Austria’s 3rd Largest Bank Goes Full Bear Stearns: CEO Blames “Short Sellers” For Firm’s Demise

You know it’s bad when… you start blaming speculators. Very reminiscent of the “it’s not us, we have a solid balance sheet, it’s the short selling speculators” bullshit in the days before and after the stock crashes of American Insurance Group, Bear Stearns, Lehman Brothers and Merrill Lynch; mere days after his bank’s bonds crashed, the CEO of Raiffeissen Bank (Austria’s 3rd largest) has stated (unequivocally) that “panic was created artificially,” blaming short-sellers for his bank’s demise.

RBI CEO Svelda tells DiePresse.com,

“This panic was created artificially to a certain degree.

25 percent of our free float was shorted. As some have speculated neatly on falling prices and our share beaten down properly.

And the whole thing because of an initial loss of 493 million euros?”

Yep all short-sellers…

 

Nothing to do with worries about Swiss Franc mortgages… As Bloomberg reports, Raiffeisen had a total of 4.3 billion euros of Swiss franc loans outstanding as of September 2014, according to estimates by Moody’s Investors Service.

The largest part of these are in Poland, where the franc has appreciated 17 percent against the zloty since Jan. 14, threatening to push up defaults on the bank’s 2.9 billion euros of mortgages in the Swiss currency.

“There’s a lot of people worried about the bank’s Swiss-franc mortgages in eastern Europe,” said Gregory Turnbull Schwartz, who helps oversee the equivalent of about $82 billion at Kames Capital in Edinburgh and doesn’t hold Raiffeisen bonds.

Raiffeisen said Jan. 15 that it can’t yet forecast the effects of the appreciation of the franc on its asset quality.

The bank “will certainly take one measure or the other in the near future,” Chief Executive Officer Karl Sevelda told reporters on the sidelines of the Euromoney CEE conference in Vienna today. He declined to elaborate. Franc loans in eastern Europe are “not a big problem,” he said.