BMO buying AIG Life of Canada for $375M
"AIG Life of Canada has about 300 employees and 400,000 customers. Bloomberg said the business posted about $571.4 million in revenue through the first six months of 2008."
www.cbc.ca/money/story/2009/01/13/bmoaig.html
In what seems a positive move, a Canadian Bank is to acquire a significant part of American International Group Inc. Should this be seen as a positive sign for Bank liquidity? Given Minister Flaherty's recent comments and efforts, are we beginning to see some reaction from the Banking and Investment community representative of these efforts?
Is this what we bailed the banks out for? Our money going to buy bargins in the U.S. I would just as soon seen the money coming back to the tax payers.
ReplyDeleteThank you comrade for giving us a place to add our voice. Hope to see more people come here.
I have a problem with any chartered bank owning/selling insurance.
ReplyDeleteAs for a positive sign for liquidity? I don't believe there is a problem with liquidity. Are the banks tightening up lending requirements? Yes. Do I think the banks should lend for riskier proposals? Nope. I think the charters are going to be risk adverse for a while even after their books are in order. As for the government buying CHMC type mortgages? Anyone care to speculate how long it will take this government to sell back those mortgages at pennies on the $ ?
Cynical I am, yes I am.
Oops. Sorry that was me at 11:04 pm
ReplyDeleteDee (who is off to figure out how to post with gmail)
Hope this project works as there are no sites out there willing to discuss new ideas as they all want to talk doom and gloom or rehash msm stories.
ReplyDeleteI hope it works too W.D. People need a forum and one of the attractions to Garth's site was multiple subjects being discussed in the same thread. In order to pursue an issue to it's fullest, often there are side issues and nuances that can and should be examined as well.
ReplyDeleteThe aspect of reader participation in creating blog threads would also give people a means to tackle a wide variety of issues. Posting a variety of threads should also make the site more appealing to a wider audience, and that is what I hope we can accomplish.
There is a lot of experience and variety of interests out there. Hopefully we can tap into that.
If memory serves, there was an attempt by banks to get into the insurance business several years ago. It failed for some reason.
ReplyDeleteBuying up the Canadian branch of an American company on the ropes seems like an excellent way of backing into the insurance business. It keeps banking and insurance separate except for obvious synergies in operations, while uniting the profits. And the 375M cost is less than one quarter's profits for one of our major banks.
Cynical I am, yes I am.
ReplyDeleteAnon @11:04 p.m. Jan 13
It's an all too common ailment I'm afraid.
"Anyone care to speculate how long it will take this government to sell back those mortgages at pennies on the $ ?"
We're not supposed to talk about that.
Comradely greetings Herb.
ReplyDeleteAccording to pundits, this is a heck of a deal and in a normal environment it would be all positives I would think. Still, there is the consideration of tax payer funded liquidity and Reaganonemics.
This is what made me uncomfortable when I saw some of the names of the 11 disciples. Piggies gathered at the trough.