• Credit default swaps on European bank bonds fell this week, heading for a record weekly decline. The region’s debt talks have helped to sooth investors nerves for now. From Reuters.
• UBS rogue trader Adoboli rings up $2B in losses which will likely wipe out earnings for the quarter at the bank. The shocking lapse in risk controls will lead to a scramble at other banks to assess risks. From the New York Times
• Central banks joined forces to make sure European banks have access to U.S. dollars. The ECB will extend lending terms to three months, rather than one week. The European Central Bank is coordinating with the Federal Reserve of the U.S., the Bank of England, the Bank of Japan, and the Swiss National Bank. The coordinated message took considerable pressure off European banks. From the New York Times.