:00:16. > :00:21.Fears rise in Asia over the health of US banks. The crisis of 2008 saw
:00:21. > :00:26.banks across Europe come close to collapse. They demanded massive
:00:26. > :00:36.injections of public money to save the system from imploding. This
:00:36. > :00:39.
:00:39. > :00:46.time, financial regulators want to be ahead of the game. It is a
:00:46. > :00:50.delicate balancing act. These are the regulators that have given the
:00:50. > :00:55.bank's a deadline of today to show how they will boost the safety
:00:55. > :01:03.buffer of cash they hold in reserve. It is a huge hurdle for the worst
:01:03. > :01:11.affected 32. One of the most troubled is this bag from Italy, it
:01:11. > :01:16.has raised 7.5 billion euros by selling used up. Its shares has --
:01:16. > :01:23.have shrunk. They want to see the banks tapping their investors for
:01:23. > :01:27.more cash. What they do not want to see is what is actually happening
:01:27. > :01:32.with banks shrinking and lending less to businesses to match their
:01:32. > :01:39.reduced circumstances. What do banks have to show they can do?
:01:39. > :01:43.They have to reach the 9% capital target. This credit specialist says
:01:43. > :01:47.that in demanding recapitalisation, the authorities must walk a fine
:01:47. > :01:53.line between reassuring investors that banks can handle more defaults
:01:53. > :01:59.in Europe and not triggering another credit crunch. The answer
:01:59. > :02:05.for banks is to seek any means possible to raise their capital
:02:05. > :02:10.levels without going to existing shareholders. One way in which
:02:10. > :02:16.banks can seek to meet the new targets will be to shrink their
:02:16. > :02:19.balance sheet. There are a number of ways they can do this. They
:02:20. > :02:26.could sell assets and curb the amount of credit they provide to
:02:26. > :02:35.the economy. The risk is that by reducing the amount of credit, it
:02:35. > :02:44.may curtail economic growth in Europe. Winnow that German, Italian
:02:44. > :02:52.and Spanish banks have to raise the most. -- we know. Some could be
:02:53. > :02:57.facing failure. The shake-up of Italy's economy continues this
:02:57. > :03:07.Friday as Mario Monti unveils new measures to make the country more
:03:07. > :03:09.
:03:09. > :03:13.competitive. First in line is the de Regulation of services. They
:03:14. > :03:20.will open up their industry to more competition. Welcome to the
:03:20. > :03:30.programme. Where is Mario Monti looking to try and find reform and
:03:30. > :03:31.
:03:31. > :03:41.save money? He is looking at several areas to reignite the
:03:41. > :03:42.
:03:42. > :03:46.economy. The idea is to bring some free-market procedures into the
:03:46. > :03:56.taxi sector, a number of sectors that he is targeting, about ten of
:03:56. > :04:01.
:04:01. > :04:05.them. He is pushing for reforms and has been talking to politicians.
:04:05. > :04:13.This is not going to be a smooth ride, but he is going to get
:04:13. > :04:22.support for these measures. It is absolutely not going to be a smooth
:04:22. > :04:27.ride. Protesters are out and about. Yes, that is true. There are a lot
:04:27. > :04:33.of corporations that have had a strong position for many years,
:04:33. > :04:43.they are going to refuse to go ahead with the changes. This is
:04:43. > :04:44.
:04:44. > :04:49.understandable. I think the options are not that many. He is getting
:04:49. > :04:57.the support from the political parties, they are not going to take
:04:57. > :05:07.this at face value. There are going to be some changes made. We are
:05:07. > :05:07.
:05:08. > :05:13.going to see some compromise on it. Do you think it is possible that
:05:13. > :05:18.Italy's economy will grow this year? It is going to be a difficult
:05:19. > :05:28.year. The government is still wrestling with the issue of public
:05:28. > :05:38.debt, it is trying to reduce that. The public infrastructure will not
:05:38. > :05:39.
:05:39. > :05:49.make major investments. Some of the service areas are going to be
:05:49. > :05:50.
:05:50. > :05:57.making some investments... Thank you. Asian markets are hitting a
:05:57. > :06:03.two-year higher on optimism from Europe. The markets have been over-
:06:03. > :06:08.pessimistic and they need to see th thbit more? Indeed. They
:06:08. > :06:17.are seeing the light this Friday. Markets are rising. We have seen
:06:17. > :06:25.the Nikkei at a two-month high. Essentially, it is an innings from
:06:25. > :06:35.US banks which were much better than expected. -- earnings. However,
:06:35. > :06:35.
:06:35. > :06:41.there is a warning. More data from the Chinese economy. Reports
:06:41. > :06:51.suggest Chinese manufacturing is contracting, that took Chinese
:06:51. > :07:00.
:07:00. > :07:10.shares off their high. There are lingering concerns about European
:07:10. > :07:11.
:07:11. > :07:17.shocks. The market predictors are out in force working out ways to
:07:17. > :07:22.see what investors are going to do this year. That is right. Traders
:07:22. > :07:27.in the region are winding up their position ahead of Chinese New Year
:07:27. > :07:34.celebrations. China is shut for one week. Many markets are going to be
:07:34. > :07:41.shut on Monday and Tuesday. This is the Year Of the Dragon. That is a
:07:41. > :07:48.particular creature in Chinese culture. It is using wind and water
:07:48. > :07:55.to predict fortunes. The dragon is not only auspicious but it is
:07:55. > :08:03.unpredictable. We have a story of two cars. The first half will be
:08:03. > :08:13.lacklustre. The real turning point will be in August. When the dragon
:08:13. > :08:17.
:08:17. > :08:21.appears, it is conceded a game changer. It is a big event. It is a
:08:21. > :08:31.very sharp turning point. The markets could go ballistic or
:08:31. > :08:34.
:08:34. > :08:38.tumble out right. It is very dramatic. Thank you. I do not know
:08:38. > :08:44.if we can face more drama this year. Talks between Greece and its
:08:44. > :08:54.private creditors are set to continue for a third day. Greece
:08:54. > :08:55.
:08:55. > :08:59.has to hold its debt to get new bonds. It is writing off 50%. The
:08:59. > :09:09.European Union and IMF say the deal must be struck before the second
:09:09. > :09:11.