Another banking crisis

Marcus Padley

Marcus Today

A recent Fairfax article about the global banking system focused on the growth of impaired loans and the amount of stress out there. True, the amount of non-performing loans is now slightly above the 4.2% that it was pre the GFC with a read of 4.3%, but the trigger for the GFC was a surprise. The collapse of Lehmans was the trigger for the GFC and the contagion that ensued. With the GFC the collapse of Lehman was the tipping point. Banking is all about confidence and the sudden jolt to the system killed that confidence. The biggest risk is either the Chinese Shadow Banking system or the Italian and European banks. The banks are in a far better position now than they were then, with the implementation of Basel III capital requirements and the Dodd-Frank regulatory reforms that the US has put in place. Read the full story for my view on the European banks: (VIEW LINK)

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Marcus Padley
Marcus Today

Marcus Padley founded Marcus Today in 1998 and leads the team of analysts and market commentators that publishes a daily stock market newsletter, presents four podcasts and runs an $80m Australian equity fund. He is passionate about educating and...

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