A billion here, a billion there

After the pain comes the recap. Again some of the larger numbers from a table on Bloomberg:

Firm	Capital Raised	Breakdown
Citigroup	30.4	Govt. of Singapore (6.9), Kuwait Investment Authority (5.6), Abu Dhabi Investment Authority (7.5), Public investors (10.4)
UBS	27.2	Govt. of Singapore (10.9), Anon. middle east (2), Public investors (14.8)
IKB Deutsche	13.2	German government, Banking associations
Bank of America	13	Public investors
Merrill Lynch	12.2	Korea Investment Corp, Kuwait Investment Authority, Mizuho, (jointly 6.6), Temasek (4.4)
Soc Gen	8.7	Public investors
WestLB	7.8	Nordrhein Westphalia, Sparkassen
Morgan Stanley	5	China Investment Corp.
Barclays	5	China Development Bank (3), Temasek (2)
Lehman	4	Public Investors
[...]
TOTAL	135.8

Several things are interesting about this. Firstly comparing the total recap, 135B, with the total losses, 231B, we see that there has been a substantial net reduction in wealth of the banking system. Secondly some of the recaps have been larger than the losses sustained (e.g. WestLB, BofA) so either the losses table does not reflect all crunch related losses - a likely explanation - or institutions are choosing to raise new capital in the current environment, perhaps to delever.

There are several indicators for the end of the crunch such as the Base rate/Libor and longer dated swap spreads, the iTraxx IG spread and Libor/GC spreads, but one of them has to be the end of the recaps. Until the banking system has fully recapitalised I think a recovery is unlikely whatever the equity market is saying.

To end, for the visually minded, a slightly trimmed version of a graphic from the NY Times, showing the flow of funds in some of the larger recaps.