Structure of Euro Area Banking
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Transcript of Structure of Euro Area Banking
StructureofEuroAreaBanking
LightlyCapitalizedCoreUniversalBanks
Deutsche,BNPParibas,CreditAgricole,INGSocieteGenerale,Commerzbank,Dexia,Natixis
BetterCapitalizedPeripheryCommercialBanks
Unicredit,Santander,Intesa,BBVA
Loans
Mega-BanksExpandedUnsustainably(EuroareabankassetsasaratiotoGDP)
050
100150200250300350
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Otherbanks 12Mega-Banks
LargeUniversalEuropeanBanksExploitedInternalRiskModelsandBecameMoreFragile
0
2
4
6
8
10
2 4 6 8 10 12
UniversalCommercial
1996
SimpleLeverageRatio:Boo
kequity/TotalAssets
BaselRatio:Tier1Capital/RiskWeightedAssets
0
2
4
6
8
10
2 4 6 8 10 12
Universalcommercial
2008
BaselRatio:Tier1Capital/RiskWeightedAssets
SimpleL
everageR
atio:Boo
kequity/TotalAssets
StructureofUSBankingin2002
LightlyCapitalizedUSInvestmentBanks
MorganStanley,GoldmanSachs,LehmanBrothers,MerrillLynch,BearSterns
StronglyCapitalizedCommercialBanks
Citi,JPMorgan,BankofAmerica,WellsFargo,Wachovia,BankOneCorporation,FleetBostonFinancialCorporation,U.S.Bancorp
GSEMortgages
0
10
20
30
40
50
60
1980 2002
Securitizations GSEs CommercialBanks
Source:USFlowofFunds
BanksSold MostMortgagesToMarkets by2002(AssetsasapercentofUSGDP)
PrivateMortgageSecuritiesSurgedAfter2003(AssetsasapercentofUSGDP)
0
10
20
30
40
50
60
981 001 021 041 061 081
GSE Private
-20
0
20
40
60
80
100
2000 2007Assets:Periphery Assets:USandUK LiabilitiesUS,UK,andPeriphery
Source:BankforInternatinoal Settlements
CoreEuroAreaBanksExpandedRapidlyOverseas(AssetsandLiabilitiesasapercentofGDP)
TheNorthAtlanticFinancialBoom
LightlyCapitalizedU.S.InvestmentBanks
WellCapitalizedUnitedStates
CommercialBanks
LightlyCapitalizedEuroAreaCoreUniversalBanks
EuroAreaPeripheryCommercialBanks
CrossAtlanticDrift
Mortgages Loans
MortgageAssets
Repos
CostsofGlobalCrisesRoseWithCapitalMobility(RatiotoGlobalGDP)
0
1
2
3
BrettonWoods LatinAmerica ERM Asia NorthAtlantic
Growth CADeficit
Source:WorldEconomic Outlook
ConsumerCredit:Asset-BackedSecurityStock(RatiotoGDP)
0
1
2
3
4
5
6
881 921 961 001 041 081 121
