DIRECTIONS: Read the following and answer the questions?
http://www.americanenglishconversation.com
http://www.freeenglishconversation.blogspot.com/
http://grammar-help.blogspot.com/
http://freeenglishlessons-denise.blogspot.com/
Most Asian markets ended in the red after euro zone finance ministers delayed a final decision on extending emergency loans to debt-stricken Greece, dashing hopes for a quick solution to the political impasse.
The FTSE CNBC Asia 100 Index [.FTFCNBCA 6455.52 -48.37 (-0.74%)], which measures markets across Asia, fell 0.7 percent.
The Nikkei average ended flat, with investor caution before the Federal Open Market Committee meeting this week offsetting gains in power companies, which rose on a government official's comment to restart nuclear reactors.
Shares in power companies Chubu Electric and Kansai Electric jumped after Trade Minister Banri Kaieda said on Saturday that government inspections showed all nuclear power plants in Japan had adequate safety measures against severe accidents and called on local governments to give the green light to restarting nuclear reactors.
But, shares of Japanese game developer Sega Sammy tumbled after the firm said information belonging to 1.3 million customers had been stolen from its database, the latest in a rash of global cyber attacks against video game companies.
The benchmark Nikkei average [.N225 9354.32 2.92 (+0.03%) ] closed at 9,354.32, while the broader Topix gained 0.2 percent to 806.83.
Seoul shares dipped as foreign investor selling continued for a third straight session, with technology issues and crude oil refiners including Samsung Electronics and S-Oil losing ground.
The Korea Composite Stock Price Index [.KS11 2019.65 -12.28 (-0.6%) ] ended down 0.6 percent at 2,019.65 points.
Australian stocks suffered another reversal as morning gains evaporated to send the market to a fresh nine-and-a-half-month low, with doubts about the Australian economy adding to worries about a Greek debt default.
Shares in oil refiner Caltex slumped 6.9 percent after it said refining margins have dropped sharply and its first-half profit would fall by up to 39 percent.
The benchmark S&P/ASX 200 index [.AXJO 4451.70 -33.20 (-0.74%) ] dropped 33.2 points or 0.7 percent to 4,451.7, having reached as high as 4,520 in morning trade.
China's main stock index ended down 0.8 percent in thin trade near a nine-month low on dampened by tight liquidity in the interbank market, while banks prepared to meet Monday's deadline for a hike in requirement reserve ratio.
The liquidity squeeze in China's money market makes brokerages, fund managers and wealthy personal investors unable to obtain sufficient cash for investments in stocks.
The benchmark Shanghai Composite Index [.SSEC 2621.25 -21.57 (-0.82%) ] finished down at 2,622.6 points, the lowest level since late September 2010 and extending a 2.3 percent loss over the week last week.
Hong Kong shares gave up earlier gains to end lower as property issues floundered and a sluggish market, which looks poised to hit a nine-month low, weighed.
The benchmark Hang Seng Index [.HSI Loading... () ] fell 0.4 percent to 21,599.5 with the property sub-index slipping 2.2 percent to its lowest level in a year.
Cheung Kong [0001.HK 109.20 -4.30 (-3.8%) ] fell 3.8 percent, leading a broad decline in property counters in Hong Kong after a top government official warned of the growing risks of a property bubble in the territory.
In Southeast Asia, Singapore's STI [.FTSTI 3013.60 8.32 (+0.28%) ] rose 0.3 percent at the finish line, while Malaysia's KLCI [.KLSE 1559.19 -4.24 (-0.27%) ] ended 0.3 percent lower.
Most Asian markets ended in the red after euro zone finance ministers delayed a final decision on extending emergency loans to debt-stricken Greece, dashing hopes for a quick solution to the political impasse?
A. TRUE
B. FALSE
Did the benchmark Hang Seng Index fell 0.4 percent to 21,599.5 with the property sub-index slipping 2.2 percent to its lowest level in a year?
A. TRUE
B. FALSE
DIRECTIONS: Read the following and answer the questions?
http://www.americanenglishconversation.com
http://www.freeenglishconversation.blogspot.com/
http://grammar-help.blogspot.com/
http://freeenglishlessons-denise.blogspot.com/
NEW YORK (Reuters) Stocks edged higher on Wednesday after an upbeat outlook from FedEx as investors awaited the Federal Reserve's assessment of the economy and any clues about plans for dealing with recent weakness.
Economic bellwether FedEx Corp (FDX.N) rose 2.4 percent to $91.31, lending support to the market after the shipping group reported strong fourth-quarter profit and forecast robust 2012 earnings.
"The new news there is FedEx made noise about how the cost of doing business is going down as opposed to up. So are we starting to see some slowdown in inflation here?" said Stephen Massocca, managing director at Wedbush Morgan in San Francisco.
The Dow Jones Transportation average (.DJT) gained 0.8 percent.
The Dow Jones industrial average (.DJI) gained 4.39 points, or 0.04 percent, to 12,194.40. The Standard & Poor's 500 Index (.SPX) put on 1.74 points, or 0.13 percent, to 1,297.26. The Nasdaq Composite Index (.IXIC) added 2.13 points, or 0.08 percent, to 2,689.39.
The Fed is likely to acknowledge weakness in the economy and reiterate its commitment to keeping interest rates low for an extended period, according to analysts.
Investors will look for clues on new measures to support the economy as the Fed's second quantitative easing program ends this month.
"(Bernanke) could surprise you, but he's certainly not looking at inflation or looking at an overheating economy. He's not looking at an economy that is so dire that he has to fire a bullet he really doesn't want to fire right now. So it's going to be the bullet is in the gun, it's ready to go if I need it, and everyone is expecting that," said Massocca.
Adobe Systems Inc (ADBE.O) slumped 6.4 percent to $29.96 a day after the software maker reported a 54 percent jump in quarterly profit but warned of weakness in European demand.
U.S. stocks advanced for the fourth straight day on Tuesday on expectations the Greek prime minister would survive a confidence vote, a key hurdle to avoiding a debt default, adding momentum to a recent rebound.
The Nasdaq posted its biggest percentage gain since October on Tuesday, while the S&P 500 marked its best day in two months in what traders see as continued short-term buying from deeply oversold levels.
Net short positions by hedge funds on the S&P 500 have recently increased, according to Societe Generale cross-asset research.
A statement from the Federal Open Market Committee is due at 12:30 p.m. EDT, followed by Bernanke's press conference at 2:15 p.m. EDT?
A. TRUE
B.FALSE
The new news there is FedEx made noise about how the cost of doing business is going down as opposed to up. So are we starting to see some slowdown in inflation here?
A. TRUE
B.FALSE
DIRECTIONS: Read the following and answer the questions?
http://www.americanenglishconversation.com
http://www.freeenglishconversation.blogspot.com/
http://grammar-help.blogspot.com/
http://freeenglishlessons-denise.blogspot.com/
Shares of major Chinese lenders China Construction Bank and Agricultural Bank of China fell to multi-month lows on Tuesday, hit by potentially souring loans, an economic slowdown and tighter capital requirements.
AFP | Getty Images
--------------------------------------------------------------------------------
CCB [1288.HK 3.94 -0.05 (-1.25%) ] was down 2.7 percent to a nine-month low of HK$6.43, while AgBank [3988.HK 3.79 -0.03 (-0.79%) ] was down 3.8 percent to a four-month low of HK$3.84, versus the benchmark Hang Seng Index's [.HSI 21850.59 251.08 (+1.16%) ] 0.4 percent rise.
"The risk of a hard landing for the Chinese economy is increasing," said Alexander Lee, a Hong Kong-based analyst at DBS Vickers. "The Japanese earthquake, a slow U.S. economy, the Eurozone problems and a slowing Chinese economy are all building up on the banking sector."
CCB is China's largest mortgage lender at a time when the government is taking increasingly heavy-handed measures to cool real estate prices, prompting Standard & Poor's to lower its outlook on the country's property sector to negative.
AgBank is the biggest lender to rural causes and has the highest non-performing loan ratio and lowest capital adequacy ratio among the big four lenders, raising worries that it may need fresh capital if the government tightens capital requirements.
Further weighing on the two stocks is the impending expiry of their cornerstone investors' lock-up period, with Bank of America [BAC 10.695 0.095 (+0.9%) ] able to sell CCB shares from late August. Bloomberg reported on Monday that Bank of America may sell half its stake in the lender to comply with new industry capital rules.
The lock-up period for AgBank will begin expiring in July, which could lead to a large number of its shares flooding the market if cornerstone investors including Singapore's Temasek and the Qatar Investment Authority choose to sell.
"This is a known risk factor that most investors should know about," said Patrick Pong, an analyst at Mirae Asset Securities.
"These cornerstone investors may choose to sell down some of their holdings, and that may weigh on the shares in the short term."
Slowdown and Tightening
The total amount China's banks have lent compared to the country's GDP size has risen to "alarming levels", and off-balance sheet financing could lead to future asset quality problems, Credit Suisse wrote in a research report on Monday.
Much of the off-balance sheet financing is likely to have gone to local government financing vehicles companies set up by provincial or city authorities who are forbidden from borrowing directly from banks.
The country's top banks provided many of the loans as part of a giant economic stimulus programme launched by Beijing in late 2008 to counter the global financial crisis.
"There are signs of an economic slowdown in China, and we believe that this may not be just a transient problem as the situation is much more complex with structural problems," Credit Suisse analysts Vincent Chan and Peggy Chan wrote in a note on Monday.
Monetary tightening in China could further pressure the sector, with the central bank raising bank reserve ratios last week for the ninth time since October to curb inflation, which is running at its fastest pace in almost three years.
The People's Bank of China is also likely to raise its benchmark interest rate at least once more and reserve requirements at least three more times this year, a Reuters poll showed in April.
"There's an increasing number of short-term risks in the horizon, and that's something investors need to look out for," said Lee at DBS Vickers.
The lock-up period for AgBank will begin expiring in July, which could lead to a large number of its shares flooding the market if cornerstone investors including Singapore's Temasek and the Qatar Investment Authority choose to sell?
A. TRUE
B.FALSE
The People's Bank of China is also likely to raise its benchmark interest rate at least once more and reserve requirements at least three more times this year, a Reuters poll showed in April?
A. TRUE
B.FALSE
DIRECTIONS: Read the following and answer the questions?
http://www.americanenglishconversation.com
http://www.freeenglishconversation.blogspot.com/
http://grammar-help.blogspot.com/
http://freeenglishlessons-denise.blogspot.com/
The nations two biggest providers of reverse mortgages are no longer offering the loans, as the economics of the business have come under pressure.
Wells Fargo, the largest provider, said on Thursday that it was leaving the business, following the departure in February of Bank of America [BAC 10.68 0.08 (+0.75%) ] , the second-largest lender. With the two biggest players gone together, they accounted for 43 percent of the business, according to Reverse Market Insight prospective borrowers may find it more difficult to access the mortgages.
Reverse mortgages allow people age 62 and older to tap what may be their biggest asset, their home equity, without having to make any payments. Instead, the bank pays the borrowers, though they continue to be responsible for paying property taxes and homeowners insurance.
But the loans have increasingly become a riskier proposition. Banks are not allowed to assess borrowers ability to keep up with all their payments, and more borrowers do not have the wherewithal to stay current on their homeowners insurance and property taxes, both of which have risen in many parts of the country. At the same time, borrowers have been taking the maximum amount of money available, often using it to pay off any remaining money owed on the home. Yet home prices continue to slide.
We are on new ground here, said Franklin Codel, head of national consumer lending at Wells Fargo [WFC 27.33 0.53 (+1.98%) ] . With house prices falling, you reach a crossover point where they owe more than the house is worth and it creates risk for us as mortgage servicers and for HUD. He was referring to the Department of Housing and Urban Development, whose Federal Housing Administration arm insures the vast majority of these loans through its Home Equity Conversion Mortgage program.
As a result, banks are seeing a rise in what are known as technical defaults, when homeowners fall behind on their taxes or homeowners insurance, both of which are required to avoid foreclosure. According to Reverse Market Insight, about 4 to 5 percent of active reverse mortgages, or 25,000 to 30,000 borrowers, are in default on at least one of those items.
Bank of America, meanwhile, said that declining home values made fewer people eligible for reverse mortgages. So it decided to redeploy at least half of those working on the mortgages to its loan modification division, which has been criticized for failing to help enough homeowners on the brink of foreclosure.
For Wells Fargo, however, the inability to assess borrowers financial health was the biggest factor for exiting the business. Anyone over the age of 62 with enough home equity can take out a reverse mortgage, regardless of their other income. The amount of money received is determined by the borrowers age, the amount of equity in the home and prevailing interest rates.
We are not allowed, as an originator, to decline anyone, added Mr. Codel of Wells Fargo. We worked closely with HUD to find an alternative solution and we were unable to find one with them, which led to this outcome.
Reverse mortgage borrowers are required to pay premiums for mortgage insurance, which protects the lender if the homes are ultimately sold for less than the mortgage value, since the government is required to pay the difference to the lender. The premium rates were increased last October to account for declining home values (though one sizable upfront mortgage premium was eliminated to make the loans more attractive to certain borrowers).
But lenders are responsible for making tax and insurance payments on behalf of delinquent borrowers until they submit an insurance claim to HUD, at which point the agency would be responsible since it provided the insurance against default.
In January, HUD sent a letter to lenders and reverse mortgage counselors that provided guidance on how to report delinquent loans to the agency, and what steps the lenders could take to get borrowers back on track, like establishing a realistic repayment plan that could be completed in two years or less, or getting a HUD-approved mortgage counselor involved to help come up with a solution. If one cannot be reached, the lenders must begin foreclosure proceedings.
Both Wells Fargo and Bank of America have said they have not foreclosed on any borrowers to date.
The National Reverse Mortgage Lenders Association, the industry group, said it has been working with HUD to come up with procedures that would allow lenders to assess a prospective borrowers income and expenses, or at least require homeowners to set aside money to pay for taxes and insurance. A spokeswoman for HUD said the guidance is still being drafted.
As it stands now, borrowers are required to see a HUD-approved lender before they can apply for a reverse mortgage. As part of that process, consumers are educated on the nuts and bolts of how the loans work and what their responsibilities are, including that they need to be able to continue to pay taxes, insurance and keep the property in good repair.
We dont tell consumers what decision to make, but we do try to give them the tools to make a decision, said Sue Hunt, director of reverse mortgage counseling at CredAbility, a nonprofit consumer credit counseling agency. She added that their sessions last about an hour and 15 minutes, on average. The counselors also look at the consumers budget to see if it is sustainable with the mortgage, as well as what circumstances might arise that could throw the borrower off track.
Outside factors are affecting people who thought five or six years ago that they were in pretty good shape, she added. The world has changed a bit around them.
In days past, the borrower would get the reverse mortgage, and equity would continue to build, experts said, which would provide borrowers with more options like refinancing should they fall on hard times. Declining home values have changed that calculus for both bankers and consumers. Borrowers have not been able to pull out as much money. At the same time, the government has also tightened its withdrawal limits.
There were a total of more than 50,000 reverse mortgages, totaling $12.66 billion, made industrywide since last October, according to HUD.
Both Wells Fargo and Bank of America will continue to service their existing reverse mortgages. And the reverse mortgage association has said it will work with its members to ensure that senior citizens who need the loans can get them, though some experts said that less competition could increase certain fees.
There is a certain amount of the business done by Wells and Bank of America that happens because of their bank branches, brand names and large sales forces, said John K. Lunde, president of Reverse Market Insight. We would expect something more than half of their volume to be absorbed by the rest of the industry, with something less than half not happening.
Wells Fargo, which said that reverse mortgages represented 2.2 percent of its retail mortgage business, employs about 1,000 reverse mortgage workers. They are being given a chance to find other positions at the bank. Bank of America said that about half of its 600 workers have been reassigned within the bank. MetLife, the third-largest provider of reverse mortgages, declined to comment on its business.
Wells Fargo, the largest provider, said on Thursday that it was leaving the business, following the departure in February of Bank of America?
A. TRUE
B.FALSE
Wells Fargo, which said that reverse mortgages represented 2.2 percent of its retail mortgage business, employs about 1,000 reverse mortgage workers?
A. TRUE
B.FALSE
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Most Asian markets ended in the red after euro zone finance ministers delayed a final decision on extending emergency loans to debt-stricken Greece, dashing hopes for a quick solution to the political impasse.
The FTSE CNBC Asia 100 Index [.FTFCNBCA 6455.52 -48.37 (-0.74%)], which measures markets across Asia, fell 0.7 percent.
The Nikkei average ended flat, with investor caution before the Federal Open Market Committee meeting this week offsetting gains in power companies, which rose on a government official's comment to restart nuclear reactors.
Shares in power companies Chubu Electric and Kansai Electric jumped after Trade Minister Banri Kaieda said on Saturday that government inspections showed all nuclear power plants in Japan had adequate safety measures against severe accidents and called on local governments to give the green light to restarting nuclear reactors.
But, shares of Japanese game developer Sega Sammy tumbled after the firm said information belonging to 1.3 million customers had been stolen from its database, the latest in a rash of global cyber attacks against video game companies.
The benchmark Nikkei average [.N225 9354.32 2.92 (+0.03%) ] closed at 9,354.32, while the broader Topix gained 0.2 percent to 806.83.
Seoul shares dipped as foreign investor selling continued for a third straight session, with technology issues and crude oil refiners including Samsung Electronics and S-Oil losing ground.
The Korea Composite Stock Price Index [.KS11 2019.65 -12.28 (-0.6%) ] ended down 0.6 percent at 2,019.65 points.
Australian stocks suffered another reversal as morning gains evaporated to send the market to a fresh nine-and-a-half-month low, with doubts about the Australian economy adding to worries about a Greek debt default.
Shares in oil refiner Caltex slumped 6.9 percent after it said refining margins have dropped sharply and its first-half profit would fall by up to 39 percent.
The benchmark S&P/ASX 200 index [.AXJO 4451.70 -33.20 (-0.74%) ] dropped 33.2 points or 0.7 percent to 4,451.7, having reached as high as 4,520 in morning trade.
China's main stock index ended down 0.8 percent in thin trade near a nine-month low on dampened by tight liquidity in the interbank market, while banks prepared to meet Monday's deadline for a hike in requirement reserve ratio.
The liquidity squeeze in China's money market makes brokerages, fund managers and wealthy personal investors unable to obtain sufficient cash for investments in stocks.
The benchmark Shanghai Composite Index [.SSEC 2621.25 -21.57 (-0.82%) ] finished down at 2,622.6 points, the lowest level since late September 2010 and extending a 2.3 percent loss over the week last week.
Hong Kong shares gave up earlier gains to end lower as property issues floundered and a sluggish market, which looks poised to hit a nine-month low, weighed.
The benchmark Hang Seng Index [.HSI Loading... () ] fell 0.4 percent to 21,599.5 with the property sub-index slipping 2.2 percent to its lowest level in a year.
Cheung Kong [0001.HK 109.20 -4.30 (-3.8%) ] fell 3.8 percent, leading a broad decline in property counters in Hong Kong after a top government official warned of the growing risks of a property bubble in the territory.
In Southeast Asia, Singapore's STI [.FTSTI 3013.60 8.32 (+0.28%) ] rose 0.3 percent at the finish line, while Malaysia's KLCI [.KLSE 1559.19 -4.24 (-0.27%) ] ended 0.3 percent lower.
Most Asian markets ended in the red after euro zone finance ministers delayed a final decision on extending emergency loans to debt-stricken Greece, dashing hopes for a quick solution to the political impasse?
A. TRUE
B. FALSE
Did the benchmark Hang Seng Index fell 0.4 percent to 21,599.5 with the property sub-index slipping 2.2 percent to its lowest level in a year?
A. TRUE
B. FALSE
DIRECTIONS: Read the following and answer the questions?
http://www.americanenglishconversation.com
http://www.freeenglishconversation.blogspot.com/
http://grammar-help.blogspot.com/
http://freeenglishlessons-denise.blogspot.com/
NEW YORK (Reuters) Stocks edged higher on Wednesday after an upbeat outlook from FedEx as investors awaited the Federal Reserve's assessment of the economy and any clues about plans for dealing with recent weakness.
Economic bellwether FedEx Corp (FDX.N) rose 2.4 percent to $91.31, lending support to the market after the shipping group reported strong fourth-quarter profit and forecast robust 2012 earnings.
"The new news there is FedEx made noise about how the cost of doing business is going down as opposed to up. So are we starting to see some slowdown in inflation here?" said Stephen Massocca, managing director at Wedbush Morgan in San Francisco.
The Dow Jones Transportation average (.DJT) gained 0.8 percent.
The Dow Jones industrial average (.DJI) gained 4.39 points, or 0.04 percent, to 12,194.40. The Standard & Poor's 500 Index (.SPX) put on 1.74 points, or 0.13 percent, to 1,297.26. The Nasdaq Composite Index (.IXIC) added 2.13 points, or 0.08 percent, to 2,689.39.
The Fed is likely to acknowledge weakness in the economy and reiterate its commitment to keeping interest rates low for an extended period, according to analysts.
Investors will look for clues on new measures to support the economy as the Fed's second quantitative easing program ends this month.
"(Bernanke) could surprise you, but he's certainly not looking at inflation or looking at an overheating economy. He's not looking at an economy that is so dire that he has to fire a bullet he really doesn't want to fire right now. So it's going to be the bullet is in the gun, it's ready to go if I need it, and everyone is expecting that," said Massocca.
Adobe Systems Inc (ADBE.O) slumped 6.4 percent to $29.96 a day after the software maker reported a 54 percent jump in quarterly profit but warned of weakness in European demand.
U.S. stocks advanced for the fourth straight day on Tuesday on expectations the Greek prime minister would survive a confidence vote, a key hurdle to avoiding a debt default, adding momentum to a recent rebound.
The Nasdaq posted its biggest percentage gain since October on Tuesday, while the S&P 500 marked its best day in two months in what traders see as continued short-term buying from deeply oversold levels.
Net short positions by hedge funds on the S&P 500 have recently increased, according to Societe Generale cross-asset research.
A statement from the Federal Open Market Committee is due at 12:30 p.m. EDT, followed by Bernanke's press conference at 2:15 p.m. EDT?
A. TRUE
B.FALSE
The new news there is FedEx made noise about how the cost of doing business is going down as opposed to up. So are we starting to see some slowdown in inflation here?
A. TRUE
B.FALSE
DIRECTIONS: Read the following and answer the questions?
http://www.americanenglishconversation.com
http://www.freeenglishconversation.blogspot.com/
http://grammar-help.blogspot.com/
http://freeenglishlessons-denise.blogspot.com/
Shares of major Chinese lenders China Construction Bank and Agricultural Bank of China fell to multi-month lows on Tuesday, hit by potentially souring loans, an economic slowdown and tighter capital requirements.
AFP | Getty Images
--------------------------------------------------------------------------------
CCB [1288.HK 3.94 -0.05 (-1.25%) ] was down 2.7 percent to a nine-month low of HK$6.43, while AgBank [3988.HK 3.79 -0.03 (-0.79%) ] was down 3.8 percent to a four-month low of HK$3.84, versus the benchmark Hang Seng Index's [.HSI 21850.59 251.08 (+1.16%) ] 0.4 percent rise.
"The risk of a hard landing for the Chinese economy is increasing," said Alexander Lee, a Hong Kong-based analyst at DBS Vickers. "The Japanese earthquake, a slow U.S. economy, the Eurozone problems and a slowing Chinese economy are all building up on the banking sector."
CCB is China's largest mortgage lender at a time when the government is taking increasingly heavy-handed measures to cool real estate prices, prompting Standard & Poor's to lower its outlook on the country's property sector to negative.
AgBank is the biggest lender to rural causes and has the highest non-performing loan ratio and lowest capital adequacy ratio among the big four lenders, raising worries that it may need fresh capital if the government tightens capital requirements.
Further weighing on the two stocks is the impending expiry of their cornerstone investors' lock-up period, with Bank of America [BAC 10.695 0.095 (+0.9%) ] able to sell CCB shares from late August. Bloomberg reported on Monday that Bank of America may sell half its stake in the lender to comply with new industry capital rules.
The lock-up period for AgBank will begin expiring in July, which could lead to a large number of its shares flooding the market if cornerstone investors including Singapore's Temasek and the Qatar Investment Authority choose to sell.
"This is a known risk factor that most investors should know about," said Patrick Pong, an analyst at Mirae Asset Securities.
"These cornerstone investors may choose to sell down some of their holdings, and that may weigh on the shares in the short term."
Slowdown and Tightening
The total amount China's banks have lent compared to the country's GDP size has risen to "alarming levels", and off-balance sheet financing could lead to future asset quality problems, Credit Suisse wrote in a research report on Monday.
Much of the off-balance sheet financing is likely to have gone to local government financing vehicles companies set up by provincial or city authorities who are forbidden from borrowing directly from banks.
The country's top banks provided many of the loans as part of a giant economic stimulus programme launched by Beijing in late 2008 to counter the global financial crisis.
"There are signs of an economic slowdown in China, and we believe that this may not be just a transient problem as the situation is much more complex with structural problems," Credit Suisse analysts Vincent Chan and Peggy Chan wrote in a note on Monday.
Monetary tightening in China could further pressure the sector, with the central bank raising bank reserve ratios last week for the ninth time since October to curb inflation, which is running at its fastest pace in almost three years.
The People's Bank of China is also likely to raise its benchmark interest rate at least once more and reserve requirements at least three more times this year, a Reuters poll showed in April.
"There's an increasing number of short-term risks in the horizon, and that's something investors need to look out for," said Lee at DBS Vickers.
The lock-up period for AgBank will begin expiring in July, which could lead to a large number of its shares flooding the market if cornerstone investors including Singapore's Temasek and the Qatar Investment Authority choose to sell?
A. TRUE
B.FALSE
The People's Bank of China is also likely to raise its benchmark interest rate at least once more and reserve requirements at least three more times this year, a Reuters poll showed in April?
A. TRUE
B.FALSE
DIRECTIONS: Read the following and answer the questions?
http://www.americanenglishconversation.com
http://www.freeenglishconversation.blogspot.com/
http://grammar-help.blogspot.com/
http://freeenglishlessons-denise.blogspot.com/
The nations two biggest providers of reverse mortgages are no longer offering the loans, as the economics of the business have come under pressure.
Wells Fargo, the largest provider, said on Thursday that it was leaving the business, following the departure in February of Bank of America [BAC 10.68 0.08 (+0.75%) ] , the second-largest lender. With the two biggest players gone together, they accounted for 43 percent of the business, according to Reverse Market Insight prospective borrowers may find it more difficult to access the mortgages.
Reverse mortgages allow people age 62 and older to tap what may be their biggest asset, their home equity, without having to make any payments. Instead, the bank pays the borrowers, though they continue to be responsible for paying property taxes and homeowners insurance.
But the loans have increasingly become a riskier proposition. Banks are not allowed to assess borrowers ability to keep up with all their payments, and more borrowers do not have the wherewithal to stay current on their homeowners insurance and property taxes, both of which have risen in many parts of the country. At the same time, borrowers have been taking the maximum amount of money available, often using it to pay off any remaining money owed on the home. Yet home prices continue to slide.
We are on new ground here, said Franklin Codel, head of national consumer lending at Wells Fargo [WFC 27.33 0.53 (+1.98%) ] . With house prices falling, you reach a crossover point where they owe more than the house is worth and it creates risk for us as mortgage servicers and for HUD. He was referring to the Department of Housing and Urban Development, whose Federal Housing Administration arm insures the vast majority of these loans through its Home Equity Conversion Mortgage program.
As a result, banks are seeing a rise in what are known as technical defaults, when homeowners fall behind on their taxes or homeowners insurance, both of which are required to avoid foreclosure. According to Reverse Market Insight, about 4 to 5 percent of active reverse mortgages, or 25,000 to 30,000 borrowers, are in default on at least one of those items.
Bank of America, meanwhile, said that declining home values made fewer people eligible for reverse mortgages. So it decided to redeploy at least half of those working on the mortgages to its loan modification division, which has been criticized for failing to help enough homeowners on the brink of foreclosure.
For Wells Fargo, however, the inability to assess borrowers financial health was the biggest factor for exiting the business. Anyone over the age of 62 with enough home equity can take out a reverse mortgage, regardless of their other income. The amount of money received is determined by the borrowers age, the amount of equity in the home and prevailing interest rates.
We are not allowed, as an originator, to decline anyone, added Mr. Codel of Wells Fargo. We worked closely with HUD to find an alternative solution and we were unable to find one with them, which led to this outcome.
Reverse mortgage borrowers are required to pay premiums for mortgage insurance, which protects the lender if the homes are ultimately sold for less than the mortgage value, since the government is required to pay the difference to the lender. The premium rates were increased last October to account for declining home values (though one sizable upfront mortgage premium was eliminated to make the loans more attractive to certain borrowers).
But lenders are responsible for making tax and insurance payments on behalf of delinquent borrowers until they submit an insurance claim to HUD, at which point the agency would be responsible since it provided the insurance against default.
In January, HUD sent a letter to lenders and reverse mortgage counselors that provided guidance on how to report delinquent loans to the agency, and what steps the lenders could take to get borrowers back on track, like establishing a realistic repayment plan that could be completed in two years or less, or getting a HUD-approved mortgage counselor involved to help come up with a solution. If one cannot be reached, the lenders must begin foreclosure proceedings.
Both Wells Fargo and Bank of America have said they have not foreclosed on any borrowers to date.
The National Reverse Mortgage Lenders Association, the industry group, said it has been working with HUD to come up with procedures that would allow lenders to assess a prospective borrowers income and expenses, or at least require homeowners to set aside money to pay for taxes and insurance. A spokeswoman for HUD said the guidance is still being drafted.
As it stands now, borrowers are required to see a HUD-approved lender before they can apply for a reverse mortgage. As part of that process, consumers are educated on the nuts and bolts of how the loans work and what their responsibilities are, including that they need to be able to continue to pay taxes, insurance and keep the property in good repair.
We dont tell consumers what decision to make, but we do try to give them the tools to make a decision, said Sue Hunt, director of reverse mortgage counseling at CredAbility, a nonprofit consumer credit counseling agency. She added that their sessions last about an hour and 15 minutes, on average. The counselors also look at the consumers budget to see if it is sustainable with the mortgage, as well as what circumstances might arise that could throw the borrower off track.
Outside factors are affecting people who thought five or six years ago that they were in pretty good shape, she added. The world has changed a bit around them.
In days past, the borrower would get the reverse mortgage, and equity would continue to build, experts said, which would provide borrowers with more options like refinancing should they fall on hard times. Declining home values have changed that calculus for both bankers and consumers. Borrowers have not been able to pull out as much money. At the same time, the government has also tightened its withdrawal limits.
There were a total of more than 50,000 reverse mortgages, totaling $12.66 billion, made industrywide since last October, according to HUD.
Both Wells Fargo and Bank of America will continue to service their existing reverse mortgages. And the reverse mortgage association has said it will work with its members to ensure that senior citizens who need the loans can get them, though some experts said that less competition could increase certain fees.
There is a certain amount of the business done by Wells and Bank of America that happens because of their bank branches, brand names and large sales forces, said John K. Lunde, president of Reverse Market Insight. We would expect something more than half of their volume to be absorbed by the rest of the industry, with something less than half not happening.
Wells Fargo, which said that reverse mortgages represented 2.2 percent of its retail mortgage business, employs about 1,000 reverse mortgage workers. They are being given a chance to find other positions at the bank. Bank of America said that about half of its 600 workers have been reassigned within the bank. MetLife, the third-largest provider of reverse mortgages, declined to comment on its business.
Wells Fargo, the largest provider, said on Thursday that it was leaving the business, following the departure in February of Bank of America?
A. TRUE
B.FALSE
Wells Fargo, which said that reverse mortgages represented 2.2 percent of its retail mortgage business, employs about 1,000 reverse mortgage workers?
A. TRUE
B.FALSE
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