palmen.pdf
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… to pay instalments on their subprime mortgage and thus CDOs, it became evident that the value of collateral did not suffice to cover the CDOs. European financial institutions and their governments shivered when they realized their exposure to this foreign event and were quickly forced to take action. Only three days after the Lehman collapse, the British Lloyds TSB bought out its national mortgage competitor Halifax Bank of Scotland after its shareholders doubted the quality of the mortgage … cause of lack of confidence. But we also require that the banks contribute adequately to the costs….’ Thereby effectively referring back to the principles written down in the R&R guidelines as described above. ..They may have to be restructured in exchange for the State aid they receive. The Commission can play a key role through coordinated and rapid action, and thus contribute to restart lending’. 46 The Commission recognizes that impaired assets are one of the factors which harass financial … 80% of one of ING’s overseas portfolios. 111 The scheme in fact covered a €27,7 billion pool of contaminated US mortgages that had been piled together as CDOs which, in the aftermath of the sub-prime mortgage crisis, were very low in demand on the trading floor. This so-called ‘Illiquid assets backup facility’ served to back up the difference in market value as a result of low demand and the factual economic value. 112 Five days later, the Commission gave its temporarily approval once again. 113 …
