Swiss banks caught in cash crisis

Swiss banks caught in cash crisis	16.10.2008
THE global financial crisis shifted gears on Thursday with fears of recession rattling financial markets even as governments sought yet more action to stop the world economy grinding to a halt. Wall Street stock index futures pointed to a lower start with financial giants Citi and Merrill Lynch expected to report heavy writedowns from losses on toxic assets. European Union leaders, meeting in Brussels, were to call for action to combat economic decline, including support for industry, according to a summit draft obtained by Reuters. Switzerland`s two largest banks - UBS and Credit Suisse - became the latest to say they were receiving emergency funding as the country`s government and other investors moved to shore them up. Japan`s Prime Minister, Taro Aso, said Washington may need to push yet more cash into its banks to restore investor confidence, shattered by a crisis that began with a US housing market collapse and now threatens economies worldwide. The European Central Bank said it would provide up to €5 billion ($6.83 billion) to Hungary to pump up liquidity. And the International Monetary Fund was in talks to find ways to help Ukraine`s economy. But the moves were overshadowed by stock market losses. "The markets are selling off stocks because investors still think the steps by US authorities are not sufficient," Japan`s Prime Minister Aso said. The pan-European FTSEurofirst 300 shed around 3.5 per cent and Japan`s Nikkei lost more than 11 per cent. Governments around the world have already pledged $3.2 trillion in emergency measures including taking stakes in banks to help them stabilise. Lack of confidence remained among financial institutions. Banks deposited a record €210.8 billion at the European Central Bank overnight rather than lend to each other. The bank-to-bank cost of borrowing eased a little as central banks continued to provide liquidity but their actions meant commercial banks did not have to go to each other for cash. "The only provider of liquidity now is the central bank," said Guillame Baron, strategist at Societe Generale in Paris. Until credit via interbank lending - frozen for much of the last year by uncertainty over which faced financial disaster - is flowing freely again, corporate activity and consumer spending is unlikely to recover.

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Serial killer Peter Dupas wins right to appeal

Appeal ... killer Peter Dupas has won the right to appeal one of his murder convictions. Picture: Andrew Tauber

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	01. 2009

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