But when the New Zealand Labout Party lost the election, they went on a spending spree... leaving the small population of 4.3 million people with heavy debt & high taxes.
Needless to say, I was a bit apprehensive about traveling in Auckland during this tough economic time...
But I suppose any probable banking trouble won't affect me much if I choose to transfer my money to a bank with good ratings.
So, before I got here, I downloaded a long list of banks in New Zealand, and checked the ratings - a tedious process which got me scratching my head.
How on earth am I supposed to know what AAA mean? -AA?
The only AAA that I knew before this was the AAA size battery
Also,... how would I know whether or no the bank's rating is really AAA or if it's just good PR?
(While my sis & bro-in-law are Finance geniuses, I'm the exact oposite)
Anyway, I didn't get to consult them before I left KL, so when I got here... I just made a wild guess on which bank would be deemed too big to fail - and put all my eggs there.
Let me introduce you to the ANZ Giant
Why I think it would be too big too fail...
- It's based in Australia.
- It also bought over the National Bank of New Zealand + a few other banks
If it ever fails, we won't just be seeing a demonstration on Auckland's Queen St
Heck, there'd be demonstrations on the Queen Streets in Sydney, Melbourne, Perth, Wellington, Christchurch and everywhere else in the Asia Pacific!
So, before I got here, I wondered why the owners of Central Hostel would open an account with an unheard of ASB Bank.
Now I know why...
& I think I kind of regretted using ANZ Bank
Why?
They leverage on the fact that they're too big to fail - and they charge a premium for their services
For example, ATM (Everyday Banking) card users are charged a $5 monthly fee
Other banks here do it for free.
You only pay charges if you exceed the max transactions per month
And... if you're an ANZ customer, you really have no choice but to open an "Everyday Banking" account
Why?
The Savings account don't come with any bank book or bank statements!
It's just an online bank account!
No wonder our Malayan Bank also too big to fail at one time wanted to charge this and that. However our Bank Negara stop it. Otherwise other banks will start to follow.
ReplyDeleteBanks are well know to give you an umbrella when it hot and take your umbrella when it is raining. This remind me of knocking at all the banks for loan and get none.
However a few years later bank start to give me OD and loan when I don't need it.
Well, if you're in Malaysia, you don't really have to worry about bank closures IF your savings with any particular bank is less than MYR100,000. So, don't put all your eggs in 1 basket. In Malaysia, I use several banks - Maybank, CIMB bank, & Public Bank. My favourite is CIMB bank - the service is excellent. For your savings account, you will be given an online account, monthly statement sent to you by post, and also an ATM card. All of that are free of charge, unless you have withdrawn more than you should or if you do not have the min. amount required in your account
ReplyDeleteahhh hahahaha
ReplyDeleteu went with the ANZ
silly!~
ReplyDeletei didn't know abt kiwibank before this ;p
ReplyDeleteany bank here is pretty safe.. and theyre all owned by overseas banks except kiwibank
ReplyDeletenot like you have much money to put in your account anyway :P:P
ReplyDeleteHey, that's sooo sarky!!!! how'd u know that i don't have much money :p
ReplyDeleteI think the AAA rating is given by the securities commission people who work under the government. Not that it makes them any more trustworthy...
ReplyDeleteAhh.... I learn something new today!:)) Thanks, Arsh
ReplyDeletea bank cant make up its own rating
ReplyDeleteIt's the rating that Standard & Poor's invented about 100 years ago -> http://en.wikipedia.org/wiki/Standard_&_Poor%27s#Credit_ratings
ReplyDeleteRule of thumb is that the investment interest rate and the rating of a stock/derivative/etc are usually reverse proportional - in order to incentivize investors to put capital into less secure ventures, a risk premium gets added to the current standard interest rate.