A SilverDoctors Exclusive:

I thought I would opine on JS Kim’s recent SD editorial- Breaking Bad With Big Bank CEO’s.  You’ve  probably read Kim’s work.  Many like us lived what he has spoken of in this and other essays. In my experience, what JS Kim writes is very accurate.
I was mid level corporate officer;  my name on the annual report;  top salesman 4 years;  the 4th largest shareholder of the bank, right behind the President, Chairman of the Board and a private investor.
We could have coined the term ‘Muppets’ when referring to our clients.   I never recall a single client referred to in a positive manner.
The only thought was how to extract the maximum yield without killing the herd. 
One stated policy was called “Bump Rate”.
Senior officers referred to that policy when renewing lines of credit.  The loan officers jacked the rate when renewing a credit line, knowing that the client would accept that rather than move his accounts.
Many of our office meetings resembled a cross between a carney barker shilling cheap thrills rides and Torquemada questioning his  victims.
We hit our clients with the highest rates possible when originating loans.  The Preferred Lender Program was our tool to get the deal through underwriting and closed before a competitor was able to reach into our pockets and take the client.
The snarling and gnashing of teeth of bankers fighting over their prey made resembled hyenas going after a wildebeast.



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By SD Contributor AGXIIK:

I thought I would opine on JS Kim’s recent SD editorial- Breaking Bad With Big Bank CEO’s.  You’ve  probably read Kim’s work.  Many like us lived what he has spoken of in this and other essays.

In my opinion what JS Kim writes is very accurate.
I was mid level corporate officer;  my name on the annual report;  top salesman 4 years;  the 4th largest shareholder of the bank, right behind the President, Chairman of the Board and a private investor.
I kept the bulk of my ownership in a house account,  so the Board would not discover what I owned at the time.
That might have disturbed the order of things.  LOL
Bank of Commerce strove to become the top SBA lender in the nation, hitting that goal in 1996.  I was hired in  1988 as a foot solider to help the bank to accomplish that goal but left in 1992 to start my  own business. While I was very successful in my job,  the bank suffered a rough patch in the bank crash of 1989-1994.  This dramatic change of fortunes forced me to make the decision to leave the bank.  There were many reasons for leaving a 6 figure income, The primary of which were  my lack of volume due to the crash and the bank’s internal credit culture.  The change in underwriting crippled my volume.  My time at the bank was on a short fuse so leaving was the best thing to do.
During my learning and high production phase, watching, hearing, then reading the pronouncements of the president and board was eye opening.  In hindsight, many of our office meetings resembled a cross between a carney barker shilling cheap thrills rides and Torquemada questioning his  victims.  The highs and lows could  leave you breathless and  disoriented.
 
We could have coined the term ‘Muppets’ when referring to our clients.   I never recall a client referred to in a positive manner.   They were usually seen as a milch cow. The only thought was how to extract the maximum yield without killing the herd.
One stated policy was called “Bump Rate”.
Senior officers referred to that policy when renewing lines of credit.  The LOs jacked the rate when renewing a line, knowing that the client would accept that rather than move his accounts. 
Incentivized to the tune of 6 figure salaries and bonuses, we hit our clients with the highest rates possible when originating loans.  The Preferred Lender Program was our tool to get the deal through underwriting and closed before a competitor was able to reach into our pockets and take the client.
Reflecting on that process, the snarling and gnashing of teeth among banks fighting over their clients made me think hyenas going after a wildebeast.

In the haste to sign loan documents, the clients were calmly told  ‘prime plus 4% was a good deal’.   The closers were good;  really good.  They could charm the birds from the trees. Clients went along with these massively high rates, thinking they got a good deal.
The phrase ‘Sign in haste; repent in leisure’ should have been emblazoned on the door.
 “Abandon all hope, ye who enter here” comes to mind.
At times prime rate was 8%, 9% and even 12%. A client could easily end up paying 12-16% on a Variable rate note. They didn’t realize it then, but they just got a very expensive ride on the Carnival Midway.  How we convinced a client to accept a 13% rate is beyond me but we did get the job done.  Worries over the consequences of rate bumps never occurred to us.
The secondary market for these  loans was so richly valued that even SBA became aware of this disparity.  The  bank’s extraordinary yields resulting from these rates caused the SBA to prohibit loans from exceeding prime plus 2.75%. This was NOT done to protect the client however.  It was done to reduce the yield from ‘obscene’ down to an acceptable level that I’d call  ‘just so ridiculous’.
 That 125 BPS difference seemed ok to the SBA.  Thus our max rate then became prime plus 2.75%.
The aftermarket return on a loan priced at that level  was prime plus 9% once the leverage of a 75%  guaranty was factored in.

Instructions came from on high to maximize yields, always!  Failure was not an option.  If we lost a deal to a competitor who offered a 50 BPS savings we were expected to make it up on the next loan.
To say that we willingly marched to this tune was an understatement but the end goal, something only the top officers had in mind, was the sale of the bank for top dollar.
Once the bank hit the national ranks as Numero Uno, we were the player to contend with.  Two years later US Bank purchased Bank of Commerce for $500,000,000.  According to some sources this was the most richly valued bank merger in history.  I exited my stock position a little to early but the funds helped start my business.
I lived precisely what JS Kim is speaking of in his essay.
Reflecting back over the last 25 years, while observing the present conditions of the banking industry, Kim’s essay describes an industry that’s has grown exponentially worse over the last 2 decades.

Sunshine Mint Rounds(3)
  1. Thanks for the great article AG12000. It takes real guts to be that honest.
     
    I’m still paying down a sizeable balance off a Citibank credit card aggressively at the rate of $1,000 per month on an interest rate of 21.99%. They hiked the rate by about 5% because at one stage I was a bad payer, but now I am better than a good payer. It hurts, but what keeps me going is it is the last debt I have to deal with post-divorce two years ago. I got stiffed in the settlement, which reminds me, the ex is a lot like a banker herself, only not so smart (just smart enough to hire a corrupt lawyer and leave me holding most of the debts).
     
    Any chance Citibank would succumb to a request to reduce the interest rate?

    • Would you qualify for another credit card with a lower rate and balance transfer?  Even if you could only do some it would be a benefit.
       
      Any home equity you could take a loan against?  Borrow against 401k?  Loan any physical to a trusted third party?

    • Mikey, thanks for replying man. Nope I sold up everything in AU and now live net cashflow positive in SG and quite happy here. I think your suggestion of a low rate card and balance transfer is the way to go. I’ve only got about $6K to go on it, but that would still save me quite a bit.
       
      I’m 55 and drew down my 401K last year, and am gradually converting it to silver. I could easily pay off Citibank if I chose to, but right now it suits me to acquire physical and make the bankers wait a bit longer for their ill-gotten spoils.
       
      Thanks also to Big Tom – hey I love camping, but am not quite ready to head for the hills in Borneo or PNG ;) hahaha.
       
      You guys are great. Thanks.

    • Speros  Thanks for the ack.  It was something I am not proud of.  That Citibank is  an egg sucking TBTF fuck bank is an understatement
      That they charge prime plus 18% is nothing short of blatant thievery.  If you can acquire the cash to rid yourself of these parasites will both free you of the leaches, zero out your counterparty risk, give yourself a nice raise in personal life stye cash flow, provide you the means to but at least 40 ounces of silver for 60 months straight. 
      Mikey makes a good point if you can get one of those ‘Free’ zero rate cards to rid yourself of that obnoxious rate.  I paid one of those Zero rate deals off just two days ago with a phone call and debit from my account.  What was a little scary was that these sons of bitches HAD my bank account number.  I usually pay by check but they recorded it, right along with my waist size, IQ and preferred shoe wear. That means they could reach into my checking account at any time and snorkel out funds for any reason—or no reason. It tells me that a bail-in would be nothing more than a key stroke to remove funds from my account. They could check my balances and what I am spending funds for as well.
      I used that card a year ago to buy phyzz at zero rate and paid them off with a debit on the account on Monday.  
      It makes me think of an old girlfriend—after a bit of coyote love one early morning, I fled changed my phone number.
       
      The name of the credit card company?  JPM Chase (They charge 29% on unpaid balances) 
      The name of the girl friend?   Joyce  
      Writing the post above was my was of amplifying on Kim’s asserting that bankers are worse than stalking girlfriends, Genghis Kahn and Hannibal Lechter combined.  You get invited to dinner (on the menu too), ass fucked  and dont even get a courtesy of a ‘reach around’  Damn I hate banks. 
      170,000 tons of gold.  How about a sacrafice to Pele.  If there is a stack like that it would be the Dragon Family gold transferred through the Philippines in WWII and stashed in an Airforce or Naval base. Ask Bush Sr about that. That story is engaging and if its true, the who dynamic of gold changes.  That’s 331,500 cu ft of gold   About 69 cubic foot cube  There is also the stat that 170,000 tons is all the gold ever mined  I vote with the latter notion
      Kill all bankers

    • OK guys so let’s not think of this ‘meeting place of the minds’ as something intangible or not producing worthwhile results.
       
      I took on Mikey’s suggestion and have just been pre-approved for a 0% x 6mths ANZ Visa card with $0 fees on balance transfers. Hopefully it will be approved and I can give those thieving mongrels at Citibank the bird.

      I also take note of AGXIIK’s example of using a 0% card to purchase physical. What a great idea. That’s my next thing to look into. Anything that can turn the bankers’ game back on them is a good plan in my books. Even better, make minimum monthly payments only, and if/when hyperinflation sets in, pay that f**ker off with worthless fiat.
       
      In the meantime, another 50oz of Maples have been requisitioned!
       
      Thanks for the suggestions :)

  2. Karen Hudes, World Bank lawyer turned whistleblower, in RT News interview, states there is much more Gold in the world than World Gold Council will let on.  She stated than the amount of Gold held in Hawaii alone is “170,000″ tons.  Still, she buys Gold as insurance because fiat paper currencies are collapsing.  More reason to be buying Silver…

    • 170,000 tons? That would take one hell of a facility to house and keep secure. Something like Fort Knox, or even bigger. Is there any building in Hawaii capable of such a deployment?
       
      Now a 1-ton cube of gold is roughly 15″ on each side. a stack of 170,000 tons stacked in cubes would form one giant cube 68’9″ along each side. Yeah I suppose that’s do-able.

    • I wish ms. Hudes could provide a tiny bit of proof on that. Bix Weir talks about some huge supply of gold somewhere too. Could easily be some ‘insider’ telling them false info to discourage gold purchases. It wouldn’t be the first time ‘officials’ have told false stories to achieve a given goal.

  3. Thanks for a view from the inside of the bankster lair, AG.  Info like this is insightful and difficult to come by.  Since banksters are a breed that tends to eat their young, it is difficult to get an inside view like this.
     
    As for myself, I have had very little to do with the banks over the years.  A fellow who was wise in the ways of the world once told me that if I valued success, I should minimize the time I spent with lawyers, bankers, thieves, and whores.  That seemed like good advice and I have taken it to heart all my life.  Your comments confirm to me that this is so.
     
    When I do deal with money-lenders, I play my cards close to the vest and play hardball.  If they do not meet my requirements, I move on to the next one who might.  This continues until I either get the deal I want or run out of possible lenders.  Of course, getting a loan these days is pretty much unnecessary.  I get one from time to time so that my money can be used for other things.  But the deal has to be a good one and I never take a bankers’ word that a deal is good.  OF COURSE they will tell me that, especially when it is not.  But, knowing this, I am ready for the sales spiel and it runs off me like water off a duck.  :-)
     

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