In Nils Pratley’s blog, he mentioned three problems for banks to fix: all complaints and no action on implementing the reforms, twisted succession plan and pressure to lend.
As a customer, I am more interested in the third problem Nils mentioned. Marriott international is buying Starwood for $12,2bn and Anheuser Busch Ibex will take over SABMiller for $103.3bn. It is certain that they will ask the band for a loan, and although it is proud for a bank to provide a huge loan, the huge loan will cause certain strain to the bank for it must have sufficient liquid assets to continue operations.
In addition, there has a focus on banks ‘capital, liquidity and their mortgage exposure. Because the direct saving of the above two purchase is low, actually the bank may not get the payback and customers of the band may not willing to put their money in the bank. And at the same time customers are not willing to see the only brand no matter where they travel. So I am wondering if the bank can put their hands on the reform that control the credits growth via the price rather than quantity.
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