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Swedish banks downplay Latvian threat

A radical proposal to slash Latvian mortgage borrowers' liabilities has focused attention on the exposure Nordic banks have to the Baltic countries. Risk managers at these institutions say they can withstand the pain, but state support might be needed to avert collapse at the weakest member of the group, Swedbank, which has just completed a third round of capital-raising. A spokesman for the bank

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The wild world of credit models

The Covid-19 pandemic has induced a kind of schizophrenia in loan-loss models. When the pandemic hit, banks overprovisioned for credit losses on the assumption that the economy would head south. But when government stimulus packages put wads of cash in…

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