In general one might have expected European banks with an interest in their own survival and prosperity to be energetically recapitalizing and reorienting their businesses for a future beyond the crisis. But there was little sign of that. Whereas America’s big banks operated under the discipline of annual “capital plans” and were required to retain whatever profit they didn’t distribute as bonuses so as to rebuild reserves, Europe’s banks were free to do as they saw fit. In a desperate effort to keep their shareholders happy, they paid out what little profit they earned in dividends in the
...more
