The results of bank stress tests released this week, do not bear good news. The bottom line is that at total of $75 billion needs to be raised from 10 major banks to prop them up for losses that could come from a deepening recession.
Here is a Top 4 summary of who needs what in the next six months:
Bank of America (BAC) will have to raise $33.9 billion;
The question people are asking is whether this is the worst news yet? Or whether it is news that the worst is over?
There is no easy answer. The truth is that if unemployment continues to rise, housing prices continue to fall and the economy continues to shrink, then much more money might be needed as problem bank loans could be on the rise.
The longer I am here at the Wall Street Green Trading Summit, the less this feels like anything to do with environmentalism. At some point, when does off-setting stop being feasible, and when does carbon reduction become the name of the game?
President Barack Obama gathered politicians and public last night to talk about how to avert the worst economic disaster in since the depression through his plan to improve health care, schools and the environment.
As ‘nationalization’ appears to be the U.S. government’s answer to saving the banking industry, the banks themselves are doing all that they can to boost shareholder confidence.
The latest news from Citibank is that they have approached the US government to agree on a new capital injection that would increase their stake in the troubled bank to about 40 per cent but prevent an outright nationalization.
Yesterday I received another email from small businesses asking for advice on where to get financing so I put together this list. Three out of the four the resources are recycled Ecopreneurist.com posts. I simply gathered them in one place:
How To Finance A Green Business by Leah Edwards is an excellent post that covers four potential sources of cash for green businesses: SBA loans, social-venture venture capital funds, Friends-and-Family financing and partnering with a nonprofit organization.
Recently, Leah also posted about Financing for Energy Efficiency Improvements. In that discussion she talked about how some private banks are starting to offer “green loans” for the financing of clean energy systems or energy efficiency improvements. These same banks may offer small business loans for green businesses. Community banks often favor green loans so after you read the post, if it seems like an option check with your community bank.
The failure of Lehman Brothers is seen as the last straw that broke the credit market. The financial markets have been in a state of complete disarray ever since the U.S. Government allowed Lehman Brothers to file for bankruptcy on September 15th 2008 instead of intervening to save it as it had done with Bear Sterns and later with the insurance company, American International Group.
