FT.com / Lex / Financial services & property - Banks and balance sheets
The tale of two banks and their SIVs. HSBC have provided the needed liquidity and consolidated their SIV onto their balance sheet, while Citi is waiting for the Super Fund to kick in.
It appears that Citi is in no position to do a similar move. Its capital ratio is so depleted taking on the massive exposure will cripple it. The evidence is the high cost of the $7.5 billion financing it took from Abu Dhabi.
MY worry is that the SIV will be too little too late. Huge expectation is being place on the super fund to fix the credit problems, it may not do so and the market will be in for another rude awaking.