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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Ramsey Su who wrote (51148)	1/24/2006 3:07:41 PM
From: russwinter	Respond to of 110194

Before we let GDW get away with "our shit doesn't stink", let's see what the 10-Q says about delinquencies, as the operational didn't appear to cover that. To me GDW's (and most other banks) main asset and claim to fame are dumb and dumber depositors, the kind of people who let billions sit around in potentially highly exposed institutions at one and half percent below T-bill rates. I guess the question to ask is will some of the dumb (forget about dumber) make a move? Their cost of deposits went from 2.97% to 3.24% from Sept to Dec. From the 3rd quarter 10-Q they had total deposits of $58.4 billion: -14.7 billion in savings deposits paying a whopping 1.93% -26.9 billion in 4 week to one year CDs paying 3.54%, and -$7.8 billion in 1-2 year paying 3.42%. You can basically add 27 bp to that to get year cost of funds. As long as dumb and dumber roll their CDs over at 3.80% when bills are paying 4.50%, GDW ought to be able to milk it a while longer. However, judging from this, cost of funds may be starting to spike? 4.61% for an eight month CD. worldsavings.com 80% of GDW's ARMs are COSI, or tied to their cost of deposits, so those mortgages so far may be getting a break.

To: Ramsey Su who wrote (51148)	1/24/2006 3:36:35 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

Actually going through Sept 10-Q it appears GDW reports problems under the term, "nonaccural loans" or over 90 days past due. In mind that's time warp and slow mo, when we are looking for dynamic change occurring since about summer. Nonaccural loans increased from 0.28% to 0.31% from Sept to Dec. Keep in mind that GDW's COSI index adjustments really lag as well. They are a time warp lender in every respect, can pretend events are transpiring in six month lag time utilizing dumb and dumber depositors.