Europe’s zombie banks: Blight of the living dead

Posted: July 12, 2013 in economy
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Has the Arab spring failed?

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Europe’s zombie banks


Europe’s financial system is in a terrible state, and nothing much is being done about it

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“PROBABLY the most successful monetary-policy measure undertaken in recent times.” That is Mario Draghi’s self-effacing judgment on the outright monetary transactions (OMT) programme, the promise made by the European Central Bank (ECB) last summer to buy the bonds of struggling euro-area governments. The ECB’s president deserves credit for bringing calm to bond markets. But in reality the situation is still awful, and Europe’s banks are at the heart of the problem.
The euro-zone economy has contracted for six consecutive quarters. The IMF this week revised its 2013 forecast down again: it expects the euro zone to shrink by 0.6% this year. (Just to rub things in, the fund adjusted its forecasts for Britain upwards.) The outlook in the core euro-zone economies has …

via Economic Crisis


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