Banks are not just systemically important; they are also global, highly interlinked and therefore subject to the spread of disease, corruption, fierce competition and cyber attack. Many are currently getting battered on many fronts. Best one keeps an eye on the tainted in order to avoid them before the rot sets in.
The European Central Bank supervises about 130 banks in the single currency area. The European Banking Authority (EBA) carried out stress tests on 51 of these in 2016, publishing its results late on a Friday when stock markets were closed - because it didn't want to rock the boat even further. There was no absolute pass or fail mark, just a suggestion of where ratios should be. It found that banks in Austria, Ireland, Italy and Spain had the most number teetering on the edge - my words, not theirs.
Italy we all know about, the oldest and the biggest (UniCredit) banks in the country both on the sick list caused by whopping bad debts. Note to self: there is no eurozone-wide classification as to what is dubious, delinquent, sour or bad debt, so please don't hang about and wait to be notified.
Austria, which would like to be included in the so-called prudent, austere, well-run, northern European economic block, has a lousy banking track record. In 2009 mortgage bank Hypo Alpe Adria was turned into bad bank Heta, where a $8.5bn black hole forced a bail-in by all bondholders - including the State of Carinthia, which had guaranteed the paper. Today Raiffeisen bank, with a big presence in eastern Europe, is the nation's most troubled yet describes itself as a "leading corporate and investment bank"; the chart of its share price says it all. And don't forget Creditanstaltt, founded in 1855 by Anselm von Rothschild, whose collapse led to the world's Great Depression.
Also on the EBA's watch list are Allied Irish and Bank of Ireland, the latter as Bank of Ireland UK servicing Post Office accounts, where for overdrafts it's a "credit broker and not the lender"; I wonder why. Yet Dublin plans to pull business away from the City of London.
Spain, where a property boom and bust has literally blotted the landscape, was one of the first to force ailing banks to merge in order to sort their bad debts. Dream on! Thus they formed Bankia, urging depositors to buy bonds and shares as yields were better than those on savings accounts. They got wiped out. Today they're trying to flog Banco Popular when the chief executive stepped down this month, marking the group's third leadership shake-up since July.
Don't think that dodgy banks are limited to weakish economies. Listed below are banks, in alphabetical order, whose share price patterns look very much like the four charts here. Allied Irish, Citi, Commerzbank, Credit Suisse, Lloyds, RBS and UBS. Variations on this same theme can be seen in the charts of Barclays, Crédit Agricole, Deutsche Bank and Société Générale. Oh dear.
