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Germany Preparing Plans For Commerzbank Bail Out

Tyler Durden's picture




 

Following today's end of day rumor being a dud (and non-existent due to the habituation nature of the market), the closing news is more unpleasant than Europe would have liked to set the overnight mood, and comes to us via the FT (yes, that FT), which states that, as long speculated both here and elsewhere, "the German government has begun preparations for a possible state bail-out of Commerzbank." The plan would be activated if CBK is unable to figure out a way to fill a €5.3 billion shortfall in the next 30 days, which in reality will likely turn out to be far greater when all of the bank's dirty laundry is exposed for all too see. And with German banks by far the most sensitive to any perceived "tipping points", since it is the German state whose job it is to bail out the world's biggest economic block, it becomes obvious why letting doubts appear about the stability of German megabanks would likely not be a "good thing."

From the FT:

German chancellor Angela Merkel’s cabinet on Wednesday agreed a bill to reinstate a state-backed bank rescue fund next year, a move that could pave the way for state aid to Commerzbank, Germany’s second-largest bank by assets.

 

Among the measures in the bill are provisions for BaFin, Germany’s financial regulator, to force banks to accept state help if it thinks a bank’s plans to raise capital are insufficient.

 

Officials in Berlin are privately sceptical that Commerzbank can keep to its pledge to shore up its capital without using more state funds. The bank received more than €18bn of aid during the financial crisis and remains 25 per cent state-owned.

 

“Under the old regime, BaFin could only step in when the existence of the bank was in danger,” said one government official. “Now it can act when it sees a danger for the entire financial system and the confidence it rests on.”

There is more explaining the history of just how CBK ended up in its predicament, but for the most part it is all widely known.

As it is widely known, certainly be ZH readers, that Commerzbank is truly one of Europe's worst banks... Just after Landesbank Berlin, Credit Agricole (which today sacked thousands of unlucky souls) best known for having the highest 3 month USD Libor each and every day in the BBA self-reporting panel, Deutsche Bank and, of course, Credit Suisse, which also fired a few token individuals in New York earlier...

 

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Wed, 12/14/2011 - 16:51 | 1980323 falak pema
falak pema's picture

germany bails out Commererz bank and lets Greece die...says it all...bye bye Euro group.

Wed, 12/14/2011 - 17:13 | 1980458 Captain Kink
Captain Kink's picture

Exactly!!!! and predictable!  The Germans are SMART mother phukkers, and why should they bail out the profligate south when every last red cent will be needed to bail out their own?  We did it here, and they will follow the same playbook, Phuk Club Med.

Wed, 12/14/2011 - 17:54 | 1980636 BadKiTTy
BadKiTTy's picture

Sooooo SMART that they lent money to people who cant pay it back! hahahahahaha!

 

The profilagate need stupid, greedy corrupt twats to support their habit.....

 

K@ 

Wed, 12/14/2011 - 19:41 | 1981032 Don Birnam
Don Birnam's picture

Cap -- soon to be every last red pfennig.

Wed, 12/14/2011 - 20:29 | 1981233 Darksideofcapitalism
Darksideofcapitalism's picture

Think it's more like violence comes bank to you. Northern European banks promoted corruption through fraudulent investments that led the south and east of Europe to insolvency. Now it has all coming back to the financiers, the northern banks. Bad debt=Bad Credit...

Wed, 12/14/2011 - 19:27 | 1980980 NoMoreBull
NoMoreBull's picture

and they were singing........Bye, Bye European Pie..............Drove our fiat to the levy but the levy was dry........and good old boys drinking whiskey and rye.........singing this will be the day the Euro dies!

Wed, 12/14/2011 - 20:29 | 1981238 supafuckinmingster
supafuckinmingster's picture

"germany bails out Commererz bank and lets Greece die...says it all...bye bye Euro group."

 

Send me some of what you're smoking........from my vantage point Germany has poured gazillions of Euro into Greece.

Wed, 12/14/2011 - 16:52 | 1980327 GeneMarchbanks
GeneMarchbanks's picture

DB is probably next on that list.

Wed, 12/14/2011 - 16:52 | 1980333 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Bullish!

Wed, 12/14/2011 - 17:19 | 1980486 slaughterer
slaughterer's picture

What has happened to DB?  Steady deterioration ever since they got rid of Greg Lippman.  

Wed, 12/14/2011 - 17:23 | 1980506 Ratscam
Ratscam's picture

watch the pre Xmas presents from the various banks world wide.
YOU'RE FIRED!
Thousands more to come.

Wed, 12/14/2011 - 16:53 | 1980336 Dick Darlington
Dick Darlington's picture

12-14 15:39: Greece's Piraeus bank to seek EUR 400mln government bailout

 

Yesterday was the last time Jabba the Hut announced Greek banks are ABSOLUTELY safe.

Wed, 12/14/2011 - 20:31 | 1981246 supafuckinmingster
supafuckinmingster's picture

A bailout from what Government exactly? Not the Greek government surely.........?

Wed, 12/14/2011 - 16:56 | 1980360 firstdivision
firstdivision's picture

Ben is piloting while Merkle is the gunner http://www.eurocopter.com/publications/img_wsw//uht%201.jpg

Wed, 12/14/2011 - 17:04 | 1980410 prains
prains's picture

Unt Von Gunt is getting her dry hump on

Wed, 12/14/2011 - 17:10 | 1980446 GeneMarchbanks
GeneMarchbanks's picture

Except now Germany is actually the only somewhat sane country left. Tanks will be elsewhere this time, that'll be the only difference.

Wed, 12/14/2011 - 16:57 | 1980363 SheepDog-One
SheepDog-One's picture

Commerzbank cancelled their Christmas party....AW no coke and hookers for them! Doubtful for any bonuses either. How long until the bankers start turning on each other I wonder.

Wed, 12/14/2011 - 17:09 | 1980442 slaughterer
slaughterer's picture

Who needs a Christmas Party when you can have a Bailout Party? Saint Merkel riding in on her reindeer.  

Wed, 12/14/2011 - 17:01 | 1980367 MFL8240
MFL8240's picture

More paper printing in Germany.  One has to wonder about a world where paper money is up, Gold is down $90 (4.5%), the US stock market only down a minor 1.5%, Silver clobered as the US banks are insolvent, French banks insolvent, Germanys banks insolvesnt, Greece bankrupt, Italy a disater, Spain a disater... did I miss any?? lol!  This fucking clown show in Chicgao the city that brought us young hitler is a fucking joke.  Yep, I mean the Comex.  But listen to the Rothchild star Bernanke as he tell the world paper is the answer and Gartman who doesnt know his ass from a hole in the ground.

Wed, 12/14/2011 - 17:15 | 1980473 whatsinaname
whatsinaname's picture

State Bank of India one of India's largest semi-state owned banks seeks a government capital infusion. There you have it. All bases covered ? kapitsch..

Wed, 12/14/2011 - 16:58 | 1980368 Comay Mierda
Comay Mierda's picture

this is good for a 1%-2% rise in spx tomorrow morning

Wed, 12/14/2011 - 17:15 | 1980471 SheepDog-One
SheepDog-One's picture

Didnt impress today, so I dont know why it will tomorrow. Anyway, markets slump to close near LOD.

Wed, 12/14/2011 - 17:30 | 1980534 Comay Mierda
Comay Mierda's picture

in this market you have to do the opposite of what makes sense

Wed, 12/14/2011 - 16:58 | 1980370 junkyardjack
junkyardjack's picture

How did they place on the stress test?

Wed, 12/14/2011 - 16:58 | 1980372 Ancona
Ancona's picture

Bring out your dead.....bring out your dead

Wed, 12/14/2011 - 16:59 | 1980377 slewie the pi-rat
slewie the pi-rat's picture

why waste the state funds?

politics?

Wed, 12/14/2011 - 17:00 | 1980385 stant
stant's picture

http://www.youtube.com/watch?v=OEvIgg3C5ok&feature=related about 52 sec in look at the building. creepy saw this yesterday in my yt recomended

Wed, 12/14/2011 - 17:00 | 1980387 CvlDobd
CvlDobd's picture

I am concerned by the enormous comeback in AMZN today.

They just won't let shit die will they?

Wed, 12/14/2011 - 17:02 | 1980399 Randall Cabot
Randall Cabot's picture

I hate it when the end of day rumor is a dud!

Wed, 12/14/2011 - 17:02 | 1980401 Piranhanoia
Piranhanoia's picture

That ought to just about do it. They never learn.  If one bank gets a sump pump, they will all want one.  

Wed, 12/14/2011 - 17:04 | 1980413 common_sense
common_sense's picture

A new bail out from FED, good for Europe !!!   it's good USA have money for everybody...

 

thanks folks !!!

Wed, 12/14/2011 - 17:06 | 1980429 slaughterer
slaughterer's picture

Bailouts are bullish. Always have been.  Always will be.  /sarc

Wed, 12/14/2011 - 17:06 | 1980430 Kaiser Sousa
Kaiser Sousa's picture

no wonder Gold & Silver tanked...

NOT!!!!!

fucking fraudulent, manipulated, phony paper markets bullshit...

Wed, 12/14/2011 - 17:07 | 1980431 Tsar Pointless
Tsar Pointless's picture

Governments captured by private interests will bail out private interests each and every time.

It's called "corporatism" - or "fascism" - people.

If you aren't able to comprehend this by now, then that's your problem, not mine.

Wed, 12/14/2011 - 17:12 | 1980457 NotApplicable
NotApplicable's picture

How can a bank have a hole? Can't they always sell CDS protection to one of their friends? Or do they have no friends?

Wed, 12/14/2011 - 17:17 | 1980460 Banksters
Banksters's picture

GOOSESTEP BITCHEZZZZZZZ!

 

SS Goosestep from Triumph of the Will

 

Cheers!   http://www.youtube.com/watch?v=IkdMzSq2y2k

Wed, 12/14/2011 - 17:22 | 1980482 earleflorida
earleflorida's picture

and so,... the, 'mini-me brit's', fire a red-ink herring in a foray of bluster, across the bow of a scuttled rhine vessel - viva lansdown redux?

Wed, 12/14/2011 - 17:17 | 1980484 no life
no life's picture

They fornicate with chickens !

Wed, 12/14/2011 - 17:20 | 1980492 slaughterer
slaughterer's picture

Well, no AH S&P France downgrade.  Bulls can live another day, it seems.  

Wed, 12/14/2011 - 17:23 | 1980504 adr
adr's picture

ppfffffftttttplbplb!!!!!

What a typical full retard market day. Plunge open, Euro close ramp job, rally falters, 3PM rumor rocket into a rapid up and down close.

The best news all day was the 5% drop in oil, of course that just leaves us back at the point when oil jumped 4% for no real apparent reason other than rumors of rumors backed up with rumors.

Would the real market movers even remember what a market fundamental looks like?

Wed, 12/14/2011 - 17:27 | 1980508 LMAO
LMAO's picture

"the closing news is more unpleasant than Europe would have liked to set the overnight mood, and comes to us via the FT (yes, that FT)"

 FULL TILT ?  Every fucking time these guys get called they flash a 7-2 os with 5 bricks on the table.

 

Wed, 12/14/2011 - 17:26 | 1980514 Rynak
Rynak's picture

Coincidentally, commerzbank was the first bank i had an account at, as a teen.

Coincidentally, it would also be the only bank i ever left so far, just because of being pissed off, as opposed to other considerations.

Wed, 12/14/2011 - 17:29 | 1980523 Dr. Acula
Dr. Acula's picture

Doesn't advance knowledge of a bailout mean that the managers will take greater risks in the meantime than they otherwise would have?

You might as well try for big gains if the losses are going to be someone else's problem.

 

Wed, 12/14/2011 - 17:30 | 1980537 rwethereyet
rwethereyet's picture

What does S&P, Fitch have to say about this?

____________Ok thats what they say.

Wed, 12/14/2011 - 17:30 | 1980541 chinaboy
chinaboy's picture

Now we know that it is the Herr Chancellor who bought a lot of Euro today to prop up a bank that lost its heart beat yeaster year. What did those traders long Euro for? A bug in there trading program?

Wed, 12/14/2011 - 17:32 | 1980548 gwar5
gwar5's picture

The FED is the only lender of last resort available.  The EU is collectively the new Greece. The Fed is the new ECB. The EU can now play the FED like Greece played Germany. If the FED does not bail out Europe, US banks will fail and the USD will skyrocket as the EURO collapses. The FED will lose their cheese eating circle jerk buddies. Plus, they don't seem to have enough domestic drones in place over US skies for the global collapse to happen just yet.

 

The FED can kill two birds with one stone and diminish the USD by bailing out the EU to prop up the EURO for a while. Fed can bail out the EU sovereigns which will help save their banks indirectly. The FED wants a strong EURO but that is not going to happen any other way. The IMF is strangely silent (and irrelevant) right now.

 

 

Wed, 12/14/2011 - 17:39 | 1980575 hugovanderbubble
hugovanderbubble's picture

jaja bullish for bears'¡:)

Keep banning the shorts¡ in French Banks'. They are collapsed, German too:...ALL FREAKING BANK IS COLLAPSED

Wed, 12/14/2011 - 18:20 | 1980741 Iam_Silverman
Iam_Silverman's picture

"It becomes obvious why letting doubts appear about the stability of German megabanks would likely not be a "good thing.""

Unless, of course, you wish to appear that your country is also struggling and therefore should not be seen as the only source of saving the EuroZone.  Since they are also considering new rules to allow their regulators to stuff money down the throats of their (soon to be nationalized?) banks, what is to keep them from saying ALL of their banks "need a little help", so, the rest of you EZ rats can take a hike?

Wed, 12/14/2011 - 18:20 | 1980742 americanspirit
americanspirit's picture

Ach du lieber- alles ist hin.

Wed, 12/14/2011 - 18:29 | 1980765 HedgeAccordingly
HedgeAccordingly's picture

meow 

Wed, 12/14/2011 - 19:03 | 1980897 littlehorse
littlehorse's picture

If I took a truck and crashed into a number of shops the state would take away my licence ( the state would say , Brad you know what you are not fit to drive trucks anymore!) , however I can work for a bank, cripple an economy , cripple my nations defence capability, put millions out of work etc,  but I'm sill allowed to go and work for another bank... 

Wed, 12/14/2011 - 20:57 | 1981370 Coldfire
Coldfire's picture

The third bailout might be the charm (1932, 2009 and 2012). Anyway, CBK is already 25% nationalised.

https://www.commerzbank.com/media/konzern/geschichte/cb_history_2009a_en...

Wed, 12/14/2011 - 22:24 | 1981494 swani
swani's picture

Excitement.

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