Hells bells

摘要

"Oh Lord, give me chastity, but do not give it yet." The words of Saint Augustine are perhaps being uttered around the corridors of Brussels and Frankfurt right now by Italian officials scrambling for options to recapitalise the country's banks ahead of stress tests - due on July 29 - that are expected to reveal a €40bn capital hole. Like Saint Augustine, those officials would like to give in to temptation one more time. They understand why Europe-wide bank resolution rules were drawn up - indeed, many of them helped write the rules, which were designed to minimise the cost of bank failures for future taxpayers by ensuring that private investors, holders of equity and bonds, are the first to take losses.