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Seminar paper from the year 2012 in the subject Economics - Finance, grade: 2,3, Johannes Gutenberg University Mainz, course: Seminar Financial Institutions, language: English, abstract: During the current financial crisis which started in the year 2007 with the bust of theAmerican housing market and peaked with the collapse of Lehman Brothers weobserve that many countries face difficulties with their domestic banking system.For instance Germany had problems with several Landesbanken, the Hypo RealEstate (HRE) and with Commerzbank or the United States struggled with thecollapse of Merrill…mehr

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Seminar paper from the year 2012 in the subject Economics - Finance, grade: 2,3, Johannes Gutenberg University Mainz, course: Seminar Financial Institutions, language: English, abstract: During the current financial crisis which started in the year 2007 with the bust of theAmerican housing market and peaked with the collapse of Lehman Brothers weobserve that many countries face difficulties with their domestic banking system.For instance Germany had problems with several Landesbanken, the Hypo RealEstate (HRE) and with Commerzbank or the United States struggled with thecollapse of Merrill Lynch and Bear Stearns leading to an enforced merger with Bankof America and JP Morgan Chase respectively. In other countries problems in thebanking system were more dramatic. After rumors in the United Kingdom about acollapse of Northern Rock people went immediately to the branches to withdrawtheir deposits. The picture spread the world when people waited outside in a queueof a branch of Northern Rock to get inside. To prevent a domestic bank run in theUnited Kingdom the government nationalized several financial institutions such asRoyal Bank of Scotland; afterwards holding a stake of 95% in this particularinstitution. Nowadays Spain faces a huge banking crisis after the bust of the Iberianhousing bubble. But what is the problem of having a banking crisis?