Ireland rolled out its “bad bank today”, taking billions of EUR in soured loans off the balance sheet of the Irish banks. It also imposed new capital requirements and lays out the amount capital each bank must raise, The industry needs to raise approximately EUR 22 bln, if my calculations are correct.
Ireland has taken its medicine like no other country in the Euro zone in terms of purging banks of bad assets. Imagine if the rest of the group did likewise…they would have to raise hundreds of billions in fresh capital.
EUR/USD is in consolidation mod after falling as low as 1.3395. Fixing-related sales combined with poor Greek debt performance and a cut in Germany’s GDP forecast from the IMF have weighed on the single currency.
