After Christmas Markdown: Credit Suisse Group sold $2.8 billion in commercial real estate loans for $1.2 billion. The loans covered property in Denmark, France, Germany and Sweden. (Source)
Credit Suisse Group is selling a $2.8 billion portfolio of soured commercial-property loans to Apollo Management LP for $1.2 billion, marking one of the largest bank sales of distressed real-estate loans since the downturn, according to people familiar with the matter. (Source)
Lloyds Banking Group and Royal Bank of Scotland shares tumbled on Friday after Lloyds said it had effectively written-off more than half of its outstanding loans to Irish borrowers. . . The huge write-offs have largely been driven by the collapse of the Irish property market and 90% of the bank’s loans against commercial property in Ireland are impaired, meaning that the borrower is either behind on payments or unable to service the debt. (Source)
The EU Crisis:
Spain and Italy have to refinance over 400 billion euros ($530 billion) of bonds in the spring, potentially sparking a fresh crisis within the 16-nation euro area. . . . The euro might break up at this point, though European politicians are normally able to respond to a crisis,” said Center for Economics and Business Research Chief Executive Douglas McWilliams. (Source)
The bailouts to Greece and Ireland solved nothing. Spain and Portugal are up next. (Source)
More of Less and Less: Moody’s says that Europe is the “weakest link” in the global economy and that even savage cuts in public spending will not save the “weaker peripheral eurozone nations” from defaulting on their debts. “The amount of austerity needed to correct Europe’s imbalances may be politically unsustainable.” (Source)
Only 41% of Germans Want to Stay on the Euro according to a report by Deutsche Welle: Survey finds half of Germans want Deutschmark back.
Love & Marriage: A single currency works only if there is (a) a single country or (b) a single strong country and a coterie of little states willing to let the strong country dominate. Neither condition prevails in Europe. And then there’s divorce. (Source)
Meanwhile: America’s economic pie is rapidly shrinking and US housing is in crisis again: Home price plunge is widespread as a double dip that Is Now Accelerating , Will Drop House Prices Another 20% and The Economy Is Screwed as things are Starting To Look Exactly Like 2006-2009 as Home foreclosures jump in 3rd quarter.
- Credit Suisse Sells Pile of Soured Property Loans (online.wsj.com)
- Apollo Swoops In on Bank’s Fire Sale (online.wsj.com)
- Lloyds Sees More Souring Irish Loans (online.wsj.com)