driven by higher input prices.

Christian Blaabjerg

“This suggests that inflation will rise even faster in the coming months and could fuel speculation of more rate hikes by the PBoC,” Saxo Bank comments.

The US economy grew 2% QoQ (annualised) in the third quarter.

Private consumption grew 2.6%, which is the fastest growth rate recorded since 4Q2006.

“This contributed 1.8%-points to GDP, while also inventories – as expected – contributed handsomely by 1.4%-points. In fact, without inventories and government spending, GDP would have declined by 0.1%,” Blaabjerg points out.

Today’s Watchlist:


GMT Event Saxo Bank Consensus Previous
08:30 SZ SVME-PMI (OCT) 59.3 59.7
09:30 UK PMI Manufacturing (OCT) 53.0 53.4
12:30 US Personal Income MoM (SEP) 0.0% 0.2% 0.5%
12:30 US Personal Spending MoM (SEP) 0.5% 0.4% 0.4%
14:00 US ISM Manufacturing (OCT) 53.0 54.0 54.4
14:00 US ISM Prices Paid (OCT) 70.0 70.5
14:00 US Construction Spending MoM (SEP) -0.3% -0.5% 0.4%

Select Your Language:

English * Arabic * Chinese * Danish * French * German * Hebrew * Italian * Japanese * Norwegian * Portuguese * Russian * Spanish * Swedish * Turkish

Comments Off on Equities: A Reason For Consern

Filed under International Econnomic Politics, National Economic Politics