Post Tagged with: "Banks"

Canadian Banks Comfortable with Energy Exposure

Canadian Banks Comfortable with Energy Exposure

Canadian banks have $80 billion of exposure to oil including untapped loans Canada’s top banks have a combined exposure of C$107 billion (USD$80 billion) to the oil and gas industry, inclusive of untapped credit lines, reports Bloomberg. Canadian Imperial Bank of Commerce said in its earnings call that total exposure to oil and gas firms rose to C$18.7 billion in the first quarter from C$17.3 billion in the previous quarter. The amount includes about C$2 billion of derivatives and other off-balance sheet items. Toronto-Dominion’s drawn oil and gas loans climbed to C$4.2 billion, or less than 1% of the total outstanding. The Canadian bank had C$9.74 billion of undrawn commitments to pipelines, oil and gas companies, raising its gross exposure to C$16.2 billion. Scotiabank, Canada’s third-largest lender, has C$17.9 billion in outstanding loans and C$14.1 billion of commitments to the oil and gas industry. About 60% of the drawn exposure[Read More…]

March 2, 2016 - 6:46 pm Canada, Closing Bell Story, Oil and Gas 360 Articles
Energy Industry: I’d Rather Not Be in Your Debt Forever

Energy Industry: I’d Rather Not Be in Your Debt Forever

The Wrath of Godzilla Oil and gas companies have become wary of debt like the residents of Odo feared the wrath of Godzilla, rising up from the sea to wreak havoc at any moment and smashing buildings in a single bound. In a highly capital intensive industry like oil and gas development, debt is a necessity. Bank debt and corporate bonds are a means of acquiring the capital required to drill thousands of wells to obtain the fuels that generate the energy and products on which modern society depends. Since the downturn in commodity prices, banks have tightened their belts and reduced borrowing bases while the market has been less receptive to new debt offerings, making the funding of capital programs more difficult. Despite these expected and anticipated measures to mitigate losses in the lending industry, the breadth of what many assumed would be a bloodbath of bankruptcies or a[Read More…]

Deposits in Saudi Banks Down $13.5 Billion in October

Deposits in Saudi Banks Down $13.5 Billion in October

Saudi Arabia sees a squeeze in liquidity as oil prices remain low Demand for deposits dropped 4.7%, or about $13.5 billion, in Saudi Arabia over the course of October, forcing banks to borrow more from each other. The rate at which banks in Saudi Arabia lend overnight to each other jumped the most in seven years in November, the fifth straight month of increases, following the lower deposits in October, according to information from Bloomberg. “The drop in deposits in October, in absolute amount, is probably the biggest since the 1990s,” Murad Ansari, a bank analyst at EFG-Hermes Holding SAE, said from Riyadh on Monday. “There are payment delays from the government to contractors, which is one of the reasons for the decline in private sector deposits, and public sector deposits are shrinking as the government is running a deficit.” The squeeze on Saudi banks comes as the group continues[Read More…]

Banks Easing Lending Practices, Expect Good Loan Performance in 2015: Fed Survey

Banks Easing Lending Practices, Expect Good Loan Performance in 2015: Fed Survey

A Federal Reserve Board survey of senior loan officers on bank lending practices found that, over the last three months, credit standards for approving applications for commercial and industrial (C&I) loans or credit lines have eased in many cases. Of the 73 banks surveyed, many stated that they generally anticipated improvements in the performance of most loan types this year. The survey found that credit standards had remained largely the same, with 89% of respondents saying standards remained unchanged for large and middle-market firms (annual sales of $50 million or more) and 91.4% saying standards were unchanged for small firms (annual sales of less than $50 million). 8.2% of respondents said standards were eased somewhat for large and middle-market firms, while 7.1% said their banks eased standards on small firms. Only 2.7% of respondents (two banks) said that they had tightened standards somewhat on large firms, while just 1.4% (one[Read More…]

February 4, 2015 - 10:40 am Oil and Gas 360 Articles