Tuesday, June 3, 2008

Europe's Banks Lag U.S. on Risk Disclosure, FSF Says

The Financial Stability forum is dissatisfied with the risk disclosure of European banks. A Bloomberg report also mentioned the possibility of a greater impact on Europen financial institutions from the current market turmoil.

Banks in Europe are lagging behind U.S. lenders in disclosing risk, damaging investor confidence, according to Svein Andresen, secretary general of the Financial Stability Forum.

European lenders face criticism for failing to reveal the extent of their losses from the U.S. subprime mortgage crisis even after disclosing $199.6 billion of writedowns, more than the $165.7 billion reported by U.S. financial institutions. Zurich-based UBS AG, HSBC Holdings Plc in London and Dusseldorf- based IKB Deutsche Industriebank AG account for three of the five worst markdowns by institutions worldwide.

"Some of the major banks have yet to make adequate disclosures in areas that the market place and counterparties consider critical to judge these banks creditworthiness and risk exposures,'' said Andresen. "This is highly detrimental to confidence.''

source: Europe's Banks Lag U.S. on Risk Disclosure, FSF Says

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