Rmb Frc is mainly institution owned bank. Over 93% owned institutions.
US 401 plans, pension funds, institution investment funds hold majority of the shares. US gov will not allow it to fail…it can play out in the following ways:
1. Fed bailout FRC
2. Fed extends unlimited lending at 0 interest rate to FRC
3. Treasury, Fed and FDIC broker deal with the major banks to increase more deposits in FRC in addition to the 30 billion
4. Treasury, Fed and FDIC broker deal for major banks to buy bonds at above market rate with Fed or FDIC paying for the difference.
5. Lastly, treasury, Fed and fdic broker a deal for big banks to bid for takeover of FRC. as for all bidding wars, the price would definitely be more higher than current share price. They would bid high to win other bidders, because a bird in hand is always worth two in the bushes…besides it’s at a highly discountec price already…
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Tadahking : 1 out too small
Tadahking : 3 quite bad. the interest rate will cause continuos unknown quaters of lose
Tadahking : 4 qiuite ok but their last talk didnt pan out for this plan.
Tadahking : 5 or fdic can seize the frc and call for bids too. so i dont know how it will pan out. fdic can basically tell shareholders to piss off also.
Tadahking : i dont know anymore i lost too much. cause i feel this is still a good business. the only issue is the deposit flights caused by tge fdic. i mean comeon imagine your balance sheet is peg at say 3 p/c int rate when current int rate is maybe 1p/c and suddenly fed raise the current int rate to 5p/c. i dont call that risky behaviour. that is just makes sense and resonably within margin of error. it is just that the fed actions needed a stupid big margin of error
TRIUMPHANT RETURNS : Remember Federal Reserve is also institutions owned.
LAboys2008 : Credit Swiss way is the best option on table now, push share holders to allow sale at low price $6-8 per share, way below book value but better than nothing. Then Chase or BofA take over with some government assistance.