Here’s a worrisome survey item from last week that caught my attention: Many college students are signing on the dotted line for student loans they don’t fully understand.
So many thousands of dollars on the line and they don’t know the terms and the numbers?
According to the report from the nonprofit Young Invincibles, nearly two-thirds of student loan borrowers misunderstood or were surprised by details of the loan process. For example, when asked about the monthly repayment, 20 percent acknowledged that the amount was unexpected.
Comments from three of the anonymous students quoted in the report offer more context:
“I did not fully understand the extent to which I was getting myself into. All I knew was in order to pay tuition, I would need to take out private and federal loans.”
“Obviously, I understood that I would have to repay my loans upon graduation. However, I did not realize how much interest (it) would take.”
“Looking back, I wish I asked a million more questions than what I did, but at the same time I don’t think I knew what to ask.”
Read more here: http://www.kansascity.com/2012/03/30/3526301/student-loan-misunderstandings.html#storylink=cpy
Saturday, March 31, 2012
Friday, March 30, 2012
China's bank profits hit record, but bad loans up
SHANGHAI -(MarketWatch)- Three of China's largest banks have reported record levels of net profit for 2011, but rising levels of bad debt have renewed concerns about credit risks in the country's banking sector.
China's largest bank by assets, Industrial & Commercial Bank of China Ltd. , said Thursday its net profit rose 26% to CNY208.27 billion (US$33 billion) last year because of wider interest margins. However, in the fourth quarter its bad loans rose by CNY3.82 billion, a mild increase considering the bank's mammoth size but one that adds to the uncertainty about the long-term health of Chinese lenders.
Separately, Bank of China Ltd. Thursday posted a 19% rise in full-year net profit to CNY124.18 billion, although the value of its bad loans rose by CNY1.39 billion in the last quarter of the year.
Earlier this week, China Construction Bank Corp., the country's biggest lender to home buyers, posted an increase of CNY6.27 billion in bad loans for the fourth quarter.
While analysts don't expect a banking crisis in China to compare with the one that hit U.S. and European banks in recent years, the country's cooling economy, falling home prices and the challenge of refinancing sizable local government debt will increase bad loans and erode banks' profitability, they say.
China's largest bank by assets, Industrial & Commercial Bank of China Ltd. , said Thursday its net profit rose 26% to CNY208.27 billion (US$33 billion) last year because of wider interest margins. However, in the fourth quarter its bad loans rose by CNY3.82 billion, a mild increase considering the bank's mammoth size but one that adds to the uncertainty about the long-term health of Chinese lenders.
Separately, Bank of China Ltd. Thursday posted a 19% rise in full-year net profit to CNY124.18 billion, although the value of its bad loans rose by CNY1.39 billion in the last quarter of the year.
Earlier this week, China Construction Bank Corp., the country's biggest lender to home buyers, posted an increase of CNY6.27 billion in bad loans for the fourth quarter.
While analysts don't expect a banking crisis in China to compare with the one that hit U.S. and European banks in recent years, the country's cooling economy, falling home prices and the challenge of refinancing sizable local government debt will increase bad loans and erode banks' profitability, they say.
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