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European Banking Recovery Hindered by Strict Laws

by High Tech Views editors with data from The Bedford Report

European banks have been involved in serious unrest throughout 2010.  Large bailouts have been requested in Ireland, resulting in the nationalization of four out of six major Irish banks.  Banks all over Europe have been trying to raise capital by selling off foreign assets to less than impressive results. Additionally, following accusations of overcharging customers, several European Banks are coming under increased pressure, which has resulted in fines. The Bedford Report examines the outlook for Foreign Banks and provides research reports on The Governor and Company of The Bank of Ireland (NYSE: IRE) and Barclays PLC (NYSE: BCS).  
Access to the full company reports can be found at:

www.bedfordreport.com/2011-01-IRE
www.bedfordreport.com/2011-01-BCS

During this week of Jan 24, 2011,  The Bank of Ireland became the only bank still listed on the Irish Stock Exchange after shares of Allied Irish Banks were delisted. Allied Irish Banks, which is 92 percent state owned, will also delist from the New York and London Stock Exchanges. The High Court ordered the delisting in December when the Minister for Finance used new emergency banking powers to inject EUR 3.7bn in to the bank from the National Pension Reserve Fund.

Presently the government only has a 36 percent stake in The Bank of Ireland. Regulations state that IRE will have to raise around $3 billion in order to meet the 12 percent tier one capital ratio requirement by the end of February. If IRE fails to meet this ratio, they will require additional funding.

In other European banking news, Barclays has been handed its second fine in two weeks by Britain's Financial Services Authority (FSA). According to the FSA managing director Margaret Cole, "Barclays Capital committed a serious breach of FSA client money rules by failing to segregate millions of pounds of its clients' money for over eight years."

Earlier this month the FSA fined Barclays 7.7 million pounds for mis-selling two income-focused funds to more than 12,000 clients who later lost money during the financial crisis.
 

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