Watch funding gaps, BIS warns Europe

European banks are still exposed to the risk of a dollar funding drought, warned the Bank for International Settlements (BIS) today. In its latest quarterly review, the BIS said the estimated total dollar funding gap for European banks that are long the dollar was between $300 billion and $1.8 trillion at the end of 2009 – and could be even higher, the bank warned. Banks that have been forced to take asset writedowns but have not closed out funding positions might actually have much la