With Dexia Done, Here Is Who Is Next: A Visual Euro Bank Liquidity Vs Funding Exposure Matrix

Tyler Durden's picture

Now that the FT is reporting that as part of the ongoing emergency talks to rescue an expiring Dexia, one of the proposals is a spin off of a Dexia "bad bank" - something which worked for UBS, which is still a partial protectorate of Switzerland, but will most certainly not work for governmentless Belgium, the question is "who is next" Luckily, we have the following handy summary, courtesy of Reuters' Peter Thal Larsen who has pulled a chart from an Espirito Santo report, showing a 2-D matrix of liquidity (i.e. liquid assets as a % of wholesale funding assets), versus reliance on wholesale funding - the one component in European interbank markets which is now completely dead. Needless to say red is bad. And if one thinks that Dexia is about to file, then it may be last rites time for Soc Gen, BNP, Raiffeisen, and DnB Nor.

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thunderchief's picture

This Euro crisis thing may work all the way through election season.  What a deal for the USA!

speconomist's picture

Dexia to spin off a worse bank? The bad one already exists.

True.North's picture

Agreed, I don't like that phrasing. It implies there is a good bank.

slewie the pi-rat's picture

call the priest, tyler!

slewie the pi-rat's picture

repent from counterparty risk now, BiCheZ!

let the zombies D-I-E!!!

DoChenRollingBearing's picture

Good point slewie!  Verte pour toi!

Get some cash OUT of the banks!  

Gold > FRNs > electrons in the bank.

Eally Ucked's picture

Just imagine that they can allow Greece to go down and recapitalize banks let's say to the tune of 75%. Still much better than US. Then the next domino falls and they do the same, and so on, still better than US. Then you take in to consideration monthly trade balance for both Europe and US - who is in better position you think?

GeneMarchbanks's picture

BNP/SocGen vs BAC/MS who's worse off, Frenchie or Yankee?

DoChenRollingBearing's picture

Hmm...  In six months we will probably know!

Mauibrad's picture

Frenchie.  Cool chart, Tyler.

falak pema's picture

marie antoinette or bonnie parker...

spiral_eyes's picture

everything will be okay if we print a lot more money bitchez!

worked for zimbabwe.


slewie the pi-rat's picture

bob chapman put it so well, yest:

  In the recent G-7 meeting in Marseilles, France, the members couldn’t identify the problems, much less analysis and solutions. The only cogent comment of value from their point of view was the banks would be bailed out no matter what the cost. So what else is new? We noticed there was little or no reporting on the conference, probably because they accomplished nothing. Of course, they were all for economic growth, strong financial markets and accommodative monetary policy.  This lack of success was in part the reason of the plunge in the stock markets that followed. That is the state of world leadership.

[paste from International Forecaster October 2011 (#1) - Gold, Silver, Economy + More]

zorba THE GREEK's picture

Thanks for the link SLEWIE. Bob does put it in prospective.

Nozza's picture

These people round here wear beaten down eyes
Sunk in smoke dried faces they're so resigned to what their fate is

That was Dexia's wasn't it? Back in the 80's



kito's picture

Well well, we may see all the european biggies go down BEFORE the fall of greece

zorba THE GREEK's picture

Greece has fought many battles in the last 3000 years. This one's not gone to beat them.

s2man's picture

Should I go long Banco Santander?

swissaustrian's picture

No, they´ll experience spanish contagion. Once the other spanish banks got bailed out, yes.

DoChenRollingBearing's picture

I too have doubts about that matrix / diagram above.  Contagion...  2011's new buzzword?

Or would that be Jubilee...?

jomama's picture

no-one expects the spanish contagion!

smiler03's picture

I've started a one man run on Santander

john39's picture

have to take anything from Alex Jones with a bag of salt...  afterall, he was the guy who claimed that Muslims control hollywood...   i really wonder who would put him up to making such a dumb statement...

CharlieSDT's picture

That's a pretty idiotic article.  A tax on financial transactions would hur the middle class?  Retarded assertion.  It might slow down the HFT a bit though.

Cone of Uncertainty's picture

BAC soon to take out the $2.53 all time low, probably in a week or so, once the bank run is completed.

PulauHantu29's picture

"First Rats off the Ship swim the Farthest."

I think it was Gandhi said that.

DoChenRollingBearing's picture

"First bearings off the ship roll the farthest."


(asssuming ship is still in port, LOL...)

achmachat's picture

What do you mean with "Dexia is done"?

I just paid a whole bunch of bills using my Dexia account.

Cone of Uncertainty's picture

Shit bitch, wait until you have to pay the piper.

Panafrican Funktron Robot's picture

There's a crapton of deposits in BAC too, doesn't mean it's not going under.

doomz78's picture

is there a short selling  ban on the euro and usa banks right now? 

monopoly's picture

Gold day high but miners struggling. FAZ looking good. 0

swissaustrian's picture

The gold/stocks correlation turned negative today... Seems like the gold market has been cleared of all the short term specs and now the strong hands rule again...

Clint Liquor's picture

Silver has decoupled from the industrial metals to move with Gold. Good sign for the holders of sludge.

monopoly's picture

And look at the high on bonds. Soon will be paying US to keep our money.

comrade rally monkey's picture

CLF just had a 1mm shares print thru 40 bucks---- 9 dollars lower than bid!!
call nanex!

Panafrican Funktron Robot's picture

Definitely feeling sorry for those institutional bag holders on this one.  If one ever needs any proof that fundamentals are completely broken, look no farther than CLF.  Now comp it to CRM.  Or AMZN.  Lollers abound.  

Peter K's picture

Bring out your dead! The Chairsatan is pulling the lines as we speak.


DoChenRollingBearing's picture

Excellent article Tyler Durden!  Please continue to keep us informed about Europe.  Very important to me.  Also, I agree with many that whither Europe goes, we will soon follow here.


slewie the pi-rat's picture

i'm catching up on my reading today, nomo gambling till tomorrow! 

we're having a light sprinking of CE 137 ~~~[:>(   ...i mean rain...   ~~~{:>)

john mauldin is in ireland; he published an interview with...himself!  but i liked this:  But first, in the interest of full disclosure, I want to briefly note to my readers that I have joined the board of Galectin Therapeutics (Ticker: GALT), a small biotech company with unique potential technologies. I get asked from time to time to join a biotech corporate board, but have so far not done so, and the exception is now GALT. (end paste)

then, he does a commercial for them!  then, he gets back to showing us how a Central Planner thinks and sees things! 

JR's picture

The black hole approaches. Every Monday's report on more extensive financial risk only multiplies the size of the disaster ahead.