Bankexit.Com
Index
1. Description
2. This is an Educational Site.
3. Bank Ploys to Debilitate Your Business and Trigger Defaults
4. Actions you think you can employ to counter the Bank’s ploys
5. Links to Business Management Courses.
6. List of employees who work in the exit side of banks.
7. List of law firms used by the banks.
8. List of people who have committed suicide or died as a result of stress related diseases caused by actions of the banks or the law firms employed by the banks.
1/ Description
The name “Bankexit” is derived from the internal bank jargon for the Credit Management function of banks. The business management section, of the bank, calls the credit management section, the exit side of the bank.
It is an extremely secretive side of banks.
Lower echelon bank employees do not know it exists.
Politicians do not know it exists.
The CEO of the bank controls it, so the CEO is part of the “exit side of the bank”.
The employees of this side of the bank have the following characteristics
A/ Fear of being known
B/ Live in secrecy
C/ Psychopathic
D/ No credibility
E/ Enjoy destroying hard working people.
F/ Enjoy driving their clients to suicide or premature death from stress related. diseases.
G/ Enjoy the parasitic reward from the destruction of client’s businesses.
H/ Receive bonuses and commissions for successfully destroying client’s businesses.
I/ Being widely considered by the employees of the bank, who know they exist, as being the dregs of the bank employees.
J/ Having no conscience when cheating the clients and lying to the clients.
K/ Avoid putting any agreement in writing at all costs.
Their aim is to ruin the clients
Health
Sanity
Wealth
Ability to fight the banks in court
Reputation
Credit rating
Their aim is also to achieve the maximum windfall profit for the bank or associates of the bank, bank lawyers, receivers and companies belonging to all of the above.
The advice or instructions these people give to clients is calculated to give the bank the greatest rewards and destroy the profitability of the clients business.
e.g. they will demand the client sell the most profitable business first, at a quick sale price and leave the client with the unprofitable business. The client is put into receivership and the bank has a self full-filling prophesy while reaping the windfall profits of penalty interest rates and other inflated costs.
Never do what they tell you to do, until you have determined whether or not it is in your best interest.
2/ This is an Educational Site
This is an educational site, designed for Small Business Operators.
It should be studied in conjunction with business management courses, as the information contained is normally acquired by bitter experience. With adequate knowledge, operators are able to anticipate how the bank will behave and successfully refinance with another bank or, more appropriately, another financial system, altogether, before the bank has a chance to implement their hidden agenda.
Banks and their associates make windfall profits by targeting certain business’s, putting them in the hands of receivers, and selling them off to companies owned by the receivers, after they have been bleed dry by inflated interest rates, unnecessary lawyers fees, valuations and additional bank charges. The companies that buy them are then able to sell the businesses and also make windfall profits.
There is a connection between soaring bankruptcies and soaring bank profits.
At the end of the eighties, after the period when the banks lost billions, the Reserve Bank put in place a grading system for credit ratings;
Grade A - Large corporations, including banks
Grade B -
Grade C -
Grade D - Small Businesses
Grade E - Exit side of the bank
All small businesses start off in Grade D.
They are only one level above Grade E and can be placed in that grading by any manager who has no more than a personality clash with the owner of the business. Many businesses and their owners have been destroyed by the vindictiveness of malicious bank managers.
When banks cheat small businesses the business is then, unwittingly, under extreme threat. If the business becomes aware that it has been defrauded then it is better off refinancing with another institution as rapidly as possible. Taking any action to recover the losses will result in the business being put into the exit side of the bank and destroyed.
This site is interactive, so that people who wish to make a comment are welcome.
.
3/ Bank Ploys to Debilitate your Business and Trigger Defaults.
Trapping you in the exit side of the bank
Bank Managers will not tell you that you are heading for the exit side of the bank. They will not explain the function of the exit side of the bank but will refer obliquely to introducing you to Mr. so and so, who will be looking after your account. Another phrase that signals the bank’s intention to lower your credit rating and force your business into the exit side of the bank is, “ we have to look to our securities”. The securities being every one of your assets that have been included in the mortgage to the bank.
The manager may start telling you that he wants you to “get on with the rest of your life”. This is a clear indication that the bank will be taking action which will damage your business and as a result, your life, irreparably.
False valuations
Banks use valuations to achieve their ploys or hidden agendas. Lay people would be forgiven for thinking that Licensed Valuers or the firms, which employ them, have professional ethics. This is not so. The profession has been completely corrupted by the banks.
The banks have a panel of valuers. These are firms, which receive the written instructions from the bank managers to perform a valuation on a property or business.
The client has to pay for the valuation and the cost is many times higher than the normal rates. Once completed, the valuation becomes the “official valuation”.
If the intent of the bank is to get a low valuation, then that is what they will get. At this point you may question the authenticity of the valuation, but you will be told that this is the official valuation and that the bank will not consider any other. Another valuer may arrive at a higher valuation. He may inform you that the capitalization rate used by the bank valuer is too high, but this will not change the official valuation.
It may occur to you to issue instructions to the valuer used by the bank. You are perfectly entitled to take this action. However, the bank will inform you that this is still not an official valuation. For it to be an official valuation the instructions have to be issued by the bank. It is impossible to get a fair valuation.
Capitalization rates are an arbitrary percentage figure, used by valuers to arrive at a value for your business. It is usually between 15% and 20%.
E.g. Business ‘a’ makes a profit of $300,000 and is considered favourably by the bank then the valuer may say it has a ‘cap. rate’ of 15%.
The value of the business is then calculated by dividing $300,000 by 15% and the value would be $2m.
Business ‘b’ also makes a profit of $300,000 but is out of favour with the bank. The valuer on the bank panel is given a wink and a nod and allocates a ‘cap rate’ of 20% to the business.
The value of business ‘b’ is $300,000 divided by 20% i.e. $1.5m.
The cap. rate cannot be disputed because it was determined by a “Licensed Valuer” on the bank’s panel of valuers.
Your equity has been reduced by half a million, your loan is now at risk so you are immediately charged higher interest rates, your credit rating drops and suddenly, with out any change to your trading in the business you are placed in the credit management or (as it is known internally in the bank) the exit side of the bank. Your business is about to be destroyed.
Debt Forgiveness
Having severely reduced your equity in the business, the bank manager will introduce you to the employee in the exit side of the Bank without disclosing the intent. They will give you a false impression that you are in good hands and that the new manager is here to help you.
The new manager will appear to be interested in your business but because of the low valuation they are unable to refinance your debt at the same level. As a special consideration the bank will consider giving you debt forgiveness to enable the debt to be reduced to a level that can be financed. You will be required to enquire, at the other banks, as to what level the other banks would finance your business, to get an idea of what the debt forgiveness will be. By doing this you will be drawing the other banks attention to the fact that you are in the credit management or exit side of your bank. At this point your business is finished because you will never get refinanced from any of these other banks again. You of course think that the assistance you have been offered is genuine. Your new manager will then inform you that he was unable to convince his (faceless) superiors that you should get any debt forgiveness at all.
You are now trapped in the exit side of the bank. Your business is about to be destroyed and your life will never be the same again.
Reduction of your Credit Rating
At this stage, the best option appears to be refinancing the business with another bank. They all know that your business is in the exit side of your bank. Regardless of how stable and viable your business may be, regardless of the fact that you may have never been late for any payment of any sort and regardless of the fact that you may have paid off many loans successfully they will not refinance your loan.
What you also don’t know is that every time you submit an application for a loan and it is refused your credit rating is decreasing. The banks know it, but you don’t. So every time your application is refused the banks give you another backhander by having your credit rating reduced and making it harder to get your loan refinanced, with your next attempt.
There are a number of credit rating companies, and for a small fee you can check your own. One place where they are listed is the Australian Taxation Web Site.
Deed of Compromise
To give you a false sense of security the banks draw up a deed of compromise, which they would have you believe, is genuine. It is more of a game, for psychopaths, to see how long they take to destroy you and your business.
Firstly your credit manager will calculate a cash flow for your business, to determine how easily the business can pay an amount of principal towards your loan. The cash flow will have numerous contrived errors, and will give a surplus figure much higher than the business will achieve, in reality. By this ruse, the manager will determine a figure to be repaid within a certain time, which will be unachievable.
It is in the credit manager’s interest to have the defaults triggered as soon as possible. As soon as the business is wound up he will receive his bonus from the proceeds of the sale. It is neither in his interest or the bank’s to see the business returned to normal trading. They both make windfall gains by the destruction of the business.
The deed of compromise will then list circumstances that will trigger a default.
E.g.
Cash flow figures out by more than 15%.
The normal procedure with businesses is to calculate projected cash flow figures for the next year. When these figures are compared with the actual figures and there is a difference of more than 15% then the business is in default. There are no mitigating circumstances like late payment by clients or seasonal fluctuations.
Overdraft limit exceeded at the end of the month.
If the bank overdraft is over the maximum limit at the end of the month then the business is in default. When this default trigger is in place, careful monitoring of the bank statements is required. This facility allows the bank to trigger defaults at any time, by withdrawing an amount from your account at the end of the month, so that the overdraft limit is exceeded. Early in the next month the money is replaced and the transaction may go unnoticed, but a default has been recorded against your business.
Dates fixed for the sale of assets.
Set dates will be allocated for the sale of your assets. When the sale of the asset is not met by the due date then the business is in default. These dates can be bought forward at the discretion of the credit manager, if the asset sale is imminent and will occur before the date fixed in the deed of compromise. If the proposed sale looks like it will occur before the revised date, then the credit manager will bring the date forward again, hoping to put the business into default as soon as possible.
Other debilitating actions of the banks are
Penalty Interest Rates
The business will be expected to pay interest rates 2% and more higher than the current interest rates.
The sale of profitable sections of the business.
The bank will force your business to sell off the most profitable sections of your business to their colleagues and leave you with the unprofitable sections.
No allowance in the budget for marketing.
The repayments of the principal will be structured so that there is no money available for marketing the business.
All of these actions are designed to create a self-fulfilling prophecy. Yours business goes into a downward spiral from which it is impossible to cover.
Nevertheless, under tremendous pressure, you may in fact survive the period of time the deed of compromise has been put in place, say three years. You may have complied with every requirement that the deed of compromise required.
Then comes the ultimate blow.
You may think that having complied with every requirement that was put in place to destroy your business, that this is the obvious proof that there has been a terrible mistake. You may think that this is the obvious evidence that your business should have never been put in the exit side of the bank. Well, you are wrong. Nothing that you have done has pleased the bank. Nothing that you do will ever please the bank. You have not done what the bank wanted, and that was to fail.
Your reward will be to receive a letter from the bank’s lawyers informing you that you will not be dealing with the credit manager in the future but only with the law firm.
Callous Law Firms with their own agenda.
The banks engage law firms, which have companies and individuals waiting to take advantage of the bank’s destruction of your business.
The objective of the law firm is to get a court judgement against your business as soon as possible. They proceed towards their objective with robotic ruthlessness.
Your business will be required to pay their regular and excessive law fees.
They will still proceed towards the court judgement even if there is a bill of sale in place and a deposit for the business has been paid. There is no defence against the court judgement and you have no one to turn to. Writing letters to the politicians will not help you. The so-called Bank Ombudsman will not help you.
4/ Actions you think you can employ to counter the bank’s ploys.
Employ a Lawyer
When the bank employs a lawyer, at your expense, then you have no choice but to employ one yourself.
There are some problems, however, especially in a small town.
Your lawyer may be doing bread and butter work for the bank eg conveyancing. This creates a conflict of interest, which the bank does not hesitate to use. The bank will not hesitate to threaten the lawyer with loss of business if he works too hard on your defence.
Get your own valuation
No doubt, during the course of discussions with the bank you will question their valuation. The credit manager will jump at the chance to suggest that you go ahead and get another valuation. This will further debilitate your business and, for the reason already explained, the valuation will be ignored any way.
Write to your local Member of Parliament.
Writing to your local MP is a total waste of time and effort.
The banks have the politicians well and truly under control. Whether through donations to their campaign funds, or personal loans to the individual members, who knows? Since the banks were deregulated they may not have any control over them, anyway. Deregulation has allowed rampart greed and self-serving, by the banks, without any regard to the clients they are destroying.
Eventually you will receive a letter from the relevant Minister in charge of financial regulations. It will contain three pertinent points.
1/ There is a long-standing policy that the government of the day does not intervene in the individual commercial arrangements between financial institutions and their customers.
2/ Referral to the Australian Banking Industry Ombudsman. Since 1998 the ABIO Scheme has accepted complaints from small businesses with fewer than 15 employees and a turnover of less than $1m per year.
What they won’t tell you is that,
1. The ABIO only accepts complaints of an arithmetic nature.
2. The ABIO will not consider complaints about bank policy, which accounts for 99% of the complaints.
3. The ABIO is a self-regulatory body of the banks, set up by the Australian Bankers Association, and employs bank personnel. It is designed to protect the banks.
3/ Have your dispute resolved in the court system.
When the bank is seeking a court judgement, there is no defence for the client. Fighting banks in court is beyond the resources of most individuals, especially after being financially debilitated by the banks.
The only difference between criminals and banks is that criminals are accountable, banks aren’t.
5/ Links to Business Management Courses
6/ List of employees in the exit side of banks
Please forward the names of bank personnel who work in the exit side of banks to the following email address
7/ List of law firms used by banks
Please forward the names of law firms and their employees to the following email address.
8/ List of bank Clients who have committed suicide or died from stress related diseases causes by the actions of banks or the law firms employed by the banks.
Please forward the names of peoples who have either committed suicide or died of stress related diseases as a result of the actions of the banks or the law firms employed by the banks, to the following email address.