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February 2016
#65

While we're worried about lots of stuff (see earlier entries, or here), the imploding shale sector and the consequences for rising bad bank loans isn't really one of them, at least not as far as their potential for causing another financial crisis. Here is Zacks:

Energy Loan Portfolios are Small – the biggest U.S. banks generally have less than 5% of their total loan portfolio in Energy (and Europe is in that range as well). Recall too that, within the oil sector, most loans are asset-backed meaning that banks can make a claim on property if needed (unlike most subprime loans). If energy loan losses were a huge problem on bank balance sheets, you would probably see non-performing loans going up throughout Europe – but they’re actually going down.

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