European banks

BCE.TC

46% of liquidity in ECB exempt of depo rate: periphery banks benefit most

Santander Corporate & Investment | Although the new deposit rate that is applied to bank liquidity in the ECB has increased 10 bp to -0.5%, the new tiering system will compensate for this increase and allow the European banks to reduce the interest from the previous -0.4% to -0.27%, as some 750 Bn€ remains exempt of payment (considering that part of the total of 788 Bn€ which supposes 6X the current reserve requirement of 131 Bn€ exceeds the excess of reserves of countries like Italy).







European banks

Mystery behind European Banks vs Utilities PER differential

In April 2018 both banks and utilities had practically the same PER, around 12.5.  Since then there has been an extreme relative movement between them, with electricity companies getting more expensive and banks cheaper, analysts at M&G Valores point out.



ECB

European banks could reduce the bill of 7 billion euros for the excess cash in the ECB deposit account

Intermoney | The president of the ECB opened the door to further stimulus if the economic and inflation perspectives in the Eurozone remain low, in the shadow of a scenario dominated by downside risks for activity. In fact, he recalled that “there is no lack of instruments” to fulfill his mandate, at the same time as he is contemplating new delays in raising interest rates. Textually he said: “we are assured that monetary policy continues to accompany the economy, adjusting our orientation on interest rates to reflect the new inflation perspectives”.


US banks vs European banks: Why such a gap in returns

Ofelia Marín Lozano | Why in the last 11 years, an investor in the American banking sector has obtained a positive profitability of 70%, whereas an investor in the European banking sector has obtained a negative return of 60%.