Quote:
Originally Posted by 1andrew1
This is why banking is so heavily regulated otherwise banks could keep on lending until the cows came home. Hence deposits v loans ratios etc and why Royal Bank of Scotland was bailed out and Woolworths wasn't.
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NRs problem wasn't deposit-loan ratio. When they sold on the loan, it was not that different to the mortgagee repaying the loan, because they sold the house or took out a mortgage elsewhere. That mortgage was no longer on their books. If a loan has been repaid, it no longer figures in any deposit-loan ratio.
---------- Post added at 22:55 ---------- Previous post was at 22:52 ----------
Quote:
Originally Posted by Hugh
Definitely not those who gave mortgages to people who didn’t have the earnings or capital to repay them - you’d think they had a "duty of care" or something...
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People lie about their outgoings, and the capital was the property, especially with houses prices increasing. In the US, mortgage brokers were falsifying documents in order to "earn" commission.