German bank exposure to debt and depositors

[diablo73]

"When you take a bit of altitude, you see that the EU is moving to save the banks in Europe and is putting the interests of the eurozone’s banks over and above the interest of the citizens. This has been the policy all along and it has failed.

Unless there are large debt writeoffs which are paid for by the creditors of banks, the whole of Europe will end up like Ireland with a zombie banking system which needs to be recapitalised over and over again." - David McWilliams

If one of these German banks got into difficulty due to their exposure to Greek debt are the "creditors of banks" referrred to those who have bank shares or those with savings in the bank, ordinary depositors?

So does the ordinary depositor pay if the bank gets into difficulty?

 

[MoM]

"When you take a bit of altitude, you see that the EU is moving to save the banks in Europe and is putting the interests of the eurozone’s banks over and above the interest of the citizens. This has been the policy all along and it has failed.

Unless there are large debt writeoffs which are paid for by the creditors of banks, the whole of Europe will end up like Ireland with a zombie banking system which needs to be recapitalised over and over again." - David McWilliams

If one of these German banks got into difficulty due to their exposure to Greek debt are the "creditors of banks" referrred to those who have bank shares or those with savings in the bank, ordinary depositors?

So does the ordinary depositor pay if the bank gets into difficulty?

If? I think you need to read about Commerzbank, Germany's 2nd largets bank which is likely to be nationalised (the government already own 25pc at present after 2008)

PS - 2012 'The year of european banks being nationalisation'

 

[diablo73]

Well the crux of my point really is who pays? If the taxpayer comes to the rescue then happy days, however if the depositor has to take a hit, not so happy.

 

[MoM]

You can be pretty sure it will be a) the taxpayers or b) the bondholders, and not the depositers. Hope that helps.

But please do some reading yourself.

 

[diablo73]

I'm trying to Google alright, but it's a difficult search term to nail

 

[Gringo]

If? I think you need to read about Commerzbank, Germany's 2nd largets bank which is likely to be nationalised (the government already own 25pc at present after 2008)

You make that sound like a bad thing. For shareholders it is very bad. For depositors, it means your deposits are owed to you by the German state. When looking to give your money to someone who will pay you back, there aren't many better options.

 

[Jim2007]

You can be pretty sure it will be a) the taxpayers or b) the bondholders, and not the depositers. Hope that helps.

But please do some reading yourself.

At the end of the day it is all the same thing!!! You can pay more taxes, see your deposit wiped out, or the value of the pension fund go down...

 

[MoM]

You make that sound like a bad thing. For shareholders it is very bad. For depositors, it means your deposits are owed to you by the German state. When looking to give your money to someone who will pay you back, there aren't many better options.

Definitely not a bad thing, don't know where you picked that from. I was merely pointing out that the poster was saying if when in fact its already happened (and happening further)

One of the main reasons to have money in Germany is the fact that no matter what the German taxpayer will continue to hand over a portion of their paypackets to the government.

 

[MoM]

At the end of the day it is all the same thing!!! You can pay more taxes, see your deposit wiped out, or the value of the pension fund go down...

Depends if you have a pension and what form it's in, so a lot of assumption there