Comments on: European Versus US Bank Leverage

By: Lars Osterman

Lars Osterman — Tue, 01 Dec 2009 15:40:53 +0000

Interesting certainly, as authorities tell us “everyting is OK” with European banks. Stress tests show “no problem” they say.

The thing I am curious about is are the assets of the European banks valued according to market value or according to old optimistic figures of the banks themselves..? Considering the recent drops this should be of interest.

Another thing one ponders upon is how the European banks will be effected the day the Federal Reserve is bancrupt and the USD finally crasches ?

By: Mark Rhind

Mark Rhind — Sat, 11 Apr 2009 13:00:43 +0000

It would be worth looking at the amount of off balance sheet activity, if reliable (any) figures could be ascertained. And assisted the banks in setting up off balance sheet entities, directly after Enron and Sarbanes-Oxley decreed that there should be no off balance sheets any more… so much for that. Think large firm consultants, providing lucrative consulting advice that, too was supposedly banned by SOX. The very heart of finance, the banking industry, has blown a bullet through SOX (SOX was intended to restore trust, does anyone remember that?)

By: Happy Birthday! | The Pink Lemon

Happy Birthday! | The Pink Lemon — Wed, 31 Dec 2008 03:12:15 +0000

[...] all manner of sources. The Flitzebogen bow and arrow game as well as a post I put up about bank leverage have by far been the most popular posts on the site, I can understand wasting some serious time on [...]

By: Octavio

Octavio — Sun, 09 Nov 2008 18:40:19 +0000

Octavio.

Os bancos europeus estao muito mais alavancados que os americanos.

Abs.

Gilson.

By: Webmaster

Webmaster — Tue, 07 Oct 2008 17:20:48 +0000

That is true, Europe and the States do have different standards, so maybe it is a bit of an apples and oranges thing. Or, at least oranges and tangerines! It remains, however, the leverage of European banks is far in excess of that maintained by their US counterparts.

I wanted to add that RBS, down the bottom of the European leverage list, has seen its stock drop a whopping 39% today alone! Dexia is also up the creek, with its market capitalization down around 41.5% since the close of September 26.

By: Michael

Michael — Tue, 07 Oct 2008 16:26:35 +0000

There seems to be a difference in the accounting standards: Europe uses IFRS and America GAAP. Until 2006 international banks were required to do both. In 2006 Deutsche Bank had a leverage ratio of 50.5 when taking the IFRS figures, when taking the GAAP figures it had “only” 33.1. UBS had 48.2 with IFRS and 40.8 with the GAAP figures.

By: A Study of Market Recoveries « Fundamental Trading Diary

A Study of Market Recoveries « Fundamental Trading Diary — Tue, 07 Oct 2008 01:43:38 +0000

[...] top US banks are not overly leveraged, especially considering their European counterparts. This fellow here has listed the top banks by assets governed in the USA and Europe and their leverage ratio. [...]

By: Bank Leverage Ratio « So Halt

Bank Leverage Ratio « So Halt — Mon, 06 Oct 2008 21:29:57 +0000

[...] Center for European Policy Studies (CEPS) wurden in den letzten Tagen z.T. Horrormeldungen (hier oder hier) über den Zustand der europäische Banken gemeldet. Die Leverage Ratio scheint bei [...]

By: Webmaster

Webmaster — Mon, 06 Oct 2008 19:15:25 +0000

Financial statements, current market prices, etcetera…

By: Michael

Michael — Mon, 06 Oct 2008 18:08:23 +0000

Where did you get this figures? I want to look up some banks.