When Gregor MacGregor made up a country in the early 19th century and proceeded to sell its non-existent land, investors were all too keen to be involved. Modern-day bond investors are perhaps not too different
If Scottish soldier, adventurer and consummate fraudster Gregor MacGregor of Poyais were alive today, he would probably accuse Honduras of being far too cautious when it ventured into the international bond market in March. In its first sovereign fund rai...
As financial experts and economists argue about the true nature of the low-rate policy adopted by most Western central banks, its effects on clients’ asset allocation are a major challenge for private bankers
One of the biggest problems caused by the financial and economic crisis is the developed economies’ level of public debt, which has reached a post-war record. So the watchword now is ‘deleverage’. When economic growth is weak, there are various ways...
By assessing the size and ratio of the high-net-worth population globally, private banking companies are ascertaining specific operational components to selective scalability
While operating conditions continue to evolve, wealth management and private banking companies need to develop scalable, meaningful, responsive business propositions to assure profitable growth in assets under management (AUM), to bolster the client-advi...
Faith Tuedor-Matthews, Group Managing Director at Mainstreet Bank, explains how the institution has turned its fortunes around
Mainstreet Bank is fast becoming the preferred bank for a sizeable portion of the Nigerian banking public. The reasons for this lie in the company’s ongoing reorganisation of over 50 years’ inherited legacy banking sevices. The corporate campaign embf...
Trafalgar Wealth Management offers a welcome alternative in the Swiss private banking sector, with a service that takes a disciplined, tailor-made approach to the challenges facing the modern investor
On the eve of an even more complex market and regulatory environment, Swiss private banking is preparing itself to cope with new challenges. Some financial institutions will fail and some will survive and emerge stronger. The question is: what is key in o...
Diamond Bank survived the pitfalls of its home country’s economy during the financial crisis and has emerged stronger than ever before
The banking sector in Nigeria has taken a battering over the last few years, as the economy found that it was incapable of sheltering itself from the turbulence that spanned the continent. Like a number of institutions, Diamond Bank found itself in a robu...
Banco Interacciones has a long history of working with its country’s governments in order to help develop infrastructure. With a new leadership inbound, that is set to continue
For the past few decades, financial services in Mexico have been growing steadily. With better-regulated markets, increased competition, and more transparency in the banking system, more people have been integrated into the financial system. However, many...
The Philippines are growing at unprecedented rates, and attract successful foreign investment to reform their economy. Rizal Commercial Bank Corp, a local institution, is expertly reaping the benefits of prosperity
The Philippines have been swiftly emerging as champion in the eyes of investors this year, as Europe and the US continue to falter. President Benigno Aquino has been winning over even the most sceptical financiers with his unfaltering pursuit of econom...
Since Pakistan’s banking sector was liberalised in the 90s, it has gone from strength to strength. MCB Bank’s assets and profits have grown with it
Pakistan’s banking industry has seen dramatic change since the country gained independence in 1947. Initially the private sector was encouraged to establish banks and financial institutions, but corruption soon took hold. In 1974 the government national...
RBC Wealth Management has been a significant presence in the Channel Islands for 50 years, and remains committed to the region
In a fiercely competitive industry, it is increasingly difficult for private banks to genuinely differentiate themselves from their peers. This is arguably nowhere more evident than in the Channel Islands, which boast an incredibly high concentration of q...
Wall Street’s general partnerships are all but gone. Brown Brothers Harriman is the only firm there still organised in that way, and its success means it isn’t about to change
Brown Brothers Harriman & Co (BBH) stands alone as the sole remaining general partnership on Wall Street. The men and women who own the firm do so outright, and share joint and several unlimited liability for the operations of the business. It’s an ...
Last year, Guaranty Trust Bank launched the first non-sovereign benchmark bond to be offered from sub-Saharan Africa to the international community
Guaranty Trust Bank (GTBank) is a premier Nigerian financial institution with business interests spanning Anglophone and Francophone West Africa and the UK. It presently has an asset base of over 1.5trn Nigerian Naira (NGN), shareholder’s funds of over ...
ComInvestBank was founded when Ukraine gained its independence in the early 90s, and has provided a quality service ever since. World Finance speaks with Myroslav Hisem
First of all, congratulations on your Best Private Bank, Ukraine 2012 award. Thank you. This is, first and foremost, a recognition of the fact that ComInvestBank is moving in the right direction. We are always trying to reach our goals. What inspired ...
With the world’s largest population of high-net-worth individuals, the opportunities for private banking lie in the emerging markets of Asia Pacific, writes Tess Albrecht
One third of the world’s millionaires now live in Asia – this fact alone is driving private banking opportunities in the east. Strong economic growth, high savings rates and the sustained performance of equity markets have all played a part in boostin...
The relationship between ‘prime actives’ and ‘dependants’ is beginning to have wide implications on the demand for assets
In periods of low interest rates, high volatility and strong correlations across asset classes, it is vital to understand the factors driving global change. A portfolio that benefits from global trends is a prerequisite for the generation of stable and po...
European countries are scrambling to raise every last penny of funds through taxes. But some countries may have gone too far...
Though all business taxes in Belgium can be paid online with little effort and preparation, the rates are still sky-high at 57.7 percent, including a staggering 50.8 percent total rate on profits only in social security contributions.
In Belarus, a company spends up to 338 hours annually preparing for and paying ten different taxes and duties. The total tax rate has incredibly been lowered to 60.7 percent, from 117.5 percent in 2008.
A company in France pays seven different taxes and duties, the sum of which can amount to 65.7 percent of profits; though President François Hollande has announced a wave of business tax rate cuts coming up.
A business in Estonia pays 67.3 percent of profits in tax, 37.2 percent exclusively in social security contributions. The country has gone against the grain in Europe by raising businesses taxes from 48.6 percent in 2008 to the current rates.
While corporate income tax (IRES) in Italy is limited to 38 percent of taxable profit, a company operating in Italy can expect to pay 14 other taxes and duties, including social security contributions, bringing their total payable tax to 68.7 percent of profits, according to the World Bank.
Norway taxes motor fuels twice, with a road use tax and a CO2 emissions tax. Combined with strikes in the energy sector that have curbed output, the price of gas at a local pump has soared to $10.12 per gallon.
Though Turkey sits on the Suez Canal and neighbours many oil rich countries, the price of a gallon of average gas clocks in at $9.41 in Turkish pumps, because of a 60 percent share of taxes.
Like Turkey, Israel is surrounded by oil-rich neighbours, but drills very little itself. Gas prices are controlled by the government, so about half of the $9.28 per gallon goes to taxes.
There are few gas stations in Hong Kong, but the ones available charge up to 76 percent more per gallon than mainland China, where the government caps the cost of fuel. A gallon at the pumps will cost around $8.61 on the island.
Expensive labour costs make the Dutch petrol prices the dearest in Europe, at $8.26 per gallon; though the 57 percent tax add-ons don’t help.
8 February 2007
HSBC warns of subprime mortgage losses
2 April 2007
New Century goes bus
14 September 2007
Wholesale markets have dried up
17 March 2008
Rescue of Bear Stearns
7 September 2008
Rescue of Fannie Mae
15 September 2008
Lehman Brothers file for bankruptcy
3 October 2008
US congress approves $700bn bailout
14 February 2009
$787bn stimulus approved by congress
The effects of the current financial crisis are global and irrefutable. With the collapse of Lehman Brothers, the domino effect of irresponsible public monetary policies, huge levels of unsustainable debt, and a deregulated financial sector, has escalated to the point where no corner of the globe has been left untouched.
Syria and Egypt launch an attack on Israel on Yom Kippur and set off a twenty day war;
US President Carter creates Department of Energy, which develops the US strategic petroleum reserve
The Organisation of Petroleum Exporting Countries (OPEC) used their oil reserves as a weapon with the Arab Oil Embargo against those who supported Israel. By January 1974, world oil prices were four times higher than they were at the start of the crisis, especially in the US, and the shock led to a huge drop in the stock market with NYSE losing $97bn in just six weeks. The embargo lasted five months, and the effects are still seen today.
1923 – 1924
The trouble began when Germany missed a repatriation payment, worth about one third of the German deficit in this period. Inflation was already high but by 1923 it was raging. Prices doubled within hours, and by late 1923, it cost 200bn marks to buy a single loaf of bread. People burned money as it was cheaper than buying firewood. Germany eventually regained control of its economy when it introduced the Rentenmark into circulation in 1923, and then the Reichmark in 1924.
The Great Crash
Recovery and Recession
After the decadence of the Roaring Twenties, the 1930s saw the biggest economic slump of all time. The stock market crashed on 29 October 1929, and optimism and decadent living tumbled along with the figures. The GDP fell from $103.6bn in 1929, to $66bn in 1934 and the subsequent years of recovery were the most dramatic in US history.
Otto Heinze and his brother Augustus Heinze bought shares of United Copper.
The stock market was already cautious over the tight money supply, but the US was thrown into a depression after the stock market fell nearly 50 percent from its peak in 1906. The Heinze brothers thought they could influence market shares but ended up bankrupting lenders that provided the financing to buy the stock. A chain reaction left nine institutions bankrupt. By February 1908, the panic was over and the government created the Federal Reserve system, to prevent banks from exercising too much control over the economy.