Lost a billion dollars in the US structured finance market? No problem: Daddy just received a huge bonus from the global economy and will give you $1 billion to cover the damage.
Pretty much what happened to Gulf International Bank last month.
GIB’s sub-prime losses were about four times as large as the next two biggest losses in the Middle East from the SIV/CDO freeze. But it took the write-down of $966 million in its stride, thanks to a cash-injection of $1 billion from the six Gulf governments that own it.
Of the three biggest sub-prime losses among Gulf banks, two were in Bahrain: GIB’s and Arab Banking Corporation’s...
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