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Bnp Suspends 3 Funds

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French bank BNP Paribas has suspended three of its funds on Thursday as problems in the US subprime mortgage sector are preventing it from calculating their value.

BNP Paribas Investment Partners said in a statement that the decision affected its Parvest Dynamic ABS, BNP Paribas ABS Euribor and BNP Paribas ABS Eonia funds.

Article at http://www.ft.com/cms/s/9a4cabc4-464d-11dc...00779fd2ac.html

SB

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BNP Paribas Freezes Three Funds Amid Subprime Concern

By Sebastian Boyd

Aug. 9 (Bloomberg) -- BNP Paribas SA, France's biggest bank, halted withdrawals from three investment funds because it can't ``fairly'' value their holdings, as concern over U.S. subprime mortgage losses roils credit markets.

BNP Paribas will temporarily suspend the calculation of net asset value for the funds, which are called Parvest Dynamic ABS, BNP Paribas ABS Euribor and BNP Paribas ABS Eonia, the Paris- based company said in an e-mailed statement today.

The French bank follows Union Investment Management GmbH and Frankfurt Trust in stopping redemptions from such funds. Late payments on U.S. subprime mortgages to borrowers with poor credit histories are at the highest since 2002, driving down the value of bonds backed by home loans. The BNP Paribas funds had about 2 billion euros ($2.8 billion) of assets on July 27, including 700 million euros in U.S. subprime mortgages rated AA or higher........

........................

We'll be having more of this in the coming months...

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Like the headline BTW ;)

http://www.bloomberg.com/apps/news?pid=206...&refer=home

Poisons hatching all over the place, good thing that it is all contained

Who knows whether it's contained but I'm sort of sad to report that, over the last few days, the various credit indices have been falling back towards the level of a few weeks ago. I think there's a lot of funds sitting on big losses that won't come back but the general panic seems to be over for the moment.

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Who knows whether it's contained but I'm sort of sad to report that, over the last few days, the various credit indices have been falling back towards the level of a few weeks ago. I think there's a lot of funds sitting on big losses that won't come back but the general panic seems to be over for the moment.

As I predicted, a storm in a teacup. When you've been here for a few years you can spot these great white hopes for house price crash a mile off. As ever, it comes to nothing and the bulls will be back to gloat (not me of course, I am a bull who wants prices to fall).

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Who knows whether it's contained but I'm sort of sad to report that, over the last few days, the various credit indices have been falling back towards the level of a few weeks ago. I think there's a lot of funds sitting on big losses that won't come back but the general panic seems to be over for the moment.

It's starting to look like the cutting and dicing of risk is going to mean all this is a storm in a tea cup.

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Who knows whether it's contained but I'm sort of sad to report that, over the last few days, the various credit indices have been falling back towards the level of a few weeks ago. I think there's a lot of funds sitting on big losses that won't come back but the general panic seems to be over for the moment.

the ECB have just announced that they are "standing ready to act".

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As I predicted, a storm in a teacup. When you've been here for a few years you can spot these great white hopes for house price crash a mile off. As ever, it comes to nothing and the bulls will be back to gloat (not me of course, I am a bull who wants prices to fall).

Or a self-hating bull maybe? :)

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As I predicted, a storm in a teacup. When you've been here for a few years you can spot these great white hopes for house price crash a mile off. As ever, it comes to nothing and the bulls will be back to gloat (not me of course, I am a bull who wants prices to fall).

You're not getting the big picture.....

ist2_833748_tempest_in_a_teacup.jpg

post-6049-1186651233_thumb.jpg

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BNP Paribas Freezes Three Funds Amid Subprime Concern

Aug. 9 (Bloomberg) -- BNP Paribas SA, France's biggest bank, halted withdrawals from three investment funds because it can't ``fairly'' value their holdings, as concern over U.S. subprime mortgage losses roils credit markets.

BNP Paribas will temporarily suspend the calculation of net asset value for the funds, which are called Parvest Dynamic ABS, BNP Paribas ABS Euribor and BNP Paribas ABS Eonia, the Paris- based company said in an e-mailed statement today.

The true mark-to-market valuation of the assets in these funds can be achieved by simply holding an open auction for a portion of the assets in those funds at the close of each trading day for the next two weeks. The bid prices received can then be used to value the price at which a portion of the redemptions should occur. If no bids are received then the fund has zero value. In addition to external third party bids, any bank could allow its own trading desk to make bids - again establishing a market price for those people who wish to exit.

I have read this "we cannot value the assets" phrase quite a few times in the last week and frankly it smacks of banks not being willing to bite the bullet and get on with liquidating the funds as they have been requested to do by the investors. I am not suggesting that these funds should be auctioned as a fire sale, nor am I suggesting any wrongdoing by the banks, but a programme of pre-announced asset sales over say a ten day period to establish a liquidation value would be fair to all involved - however unpalatable the final realised price turns out to be!

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The true mark-to-market valuation of the assets in these funds can be achieved by simply holding an open auction for a portion of the assets in those funds at the close of each trading day for the next two weeks. The bid prices received can then be used to value the price at which a portion of the redemptions should occur. If no bids are received then the fund has zero value. In addition to external third party bids, any bank could allow its own trading desk to make bids - again establishing a market price for those people who wish to exit.

But why would they invest there own money just to mark a price so investors can bail out or recieve any payment percentage. All the banks are in trouble, like it stated a few weeks ago " it is all fine" now it turns out it isnt. The fund has value but its a lose no one knows how big the lose is " they can sell it but the problem lays with the large spread of what other desk think the value should be and that all are negative figures, then again investing your money in something that way be a lose already is wasting your money.

In order to protect the interests and ensure the equal treatment of our investors" slap investors in the face what it really means we are not willing to give investors our money in order to defend it. They are not selling and not buying, they are shooting them selves in the foot as this is being copied by other banks meaning nothing is moving, infact means they themsleves are starting the crash, so yep this news is good to distabilize the market and create iliquid market. They are playing a poker game now, everyone has a bad hand.

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French bank BNP Paribas has suspended three of its funds on Thursday as problems in the US subprime mortgage sector are preventing it from calculating their value.

YES THEY ARE WORTH NOTHING!!! YOU CANT CALCULATE NOTHING CAN YOU?

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the ECB have just announced that they are "standing ready to act".

My credit analysts have just released a note confirming the CP (Commerical Paper) market is closed.

That is why the ECB have announced support, because without access to the CP market, lots of banks will have to find the cash to repay the money markets which have lent them money via their conduit programmes.

This could be really very big.

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if this is whats happening and the crash has not realy started yet then think what it will be like when it gets going.

Pensions are going to go bang and goverment will let the managers walk away scot free and very rich indeed like they did last time.

Keep paying your NI and you might get a penney in the pound back when you get old.

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But why would they invest there own money just to mark a price so investors can bail out or recieve any payment percentage. All the banks are in trouble, like it stated a few weeks ago " it is all fine" now it turns out it isnt. The fund has value but its a lose no one knows how big the lose is " they can sell it but the problem lays with the large spread of what other desk think the value should be and that all are negative figures, then again investing your money in something that way be a lose already is wasting your money.

In order to protect the interests and ensure the equal treatment of our investors" slap investors in the face what it really means we are not willing to give investors our money in order to defend it. They are not selling and not buying, they are shooting them selves in the foot as this is being copied by other banks meaning nothing is moving, infact means they themsleves are starting the crash, so yep this news is good to distabilize the market and create iliquid market. They are playing a poker game now, everyone has a bad hand.

I agree. My biggest problem with all this is when are the regulators are going to step in and do the job they are paid for?

Fund managers and banks cannot just keep on holding the fund assets and then saying sorry we cannot value this so nobody is allowed to sell. Surely, they will be forced to liquidate and fairly soon? Mind you, if gfromls @ 09:51is right about the ECB 'standing ready' then maybe it is really really bad and the authorities just need more time to get their ducks in a row.

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My credit analysts have just released a note confirming the CP (Commerical Paper) market is closed.

That is why the ECB have announced support, because without access to the CP market, lots of banks will have to find the cash to repay the money markets which have lent them money via their conduit programmes.

This could be really very big.

I also heard this. Frightening stuff!

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My credit analysts have just released a note confirming the CP (Commerical Paper) market is closed.

That is why the ECB have announced support, because without access to the CP market, lots of banks will have to find the cash to repay the money markets which have lent them money via their conduit programmes.

This could be really very big.

why is it closed...... lack of paper?

:lol:

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I agree. My biggest problem with all this is when are the regulators are going to step in and do the job they are paid for?

Fund managers and banks cannot just keep on holding the fund assets and then saying sorry we cannot value this so nobody is allowed to sell. Surely, they will be forced to liquidate and fairly soon? Mind you, if gfromls @ 09:51is right about the ECB 'standing ready' then maybe it is really really bad and the authorities just need more time to get their ducks in a row.

What i really dont understand traders brokers are really work for the investors, if the investor wants to take a loss then they should sell, now if no one is buying then its worth 0 as they say its only worth what some one is willing to pay for it. what it seems like the investors have lost all control, now if the suspension was on the stock market it would mean the company has gone bust, does this mean the mortgage market has gone bust? ie bankrupt.

There is more here than they are letting us know.

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My credit analysts have just released a note confirming the CP (Commerical Paper) market is closed.

That is why the ECB have announced support, because without access to the CP market, lots of banks will have to find the cash to repay the money markets which have lent them money via their conduit programmes.

This could be really very big.

Could you please explain what commercial paper means here? Is it company bonds? I am just no expert in 'paper' (I know, I know...).

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Could you please explain what commercial paper means here? Is it company bonds? I am just no expert in 'paper' (I know, I know...).

unsecure iou short term max 9 months cheap borrowing, fast way to raise money.

Edited by crash2006

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unsecure iou short term max 9 months cheap borrowing, fast way to raise money.

So, in other terms, companies are not able to raise short term cash at the moment. Is that the tide going out and we will see who was swimming naked (WB)?

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