U.S. Government to be more than one hundred billion U.S. dollars of assets banks "pressure test"
The United States Government in the ratio of Citigroup's stake may be increased to 40%.
□ reporter Gao Jian
Also the United States banking industry toward "nationalization" of the road, a last resort to a big step.
According to reports, Citigroup is working with the United States before the federal government on the Government to drastically expand its holdings of the Citigroup negotiations. Expected after the negotiations, the U.S. government in the proportion of Citigroup's stake will be from the current 7.8 percent jump to up to 40%.
In this regard, experts said that if these negotiations succeed, the United States investor confidence in the banking industry will hit bottom, while the New York Stock Exchange in the financial stocks will also be subjected to a new round of panic selling of drag, the emergence of stock "slumped."
Citigroup has been the nationalization of the actual
It is reported that the U.S. government in the negotiations will be forced Citigroup to divest its part of the business, and management of the Group consolidated salary matters with veto power; the same time, when the proportion of Citigroup's stake will significantly improve; the Government before the United States several months through Citigroup injected 45 billion U.S. dollars and held 7.8 percent of preferred stock will be converted into ordinary shares part.
At present, the United States government finally held in Citigroup common stock may be as many as 40 percent, even though Citigroup executives hope that the U.S. Government shareholding ratio is closer to 25 percent. It should be noted that the United States federal government on the above-mentioned measures to negotiate with Citigroup, are taken into account it does not require taxpayers to spend more money. In other words, the United States the federal government will not be additional investment in the circumstances, will be in Citigroup's shares held 7.8 percent from the current jumped to a one-time up to 40%. This means that Citigroup's other shareholders will be faced with a situation in diluted shares.
Chinese Central University of Finance and Economics School of Management Professor of Economics and Bu if Parker (Robert H. Blohm) pointed out that the U.S. federal government initiatives will enable the above-mentioned Citigroup stock price and market value per share book drag each other into a vicious cycle of decline. Even more serious, in view of the U.S. federal government had agreed to absorb the balance sheet of Citibank hundreds of billions of dollars worth of non-performing assets losses, Citigroup has been in fact the nationalization.
In fact, in the United States mortgage finance agencies Fannie Mae (Fannie Mae) and Freddie Mac (Freddie Mac) the effectiveness of the structure of Hong Yuan Securities Investment Bank Fung, general manager of soldiers, in an interview with China Securities Journal reporter said that the United States investment bank system crisis "久治不愈" will force the U.S. government has resorted to nationalization measures, which means that American investment banking system of bad assets will be transferred to the Government's balance sheet, and through the transition of American taxpayers, and ultimately transfer to the United States commercial banking system's balance sheet. From this perspective, there may be a "bank nationalization" will enable a new round of destructive power of an even greater crisis broke out in the commercial banking system.
Facing the test of investor confidence
Prior to last Thursday, the market had been Citigroup and Bank of America may be nationalized hearsay. The results of the three major New York stock market indexes in the financial shares dragged down under, made a straight drop of a violent reaction. Although Bank of America to explore 22 permit the Government to deny access to the bank more equity-related matters, but Citigroup's talks with the government, and its inevitable rise to the plight of other banks also will be entered into such an agreement guess, is still increasing in New York the possibility of the stock market continued to fall.
Bu if Parker has explained that the United States Government to expand its stake in Citibank, the proportion of practices, caused investors are banking on the entire United States as an independent identity survive the collapse of the financial crisis of confidence, therefore, U.S. stocks fell a row almost no suspense.
For some analysts to the United Kingdom nationalize the stock market did not appear because the collapse of the banking sector on the grounds in support of the nationalization of American banks point of view, if Bu Bai said that the United Kingdom only a limited number of large financial institutions, so the Government last year诺森罗克Bank nationalization of the negative effects of the conduction does not have enough space; even if the European market as part of its extension, the European continent to save the banking industry measures differ, and therefore no local investors because the British Government's initiatives and panic. And the United States a unified national market and hundreds of major financial institutions, but must also guard against the Government in increasing the proportion of Citigroup shares the negative effects caused by the impact.
"Nationalization" is still a last resort
In fact, the "nationalization" of rumors were flying around from the U.S. Treasury Secretary Timothy Geithner on the 10th of this month released the second round of the financial rescue plan. Under the program, the Government will soon be more than one hundred billion U.S. dollars of assets of major banks to start all-round "pressure test" to assess the review of bank's financial situation, determine what the bank needs additional capital injection. If the bank can not pass the test, the government will conditionally provide "additional support."
Currently in the "stress tests" at the time about to begin, the former Federal Reserve economist Riding pointed out that if Timothy should not include hedge funds to other investors, including providing low-interest loans, then the entire second round of the financial rescue plan is very may be impossible to implement. In other words, for any rescue measures for the banking industry, must be included in addition to government support other than the principal, the bank "nationalization" to make it out of the crisis, and will remain the last resort assistance.
In fact, on the 18th German federal government adopted a country to permit troubled banks nationalization programs, have also highlighted the bank nationalization are "last resort" only when other means have proved ineffective circumstances permit the implementation.
At the same time, earlier in the "bank nationalization" to deal with crisis ahead of the United Kingdom appears to have every effort to avoid a "nationalization" of the case: the Royal Bank of Scotland (RBS) management is scheduled for this week announced the reorganization of the four programs , is likely to take the bank into "good bank" and "bad bank" business hedge Ways, it is expected that about half of them quit the overseas market, and as many as 300 billion pounds of business to be sold under the "bad bank" .
The United States Government in the ratio of Citigroup's stake may be increased to 40%.
□ reporter Gao Jian
Also the United States banking industry toward "nationalization" of the road, a last resort to a big step.
According to reports, Citigroup is working with the United States before the federal government on the Government to drastically expand its holdings of the Citigroup negotiations. Expected after the negotiations, the U.S. government in the proportion of Citigroup's stake will be from the current 7.8 percent jump to up to 40%.
In this regard, experts said that if these negotiations succeed, the United States investor confidence in the banking industry will hit bottom, while the New York Stock Exchange in the financial stocks will also be subjected to a new round of panic selling of drag, the emergence of stock "slumped."
Citigroup has been the nationalization of the actual
It is reported that the U.S. government in the negotiations will be forced Citigroup to divest its part of the business, and management of the Group consolidated salary matters with veto power; the same time, when the proportion of Citigroup's stake will significantly improve; the Government before the United States several months through Citigroup injected 45 billion U.S. dollars and held 7.8 percent of preferred stock will be converted into ordinary shares part.
At present, the United States government finally held in Citigroup common stock may be as many as 40 percent, even though Citigroup executives hope that the U.S. Government shareholding ratio is closer to 25 percent. It should be noted that the United States federal government on the above-mentioned measures to negotiate with Citigroup, are taken into account it does not require taxpayers to spend more money. In other words, the United States the federal government will not be additional investment in the circumstances, will be in Citigroup's shares held 7.8 percent from the current jumped to a one-time up to 40%. This means that Citigroup's other shareholders will be faced with a situation in diluted shares.
Chinese Central University of Finance and Economics School of Management Professor of Economics and Bu if Parker (Robert H. Blohm) pointed out that the U.S. federal government initiatives will enable the above-mentioned Citigroup stock price and market value per share book drag each other into a vicious cycle of decline. Even more serious, in view of the U.S. federal government had agreed to absorb the balance sheet of Citibank hundreds of billions of dollars worth of non-performing assets losses, Citigroup has been in fact the nationalization.
In fact, in the United States mortgage finance agencies Fannie Mae (Fannie Mae) and Freddie Mac (Freddie Mac) the effectiveness of the structure of Hong Yuan Securities Investment Bank Fung, general manager of soldiers, in an interview with China Securities Journal reporter said that the United States investment bank system crisis "久治不愈" will force the U.S. government has resorted to nationalization measures, which means that American investment banking system of bad assets will be transferred to the Government's balance sheet, and through the transition of American taxpayers, and ultimately transfer to the United States commercial banking system's balance sheet. From this perspective, there may be a "bank nationalization" will enable a new round of destructive power of an even greater crisis broke out in the commercial banking system.
Facing the test of investor confidence
Prior to last Thursday, the market had been Citigroup and Bank of America may be nationalized hearsay. The results of the three major New York stock market indexes in the financial shares dragged down under, made a straight drop of a violent reaction. Although Bank of America to explore 22 permit the Government to deny access to the bank more equity-related matters, but Citigroup's talks with the government, and its inevitable rise to the plight of other banks also will be entered into such an agreement guess, is still increasing in New York the possibility of the stock market continued to fall.
Bu if Parker has explained that the United States Government to expand its stake in Citibank, the proportion of practices, caused investors are banking on the entire United States as an independent identity survive the collapse of the financial crisis of confidence, therefore, U.S. stocks fell a row almost no suspense.
For some analysts to the United Kingdom nationalize the stock market did not appear because the collapse of the banking sector on the grounds in support of the nationalization of American banks point of view, if Bu Bai said that the United Kingdom only a limited number of large financial institutions, so the Government last year诺森罗克Bank nationalization of the negative effects of the conduction does not have enough space; even if the European market as part of its extension, the European continent to save the banking industry measures differ, and therefore no local investors because the British Government's initiatives and panic. And the United States a unified national market and hundreds of major financial institutions, but must also guard against the Government in increasing the proportion of Citigroup shares the negative effects caused by the impact.
"Nationalization" is still a last resort
In fact, the "nationalization" of rumors were flying around from the U.S. Treasury Secretary Timothy Geithner on the 10th of this month released the second round of the financial rescue plan. Under the program, the Government will soon be more than one hundred billion U.S. dollars of assets of major banks to start all-round "pressure test" to assess the review of bank's financial situation, determine what the bank needs additional capital injection. If the bank can not pass the test, the government will conditionally provide "additional support."
Currently in the "stress tests" at the time about to begin, the former Federal Reserve economist Riding pointed out that if Timothy should not include hedge funds to other investors, including providing low-interest loans, then the entire second round of the financial rescue plan is very may be impossible to implement. In other words, for any rescue measures for the banking industry, must be included in addition to government support other than the principal, the bank "nationalization" to make it out of the crisis, and will remain the last resort assistance.
In fact, on the 18th German federal government adopted a country to permit troubled banks nationalization programs, have also highlighted the bank nationalization are "last resort" only when other means have proved ineffective circumstances permit the implementation.
At the same time, earlier in the "bank nationalization" to deal with crisis ahead of the United Kingdom appears to have every effort to avoid a "nationalization" of the case: the Royal Bank of Scotland (RBS) management is scheduled for this week announced the reorganization of the four programs , is likely to take the bank into "good bank" and "bad bank" business hedge Ways, it is expected that about half of them quit the overseas market, and as many as 300 billion pounds of business to be sold under the "bad bank" .
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