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December 18th, 2007

ECB Urges Banks to Disclose Subprime Risk

“The period of temporarily high inflation rates would be somewhat more protracted than previously expected”

The European Central Bank’s president called on banks Wednesday to disclose how much they could lose in the wake of a financial crisis that has tightened credit conditions.

‘It is crucial to promote a widespread consistent valuation of complex structured products as well as an adequate disclosure by banks of their exposures, in particular related to the U.S. sub-prime mortgage sector,’ ECB President Jean-Claude Trichet told the European Parliament’s economic and monetary affairs committee.

He said the financial industry needed to provide more public information about securitization where debt is repackaged in a complex investment credit risk transfer and complex structured products. Read more



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