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The news that almost a third of Bank of Moscow’s $30bn loan portfolio may include non-performing real estate loans is a reminder that — in emerging markets in particular — international lenders' credit processes must be strong enough to drill through what can be opaque financial reporting.
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The European Commission might be breathing a sigh of relief that its messy involvement with Germany's WestLB will soon come to an end. But it shouldn't think for a moment that it has achieved anything.
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Criticising Cocos means criticising the consensus that these securities will solve the capital problems of the big international banks. Plenty of people, from DCM bankers to treasurers to politicians, have vested interests in backing the new system. Mervyn King should be applauded for resisting the urge.
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While it is difficult to argue against the logic of senior creditor bail-ins, the practicalities are complicated. Bank of Ireland’s capital generation exercise, even though it is so far limited to tier two paper, has highlighted some of the pitfalls. Regulators ignore these worries at their peril.
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After two months with no covered bond supply from peripheral Europe, the last two weeks have seen two benchmark deals that priced tight to where their respective government bonds trade. But that’s where the similarities end. The deals' outcomes could not have been more different.
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The FSA’s new guidelines on risk weighting securitisations are not surprising in themselves. The odd thing is that they’ve taken so long to break cover, while regulators have busily worked themselves into a lather over loan level data and other distractions.
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The Australian Senate wants to extend government support for RMBS deals to other types of securitisation. That would be a mistake.
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With peripheral European sovereign bonds looking shakier by the day, it's clearer than ever that Basel III will not give covered bonds the credit they deserve.
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Syndicate Bank lived up to its name this week: picking a consortium of eight banks to manage its debut international bond. The heavy bookrunner list was a nod to the strong relationships the bank has built with foreign lenders. But was it a wise decision to give the mandate to so many different banks?
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Whinging to regulators that banking business models will have to change is a missing the point. Change is exactly what regulators want.