david Folkerts-Landau, of Deutsche Bank, ....."‘Europe is extremely sick and must start dealing with its problems extremely quickly, or else there may be an accident,’ he said. ‘I’m no doomsday prophet, I am a realist.’................ the nation’s teetering banks, are sitting on £307billion of bad debt .
Their share prices have been hammered in the weeks since markets were shocked by Britain’s vote to quit the European Union, with Unicredit – Italy’s largest bank – losing 30.1 per cent of its value................More worryingly still, there is increasing evidence that savvy international investors are betting on a fresh financial crisis in Italy.
The UK’s City watchdog last week temporarily suspended short selling of shares in two banks, Credito Valtellinese and Banca Monte dei Paschi di Siena, as well as communications company Telecom Italia.
Although a huge push to cut interest rates and improve credit conditions might help some struggling lenders, others will suffer from ‘very negative profitability’ regardless of what happens,....The report also warned that even if there was such an effort, demand for loans might still not be high enough to allow improved profits.
taly itself has a public debt 133pc the size of its economy and is ill-placed to rescue its stricken banks. Government action is also forbidden under EU rules.
Italian Prime Minister Matteo Renzi seized on Brexit as an opportunity to beg for the right to launch a bailout, but his demands were rebuffed by German Chancellor Angela Merkel.
Read more:
http://www.dailymail.co.uk/news/article-3685601/EU-banks-need-128bn-bailout-Chief-economist-bloc-s-biggest-lender-warns-industry-heading-disaster-unless-action-taken.html#ixzz4E9rgyfB6
