Ireland’s banks need $43 billion in new capital after “appalling” lending decisions left the country’s financial system on the brink of collapse.
The fund-raising requirement was announced after the National Asset Management Agency said it will apply an average discount of 47 percent on the first block of loans it is buying from lenders as part of a plan to revive the financial system.
How could bankers have missed these holes in their balance sheets? Maybe they were trained by colleagues at other banks who can't tell the difference between assets and liabilities in their pension plans:
However, due to different accounting rules, some banks reported a net asset on their respective balance sheets for their plans in fiscal 2009, even though the plans were in a deficit position: the funded status of Bank of Montreal’s (BMO) plans was a deficit of CAD0.8 billion, but it reported a net asset of CAD0.6 billion; the funded status of UBS’s (UBS) plans was a deficit of CHF1.9 billion, whereas it reported them as a net asset of CHF2.6 billion; and the funded status of Mizuho Financial Group’s plans was a deficit of JPY158 billion, whereas it reported a net asset of JPY523 billion.
I used to peruse career sites for job listings with banks. The jobs advertised invariably demanded applicants of the highest caliber with clearly defined qualifications. It turns out that the people who fill these jobs have trouble discerning the difference between assets and liabilities . . . profits and losses . . . positive and negative numbers . . . numbers and letters . . . people and inanimate objects . . . and most importantly, truth and falsehood.
I have no such difficulties. That's why HR managers and high-powered recruiters have screened me out as ineligible to work in a bank.
