According to this article from the WSJ blog site, RBS may be adversely affected by a collapse of Irish debt and could require additional governmental aid. Quoting from the article "For RBS, which owns Ireland’s Ulster Bank, this could prove particularly damaging. The bank could be accused of using cheap public funds provided by the U.K. and euro-zone governments to buy high-risk paper from these widely known euro-zone debtors. This could put the bank in line for another bailout if Ireland has to tap the euro zone’s stabilization fund." See the full article at http://blogs.wsj.com/source/2010/11/11/euro-zone-debt-will-hit-the-pound-now/?mod=yahoo_hs
Oh, I did see a article which appeared to claim the Euro Commission made the call on suspending the e, g, and i's. Inferred was that the EC made the determination that they are deferrable. This article I did not save, but I did think that maybe it was not a correct characterization, but rather the EC made the call to get these included in the original APS agreement and may not have made a determination on what basis they can be suspended.
I think so. Added today in fact.
A bit of weakness in EU preferreds recently, but I'm concerned and view it as buy opportunity. Bottoms impossible to decipher, my view of the g and e has beenn a bottom about $13 with reasonably normal trading.
Hmmmm, maybe I should be bashing em down to below $10?
cheers to all,
"Bankers And Clients Are Fleeing Scotland As RBS Stops Lending" What did they expect from a failed institution masquerading as a bank? See story at http://finance.yahoo.com/news/Bankers-And-Clients-Are-siliconalley-2455602065.html?x=0&.v=2
It's early days. Too soon to evaluate market response beyond the kneejerk reaction. Time will tell. In the meantime, a weakened Euro will be a benefit to the eonomy of several of the EU countries.
How is that Irish bailout working out for RBS? "“In essence, equity markets have rejected the Irish bailout plan, with fears that further euro-zone countries will now run into difficulty weighing on euro-denominated assets,” said Anthony Grech, head of research at IG Index."
"Roubini Maps Out Nightmare Scenario of Domino Debt Collapse in Europe" see full story at http://finance.yahoo.com/news/Roubini-Maps-Out-Nightmare-cnbc-2735623765.html;_ylt=AsaqvdOSPQniAZpB74CRoG2xcq9_;_ylu=X3oDMTE2czRsbWk0BHBvcwMzBHNlYwN0b3Atc3RvcmllcwRzbGsDcm91YmluaW1hcHNv?x=0
Mr. Roubini points out that socialization of the private losses of the banking system could lead to a broader collapse. Ultimately, debt holders of the banking institutions will be forced to take a hit. Quoting Mr. Roubini "At some point you need the creditors of the banks to take a hit - otherwise you put all this debt on the balance sheet of government".
Notice how the Irish bank bailout is catching up with Ireland. "Irish banking shares will never — or not for a long time — be worth anything. The solution requires the total destruction of the existing share base," said David McWilliams, a former Irish Central Bank economist and European hedge fund manager." See full article "Irish unveil 4-year plan to claw back $20B, slash deficit" at http://www.usatoday.com/money/world/2010-11-24-ireland-cuts_N.htm?csp=YahooModule_Money This is just a precursor of what is in store for other European states which have become over extended in an attempt to bail out the corrupt and incompetent banking system. This house of cards will not withstand the winds of financial reality.