« Home | Club Penguin - A Very Successful Habbo Hotel Look ... » | Bank of America Goes Mobile: Is It Deja Vu All ove... » | Cingular to Launch Mobile TV - Bad News for MobiTV... » | Cisco Buys Social Networking Co Five Across » | Only in Iraq: World's Largest Secure Satellite VOI... » | Hot Vietnamese IPOs » | Virgin Goes Portal » | MySpace Defends User Domains » | China Architectural Engineering Files IPO » | I Have to Hand it Mark Cuban For Calling the YouTu... »

February 22, 2007

How a Bank Lost $200 million Online

posted by MR WAVETHEORY at 2/22/2007 12:19:00 AM
I am still surprised at how much money NetBank lost in 2006. $202 million! How did these guys do it? Stuff the money in their pockets and make a run for the exit? (earnings press release)

The problem looks like lending which is just another way of saying the credit market is turning (for the worse)

NetBank has been shedding business units rapidly. In 2006 it sold, exited, or shut down its non-conforming mortgage operation; its RV, boat, and aircraft financing business; its Financial Technologies Inc. subsidiary and QuickPost service; and NetInsurance. In December it "substantially effected" a shutdown of its auto lending unit.

They must have really gone out on a limb with these RV borrowers and trailer park residents! I'm not busting the chops on people who live in RVs, but any lender should know that people who live in RVs well ... they're financially challenged and might have trouble paying back the loan. Get a whole portfolio of these borrowers like NetBank and it's like lighting a match and tossing it on a barrel of kerosene. Poof! $202 million!

Previous Posts

0 Comments:

Post a Comment

Links to this post:

Create a Link

<< Home