Every morning the rooster crows, including that of An-Nahar newspaper, there is a call to restructure the banking sector. Veracious words often used with bad intentions. Some are calling for the reduction of the number of banks to just five, to perhaps dole them equitably among the lords of the sects! Others want to undertake a blood test separately for each bank in order to issue certificates of performance to label them as ‘Good’ or ‘Bad’ banks.
The Good and the Bad
The proponents of this approach are not saying if deposits should be considered as ‘Bad’ liabilities since assets are also classified as ‘Bad’. By international norms a ‘Bad Bank’ means non-performing assets in the loan portfolio for the public and private sectors. The banks have already provisioned for the losses. Their equity actually declined by $4 billion over the
