Newsgroup: it.economia.borsa
Titolo: $300bn of credit insurance for European banks

...AIG's last annual report reveals that it had written coverage for more 
than $300bn of credit insurance for European banks. The comment by AIG 
itself on these positions was that they were "for the purpose of providing 
them with regulatory capital relief rather than risk mitigation in exchange 
for a minimum guaranteed fee". Thus, a formal default by AIG would have 
exposed European banks to large increases in regulatory capital 
requirements, with possibly devastating effects on their ratings and market 
confidence. Thus, the US Treasury has saved, inter alia, the European 
banking system.
The extent of regulatory arbitrage can also be seen in the very large gap 
between overall leverage ratios and the official regulatory ratios. The 
dozen largest European banks have now, on average, an overall leverage ratio 
(shareholders' equity to total assets) of 35, which has actually increased 
so far this year, compared with less than 20 for the largest US banks. But 
at the same time most large European banks also report regulatory leverage 
ratios of close to 10. This is partly due to the fact that the massive 
in-house investment banking operations of European banks are subject only to 
limited regulatory capital requirements. Another part of the explanation 
must be regulatory arbitrage, for example, through the credit insurance 
offered by AIG.
Europe's banks will benefit greatly from the effective nationalisation of 
the US financial system now being planned, because the larger ones, which 
all have significant US operations will also benefit from the $700bn 
bail-out fund. But it remains unclear how many of these assets they still 
hold in their balance sheets and how volatile their liability base will 
prove if confidence does not return quickly.
The crucial problem on this side of the Atlantic is that the largest 
European banks have become not only too big to fail, but also too big to be 
saved. For example, the total liabilities of Deutsche Bank (leverage ratio 
over 50!) amount to about ?2,000bn (more than Fannie Mae) or more than 80 
per cent of the gross domestic product of Germany. This is simply too much 
for the Bundesbank or even the German state, given that the German budget is 
bound by the rules of the European Union's stability pact and the German 
government cannot order (unlike the US Treasury) its central bank to issue 
more currency. Similarly, the total liabilities of Barclays of around 
�1,300bn (leverage ratio 60!) are roughly equivalent to the GDP of the UK. 
Fortis bank has a leverage ratio of "only" 33, but its liabilities are three 
times the GDP of its home country of Belgium.
With banks that have outgrown their home turf, national treasuries and 
regulators in Europe are living on borrowed time: they cannot simply develop 
"road maps" (the only result of various Ecofin discussions of regulatory 
reform by finance ministers), but must contemplate a worst-case scenario.
Given that solutions for the largest institutions can no longer be found at 
the national level it is apparent that the European Central Bank will need 
to be put in charge as it is the only institution that can issue unlimited 
amounts of a global reserve currency. The authorities in the UK and 
Switzerland - which cannot rely on the ECB - can only pray that no accident 
happens to the giants they have in their own garden.
Daniel Gross is director of the Centre for European Policy Studies in 
Brussels. Stefano Micossi is director of Assonime, a business association 
and think-tank in Rome 

Se Deutsche Bank o una mega banca svizzera o inglese (le più esposte) o una 
francese con la recessione che è iniziata in europa e il cedimento degli 
immobili un poco anche da noi finisce nei guai in Europa è impossibile 
mettere d'accordo e trovare l'autorità per salvarla a livello UE e salta 
l'europa. Solo l'America al momento può improvvisare una mega operazione di 
salvataggio in cui si crea una domanda per questi asset pericolosi con 
denaro statale. In europa anche essendo convinti che sia necessario mancano 
le leggi necessarie e si tratta di mettere d'accordo una dozzina di paesi
Anche dall'europa oggi e domani tutti guardano con ansia se i deputati 
americani votano i 700 miliardi

 d'accordo una dozzina di paesi 
Che l'europa fallisca non mi meraviglierebbe, ma qello che non si č 
capito č che i 700mld di USD sono una manna del cielo per le banche 
europee, sopratutto quelle sovra esposte.
In pratica, se la cosa va in porto ed č probabile, questi soldi 
serviranno a far sě che le banche europee vengano salvate proprio da 
questo disennato piano di salvataggio.