Bank shareholder and homeowner

[BradK]

Something has always bothered me.

The media talks about bank shareholders as if we are one big homogenous group of people who care only about the bottom line.

I hold two banks - CBA and SGB.

However, I have a mortgage with the CBA. I for one would rather see an interest rate cut in the interests of struggling Australians (of which I am not - I have a relatively small mortgage) rather than get a couple of cents extra in dividend. However, the media talk about ME as if I am the villain.

What do people think? Its a subtle one, but a very real one.

Cheers
Brad

 

[bassmanpete]

Re: Shareholder - Homeowner

I don't think bank shareholders are the problem, it's the bank boards' ideas of what shareholders want that is problem.

 

[Doris]

Re: Shareholder - Homeowner

A friend of mine arrived with a bottle of Wolf Blass, 'excusing' it, as she has a small holding in Fosters.

Her husband has quite a large holding of WBC.
When I asked if he banked with them he said, 'No way! They have too many fees! I won't pay bank fees!'

 

[CanOz]

Re: Shareholder - Homeowner

If you pulled up the top 10 shareholders of any bank and then asked: would they give up a portion of their dividend for an interest rate cut?

What do you think the answer would be?

I think these are the shareholders the media paints as profit orientated.

CanOz

 

[cutz]

Re: Shareholder - Homeowner

BradK

I also hold bank stocks and like yourself I would like to see a drop in interest rates in the interests of struggling families but this is a double edged sword as low interest rates also encourages borrowings in depreciating assets and loose money management. So when things turn many are caught with there pants down.
My opinion is that the media seems to report in blocks, say when there is some interest rate rises, the bashing of banks go on for weeks and stories of struggle emerge.
A hole appears in an aircraft fuselage and the media latches on for weeks,
Now the focus is on the China Olympics.

Sorry i seem to have gone a bit off topic,

Cheers,

Cutz.

 

[cutz]

Re: Shareholder - Homeowner

Doris

Your friend's husband just has to flash his WBC shareholder discount card to get the bank fees waived.

Cheers,

Cutz.

 

[nizar]

Re: Shareholder - Homeowner

If you pulled up the top 10 shareholders of any bank and then asked: would they give up a portion of their dividend for an interest rate cut?

What do you think the answer would be?

I think these are the shareholders the media paints as profit orientated.

CanOz

I agree wholly.
The answer would have to be a resounding NO.

 

[Julia]

Re: Shareholder - Homeowner

Whenever the question of interest rates is discussed, it's all about struggling homeowners.

Almost never is any reference made to those large numbers of people who have earned a bit more on their term deposits and other bank interest.

I'm not sure of this percentage (someone will know) but I think only about a third of Australians actually have a mortgage.

 

[Doris]

Re: Shareholder - Homeowner

Doris

Your friend's husband just has to flash his WBC shareholder discount card to get the bank fees waived.

Cheers,

Cutz.

Thanks cutz! I'll run this by him...
He is quite astute so it'll be interesting!

 

[BradK]

Re: Shareholder - Homeowner

Interesting article by Ross Gittins this morning in the SMH. He seems to think the banks will pass on because everyone will be screaming blue murder if they dont.

And now that wholesale funding costs have come down 30 percent, are we going to get those over and above cuts back? Lets hope that the talk back jocks keep on them... no, wait, unless they are also in the banks pockets.

Brad

 

[wayneL]

Re: Shareholder - Homeowner

Whenever the question of interest rates is discussed, it's all about struggling homeowners.

Almost never is any reference made to those large numbers of people who have earned a bit more on their term deposits and other bank interest.

I'm not sure of this percentage (someone will know) but I think only about a third of Australians actually have a mortgage.

Exactly.

A cut in interest rates now would screw over savers. Interest rates are already seriously negative in real terms.

Rates should be raised!

 

[CanOz]

Re: Shareholder - Homeowner

We need a serious payoff of debt. As a society we cannot keep maxing out credit cards and dipping into whats left of home equity.

The US is close to running out of C.Card debt now, even Amex is having defaults. Banks are chasing the balance down and lowering limits.

If your going to have a recession, may as well make it a good one and increase the savings too!

Cheers,


CanOz

 

[singlefished]

Re: Shareholder - Homeowner

What irks me is when the media / pollies pester the likes of CBA for a cut in rates ONLY on the back of their profit announcement.

I'm pretty sure that the big 4 are all fairly competitive on rates and fees across the board but because CBA have managed their business better than some of the other banks they are being crucified for it and we, the shareholders, are expected, nay, obliged to accept less profit in the future because they've managed their business too well and made too much money during this tough economic climate!!!

"CBA have an obligation to pass on rates cuts...." what a joke!!!

We didn't hear the same sort of pestering from the media / pollies to ANZ and NAB when they announced their multi-million write down provisions the previous week did we??? The shareholders were left to sort that one out on their own and the respective share prices dropped accordingly.

Pester power is a no-no if you're a parent and you learn to manage and control it.... sometimes

Shouldn't the media / pollies be praising the CBA for how well they're coping when so many others around the globe are failing? Doesn't the country that provides the most inaffordable housing in the world require a robust enough banking system strong enough to support all this debt people are prepared to take on to buy into this inflated property market? And why can't the banks that loan the money make themselves and their shareholders a small profit along the way if they run their business well?

OK - rant over

For the record:
YES - I own CBA. One of 3 banks that I currently have faith in.


Cheers,
Scotty....