French banks in trouble?

[FLPanhandle]

http://globaleconomicanalysis.blogspot.com/2011/07/details-cast-more-suspicion-on-latest.html

Details Cast More Suspicion on Latest European Bank "Stress Tests"
As stress test detail come in, the more ridiculous the latest results look.



During Europe's 15-month financial crisis, investor and analyst fears have centered largely on banks' holdings of sovereign debt issued by governments in financially shaky countries such as Greece, Ireland and Portugal. If those countries were to default, it could saddle banks and other holders of their bonds with big losses.

But Friday's test results shed light on another potential problem for Europe's banks: huge piles of residential mortgages, small-business loans, corporate debt, and commercial real-estate loans to institutions and individuals from ailing countries. As those economies struggle, the odds of rising defaults grow.

As of Dec. 31, its four largest banks—BNP Paribas SA, Crédit Agricole SA, BPCE Group and Société Générale SA—were holding a total of nearly €300 billion ($425 billion) in loans and other debt issued to institutions and individuals in Portugal, Ireland, Italy, Greece and Spain, the countries that are among Europe's most troubled. That's largely a result of some of the French banks having big retail- and commercial-banking operations in Greece, Italy and Spain.





Coincidentally, the new IMF head is from France and France pushed the hard for the Greece bail out package/austerity deal. French banks are sitting on a mountain of non-governmental debt (i.e. commercial loans and the like) that dwarf the governmental debt. Of course, all of this debt is assumed to be all good :rofl:

[dkf]

1. One of our local banks is owned by BNP

We are interconnected just as much as in the Lehman days.

[Demeter]

2. All the Banks are in Trouble

with a few, well-run exceptions, and some credit unions.

That's the worst-kept secret in finance today. And nobody's done anything to fix the problem, not here or abroad. They just keep the banks on their favorite drug--bailouts, no matter the method.