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FT Alphaville: Funding stress in Euroland, continued
Funding really becomes a concern where it impacts the long end, i.e., if a bank cannot independently fund in the senior unsecured debt markets, it does not have a long-term viable future. While issuance has been negligible since July, this is because large EU banks have pre-emptively funded typically 70-90% of their 2011 needs, limiting the need for additional issuance into troubled markets. BNP is 100% complete, while SocGen has completed 93% of its 2011 funding.


About that long-term issuance Nomura mentions at the top by the way -- it's worth reprising some recent charts from Morgan Stanley bank analyst Huw van Steenis. They show the recent slowdown in markets and also the funding needs into 2012:

There follow two very scare charts, one of bank funding drying up to a trickle in the first half of this year, and the other of all the European banks' debt rollover needs for the next few years.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Thu Aug 11th, 2011 at 02:10:46 PM EST
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