GLOBAL RECESSION AT PORTAS
"Deutsche Bank appears to
be the most important net contributor to systemic risks, followed by HSBC and
Credit Suisse. 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."
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."
SEE CHART AT: http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2013/04/DB%20Derivative%20Exposure_0.jp
Yes, the same bank whose stock price hit a record low
just two days ago.
Here is the key section in the report:
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.
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.
Here is the IMF's chart showing the key linkages of the
world's riskiest bank:
IMAGE LOCATION AT: http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/06/27/DB%20IMF%201_0.jpg
And while DB is number 1, here are the other banks whose
collapse would likewise lead to global contagion.
IMAGE AT: http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/06/27/DB%20IMF%202_0.jpg
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.
….
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