The current situation is definitely not pretty. In the turmoil that affects equity markets, banks seem to be taking center stage. Among them, Italian banks have become the center of attention.
European banks are not in good health
The recent assessment of the International Monetary Fund that European Banks have not provided for 900 billion dollars of bad loans is not particularly reassuring. As early as this week, former Governor of the Banque de France Christian Noyer was bold enough to state that “Eurozone banks are going very well. It is solid”. It is precisely that official speech that is the first source of worry. Is it denial or public relations? None of those are part of a Central Bank Governors’ job description. The reality should be sobering. In the last five days Deutsche Bank shares lost 15% of their value. Read more