[ mathsilver ] : actualités du système bancaire

[M S]

DETTE/Merkel veut tout faire pour éviter faillite incontrôlée de la Grèce

Berlin (awp/afp) - La chancelière allemande Angela Merkel a jugé mardi qu'il fallait "éviter tout processus incontrôlé dans la zone euro", en référence à une faillite de la Grèce telle qu'elle est évoquée avec insistance en Allemagne ces jours-ci.

"Nous travaillons avec tous les moyens à notre disposition afin que cela n'arrive pas", a dit la chancelière dans une interview à la radio Inforadio. "La priorité absolue est d'éviter un défaut de paiement incontrôlé, parce que cela ne toucherait pas seulement la Grèce, et parce que le risque que cela nous affecte tous, ou du moins beaucoup d'autres pays, est très élevé", a-t-elle ajouté.

Son ministre de l'Economie, le libéral Philipp Rösler, avait évoqué dans une tribune de presse lundi l'éventualité d'un défaut de paiement d'Athènes, mettant le feu aux Bourses européennes.

"Je pense que nous rendons un grand service à la Grèce si nous spéculons le moins possible mais encourageons la Grèce à respecter ses engagements", a dit Mme Merkel, critiquant indirectement la sortie de M. Rösler, qui est également vice-chancelier.

S'exprimant à la télévision publique, le député européen Elmar Brok, issu des rangs de son parti conservateur CDU, a rappelé que "si la Grèce faisait faillite, nous devrions toujours la soutenir financièrement". "Et l'économie allemande tomberait dans la crise, pas seulement de son commerce extérieur mais aussi de son secteur financier", a-t-il dit.

La chancelière a également exclu une sortie de la Grèce de la zone euro. "J'ai dit très clairement ma position, qui est que tout doit être fait pour maintenir la zone euro politiquement intacte", a-t-elle répété.

"D'après tout ce que j'entends en provenance de Grèce, le gouvernement grec a pris conscience de la situation et fait ce qu'il doit faire", a jugé la chancelière, qui avait déjà appelé il y a quelques jours à la patience à l'égard d'Athènes.

"Le fait que la Troïka revienne suggère que la Grèce a initié un certain nombre de choses nécessaires", selon elle.

Le groupe d'experts de la Commission européenne, de la Banque centrale européenne (BCE) et du Fonds monétaire international (FMI) chargé d'évaluer les progrès d'Athènes dans la mise en oeuvre de son programme de réformes avait quitté inopinément le pays le 2 septembre. Il doit revenir à Athènes dans les prochains jours.

mm


(AWP / 13.09.2011 09h21)

[M S]

BNP Paribas : un point de vue publié dans le 'Wall Street Journal' sème le trouble 13/09/2011 10:33


Le titre BNP Paribas s'effondre de plus de 10% en matinée à Paris, sur les 23,475 Euros, après que le 'Wall Street Journal' eut écrit, sur la foi des commentaires d'un dirigeant de l'établissement, que la banque française n'avait plus accès aux financements en dollars et qu'elle se tournait vers le marché en euros. "Nous créons un marché en euros, c'est une première... nous espérons que cela fonctionnera, sans quoi la spirale baissière sera un vrai enfer. Nous n'inspirerons plus du tout la confiance et personne ne nous prêtera plus", a expliqué cette source, la semaine dernière, au rédacteur de l'article, publié dans la rubrique "Opinion Europe", Nicolas Lecaussin, directeur du développement du think-thank libéral Institut de Recherches Economiques et Fiscales.

La semaine dernière, la banque de Baudouin Prot avait mis en ligne un document sous forme de "questions réponses" pour tenter de désamorcer les tensions de marché concernant les établissements français. BNP y expliquait notamment que son financement en euro à court terme est "très abondant et provient de sources diversifiées", tout en soulignant que sa liquidité en dollar à court terme était excédentaire. La banque concédait que depuis le mois d'août, elle avait "observé un raccourcissement des maturités disponibles et une légère baisse des montants provenant des fonds monétaires américains", mais signalait aussi que ses sources de financement sont diversifiées. BNP avait aussi rappelé qu'elle "dispose d'une réserve de liquidité considérable", chiffrée à 150 Milliards d'Euros d'actifs disponibles éligibles auprès des banques centrales, dont 30 Mds$ éligibles auprès de la Fed et que son programme de financement 2011 était bouclé depuis le mois de juin.

Hier, la banque s'était fendue d'une nouvelle annonce après la spéculation sur une dégradation de sa notation crédit par l'agence Moody's, rappelant notamment que les décisions de Moody's concernant les banques françaises "ne sont pas encore connues à ce jour", et que le marché est au courant depuis le mois de juin des intentions de l'agence de notation. L'occasion pour BNP de rappeler que son exposition à la dette souveraine grecque est de 3,5 Milliards d'Euros, après une provision de 0,5 MdE, et qu'elle n'est "pratiquement pas exposée" au secteur bancaire grec. Pour faire bonne mesure, BNP Paribas rappelait aussi avoir dégagé un bénéfice net de 12 MdsE l'année dernière et de 7,4 MdsE au premier semestre 2011.

La débâcle boursière des banques françaises, qui apparaissent pourtant parmi les plus solides de la zone euro, a de quoi surprendre, d'autant que des établissements réputés beaucoup plus fragiles en Europe sont largement moins chahutés. Le 'WSJ' rappelle d'ailleurs dans son article que des rumeurs de nationalisation ont d'ailleurs circulé récemment, signe du manque de sérénité qui règne actuellement dans le milieu.

[M S]

je sais que beaucoup ne l'aiment pas et ne partagent pas ses analyses. Mais peu importe, toutes les voix comptent.



http://www.jpchevallier.com/article-bnpas-de-paniq...


http://www.jpchevallier.com/article-urss-84143617.html


http://www.bloomberg.com/news/2011-09-12/u-s-money...

[coulous]

Moody's downgrades long-term ratings to Aa3 on normalised systemic support, Outlook negative, BFSR remains on review to consider impact of funding challenges on credit profile

Further to the review initiated on 15 June, 2011


Paris, September 14, 2011 -- Moody's Investors Service has announced an extension of its review of the C+ standalone Bank Financial Strength Rating (BFSR) of Societe Generale SA (SocGen), equivalent to a standalone Baseline Credit Assessment (BCA) of A2 on the long-term ratings scale, originally announced on 15 June, 2011. While Moody's concluded that SocGen's capital base currently provides an adequate cushion to support its Greek, Portuguese, and Irish exposures, Moody's announced that it will extend its review for downgrade of the C+ BFSR to consider the implications of the potentially persistent fragility in the bank financing markets, given its continued reliance on wholesale funding.

As announced in our press release of 15 June 2011, however, Moody's review also encompassed a re-consideration of systemic support assumptions factored into SocGen's long-term debt and deposit ratings under our Joint-Default Approach (JDA). Moody's has today concluded this aspect of the review by downgrading SocGen's debt and deposit ratings by one notch to Aa3 from Aa2. The outlook on the long-term debt ratings is negative. Moody's anticipates that the impact of our review on the BFSR would be limited to a one-notch downgrade, which would not in itself impact the long-term ratings given our revised support assumptions for SocGen, which anticipate increased uplift at a lower standalone rating level. However, a conclusion with a negative outlook on the BFSR would lead to a renewed negative outlook on the long-term ratings. Given this possibility, we are maintaining our negative outlook on the long-term ratings during the review of the BFSR.

The Prime-1 short-term ratings have been affirmed.

Moody's will publish separate press releases on other institutions covered by the review announced on 15 June, 2011.

RATINGS RATIONALE

In its press release of 15 June, 2011, Moody's announced a review of the BFSRs and long-term ratings of three French banking groups (BNP Paribas, Credit Agricole SA and SocGen) because of concerns about the potential inconsistency between their ratings and their exposures to the Greek economy (Greece is rated Ca, outlook developing), either through their holdings of government bonds or the credit they had extended to the Greek private sector.

In the case of SocGen, the review included a reconsideration of the three notches of systemic support included in its long-term debt and deposit ratings. Given the shift in the European-wide public policy environment, Moody's concluded in its review that the exceptional uplift previously applied to SocGen is no longer appropriate. As a result Moody's now applies the same assumptions for systemic support to SocGen as to BNPP and CASA, also considered highly likely to receive such support, resulting in two notches of uplift from its A2 standalone BCA.
Consequently, Moody's has downgraded its long-term debt and deposit ratings to Aa3 from Aa2.

Moody's believes that SocGen has a level of capital, consistent with its BFSR, that can absorb potential losses it is likely to incur over time on its Greek government bonds and to remain capitalized at a level consistent with its BFSR even if the creditworthiness of Irish and Portuguese government bonds were to deteriorate further. This assessment incorporates loss assumptions that are significantly higher than the impairments the bank has already recognised.

However, during the review, Moody's concerns about the structural challenges to banks' funding and liquidity profiles increased, in light of worsening of refinancing conditions, and have prompted an extension of the review. The continuing review will focus directly on these funding and liquidity challenges for SocGen which, given the current environment, could become long-term constraints to the performance of its franchise.

Limited Impact Of Greek And Other Sovereign Exposures On Overall Risk Profile

Since the start of the review for downgrade, SocGen, along with many other financial institutions, has expressed its intention to participate in a proposed restructuring of Greek debt. This led to its recognition of
EUR395 million in impairments in the second quarter of 2011 (1). SocGen was able to comfortably absorb this amount, as it reported net earnings of EUR747 million for the quarter and continues to build its capital ratios. However, at 30 June 2011, SocGen still had net exposures to Greek government bonds of EUR1.9 billion (2), virtually all of which have been impaired.

The residual risk to the group from these exposures is modest, however, in Moody's view. Holdings of other non-investment-grade peripheral European countries government bonds are not a significant concern, given total exposures including the trading book of only EUR400 million to Ireland and EUR600 million to Portugal, and these amounts have since declined slightly further (3). Italian and Spanish government bond holdings are larger at EUR5.0 billion and EUR2.3 billion respectively.
SocGen's exposures to the Greek private sector credit are larger but also modest overall, and lie chiefly at its subsidiary General Bank of Greece (Geniki; E / Caa1 / B1, on review for possible downgrade), which had gross loans of EUR4.3 billion at 30 June 2011. These loans are of generally poor quality, and the bank has provisioned EUR1.0 billion, 24% of the loan book, with a cost of risk in the first half of 2011 of around 9% annualized (4). SocGen's exposure to Ireland and Portugal private sector credit are smaller, at EUR2.8 billion and EUR0.9bn respectively at end-2010, according to European Banking Authority disclosures.

In its review, and in the context of a stress test covering SocGen's global loan book and structured finance exposures, Moody's considered a severe case scenario for certain government bond holdings, using haircuts significantly higher than the impairments the bank has already
recognized: 60% for Greece, 50% for Ireland, 50% for Portugal, 10% for Spain and 7% for Italy. Taking into account the impairments already made against some Greek bonds, we believe resultant pretax losses would total around EUR1.6 billion, about 3.4% of SocGen's core Tier 1 capital after tax or 32bps of risk-weighted assets, with further mitigation possible via reduced dividends. Loss assumptions for private sector credit were based upon those previously published by Moody's, see "European Banking Credit Loss Assumptions", published on 2 August, 2010.

For the group overall, the potential impact of these exposures is diluted considerably and even at the level of SocGen's international retail banking operations, which include Geniki, the bank has been consistently profitable as earnings elsewhere offset the Greek losses. Moody's therefore considers SocGen to be sufficiently profitable and capitalized that it can absorb further potential related losses. The bank has strong franchises, good geographical diversification and a broad spread of business activities. Moody's also takes into account the bank's legacy positions in structured credit products, as well as weaknesses in risk management that were exposed by the trading fraud discovered in early
2008 (and the subsequent improvements in risk management), in addition to the volatile nature of SocGen's capital markets business, which in common with those of many other banks, is characterised by a certain complexity and opacity of risk profile, as well as a relatively confidence-sensitive customer base.

CONTINUED REVIEW OF BFSR TO FOCUS ON FUNDING PROFILE

Nevertheless, SocGen's wholesale funding, the majority of which is short-term, is still high in absolute terms and may pose a vulnerability given considerable market tension. During the summer, concerns over sovereign exposures and the health of sovereign balance sheets grew significantly. This was most manifest in the behaviour of US money market funds, which are an important source of short-term US dollars for SocGen.
These funds became particularly risk-averse, resulting in reduced availability and shorter tenors for this type of financing. For more details, see Moody's Special Comment, "EU Banks: Stronger Liquidity and Central Bank Actions Mitigate Recent Volatility but Longer-Term Concerns Remain".

Moody's notes that SocGen has substantial holdings of central bank eligible assets, which it reports to be around EUR79 billion, and EUR26 billion of other liquid assets at end-August. In addition, SocGen has full access to Eurosystem central bank liquidity in major currencies. As such Moody's believes that SocGen can withstand the short-term credit negative impact of the contraction in dollar funding, and euro funding remains plentiful. Even so, the amount of the bank's wholesale funding requirements makes it vulnerable to a deterioration in market sentiment.
At end--2010, from a strictly accounting view, debt securities and interbank borrowings totalled EUR216 billion, or 25% of its total balance sheet excluding insurance technical reserves and derivatives, 64% of which falls due within three months, and 79%, within one year (5).

Moody's expects SocGen to continue to enhance the amount and quality of liquidity, reduce its reliance on the wholesale markets, and lengthen the duration of its borrowings, in anticipation of the challenges posed by the Net Stable Funding Ratio and Liquidity Coverage Ratio to be introduced by Basel III. However, given the likelihood that bank financing conditions will remain fragile and prone to disruption so long as concerns persist over European sovereigns, and the potential for that disruption to become more marked and sustained over time, Moody's is maintaining its review on SocGen's BFSR. The extended review will assess the potential for further, increased disruption to undermine SocGen's business model and creditworthiness given its continued reliance on short-term funding, as well as the potential impact on other credit considerations, notably profitability.

LONG-TERM DEBT AND DEPOSIT RATINGS DOWNGRADED TO Aa3

Moody's regards France as a high support country, in which SocGen plays a major role as an intermediary and to whose banking system it is integral.

In its press release of June 15, 2011, Moody's stated that it would re-assess the systemic support assumptions factored into its long-term ratings on SocGen. The long-term rating incorporated a three-notch uplift from its intrinsic financial strength equivalent on the long-term rating scale (above average for France), compared to the two-notch uplift assigned prior to Moody's downgrade of the financial strength rating on
14 April 2009, and the two-notch uplift assigned to both BNPP and CASA.

Moody's still assesses the probability of systemic support for SocGen in the event of distress as being very high, but now believes that given the shift in the European-wide public policy environment, the exceptional uplift previously applied to SocGen is no longer appropriate and the assumptions of systemic support for SocGen should be in line with those for BNPP and CASA. This has resulted in a downgrade to the long-term debt and deposit ratings to Aa3 from Aa2, and in two notches of uplift from the bank's A2 standalone financial strength equivalent on the long-term scale, from three notches previously.

OUTLOOK FOR LONG-TERM DEBT AND DEPOSIT RATINGS NEGATIVE

The outlooks for the long-term debt and deposit ratings of SocGen are negative. This reflects the application of Moody's JDA. Moody's anticipates that the impact of our review on the BFSR would be limited to a one-notch downgrade to C, which would not in itself impact the long-term ratings, given our revised support assumptions for SocGen, which anticipate increased uplift at a lower standalone rating level.
However, a conclusion with a negative outlook on the BFSR would lead to a renewed negative outlook on the long-term ratings. Given this possibility, we are maintaining our negative outlook on the long-term ratings during the review period.

KEY RATING SENSITIVITIES

Given the current review for downgrade on SocGen's BFSR, an upgrade is unlikely.

Similarly, an upgrade of the long-term deposit and debt ratings is also unlikely in the foreseeable future given the current review for downgrade on the BFSR.

The main factors which could lead to a lower BFSR include:

- a reconsideration of the bank's funding and liquidity profile within the context of its broader business model, and the impact of its current and future funding structure on other credit considerations, chiefly risk management and profitability;

- a prolongation or intensification of challenges to refinancing conditions, resulting in a weaker liquidity and / or funding position in Moody's view;

- increased sovereign risk in the euro area

- an unexpectedly sharp deterioration in the bank's capital markets activities;

- aggressive expansions of riskier activities or an actual failure in risk management;

- further significant asset quality deterioration, in the lending activities or in its structured credit-related exposures;

- increased uncertainty over the bank's ability to strengthen capital and liquidity in advance of Basel 3 requirements or deteriorating market conditions.

A one-notch downgrade of the BFSR -- as could result from our current review -- would not result in a downgrade of the debt and deposit ratings. The latter could however, in theory, be downgraded as a result of a multi-notch downgrade of the BFSR or following a further reduction in Moody's expectation of the probability of systemic support to be extended to SocGen in the case of stress, neither of which Moody's expects.

SUBORDINATED OBLIGATIONS AND HYBRID SECURITIES

The ratings on SocGen's dated subordinated obligations are notched off the bank's fully supported, long-term GLC deposit ratings.

The ratings on the bank's hybrid obligations are notched off SocGen's Adjusted BCA of A2, in accordance with Moody's Guidelines for Rating Bank Hybrid Securities and Subordinated Debt published 17 November 2009.

KEY RATING FACTORS AND SENSITIVITIES FOR OTHER ENTITIES AFFECTED BY THIS RATING ANNOUNCEMENT

For all other entities affected by this rating announcement, please refer to the rationale above.

[M S]

tu m'as devancé

3 banques françaises dégradées par l'agence de notation Moody's

Société Générale, BNP Paribas et Crédit agricole dégradées par l'agence de notation Moody's.

[M S]

Moody's abaisse les notes de Société Générale et Crédit Agricole

PARIS - L'agence d'évaluation financière Moody's a abaissé d'un cran la note des banques françaises Société Générale et Crédit Agricole, selon un communiqué publié mercredi, confirmant une rumeur qui circulait depuis dimanche.

Dans le cas de Crédit Agricole, dont la note passe de Aa1 à Aa2, la décision est liée à l'exposition à la Grèce, tandis que dans celui de Société Générale, dont la note est rétrogradée de Aa2 à Aa3, la révision tient à la réévaluation de l'aide que pourraient fournir les pouvoirs publics en cas de crise grave.


(©AFP / 14 septembre 2011 07h24)

[M S]

BNP Paribas table sur un ratio de fonds propres "durs" de 9% début 2013

Paris (awp/afp) - La banque française BNP Paribas vise un ratio de fonds propres "durs" (capital social et bénéfices mis en réserve rapportés aux crédits) de 9% début 2013, qui marquera l'entrée en vigueur du nouveau cadre réglementaire dit Bâle III, selon des documents publiés mercredi sur son site.


Il s'agit d'un relèvement ambitieux des objectifs de l'établissement, qui tablait seulement jusqu'ici sur un ratio "nettement supérieur à 7%" à cette échéance, selon les propos de son directeur général Baudouin Prot en novembre 2010.


Pour parvenir à ce nouvel objectif, le groupe entend poursuivre sa politique de mise en réserve d'une part majoritaire des bénéfices, à l'image de l'exercice 2010, qui l'a vu conserver deux tiers des profits.


Il prévoit également de réduire la taille de son bilan, ce qui diminuera mécaniquement ses besoins en fonds propres et améliorera les ratios.


Fin juin 2011, le ratio de fonds propres "durs" ressortait à 9,6%, mais sa définition diffère assez sensiblement de celle qui sera appliquée dans le nouveau cadre Bâle III, beaucoup plus restrictif.


Entre début 2008 et fin juin 2011, BNP Paribas a plus que doublé ses fonds propres, passés de 27,4 milliards d'euros à 57,4, en partie grâce à l'absorption de la belge Fortis.


Les nouvelles normes de Bâle III imposent un niveau de fonds propres minimum de 7% à compter de début 2019, mais la plupart des grands établissements ont publiquement affiché leur volonté de satisfaire ce ratio dès le début de la phase de transition, en 2013.


Le Comité de Bâle a défini, en outre, le principe d'une exigence complémentaire de fonds propres pour les établissements désignés comme systémiques, c'est-à-dire dont la défaillance risquerait de menacer le système financier tout entier.


BNP Paribas figure vraisemblablement parmi les 28 établissements systémiques identifiés par le Comité de Bâle, même si la liste n'a pas été publiée.


La couche de fonds propres supplémentaires serait comprise entre 1 et 2,5 points de pourcentage, qui s'ajouteraient aux exigences de base de Bâle III.


jq



(AWP / 14.09.2011 07h44)

[M S]

Espagne: la dette des banques vis-à-vis de la BCE bondit en août


MADRID - La dette des banques espagnoles envers la Banque centrale européenne (BCE) a bondi en août de 34% par rapport à juillet, à 69,92 milliards d'euros, révélant des difficultés pour se financer sur le marché, a indiqué mercredi la Banque d'Espagne.

La dette des banques espagnoles atteint ainsi son maximum depuis septembre 2010, mais reste en repli par rapport à août 2010 (109,79 milliards d'euros).


(©AFP / 14 septembre 2011 11h08)

[M S]

http://chevallier.biz/2011/09/bce-2-banques-en-def...

"Aujourd’hui, mercredi 14 septembre, la BCE vient d’annoncer que 2 banques de la zone euro lui ont demandé 575 millions de dollars afin de ne pas être en défaut de paiement en dollars

"

[M S]

PRESSE: Les banques US ont prêté des milliards aux banques europénnes 14/09/2011 16:07


(Dow Jones)--Les banques américaines ont conclu ces dernières semaines des accords visant à prêter des milliards de dollars aux banques européennes, structurés comme des accords dits repo, rapporte mercredi le site International Financing Review, en citant des banquiers directement impliqués dans ces transactions.

Des établissements britanniques et français comptent au nombre des banques européennes concernées. Au moins trois des cinq plus grandes banques américaines sont également impliquées.

Société Générale SA (GLE.FR) a indiqué avoir conclu un accord repo équivalent à 6 milliards d'euros contre un portefeuille de titres adossés à des prêts hypothécaires commerciaux et des prêts garantis, indique IFR.

Une personne de BNP Paribas SA (BNP.FR) a indiqué que la banque utilisait également les marchés repo en dollars pour son activité obligataire, mais "pas plus que d'habitude".

Les banques américaines impliquées dans ces transactions appliquent des taux plus élevés que la moyenne, dans certains cas, le double des taux du marché monétaire.

[M S]

Austria Fails To Ratify EFSF Expansion


Submitted by Tyler Durden on 09/14/2011 - 10:22 Yup, Europe is open, and the suiciding has started early.

AUSTRIAN PARLIAMENT COMMITTEE DOESN'T APPROVE EFSF UPGRADE
AUSTRIAN PARLIAMENT COMMITTEE NEEDED 2/3 MAJORITY


As a reminder all countries need to ratify the EFSF, even the weakest links, or else no bailout. As Peter Tchir reminds: "And Austria is AAA, it is needed for EFSF to get AAA on its size, would have to be cut back by about 15 billion EUR to still have AAA. Though I would guess this gives other countries the courage to say enough is enough."

[M S]

nouveau Kerviel ? les cadavres sortent des placards





Fraude à l'UBS: 2 milliards de dollars de perte - un homme arrêté


UBS a annoncé qu'un courtier avait généré des pertes de l'ordre de 2 milliards de dollars (1,75 milliard de francs) à travers des transactions non autorisées dans sa banque d'investissement. La police londonienne a arrêté jeudi vers 3h30 un homme de 31 ans.

Elle n'a revanche pas indiqué s'il s'agissait d'un employé de l'UBS. Il est accusé d'abus de confiance. L'affaire qui n'a pas affecté de positions de clients, pourrait conduire à une perte au 3e trimestre, a précisé UBS à quelques minutes seulement de l'ouverture de la Bourse suisse.

La banque n'a pas souhaité donner plus d'informations sur cette affaire. La nouvelle a entraîné la chute du titre UBS à la bourse, celui-ci lâchant 8,5% dans les premiers échanges, pour se reprendre quelque peu vers 09h15, en abandonnant 5,76% par rapport à la clôture de la veille à 10,30 francs.

L'affaire n'est pas sans rappeler celle qui avait touché la banque française Société Générale au début 2008, lorsque des opérations d'un de ses courtiers, Jérôme Kerviel, avaient entraîné des pertes de 4,9 milliards d'euros. Jugé seul responsable de ce débours, l'ex-trader a été condamné en octobre 2010 à cinq ans de prison dont trois ferme.


(ats / 15.09.2011 11h55)

[M S]

Deposit Flight at European Banks Means Risk Piling Up at ECB

http://www.bloomberg.com/news/2011-09-13/deposit-f...



European banks are losing deposits as savers and money funds spooked by the region’s debt crisis search for havens, a trend that could worsen economic and financial conditions.

Retail and institutional deposits at Greek banks fell 19 percent in the past year and almost 40 percent at Irish lenders in 18 months. Meanwhile, European Union financial firms are lending less to one another and U.S. money-market funds have reduced their investments in German, French and Spanish banks.

While the European Central Bank has picked up some of the slack, providing about 500 billion euros ($685 billion) of temporary financing, banks are cutting lending, which could slow growth in their home countries. They’re also paying more to keep and attract deposits -- or, in the case of Italy, selling bonds to retail customers for five times the interest they offer on savings accounts -- which will erode profitability.

“All of this is symptomatic of a lot of fear in the European financial sector,” said Kash Mansori, senior economist at Experis Finance in Charlotte, North Carolina, which advises U.S. and European companies. “It shows that even European banks don’t trust each other anymore, so they’re taking their money out of the EU system. It’s similar to the distrust that happened worldwide in 2008.”
Deposit Erosion

Deposits by financial institutions in Greek banks, which make up 21 percent of the total, have fallen by one-third since the beginning of 2010, while those by non-financial firms and residents dropped 9 percent, according to Bank of Greece data.

In Germany, deposits by financial institutions, which account for one-third the total, declined 12 percent over the same period and 24 percent since the September 2008 collapse of Lehman Brothers Holdings Inc., ECB figures show. In France, where the erosion started last year, the same type of deposits, which make up half the total, are down 6 percent since June 2010. They have fallen 14 percent since May 2010 at Spanish banks, where they account for one-fifth of the total.

Deposits include money kept in banks by individuals and companies. Most of the short-term funding supplied by financial institutions and money funds is counted as deposits by the ECB and other central banks in Europe.

While retail deposits at Italian banks have fallen only 1 percent in the past year, the outflow of money from financial institutions has exceeded $100 billion, a 13 percent decline, according to Bank of Italy and ECB data.
Money-Fund Withdrawal

Some of the retail deposits have been invested in bank bonds sold directly to retail clients that pay as much as 5 percent, compared with an average interest rate on deposits of 0.88 percent. Retail investors in Italy own about 63 percent of bank debt, compared with a European average of 48 percent, data compiled by the Bank of Italy and banking association ABI show.

In Portugal, where banks raised the interest rates they pay savers, non-residents have reduced deposits by 19 percent since March 2010.

The eight largest U.S. money-market funds halved their lending to German, French and U.K. banks over the past 12 months and stopped financing Italian and Spanish financial firms, according to data compiled by Bloomberg from investment reports.

A survey by Fitch Ratings showed that U.S. money-market funds reduced their lending to European banks by 20 percent from the end of May through July. The funds cut investments in Spanish and Italian lenders by 97 percent, to German firms by 42 percent and to French ones by 18 percent, Fitch said. The Aug. 22 survey covers almost half the $1.53 trillion assets held by money funds in the U.S.
Relying on ECB

Moody’s Investors Service today cut the long-term debt rating one level on Credit Agricole SA (ACA) and Societe Generale (GLE) SA, the country’s second- and third-largest lenders by assets, citing the euro-region sovereign debt crisis and concerns about “the structural challenges to banks’ funding and liquidity profiles.” BNP Paribas (BNP) SA, France’s biggest lender, was kept on review for a possible cut. BNP fell 4.3 percent at 4:02 p.m. in Paris trading, while SocGen declined 8 percent. Credit Agricole fell 2 percent.

To make up the deficit, firms are leaning on the ECB for short-term funding. Borrowing by Italian lenders from the central bank more than doubled to 85 billion euros between June and August. Greek and Irish banks each took about 100 billion euros from the ECB in August. Irish lenders also got 56 billion euros from their domestic central bank. Portuguese banks borrowed about 46 billion euros from the ECB, while Spanish banks took 52 billion euros in July.

The ECB said today it will lend $575 million to two euro- area banks, without identifying them, a sign that they’re finding it difficult to borrow the U.S. currency in markets.
‘Left With Garbage’

By accepting those countries’ bonds as collateral in exchange for funds, the ECB is piling up risk, said Desmond Lachman, a fellow at the American Enterprise Institute in Washington. In the event of a default, the ECB’s losses would be borne by the EU’s member states. Lending to the region’s banks by the ECB and other central banks is about seven times the capital of the Eurosystem, the consolidated balance sheet of all euro zone central banks.

“If there are sovereign defaults, the ECB will be left with garbage that has been accepted as collateral,” said Lachman. “It’s putting EU taxpayers’ money at risk in a very non-transparent way. But there’s no alternative. The ECB is the only game in town.”
ECB Defends Actions

William Lelieveldt, a spokesman for the ECB in Frankfurt, declined to comment about the risk to the central bank. ECB President Jean-Claude Trichet has defended his institution’s actions. European banks have more collateral that they can place with the ECB in exchange for additional financing if they need it, he said Sept. 8 in Frankfurt.

“We stand ready to provide liquidity as we have done in the past,” Trichet said.

The outflow of deposits is a measure of eroding trust in the region’s financial system. Banks outside of Greece, Ireland, Portugal and Spain have $1.7 trillion at risk in loans to those countries’ governments and corporations, as well as guarantees and derivatives contracts, according to the Bank for International Settlements.

Concern that those nations will default or leave the EU and devalue their currencies has hastened the flight, according to Dimitris Giannoulis, a Deutsche Bank AG (DBK) analyst based in Athens.

People “are now afraid of the possibility of returning to the drachma,” said Giannoulis, referring to the Greek currency in circulation before the country adopted the euro in 2001. “Just a headline is enough to spook depositors.”
Irish Banks Hurt

Irish banks have been the hardest hit. Losses on the collapsing real-estate market and a government guarantee of bank liabilities forced the nation to seek EU assistance in November. The money started flowing out in early 2010 as confidence in the government’s ability to support the banks waned, and it accelerated later that year after Ireland’s rescue by the EU led multinational companies to move deposits out of the country.

Ireland took control of five lenders and is winding down two of them. Even Bank of Ireland, which wasn’t nationalized because its losses weren’t as catastrophic, saw deposits dwindle by 20 billion euros, or 23 percent, last year.

At Allied Irish Banks Plc (ALBK), Ireland’s second-largest lender, deposits declined 37 percent over the past 18 months. The bank said July 25 that most of the drop occurred at the end of 2010 and in the first quarter of this year as companies pulled money amid sovereign and bank downgrades. Deposits since the end of the first half have been “broadly stable,” said Alan Kelly, the lender’s director of corporate affairs and marketing, who declined further comment.
‘Afraid of Them’

While “the rate of outflow is falling,” Finance Minister Michael Noonan said on Sept. 1 in Dublin, that hasn’t soothed savers such as Phil Carey, an 86-year-old mother of eight from Galway in western Ireland.

“I wouldn’t trust the banks,” said Carey, who keeps her savings at credit unions. “I’d be afraid of them. Look at the money they gave to the builders and the terrible situation we’re in now.”

It isn’t easy for retail depositors such as Carey to move funds abroad. In Ireland, there has been some shift to units of foreign banks operating in the country. RaboDirect, the Irish online-banking unit of Utrecht, Netherlands-based Rabobank Group, saw deposits rise about 40 percent in 18 months, according to General Manager Roel van Veggel.
Tax Avoidance

While the implosion of Irish banks led the government to seek an EU bailout, in Greece the state’s finances collapsed first. Now Greek lenders are feeling the pain because they own about 40 billion euros of their government’s sovereign debt. If they have to take losses of 40 percent or more on those bonds, it would wipe out all the capital held by the country’s banks, the European Commission estimated in July. Greek government bonds are already discounted by 60 percent in the secondary market, according to data compiled by Bloomberg.

In addition to fearing a drachma conversion, some affluent Greeks are moving money out of the country to avoid having their bank accounts become targets for tax collectors, said Antonio Ramirez, an analyst at KBW Inc. in London.

“As the government starts looking for revenue, starts fighting tax evasion, wealthy families move their money out,” said Ramirez, who covers Greek, Irish and Portuguese banks.

That dynamic is also at work in Italy, according to Carlo Alberto Carnevale-Maffe, a professor of business strategy at Milan’s Bocconi University. Deposits at Milan-based Intesa Sanpaolo SpA (ISP), Italy’s second-biggest bank by assets, fell 4.4 percent in the year ended in June.
‘Under the Mattress’

“People are moving deposits into safe goods such as gold and safety-deposit boxes,” Carnevale-Maffe said. “They’re simply putting the money under the mattress to avoid taxes.”

Intesa CEO Corrado Passera said on an Aug. 5 call that the decline was the result of a decision to discontinue some institutional funding and the sale of retail bonds.

“In terms of flight to quality, no, I must tell you that we are not experiencing in our country anything like that,” Passera said.

European lenders are also moving money out of the region. The cash that foreign banks keep at the U.S. Federal Reserve has more than doubled to $979 billion at the end of August from $443 billion at the end of February, according to Fed data. The increase in bank deposits at the ECB has been smaller, suggesting that healthy European firms are putting money in the Fed instead of lending to weaker banks, according to economist Mansori, who also writes a blog called “Street Light.”
Bank Lending

“Do you want to keep your money at the Fed, which you know will pay you back, or at the ECB, which has lots of periphery euro zone country debt?” said Mansori.

The reluctance of European banks to lend to one another has been on display since last month. The spread between Euribor and the overnight indexed swap rate, which reflects the higher risk of lending euros for three months versus overnight, widened to 0.85 percentage point on Sept. 13. The rate compares with 0.36 percentage point at the beginning of August.

Banks can’t continue to rely on the ECB for funding because that’s a sign of being on “life support,” so they’ll have to shrink their balance sheets, said KBW’s Ramirez. That means reduced lending in countries where growth is stagnant.

Lending by banks in Ireland declined 9 percent in the past year, 3 percent in Greece and Italy and about 1 percent in Portugal and Spain, according to ECB data. Gross domestic product in Italy expanded 0.8 percent in the second quarter from a year ago and 0.7 percent in Spain. Greece’s economy shrank 7.3 percent, while Portugal’s contracted by 0.9 percent. Irish GDP growth was 0.1 percent in the first quarter, according to the latest data available.
Irish Cutbacks

Ireland said in March that its surviving banks would wind down more than 70 billion euros of loans. Most of the reduction will be lending to borrowers outside Ireland, which could hurt growth in other EU countries. Greek banks, unable to sell sovereign bonds they hold, will also have to trim their loan books, according to Ramirez.

“It’ll aggravate the recession,” he said.

While banks say higher capital requirements will curb lending and economic growth, it’s the lack of capital in the European banking system that’s spooking depositors and other creditors, said Lachman of the American Enterprise Institute. That’s why the International Monetary Fund is pushing for recapitalization of the region’s banks, he said.

Paying more for deposits to prevent them from leaving, as banks in Ireland, Spain and Portugal are doing, will hurt banks’ chances of rebuilding capital through earnings. Offering higher interest rates for retail bonds as Italian lenders have done will cut into interest margins.
‘Not Sustainable’

“It’s not sustainable for this type of pricing strategy to continue,” Rabobank’s Van Veggel said about the high rates Irish banks are offering for deposits. “But I don’t think rates will start to come down until nervousness about European, and indeed global, issues calm down.”

German and French banks are losing funds because they hold the most debt linked to troubled euro zone countries, according to Mark Schaltuper, an analyst at Business Monitor International, a London-based consulting group. Investors and creditors worry that German and French lenders will face losses on their holdings in the event of a default, he said.

“European policy makers are kicking the can down the road, waiting for banks to recapitalize slowly so they can take these losses over time,” said Schaltuper, the firm’s chief European analyst. “Until the debt situation in the periphery is sorted out, these funding troubles won’t end.”

To contact the reporters on this story: Yalman Onaran in New York at yonaran@bloomberg.net.

To contact the editors responsible for this story: David Scheer in New York at dscheer@bloomberg.net.

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Lagarde (FMI): les économies occidentales dans un cercle vicieux


WASHINGTON - La directrice générale du Fonds monétaire international Christine Lagarde a affirmé jeudi lors d'un discours à Washington que les économies occidentales étaient dans un cercle vicieux aggravé par les atermoiements des dirigeants politiques.

Elle a appelé le monde à faire front commun pour parer au risque de récession aux Etats-Unis et en Europe, estimant que personne ne serait épargné si ces économies rechutaient.

Il y a trop d'endettement dans le système. Les incertitudes planent sur les Etats dans l'ensemble des économies avancées, sur les banques en Europe et sur les ménages aux Etats-Unis, a écrit Mme Lagarde, selon le texte de ce discours transmis à la presse.

La faiblesse de la croissance et la fragilité des bilans -- ceux des Etats, des établissements financiers et des ménages -- s'aggravent mutuellement, attisent la crise de confiance et freinent la demande, linvestissement et la création d'emplois, a-t-elle expliqué.

Ce cercle vicieux gagne en intensité et, pour être franche, les atermoiements des dirigeants et les dysfonctionnements politiques n'y sont pas étrangers, a déploré la dirigeante du Fonds.

L'heure nest pas au repli sur soi, aux demi-teintes ou aux palliatifs (...). Les dirigeants doivent aussi faire front commun, a-t-elle lancé. Car selon elle, si les pays avancés sombrent dans la récession, les marchés émergents ne seront pas épargnés. Dailleurs personne ne le sera.

Mme Lagarde s'exprimait une semaine avant une réunion de ses 187 Etats membres à Washington, lors des assemblées annuelles du FMI et de la Banque mondiale.

La croissance économique des Etats-Unis et de l'Europe, déjà lente au premier semestre, a encore faibli depuis le début de l'été, provoquant des remous sur les marchés financiers et aggravant les problèmes des Etats de la zone euro confrontés à une crise de la dette publique.


(©AFP / 15 septembre 2011 16h09)

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Grèce: l'Autriche n'exclut pas que la faillite soit la meilleure solution


WROCLAW (Pologne) - La ministre autrichienne des Finances, Maria Fekter, n'a pas exclu vendredi qu'une faillite de la Grèce soit une solution préférable à un sauvetage trop onéreux, à son arrivée à une réunion avec ses homologues européens à Wroclaw, en Pologne.

Nous poursuivons sur notre voie de manière résolue mais si nous devions avoir une situation montrant qu'elle est plus onéreuse qu'une alternative comme le défaut de paiement, nous devrions réfléchir à cette alternative.

Mais pour le moment ce n'est pas le cas, a-t-elle précisé.

La réunion informelle des ministres européens des Finances qui se tient vendredi et samedi doit théoriquement permettre de surmonter les obstacles avant la mise en oeuvre du second plan d'aide à Athènes d'un montant de près de 160 milliards d'euros, décidé le 21 juillet.

Mais certains pays européens traînent les pieds, à l'image de la Finlande, qui réclame des garanties financières en échange de nouveaux prêts à la Grèce, et à laquelle d'autres pays, dont l'Autriche, ont emboîté le pas.

La ministre finlandaise des Finances, Jutta Urpilainen, a indiqué vendredi qu'il n'y avait pas de solution en vue ce vendredi.

Cette question des garanties empoisonne les relations au sein de la zone euro depuis des semaines et retarde la mise en oeuvre du second plan d'aide.

Par ailleurs, la troïka (FMI, BCE, Commission européenne) doit se rendre à Athènes en début de semaine pour reprendre les discussions en vue du versement d'une sixième tranche du précédent prêt de 110 milliards d'euros accordé à la Grèce en mai 2010.

Le gouvernement grec a déjà reconnu qu'il n'avait pas atteint les objectifs budgétaires fixés par ses créanciers, à cause d'une récession plus dure que prévu, mais qu'il avait la détermination de poursuivre les efforts demandés.

Il n'y a plus beaucoup de temps, a estimé mercredi la directrice du FMI, Christine Lagarde.

Les marchés s'attendent à ce qu'en l'absence de déblocage de la nouvelle tranche de prêt de 8 milliards d'euros, la Grèce se retrouve en faillite dès octobre.


(©AFP / 16 septembre 2011 10h00)