RBS puts lipstick on Citizens for $14 bln IPO

September 8, 2014

The Scottish bank reckons cost cuts, rising interest rates, capital returns and more business will boost its poorly performing U.S. unit. Granted, all this might create decent enough returns to justify the price. But RBS is painting too pretty a picture of Citizens’ independence.

Review: “House of Debt” diagnosis beats remedies

June 13, 2014

Atif Mian and Amir Sufi make a compelling case that excess consumer debt caused the U.S. Great Recession’s severity, but their mortgage bailout proposal would make matters worse. Their shared value mortgages might help, but old-fashioned tight money is a simpler and better way.

Bank of Moscow exposes Russian regulatory void

July 5, 2011

Russian bank failures usually have political causes: well-connected banks often have more clout than regulators.

ECB will find it hard to avoid pain on Greek debt

January 11, 2012

The central bank’s refusal to participate in the Greek debt restructuring becomes harder to sustain as Athens threatens to become more coercive. And any attempt to spare the ECB losses will make it look as if it enjoys implicit seniority, pushing sovereign yields even higher.

What would a Greek plan B look like?

By Hugo Dixon
January 24, 2012

If brinkmanship over a “voluntary” debt restructuring fails, Athens will be staring at a hard default. The challenge will be to prevent it being a messy one. That means bailing out Greek banks. But even after that, the country’s official creditors may save money.

Worst might be over in euro debt crisis

By Edward Hadas
January 24, 2012

Greece could still have a hard default and Portugal remains worse than a question mark. But the main reason there’s a regional crisis is that investors think there is one. Now they could be changing their minds, thanks to money from the ECB, plus some fiscal and political resolve.

Who will pay for the euro firewall?

By Hugo Dixon
January 27, 2012

Berlin is still against increasing the size of the euro zone’s warchest. But the rest of the world doesn’t want to raise the IMF’s firepower unless the zone beefs up its own. If a deal is done, it seems likely that the Europeans will pick up 70-80 pct of the tab.

Ireland’s bond swap shows how self help can work

January 27, 2012

Greece is defaulting, Portugal may follow, but Ireland is raising funds. Dublin’s 3.5 bln euro bond swap eases fears of a liquidity crunch and will help the country return to markets during its IMF programme. It’s a step closer to normality for Ireland, and Europe.

Fred Goodwin’s title clawback sets bad precedent

January 31, 2012

The disgraced former Royal Bank of Scotland chief executive has been stripped of his knighthood. The politically motivated move may stoke rather than sate anti-banker anger. Moreover, it devalues one of the few non-financial rewards that could be used to motivate bankers.

EU needs contingency plan to handle Greek blow-up

By Hugo Dixon
February 7, 2012

The latest game of brinkmanship being played in Athens will probably end in a fudge. But if it doesn’t, Greece’s banks will go bust and the rest of the euro zone will need a plan to prevent a panic in its own banking industry.