Chapter 613 Richard
“Frankly speaking, I think the government needs to allocate funds to support domestic subprime mortgages. The United States has already done this. The main thing is to have a certain repayment ability. Ordinary people have spent more than 100 billion US dollars to ensure that their homes will not be repossessed due to temporary difficulties. Financial policies are still based on liberalism with minimal intervention. This kind of policy will make the financial system more dynamic in normal times, but when encountering serious damage such as the subprime mortgage crisis, it is often easy to Leading to cascading disaster consequences in the financial system.
This time, Barron’s meeting with Finance Minister Darling was to persuade the other party to agree to provide relief to ordinary people who are struggling with mortgage repayments, so that Britain would launch a “lifeline” plan similar to the previous one in the United States. bailout plan.
“The bailout I am talking about is not for the relevant banks, but for those groups who are able to repay their mortgages under normal circumstances, but due to the impact of the subprime mortgage crisis, they are in temporary repayment difficulties. These groups They are the backbone of our society and need to ensure that they can survive this crisis and keep the properties they purchased.”
Barron did not lie to Darling. Such rescue measures are indeed very necessary. If it is purely for investment in real estate and speculation in the form of leverage, then there is no need for the government to bail out.
However, there are still many people who need to buy houses and have considerable repayment ability, but due to the impact of the subprime mortgage crisis - or other investments have suffered losses, or because the company where they work suddenly closed down, Or they were laid off... or other unexpected reasons.
In normal times, the government can still maintain a "free economy", but in this case, it must suppress panic and give the "middle class" some support to survive the crisis safely.
Of course, Barron and the others already understand the attitude of the British government.
So last month, the four major listed banks in the UK - HSBC Holdings, Royal Bank of Scotland, Standard Chartered Bank and Barclays Bank jointly established a crisis response fund of up to 50 billion pounds. Yu provided guarantees for some non-performing assets for some British banks affected by the subprime mortgage crisis.
Naturally, the objects guaranteed by this fund also need to be reviewed by a temporary agency composed of four banks.
This time the government’s rescue plan is not only promoted by Barron’s, but also by other bank executives.
After all, these banks are more or less involved in housing mortgage loans, and they definitely hope that the government can provide assistance to some users with better qualifications to reduce the proportion of their non-performing assets-even if they are When customers cut off their payments, they can take back the mortgaged properties, but they are banks, not real estate sales companies, and they simply don’t want to spend too much energy dealing with these properties.
What's more, from last year to now, the real estate market in the entire UK has continued to decline. The market value of almost all mortgaged properties has been lower than the mortgage loan they provided...
In Among them, Standard Chartered Bank's situation is still the best, because after Standard Chartered Bank was acquired by Barron's, it strictly controlled the issuance of housing mortgage loans, especially those extremely high-risk subprime mortgage loans. The scale of operations only accounts for a very low proportion.
This type of non-performing assets of Standard Chartered Bank mainly comes from the related businesses of Northrock Bank they acquired.
If these businesses of Northen Rock Bank account for a high proportion for this bank, then when compared to the scale of Standard Chartered Bank, it is not too high.
And before Standard Chartered Bank acquired Northron Rock Bank, these non-performing assets had already written off a considerable proportion of North Rock Bank's market value.
Then just recently, Cavendish Trust injected 10 billion euros of the profits it made from this short selling through DS Group into Cavendish Asset Management, a subsidiary of the trust fund. Among them, and through Cavendish Asset Management, it purchased assets worth 10 billion euros from Standard Chartered Bank.
These assets all come from some of the non-performing assets of Northrock Bank, which was acquired by Standard Chartered Bank - some properties that were repossessed because mortgage loans were "cut off". After purchasing these properties, Cavendish Asset Management will simply organize and decorate these properties, and then rent them out temporarily - after the housing prices in the UK rise again, even if the rent is not included, it will still be satisfactory. income.
By selling these assets, Standard Chartered Bank has also recovered funds, greatly reducing its non-performing asset ratio. By the way, it can also return a considerable part of the short-term high-interest foreign debt of Northen Rock Bank.
It can be said that this is a win-win situation. At present, it seems that Cavendish Asset Management will suffer a little loss - although they acquired these properties in packages at a slightly lower price than the current market price, the British The real estate market is still continuing to decline, and the market is not optimistic about it. This subsequent transaction may soon show a loss on the books.
But Barron understands that the British real estate market, especially the London real estate market, will rebound again in the next few years and be higher than the previous price. As a long-term investment, Cavendish Asset Management’s A transaction, at least in terms of income, can still be satisfactory.
……
On September 8, three days ahead of schedule, Bonnie Cavendish began to have reactions.
That night, at the best maternity hospital in London, with Barron waiting a little anxiously, Bonnie gave birth to their second son.
“Thank you, honey.”
Barron held Bonnie’s hand, looked at her weak look, and kissed her on the forehead.
"I want to see our child..."
"I just took him out to clean up. I believe he will be back soon."
Of course, as a descendant of Barron, after the child is born, someone will be with the nurse throughout the process to ensure the baby's health. Safety.
Just as Barron finished speaking, the nurse had already brought the baby in.
"Look, he is so cute, just like George when he was little..."
Barron took the child, put it in front of Bonnie, and said to her softly.
Their child was also second in line to the Dukedom of Devonshire, and Barron named him Richard Cavendish.
(End of this chapter)