Property in chennai and its exposure to deutsche bank

Property in Chennai’s and its Exposure to Deutsche Bank

The likelihood of Deutsche Bank’s failure is low and unlikely to have an impact on property in Chennai. While many authorities in the European Union are unnerved by the events unraveling before their eyes with regards to Deutsche Bank and the great a risk it poses as it is interconnected across the globe since 2008 new measures have been put in place which is likely to prevent the Lehman style collapse witnessed eight years ago.

Derivatives link banks and assets to each other in such complex ways that the impact of derivatives on asset prices and other financial instruments is difficult to fathom.

property in Chennai That is until a large institution such as Lehman Brothers fails and other banks balance sheets also feel the pinch of a globally interconnected banking system. A systemic risk such as one alluded to above often unravels quickly and leads to the loss of jobs and fortunes across the globe. Today however such a scenario is highly unlikely as banks are in a far better position than they were eight years ago and as banks have since been required to set aside funds to deal with a scenario.

While the fortunes of Deutsche Banks are linked to many banks across the globe, it is unlikely to require a bailout such as the one which would have been necessary for Lehman Brothers. Hence may rest easy knowing that another financial calamity is not on the horizon. Borrowers in India who have just taken a home loan from Deutsche Bank to purchase builders in Chennai need not worry that the bank poses any danger of systemic risk.

. The financial system today is far more robust than it was during the last financial crisis and banks, including Deutsche, have funds set aside should the worst occur. The likelihood of which is itself minuscule.

Germany, the home of Deutsche bank, is unlikely to bail out its largest bank considering it has demanded huge public spending cuts in Greece to ensure payments from Greece to German banks. A bail out of Deutsche Bank by the German government will be regarded as hypocritical by member states of the EU as Germany has insisted that other governments not help their banks as member states of the EU such as Italy have attempted to do.

The reasons for the troubles ailing Deutsche Bank remain unclear; however, luxury apartments in Chennai one reason is almost certainly the poor state of the global economy which continues to remain anemic as measures to stimulate growth by quantitative easing and negative interest rates, both of which have been applied across the globe, have yet to produce the kind of growth necessary for businesses to start borrowing and employing greater numbers of people.