Basel II and the German credit crunch?

In the market for German real estate finance at the end of 2001 a phenomenon could beidentified that shows significant parallels to the shortening of credit supply in the USmarket in the early nineties, called the credit crunch. There are two basic reasons thatexplain the withdrawal of mortgage banks from the current events in real estate debtfinance. Both are linked to a lack of risk identification in real estate investment. First,mortgage banks are engaged in a portfolio of bad real estate credits...