Chapter 15 Blog
Summary:
This article talks about RBC's profit continuing to slide, while the largest bank in Canada (RY/TSX) still is able to put up $1-billion of earnings despite having a 15% slide in income. RBC looks for more shareholders to reinvest dividends in their bank. They are hoping to get $200 million in investments from shareholders. CIBC has also been struggling lately. They suffered a $1-billion blow from bad bets, investing in credit instruments that are hard to value and sell. CIBC reported a $147-million net income for the first quarter compared to a net loss of $1.5-billion last year in the same quarter.
Connection:
The connection between this article and the chapter, is the comparison between last year's financial statement and this year's financial statement. The net income for CIBC this year was $147-million while the previous quarter they had a net loss of $1.5-billion. This is an increase of 1.6-billion, or 1120.4%. While the largest bank in Canada (RY/TSX) had $1-billion of earnings versus previous quarter's $1.15-billion, a decrease of 15%.
This article talks about RBC's profit continuing to slide, while the largest bank in Canada (RY/TSX) still is able to put up $1-billion of earnings despite having a 15% slide in income. RBC looks for more shareholders to reinvest dividends in their bank. They are hoping to get $200 million in investments from shareholders. CIBC has also been struggling lately. They suffered a $1-billion blow from bad bets, investing in credit instruments that are hard to value and sell. CIBC reported a $147-million net income for the first quarter compared to a net loss of $1.5-billion last year in the same quarter.
Connection:
The connection between this article and the chapter, is the comparison between last year's financial statement and this year's financial statement. The net income for CIBC this year was $147-million while the previous quarter they had a net loss of $1.5-billion. This is an increase of 1.6-billion, or 1120.4%. While the largest bank in Canada (RY/TSX) had $1-billion of earnings versus previous quarter's $1.15-billion, a decrease of 15%.
Reflection:
I think that the banks are capable to earn what they lost in a quarter. So a lost of $150-million should not be a big problem for the banks. Also, RBC seems to be desperate to get their shareholders to reinvest into their bank by offering them 3% discount for those who wish to use them as stock. I think that the banks should reconsider when they lend out loans because their lost in profit is greatly due to the loan losses. They should think again before lending out loans and thoroughly look through the financial statements of the person, or company they're lending to.
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