Although not emerging great innovations of financial institutions with problems in Europe, some already are rearranges to avoid suffering at the deterioration of the economic scenario. In this sense, both the British bank HSBC Holdings plc (LSE: HSBA, NYSE: HBC) as the Group banking and insurance belgo-Dutch Fortis, are reducing costs and increasing their liquidity. HSBC announced it would cut 1,100 jobs due to the financial crisis. Nearly half of the affected posts are in the United Kingdom, especially in the section of investment banking in London. The entity had announced last month that its half-year profits fell 28% to $10,200 million. Group banking and insurance belgo-Dutch Fortis announced that it will sell assets for up to 10,000 million euros.
The authorities denied any possibility of problems for the entity and explained: a bankruptcy of Fortis is not for anything topical. There is not the slightest risk that we have to deal with a problem of that type. Do you need Europe have a similar to the U.S. rescue plan.UU.? The first impression that exists is that not. While the crisis has hit the financial system in Europe and there will probably be entities that require cleaning their balance sheets to improve the quality of them, does not seem that a risk of crisis of the magnitude that is faced in the United States there is.UU. But arriving at this height of the circumstances, and against the prevailing uncertainty in markets, it would be convenient that unless European countries working on a contingency plan beyond that the probability of having to be used is minimal.
This suggestion has nothing more than a reason if you like psychological. Is that it would be highly valued by the market which would find peace of mind in knowing of the existence of a concrete plan of action where the situation from worsening. By way of example to understand the importance of this kind of signals to the market, it is worth remembering that Henry Paulson said, while Lehman Brothers (NYSE:LEH), the American Government had not fell thought continue using money from families in more bailouts of entities. Knowing that the risk before any inconvenience was very high, put in jeopardy all the American financial system. I understand therefore, that European countries should send reassuring signals to the market through the elaboration of contingency plans. Meanwhile, since monetary institutions in Europe, with the ECB and the Bank of England to head, working to provide all the liquidity that the market requires to eliminate any kind of tensions that may arise, while awaiting a nod from the United States.UU. with the approval of the mega rescue.