Italy’s Bank Bailout Fund Already One Third Empty After First Bank Rescue

When one month ago, Italy was scrambling to unveil a “last resort” bad bank bailout fund (which eventually received the name Atlante, or Atlas, for the Titan god who was condemned to hold up the sky for eternity, only in this case he is holding up Italy’s €360 billion in bad loans), many wondered why the rush? While the explicit purpose of the fund was to allow Italy to bailout insolvent banks without the involvement of the state which is expressly prohibited by the Eurozone, the scramble appeared erratic almost frentic, and was one of the reasons why Italian bank stocks tumbled in early February.

The question: “Does someone know something?” Continue reading

J.P. Morgan’s Dimon warns next crisis will bring even more volatility

It’s not a matter of ‘if’, but ‘when’… and here’s your latest confirmation.

 

LONDON (MarketWatch) — You ain’t seen nothing yet, when it comes to market wreckage from a financial crisis, according to J.P. Morgan boss Jamie Dimon.

In his annual letter to shareholders, the bank’s chief executive warned “there will be another crisis” — and the market reaction could be even more volatile, because regulations are now tougher.

Continue reading

Deutsche Bank to slash U.S.-based assets by $100 billion: FT

(Reuters) – Deutsche Bank has laid out plans to reduce its U.S. balance sheet as the U.S. Federal Reserve adopts new rules to shield the country’s taxpayers from costly bailouts, the Financial Times reported on Sunday.

The lender is expected to reduce its $400 billion balance sheet in the United States to around $300 billion in part by reassigning operations such as its Mexican arm and its Frankfurt and Tokyo-based repo businesses that are currently part of its U.S. business elsewhere, the FT reported. Continue reading