Spanish Banks Need 60 Billion Euros in Aid

By: Sunday September 30, 2012 6:00 pm

Spain announced the results of a stress test of its banks, finding a €60 billion shortfall, in line with estimates.

It’s important to understand that there are two bailouts as it pertains to Spain. The bank bailout, meant to cover this €60 billion shortfall, has already been requested and approved. Europe has reserved around €100 billion for this purpose. The other bailout, a bailout for Spain’s sovereign debt, has not yet been requested, much to the consternation of top European officials.

Banks Poised to Pass Another Round of Bank-Designed Stress Tests

By: Monday March 12, 2012 1:30 pm

At a time when the government will release banks from their shameful conduct in the mortgage industry, they are also conducting stress tests to determine the financial health of those same banks. Given government policy that protects and coddles the banks, I would imagine the health to be shown as pretty darn good. And indeed, that’s the expectation, with the Federal Reserve expected to release the results of stress test to determine how well the banks have been rescued from their own self-destructive folly.

Banks Want to Stop Disclosure of New Stress Tests Results

By: Monday March 5, 2012 10:35 am

Not only do Too Big to Fail banks want an implicit guarantee against their demise, not only do they want free money from the government to prop them up, but they also want as much secrecy as possible about their operations and their finances. That’s at the heart of this latest push to get the Fed to not disclose the most recent round of stress tests.

Banks Writing Their Own Stress Tests

By: Thursday March 3, 2011 6:18 pm

You may not know that there’s a new round of stress tests for the banks on the horizon. The Federal Reserve announced these stress tests late last year, designed to determine whether the banks could handle another downturn. The last stress tests were plagued by actual bargaining between the administrators of the tests and the banks to get them to a relatively healthy position. They simply weren’t a real assessment of the health of the banks. Similarly, these tests probably won’t include any contingency for mass putbacks of soured mortgages by investors, for example. Therefore, these stress tests won’t be entirely legitimate either.

Rep. Brad Miller: “Protecting Bank Solvency Has Been a Goal of Treasury That I Do Not Share”

By: Friday November 19, 2010 7:58 am

One of the more amusing moments of yesterday’s House Financial Services Committee hearings on foreclosure fraud was when the representatives for the loan servicers were asked why they were subsidiaries of the large financial institutions. The link between the servicers and the big banks, mainly caused by a series of mergers, leads to all kinds of conflicts of interest, because it inevitably pairs them up with the originator or trustee of the loan. The servicers had no real answer to this question. Finally, the Wells Fargo representative claimed that it was for “customer convenience,” because some customers had their mortgage and their checking accounts at the same bank.

Everyone’s jaw dropped in the hearing room.

Now Miller is out with a letter, signed by all the top leaders of the House Financial Services Committee, that seriously ratchets up the demands on the Financial Stability Oversight Council. Among other things, it asks the FSOC to use its authority under Dodd-Frank to force the large financial institutions to divest from the loan servicers.

Did Servicers Commit Fraud So Banksters Could Get Big Bonuses?

By: Wednesday October 13, 2010 12:30 pm

Given that we know Timmeh Geither, campaigner against injustice, was officially warned and knew about this conflict, I’d like to know how much he knew about this hedge. The Administration now says it was helpless to stop this kind of fraud, yet it chose not to use at least two sources of leverage (cramdown and stress tests) to control it. Is that because they knew the servicer fraud was an important part of extend and pretend?

Where Was Tim Geithner’s and Larry Summers’ Stress Test?

By: Saturday September 25, 2010 9:00 am

In early 2009, the Administration proposed to put the banks through “stress tests” to see how they’d survive more adverse scenarios. So why didn’t the economic team also have a test in case their own recovery plans proved to be insufficient?

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