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The Congressional Oversight Panel has released its August report which contains some much more dire language about the prospects of the U.S. banking system than did the joke that was the Stress Test, especially in the small/middle bank sector.
The Panel‘s analysis of troubled whole loans suggests they pose a threat to the financial health of smaller banks ($600 million to $100 billion group). Using the same assumptions, it looks as if banks in the $600 million to $100 billion group will need to raise significantly more capital, as the estimated losses will outstrip the projected revenue and reserves. Under the "starting point" scenario, this second group of banks will need to raise $12-14 billion in capital to offset their losses, while in the "starting point + 20% scenario", non-stress-tested banks are expected to have to raise $21 billion in capital to offset their losses. The capital shortfall for those relatively smaller banks is primarily due to the lack of reserves, which on average account for only 25 percent of the expected loan losses.
Originally posted by marg6043
!!!!!! T-Bonds for sell!!!!!!! come and get your T-3-bonds for sell, auction to start in a few minutes!!!!!! don't miss on the opportunity to own a piece of the USA.
Troubles spreading in U.S. consumer-linked sectors: S&P
NEW YORK (Reuters) - Poor consumer demand amid economic turmoil and choppy credit markets will continue to pressure U.S. companies in consumer-dependent sectors for the remainder of this year, Standard & Poor's said in report on Tuesday.
Companies in consumer products, media and entertainment and retail and restaurant sectors continue to feel the worst effects of the economic downturn and will likely see the most defaults through the remainder of 2009.
"These sectors consistently have the highest levels of risk among our lists of distressed companies, weakest links, and potential bond downgrades," said Diane Vazza, lead author of the report.