Banks in Europe and America are always under pressure to add to capital, and use of stress tests, in order to withstand any potential, future credit problems.
Risk-weighted assets can be assumed to be as high as 70% of total
assets in the large U.S. banks. The stress figure in Europe is half that for various accounting reasons; which are not that strong.
In other words, bank safety assessments are pretty much subjective.
Furthermore, it’s all nonsense. As panic-driven problems negate supposed cushions as will a tendency to have mark-to-market accounting. Much of what goes on is political maneuvering and posturing. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)
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