Tuesday, January 20, 2009

German banks have another $300 billion more to write off

German banks face further losses totalling billions of euros because they have only written off a fraction of their non-performing securities linked to American mortgages and student loans, according to a survey of 20 major German banks conducted by the German central bank and banking watchdog BaFin.

All the country's top commercial banks and the publicly owned regional banks known as Landesbanken took part in the survey which revealed that the banks hold so-called "toxic" securities totalling just under €300 billion ($398 billion), of which only a quarter has been written off.

Now what did the German finance minister, Peer Steinbruck say last week? He said it was inconceivable for Germany to have a "bad bank."

But Prime Minister Guenther Oettinger (from Baden-Wurttemberg one of the 16 states of FRG) now said it is necessary for the economic programs.

Which means we are soon going to have branches of the "bad banks" all across the globe!

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