"Deutsche Bank Poses The Greatest Risk To The Global Financial System": IMF
by Tyler Durden
Jun 30, 2016 5:58 AM
Over three years ago we wrote "At $72.8 Trillion, Presenting The Bank With The Biggest Derivative Exposure In The World" in which we introduced a bank few until then had imagined was the riskiest in the world.
As we explained then "the bank with the single largest derivative exposure is not located in the US at all, but in the heart of Europe, and its name, as some may have guessed by now, is Deutsche Bank. The amount in question? €55,605,039,000,000. Which, converted into USD at the current EURUSD exchange rate amounts to $72,842,601,090,000.... Or roughly $2 trillion more than JPMorgan's."
So here we are three years later, when not only did Deutsche Bank just flunk the Fed's stress test for the second year in a row, but moments ago in a far more damning analysis, none other than the IMF disclosed that Deutsche Bank poses the greatest systemic risk to the global financial system, explicitly stating that the German bank "appears to be the most important net contributor to systemic risks."
Yes, the same bank whose stock price hit a record low just two days ago.
Here is the key section in the report:
[url=http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/06/27/DB IMF 1.jpg][/url]
And while DB is number 1, here are the other banks whose collapse would likewise lead to global contagion.
[url=http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/06/27/DB IMF 2.jpg][/url]
Considering two of the three most "globally systemically important", i.e., riskiest, banks just saw their stock price scrape all time lows earlier this week, we wonder just how nervous behind their calm facades are the executives at the ECB, the IMF, and the rest of the handful of people who realize just close to the edge of collapse this world's most riskiest bank (whose market cap is less than the valuation of AirBnB) finds itself right now.
http://www.zerohedge.com/news/2016-06-29/imf-deutsche-bank-poses-greatest-risk-global-financial-system
by Tyler Durden
Jun 30, 2016 5:58 AM
Over three years ago we wrote "At $72.8 Trillion, Presenting The Bank With The Biggest Derivative Exposure In The World" in which we introduced a bank few until then had imagined was the riskiest in the world.
As we explained then "the bank with the single largest derivative exposure is not located in the US at all, but in the heart of Europe, and its name, as some may have guessed by now, is Deutsche Bank. The amount in question? €55,605,039,000,000. Which, converted into USD at the current EURUSD exchange rate amounts to $72,842,601,090,000.... Or roughly $2 trillion more than JPMorgan's."
So here we are three years later, when not only did Deutsche Bank just flunk the Fed's stress test for the second year in a row, but moments ago in a far more damning analysis, none other than the IMF disclosed that Deutsche Bank poses the greatest systemic risk to the global financial system, explicitly stating that the German bank "appears to be the most important net contributor to systemic risks."
Yes, the same bank whose stock price hit a record low just two days ago.
Here is the key section in the report:
The IMF also said the German banking system poses a higher degree of possible outward contagion compared with the risks it poses internally. This means that in the global interconnected game of counterparty dominoes, if Deutsche Bank falls, everyone else will follow.
Domestically, the largest German banks and insurance companies are highly interconnected. The highest degree of interconnectedness can be found between Allianz, Munich Re, Hannover Re, Deutsche Bank, Commerzbank and Aareal bank, with Allianz being the largest contributor to systemic risks among the publicly-traded German financials. Both Deutsche Bank and Commerzbank are the source of outward spillovers to most other publicly-listed banks and insurers. Given the likelihood of distress spillovers between banks and life insurers, close monitoring and continued systemic risk analysis by authorities is warranted.
Among the G-SIBs, Deutsche Bank appears to be the most important net contributor to systemic risks, followed by HSBC and Credit Suisse. In turn, Commerzbank, while an important player in Germany, does not appear to be a contributor to systemic risks globally. In general, Commerzbank tends to be the recipient of inward spillover from U.S. and European G-SIBs. The relative importance of Deutsche Bank underscores the importance of risk management, intense supervision of G-SIBs and the close monitoring of their cross-border exposures, as well as rapidly completing capacity to implement the new resolution regime.
The IMF concluded that Germany needs to urgently examine whether its bank resolution, i.e., liquidation, plans are operable, including a timely valuation of assets to be transferred, continued access to financial market infrastructures, and whether authorities can ensure control over a bank if resolution actions take a few days, if needed, by imposing a moratorium:
Notwithstanding moderate cross-border exposures on aggregate, the banking sector is a potential source of outward spillovers. Network analysis suggests a higher degree of outward spillovers from the German banking sector than inward spillovers. In particular, Germany, France, the U.K. and the U.S. have the highest degree of outward spillovers as measured by the average percentage of capital loss of other banking systems due to banking sector shock in the source country.
Here is the IMF's chart showing the key linkages of the world's riskiest bank:
Operationalization of resolution plans and ensuring funding of a bank in resolution is a high priority. The authorities have identified operational challenges (e.g., the timely valuation of assets to be transferred, continued access to financial market infrastructures) and are working to surmount them. In some cases, actions to effect resolution may require a number of days to implement, and the authorities should ensure they can maintain control over the bank during this period, including by using their powers to impose a more general moratorium for a specific bank.
[url=http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/06/27/DB IMF 1.jpg][/url]
And while DB is number 1, here are the other banks whose collapse would likewise lead to global contagion.
[url=http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/06/27/DB IMF 2.jpg][/url]
Considering two of the three most "globally systemically important", i.e., riskiest, banks just saw their stock price scrape all time lows earlier this week, we wonder just how nervous behind their calm facades are the executives at the ECB, the IMF, and the rest of the handful of people who realize just close to the edge of collapse this world's most riskiest bank (whose market cap is less than the valuation of AirBnB) finds itself right now.
http://www.zerohedge.com/news/2016-06-29/imf-deutsche-bank-poses-greatest-risk-global-financial-system
Today at 10:26 am by Rocky
» Kuwait is drilling an oil well near Umm Qasr, towards Iraqi territory
Today at 10:24 am by Rocky
» In the document... the first Iraqi ministry identifies the obstacles to changing the new official wo
Today at 10:22 am by Rocky
» Italian Institute: Iraq is stuck in its own crises, including Baghdad’s efforts to undermine the “au
Today at 10:21 am by Rocky
» The head of the Integrity Commission announces the holding of an international Interpol conference i
Today at 10:18 am by Rocky
» Planning: Iraqi companies are not efficient in conducting the population census
Today at 10:14 am by Rocky
» utube MM&C 4/24/24 Support - USA- Turkey - Timing- Currency Value - Tabled
Today at 8:08 am by Rocky
» MM&C 4/25/24 National Bank of Iraq goes live with Temenos core banking and payments
Today at 8:06 am by Rocky
» utube MM&C 4/26/24 Iraqi Dinar - US Treasury Exchange Rates- Focus - Banking Partnerships - Rate C
Today at 8:06 am by Rocky
» A banking official indicates a "danger" to Iraq by depriving more than half of its banks of dollars
Today at 7:55 am by Rocky
» With the participation of the Association of Private Banks, investment opportunities are on the tabl
Today at 7:45 am by Rocky
» Within a month... an Iranian border crossing recorded a noticeable increase in exports of goods to I
Today at 7:44 am by Rocky
» The Association of Private Banks appreciates the efforts of the government and the Central Bank to c
Today at 7:43 am by Rocky
» Al-Maliki's coalition presents a third candidate for the position of governor of Diyala
Today at 6:57 am by Rocky
» Arab gathering: The Kirkuk problem is getting complicated and the Sudanese must intervene
Today at 6:56 am by Rocky
» Next week.. a Kurdish delegation will visit Baghdad to meet with the Minister of Finance
Today at 6:54 am by Rocky
» Under the pretext of salaries... Al-Party refrains from handing over port revenues to Baghdad
Today at 6:53 am by Rocky
» Association of Banks: For the first time, we are witnessing a clear targeting of depriving half of t
Today at 6:51 am by Rocky
» Parliament does not know the reason for the delay in sending the 2024 budget schedules: Voting takes
Today at 6:49 am by Rocky
» Applicants for the 2024 Hajj are demanding that the Central Bank secure the dollar for them through
Today at 5:09 am by Rocky
» Governmental and private banks will showcase their services tomorrow during Financial Inclusion Week
Today at 5:08 am by Rocky
» Iraq's oil exports rise despite OPEC+ cuts
Today at 5:06 am by Rocky
» A study explodes a "surprise"... Iraq is among the countries that export oil to "Israel": How is the
Today at 5:04 am by Rocky
» Al-Araji emphasizes working to strengthen national identity
Today at 5:02 am by Rocky
» Al-Sudani visits Saudi Arabia to participate in the World Economic Forum in Riyadh
Today at 5:01 am by Rocky
» Iraq is talking about producing one million additional liters of gasoline
Today at 4:59 am by Rocky
» The Council of Ministers approves the implementation of the Baghdad Metro project
Today at 4:56 am by Rocky
» Minister of Commerce: We formed a joint economic committee with Türkiye
Today at 4:55 am by Rocky
» Resources: Government measures have contributed to improving the water situation in Iraq
Today at 4:53 am by Rocky
» Parliamentary Finance: Baghdad will continue to send salaries to the region’s employees until settle
Today at 4:51 am by Rocky
» A parliamentarian describes the corruption of Iraqi ports as “ghouls” and reveals the involvement of
Today at 4:49 am by Rocky
» Obelisk Hour: Basra is the subject of political conflict and ambiguity over the fate of the funds al
Today at 4:48 am by Rocky
» Turkmen leader: An agreement on the local government of Kirkuk is near
Today at 4:45 am by Rocky
» Anbar calls for the operation of its factories despite financial obstacles
Today at 4:44 am by Rocky
» Turki: The crisis of the Presidency of Parliament prompted the Sunnis to amend the Council’s interna
Today at 4:43 am by Rocky
» The Agriculture Committee confirms the existence of Iraqi-Turkish-Iranian discussions on water
Today at 4:42 am by Rocky
» Resources diagnose the challenges facing the water file in Iraq
Today at 4:38 am by Rocky
» Parliament pledges to the Interior Ministry: We will transfer money to buy weapons from citizens
Today at 4:33 am by Rocky
» Al-Issawi is the closest.. Parliament sets the date for deciding the choice of the new president
Today at 4:31 am by Rocky
» Deputy: Iraq's investments have risen and need a comprehensive review of previous years
Today at 4:30 am by Rocky
» Iraqis consume 7 billion eggs annually and import about $900 million
Today at 4:28 am by Rocky
» The Iranian role complicates attempts at open cooperation between Iraq and Turkey. Turkey is trying
Today at 4:26 am by Rocky
» Move in Iran to obtain $242 billion from Iraq in compensation for the eight-year war
Today at 4:25 am by Rocky
» 12 decisions from the Council of Ministers regarding the Baghdad Metro and Najaf-Karbala train proje
Today at 4:23 am by Rocky
» Sudanese Advisor: The path to development has begun... the Baka and the militias “we silence them wi
Today at 4:21 am by Rocky
» Not from Kurdistan.. How did Iraq become a source of oil for “Israeli tanks”?
Today at 4:19 am by Rocky
» Parliamentary Agriculture criticizes the Sudanese and Erdogan agreement: Türkiye will control water
Today at 4:16 am by Rocky
» The Iraqi government issues new decisions
Yesterday at 2:35 pm by Rocky
» The story of “reduced oil” to Jordan, from “compulsion” to mutual benefit.. Is there a loss?
Yesterday at 2:33 pm by Rocky
» The Council of Ministers takes 12 decisions for the Baghdad Metro and the Najaf-Karbala train
Yesterday at 2:32 pm by Rocky
» utube MM&C 4/23/24 Iraqi Dinar - IQD Update - Development Road Project - Saviour of Global Banking
Yesterday at 10:18 am by Rocky
» Kidney from pig transplanted into deathly ill New Jersey woman — and begins working almost immediat
Yesterday at 10:15 am by Bama Diva
» The most difficult option.. Warnings of the danger of floating the Iraqi dinar without achieving an
Yesterday at 9:48 am by Rocky
» Trade from the “Economic Committee” with Türkiye: It will overcome all obstacles facing the traders
Yesterday at 9:46 am by Rocky
» Washington's hope for stable relations with Baghdad clashes with Iraqi parties' rejection of the Ame
Yesterday at 9:41 am by Rocky
» Karim Badr: Development is America’s will to kill silk
Yesterday at 9:36 am by Rocky
» Oil: Opening of a new port for liquid gas for vehicles in Baghdad
Yesterday at 9:33 am by Rocky
» A media advisor warns of corruption in a draft law on the Parliament’s agenda
Yesterday at 9:21 am by Rocky
» Economist: There is serious work to lift US sanctions on Iraqi banks
Yesterday at 9:16 am by Rocky
» Will the agreements signed with the US Treasury reflect positively on the exchange rates?
Yesterday at 7:52 am by Rocky
» Iraq continues its quest to join the World Trade Organization
Yesterday at 7:51 am by Rocky
» Iraq completes the completion of the files for the initial offer of goods and services to join the W
Yesterday at 7:50 am by Rocky
» Economist: Travelers' dollars are leaking into the parallel market...and this is what the Central Ba
Yesterday at 7:32 am by Rocky
» President of the Federal Court: It is not permissible to force anyone to join any party, and the pol
Yesterday at 7:30 am by Rocky
» The Council of Ministers holds its session headed by Al-Sudani
Yesterday at 7:27 am by Rocky
» America weakens Baghdad...and increases Kurdistan's military capabilities
Yesterday at 7:26 am by Rocky
» The Iraqi government plans to build 10,000 schools throughout the country
Yesterday at 7:23 am by Rocky
» American threats close the Iraqi Stock Exchange at a loss
Yesterday at 7:21 am by Rocky
» Increase in external transfers at the Central Bank
Yesterday at 7:20 am by Rocky
» Al-Maliki calls on Britain to cancel restrictions on the entry of its companies into Iraq
Yesterday at 7:18 am by Rocky
» Planning and the European Union are discussing signing a number of agreements in the development, en
Yesterday at 7:16 am by Rocky
» Parliament talks about the mechanism for recovering smuggled funds and hints at the next stage
Yesterday at 7:13 am by Rocky
» Interior Ministry: The number of completed national cards reached 37 million cards
Yesterday at 7:06 am by Rocky
» Amnesty International: Violations of freedom and human rights continue in Iraq and the Kurdistan Reg
Yesterday at 7:04 am by Rocky
» Parliamentary Oil: The government is proceeding with the decision to raise the price of improved gas
Yesterday at 7:03 am by Rocky
» A parliamentary committee in Basra to investigate violations of the port company and the local gover
Yesterday at 7:00 am by Rocky
» Revealing the 10 most important American exports to Iraq
Yesterday at 5:31 am by Rocky
» A noticeable increase in the rate of Iraq's import of Chinese cooling devices
Yesterday at 5:30 am by Rocky
» Prime Minister: Working on projects without completing the infrastructure is a waste of money
Yesterday at 5:28 am by Rocky
» Iraq.. Extending the deadline for registration procedures on plots of land
Yesterday at 5:27 am by Rocky
» What is the main purpose of conducting the population census in Iraq?
Yesterday at 5:25 am by Rocky
» A plan to transform Iraq from a barren land to green with 5 million trees
Yesterday at 5:24 am by Rocky
» The Housing Fund announces the acceptance of more than 11 thousand loans through the Ur platform
Yesterday at 5:23 am by Rocky
» The Bank of Baghdad is moving to increase its capital to 400 billion dinars
Yesterday at 5:20 am by Rocky
» The electronic payment system will soon be adopted on Iraqi buses
Yesterday at 5:19 am by Rocky
» “It threatens our interests and destroys our economy.” An Iraqi project “irritates” the Kuwaiti stre
Yesterday at 5:18 am by Rocky
» Warning from the Central Bank about “misuse of electronic payment cards”
Yesterday at 5:17 am by Rocky
» Iraq and the Sultanate of Oman are discussing sending capacities through the Gulf countries
Yesterday at 5:16 am by Rocky
» The fact that a decision was issued to deport Syrian workers from Iraq
Yesterday at 5:14 am by Rocky
» Rice comes first... America exports 10 foodstuffs worth more than 350 million dollars to Iraq
Yesterday at 5:14 am by Rocky
» A sixth licensing round for gas exploration
Yesterday at 5:12 am by Rocky
» Baghdad is preparing to host the 50th session of the Arab Labor Conference
Yesterday at 5:11 am by Rocky
» Scientific symposium on the future vision of the tripartite budget
Yesterday at 5:09 am by Rocky
» Five conversion power stations enter service in Najaf
Yesterday at 5:08 am by Rocky
» Planning: Conduct a population census next November
Yesterday at 5:07 am by Rocky
» Experts: Spreading misleading information harms development and investment
Yesterday at 5:03 am by Rocky
» Economists call for tightening money laundering laws and port controls
Yesterday at 5:02 am by Rocky
» Today's newspapers are interested in Sudanese's visit to Anbar Governorate and preparations for cond
Yesterday at 5:00 am by Rocky
» Iraq and Russia discuss cooperation between the two countries in the field of information and artifi
Yesterday at 4:58 am by Rocky