Squeezing more into tier one

It's hardly been the best year for banks to raise capital. The fallout from last year's Asian crisis scared off investors concerned that the banks might have overly high exposure to some of the affected markets, and so drove out spreads and hit share prices. Then, just as confidence was beginning to return, the Russian crisis hit, and deals either had to be restructured - Fortis, for example, switched from a straight secondary equity issue to a convertible bond to aid in its acquisition of Belgium's Generale Bank - or deals were pulled entirely, the most high-profile one being the cancellation of the Goldman Sachs flotation.

But, barring a few notable exceptions, what this year proved in contrast to earlier crises - especially the Latin American debt crisis of the early 1980s - is how much better capitalized the major international banks are, and therefore how much more able they have been...