IMF: World must prepare for a new wave of bank collapses

1507 (GMT +04:00) - 30/09/09
Istanbul, Turkey (CNN) - The International Monetary Fund called on governments around the world to confront the wave of collapses and losses in banks, in addition to write-off of loans in the tune of more than 1.5 trillion dollars, which is poised to increase in parallel with rising rates of unemployment and deficits in the payment of financial obligations around the world.
The IMF said in a report issued by the Turkish city of Istanbul on Wednesday, before its annual meeting, the concern in global financial markets has declined significantly during the last period, because of the actions taken by Governments and the return of growth - albeit limited - adding that the path of financial recovery would not be free of large bumps and obstacles.
The report confirms that banks around the world will not be able to return to play a positive role in the financing of the economy and credit is not completed write-offs for bad loans have, and "cleaned" of its budget, warns that a slowdown this step may be reflected in a very real threat to the growth of world economy already tottering financial crisis.
He noted that the Fund had estimated in April this year the possibility that forced banks to write off U.S. $ 4 trillion in the form of tablets dogs and assets are not valid, adding that the recent rise in stock prices, and improved long some stocks and bonds to reduce this amount to 3.4 trillion dollars .
But he added that banks around the world had been written off even at only 1.3 trillion dollars during the first half of 2009, which leaves them facing the possibility of having to write off an additional $ 1.5 trillion.
Fund urged banks to increase capital to meet this next challenge, as the expected profits during the next 18 months will not be sufficient to cover expected losses.
Monetary Fund, and select a combination of factors, which said it could help to avoid the next wave of collapses, including work to support capital markets and developing legislation for the banking sector and enhance international cooperation in financial terms.
Referred to the crisis in money and credit has led to the bankruptcy of dozens of banks around the world, especially the "Lehman Brothers", and had a giant banks such as the "City" and "Bank of America" and "Morgan Stanley" to the government support to prevent collapse.
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