Friday, June 08, 2007

Banca Italease Plunges Another 25%

the saga continues....click on the headline to read the fill press release (pdf).

die geschichte geht munter weiter...klickt bitte auf die überschrift um die veröffentlichung komplett zu lesen (pdf)

part 1 http://tinyurl.com/yomfos
part 2 http://tinyurl.com/2zumvb
part 3 http://tinyurl.com/35r6oh



With regard to the potential credit exposure of Banca Italease towards its
customers in relation to derivatives instruments, disclosed on 31 May 2007 with
reference to reports dated 22 May, for a total of approximately EUR 400 million,it is noted:

• around EUR 150 million were related to contracts that, with reference to
reports dated 5 June, entail potential exposure of the customers towards
Banca Italease of approximately EUR 235 million. The Bank has already closed out the related hedging instruments with bank counterparties, by paying an amount of around EUR 192 million.

The remaining contracts, whose potential exposure of the customers towards Banca Italease was around EUR 250 million as of 22 May, entail potential exposure of approximately EUR 365 million as of 5 June; for these contracts, too, the Bank is evaluating the possibility to arrange for closing out the hedging instruments.....

>keep in mind that the combined net income for 2004-2006 was 348 mio €.......

>das ganze ausmaß wird erst deutlich wenn man bedenkt das in den jahren nur 348 mio € als nettogewinn ausgewiesen worden sind.

The number of contracts amount to approximately 2,600, related to around 2,200 customers; In particularly the potential credit exposure of the Bank towards the top 20 clients represents roughly 60% of the total.

In relation to the increase of such potential exposure of all the customers
of Banca Italease, the Bank informs that contacts with customers has been
initiated in order to provide specific clarification about their exposure and to
ascertain with them the best solutions to safeguard reciprocal interest. At the
same time, the Bank is proceeding to update the analysis of the
creditworthiness of customer counterparties
. ....


Banca Italease cut to 'BBB+'; remains on rating watch negative
Fitch Ratings has cut Banca Italease SpA's issuer default rating (IDR) to 'BBB+' from 'A-' and said it remains on negative rating watch, reflecting the bank's increased exposure to credit, risk arising from concentration in its loan book and from the sale of structured derivative products to its client base.

At the same time, the bank's short-term 'F2' rating was placed on negative rating watch, while its individual 'C' and support '2' ratings were affirmed. The bank's 150 mln eur trust preferred securities were downgraded to 'BBB-' from 'BBB+' with a negative rating watch, Fitch added.

The agency said it expects to resolve the rating watch once the bank presents the outcome of its initiatives to resolve the client exposure arising from derivative products and said it will focus on the direct financial impact and effect on the bank's profitability and capitalisation over the longer term.

>the only surprise is that they have only downgraded one notch......next stop "junk"

>nur überraschend das nur um eine stufe gen süden abgewertet worden ist.....der nächste schritt heißt dann wohl "junk"

to be continued.......


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2 Comments:

Anonymous traderb said...

not quite sure I understand what the story with this company is? why does it matter if its customers have lost money? as long as the cutsomers dont go bust, then why should Italease care??

10:30 AM  
Blogger jmf said...

"The Bank has already closed out the related hedging instruments with bank counterparties, by paying an amount of around EUR 192 million."

it looks like some of them have already bite the dust.....

11:29 AM  

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