insolvency and the banks

Good people, do you think that the "four pillar" banks are going to let this go belly up? They are, according to the SMH and AFR in it up to their necks....approaching a billion dollars. Will they be considering what will happen to their own sp and ratings if they have to write off that much debt in the current environment?

I believe that they won't. Just as the banks in the U.S. have changed their policies regarding foreclosures, the banks here will be weighing up the preservation of a big company that will over time give them a return as opposed to another big write-off.

I'm interested in what posters have to say about the practicalities, and not just the numbers as they present themselves. The share market is, after all, a predictor and not a reactor in the bigger picture, and there are already signs that the worst appears to be over....or at least the steep and never-ending declines seem to have abated. Looking forward to your views.