ECB Blows €400bn on “Brexit Black Friday” Bank Bailouts
by Wolf Richter
WolfStreet.com
June 26, 2016
Remember TARP, the Troubled Asset Relief Program that the US Congress approved to bail out banks and other companies during the Financial Crisis? $700 billion were authorized, later reduced to $475 billion. The Treasury eventually dispersed $432 billion. I bring this up because the ECB bailed out the European banks with more than TARP, in just one day: on Brexit Black Friday.
The ECB saw what was happening to the shares of the largest banks on that propitious day. It saw a blooming financial crisis:
Top UK Banks:
HSBC, the apparent winner in this fiasco, perhaps because of its exposure to Asia, -1.4%
Barclays: -17.7%
Royal Bank of Scotland: -18.0%
Lloyds Banking Group: -21.0%
Top German Banks:
Deutsche Bank: -15.9% to €13.25, down 59% from April last year, possibly on the way to zero.
Commerzbank: -13.6%, to €6.20. The German government still owns nearly 16% of it as a result of the bailout during the Financial Crisis.
The third-largest German bank, KfW, is a state-owned institution, so taxpayers are automatically on the hook.
The Rest…HERE
