It tells us how much exposure each bank has to Europe and how it is safe to a certain extent.
Its great information and can help you invest in the bank based on your prediction of Europe
Tuesday, December 6, 2011
American Banks
This is a great article showing the effect of the European crisis on American Banks...
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It is good to see that banks are now raising and holding more capital than required to not put themselves in the position they were in during 2008. Hopefully, they will be lending out with the same mentality.
ReplyDeleteAlthough Americans bank do have exposure the government will not let it fail and neither will Europe let fail its big banks.
ReplyDeleteEurope doesnt have enough money to be in a position where it can influence the banks...
ReplyDeleteit has to first save the countries also America is helping some European Banks by giving them dollars
European Central Bank has promised to act as a lender of last resort. This rules out the possible failure of European Banks.
ReplyDeleteBut when the banks borrow from the Central Bank this signals to the market that something is wrong...
ReplyDeleteas such this will lead to a period of consolidation