ECB writedowns estimate at 550bn

The European Central Bank has increased to more than €550 billion its estimate of writedowns euro-zone banks could have suffered by the end of next year. The bank also issued a further blunt warning to Greece on the urgency of bringing its public finances back under control.

The ECB’s assessment of risks to financial stability in the 16-country region noted improvements since its last report in June, but it warned banks they could face greater losses on their lending business than they did on so-called toxic assets at the height of the financial crisis. –(Copyright The Financial Times Limited 2009)