Friday, January 29, 2016

This Week in Bank Failures

The United Kingdom will hold a referendum on leaving the European Union, though the voting date has not been decided. While an EU exit would boost the U.K. economy in other areas, London would lose its place as an important European banking center, though it would remain an important global banking center. An EU exit could also put the United Kingdom in a stronger position the next time a euro zone crisis erupts. The potential for a United Kingdom exit is a hotly debated topic with substantial opinions from multiple countries in favor and opposed.

In Portugal, authorities say they can now proceed with the sale of Novo Banco and the liquidation of assets of the failed Banco Espírito Santo in spite of a series of legal challenges surrounding the split of assets between the two banks. The remaining issues will take years to decide in court, but realistically, the sales cannot wait until every single legal question is answered.