We have ways of making you pay

The German banks’ latest ploy for repairing balance sheets bloated with non-performing loans is laughable. Siphoning off the good loans and leaving behind the non-performing ones – those that the banks really should be doing something about – can only result in balance sheets in worse shape than before.

So what’s the solution? They could do worse than to follow the example of Italian financial services firm Capitalia. It has a joint venture with Archon Group, a subsidiary of Goldman Sachs, to deal with its overdue debtors.