Global Banking Directory 2.0
Press Release Distribution Service
Add Bank | Banking Forum Online
BankDEP Crypto Bank
BanksDaily on Twitter BanksDaily on LinkedIn BanksDaily on Instagram

Financial and Banking News

Emerging markets become a trap for U.S. banks

Citigroup Inc., Goldman Sachs and other U.S. banks had hoped emerging markets would take some of the sting out of the credit crisis, but instead they seem to be worsening the pain.

Emerging markets have been battered along with other financial markets, leaving the main index of emerging markets stocks MSCIEF down about 59% so far this year while sovereign debt has weakened to 2002 levels. That means banks that touted their emerging markets strength in the second quarter will likely be writing down loans and recording credit losses in the fourth.

Citigroup, which gets one third of its revenue from emerging regions, has been setting aside hundreds of millions of dollars to cover spiking credit losses in Brazil and Mexico. Its revenue from Latin America dropped 23% in the third quarter.

Goldman Sachs bought a stake in Industrial and Commercial Bank of China in 2006 that was valued at $7.1 billion at the end of August. ICBC's shares in local currency terms have fallen by about 40% since then.

For about a year, it looked as if the financial crisis would mainly slam the United States and parts of Europe while emerging markets enjoyed a steady flow of dollars from record-high commodities prices led by oil, gold and copper.

But even with windfalls from commodities, the strength in markets like Brazil, Russia, India and China seemed unusual given that when developed markets weaken, emerging markets generally become weaker still.

Emerging markets companies that issued debt will likely have trouble refinancing when their bonds mature, which is apt to be exacerbated by the strengthening U.S. dollar.

These companies face debt maturities of $450 billion in notes, bonds and loans next year, and another $487 billion in 2010, according to Dealogic. Market conditions have made credit scarce and refinancing difficult.

Source: Reuters
Date: 30.10.2008 [204]
Get your content published on BanksDAILY.com in just a few clicks.

Financial and Banking News
 Post-Pandemic Economic Recovery: Key Factors Driving Growth and Stability

The COVID-19 pandemic caused a global economic halt, resulting in disruption, job losses, and uncertainty. However, as vaccination efforts progress and countries adjust to the new normal, there is hope for an economic recovery.

 Wiki Finance Expo Sydney 2023 Is Coming Soon!

Regulation, Forex, Crypto, Web 3.0, Metaverse, AI, ESG Will Be in Focus. Taking place on November 16th, Wiki Finance Expo, Sydney 2023 is Aussie largest and most anticipated fintech event of the year. 30.10.2023 | Source: WikiExpo

 Blockchain Economy Dubai Summit 2023: Just Two Weeks Away and Buzzing with Anticipation

Dubai, UAE - The Blockchain Economy Dubai Summit is generating palpable excitement within the blockchain and crypto communities, with only two weeks remaining until the event. Scheduled for October 4-5, 2023, at the Le Meridien Dubai Hotel & Conference Center, this prestigious event gathers over 3,000 blockchain entrepreneurs, crypto enthusiasts, and industry leaders from 85 countries. 20.09.2023 | Source: Teklip

 📰 News Archive

2007-2024 © BanksDAILY.com | All Banks in One Place | Privacy Policy