Value Investing Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Paul Senior who wrote (43973)	8/16/2011 10:14:26 PM
From: Spekulatius	of 78673

re BNP >>Yes, there's risk of loss with PNB. Risk of total loss though, I suspect is negligible. Bank is too big to fail, and perhaps too important to French prestige.<< Too big to fail does not protect equity holders. I agree that if a calamity were to happen, the french government would step in but you would loose probably 90% of your equity due to dilution, similar to what happened to holders of AIG, C or RBS stock. Senior and subordinated debt holders would be spared (my guess) and preferred holders would share some of the pain. If one of the major countries (Italy or Spain), the french bank will need a bailout. Even if not, they may need re-capitalization. The first rule investing in upheavel is to get out in front of the firing squad. BNP may end up standing in front of the firing squad of certain things happen in Europe. I have mentioned others that are similar cheap that don't. I could well be wrong but that is how I see it.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next