New Credit Hurdle Looms for Banks
By Carrick Mollenkamp
U.S. and European banks, already burdened by losses and concerns
about their financial health, face a new challenge: paying off
hundreds of billions of dollars of debt coming due.
At issue are so-called floating-rate notes -- securities used heavily by banks in 2006 to borrow money. A big chunk of those notes, which typically mature in two years, will come due over the next year or so, at a time when banks are struggling to raise fresh funds. That's forcing banks to sell assets, compete heavily for deposits and issue expensive new debt.
The crunch will begin next month, when ...
