Does anyone have any thoughts on it?
Penson 10-Q released yesterday (May15). Any thoughts on it?
- Thread starter jackpearson
- Start date
penson are bankrupt
anyone else have any thoughts?
Seems there is "going out of business" risk all over the place.
I've had accounts with
Chicago Grain
Refco
Lind-Waldock
Mann (?)
MF Global
Penson
All but Lind got into financial difficulty.
I've had accounts with
Chicago Grain
Refco
Lind-Waldock
Mann (?)
MF Global
Penson
All but Lind got into financial difficulty.
Just look at the balance sheet.
Stockholder equity is only $28.5 million. Other assets total $76.3 million. This makes tangible stockholder equity a negative $47.8 million.
It is now obvious that the parent company is broke. Penson Worldwide had to borrow $5.5 million from Penson Financial Services to make the $12.5 million interest payment due May 15, 2012.
"On May 15, 2012, Penson Worldwide, Inc. (the âCompanyâ) reached an agreement with Financial Industry Regulatory Authority (âFINRAâ) regarding the Companyâs request to withdraw regulatory capital via an intercompany loan between the Company and Penson Financial Services, Inc. (âPFSIâ), the Companyâs U.S. broker-dealer subsidiary. Under the agreement, FINRA granted permission for an intercompany loan of $5.5 million from PFSI to the Company, which was used to pay interest on the Companyâs outstanding 12.50% Senior Second Lien Secured Notes due 2017 (âSenior Second Lien Notesâ)."
Stockholder equity is only $28.5 million. Other assets total $76.3 million. This makes tangible stockholder equity a negative $47.8 million.
It is now obvious that the parent company is broke. Penson Worldwide had to borrow $5.5 million from Penson Financial Services to make the $12.5 million interest payment due May 15, 2012.
"On May 15, 2012, Penson Worldwide, Inc. (the âCompanyâ) reached an agreement with Financial Industry Regulatory Authority (âFINRAâ) regarding the Companyâs request to withdraw regulatory capital via an intercompany loan between the Company and Penson Financial Services, Inc. (âPFSIâ), the Companyâs U.S. broker-dealer subsidiary. Under the agreement, FINRA granted permission for an intercompany loan of $5.5 million from PFSI to the Company, which was used to pay interest on the Companyâs outstanding 12.50% Senior Second Lien Secured Notes due 2017 (âSenior Second Lien Notesâ)."
That is about equal to the $42 million Penson Worldwide invested in the racetrack. Penson has for sure desperately needed that money since that $42 million giveaway. Just think about all of the abnormally high interest loans Penson has been paying ever since and will pay into the future. If Penson owed me money I would not accept a debt to equity deal. Equity issued by Penson never has been, is not now, and never will be worth anything. I would enforce the debt and take my loss when Penson defaulted.