But lately, the health of banks, especially the ones who have had large exposure to commodities including energy sector, has also been called into question. Top banks in Europe have seen their stock prices falling sharply and their CDS premia go to near crisis-levels. Banks in UK, US, Australia, Japan are all, to a lesser extent, similarly affected.
Lenders initiated roughly 1-1/2 million foreclosures last year, up from an average of 950,000 in the preceding two years. More than one-half of the foreclosure starts in 2007 were on subprime mortgages. Behind these disturbing statistics are families facing personal and financial hardship and neighborhoods that may be destabilized by clusters of foreclosures. These realities challenge us to find ways to prevent unnecessary foreclosures.