Renta 4 | The ratings agency S&P has maintained the rating of BBVA, but has lowered the Outlook from stable to negative because its exposure to Turkey through Garanti, of which BBVA controls 49.85% and which accounts for 15% of the Group´s profits.
Santander | After the collapse of the Morandi bridge in Genoa, the Italian government has begun the process of terminating ASPI´s concession. The management team could try to negotiate possible solutions to avoid the termination, despite the protection offered by the terms of the contract.
Bankinter | We are revising our recommendation for BBVA to Neutral from Buy because of the deterioration of the situation in Turkey.
Repsol has reached agreement to acquire 40% of Mexican lubricant company Bardahl, which represents its biggest purchase in this business and pushes forward its internationalisation strategy in Downstream.
Banco Santander increased attributable profit in the first half of 2018 to €3,75 2 million, 4 % higher than the same period of last year after a €300 million net charge primarily related to integration costs for Banco Popular. At the time of the Popular acquisition, on June 7 th 2017, the Group said it expected to register € 300 million in integration costs per year until 2019.
Sabadell has just announced the sale of real estate assets to the fund Cerberus for 9.1 billion euros. The assets have been given a net value of 3.9 billion euros, which means Sabadell will have to make provisions for 92 million euros. Cerberus will hold 80% of the joint Enterprise called NewCo, leaving Sabadell with 20%. Specifically, the operation has been structures through the issue of two portfolios of real estate assets commercially named “Challenger” and “Coliseum”.
Naturgy´s adjustments in the value of its conventional electricity generation assets in Spain will rise to 3.7 billions. According to what the group, old Gas Natural Fenosa, told the regulator CNMV, this results from a depreciation of the value of its assets of 4.9 billion euros.
Spain was a well-liked region within European banks until the new government came into place. As Morgan Stanley points in a note to investors, “the negative noise around a potential bank tax and the doubts on the fiscal plans have hit the sector.” Santander will kick off the 2Q18 results season on July 25th with all the eyes on its capital position and headwinds from Latam currencies. Issues like Turkey in BBVA and TSB in Sabadell have provided more downside to some of these names.
Turkish President Erdogan has began to exercise his new “attributes”, recently provided by an ever more authoritarian political system, in relation to the monetary policy of the central bank by affirming informally that interest rates will be lowered. This weakened the Turkish Lira from 4.66/$ to 4.85/$ (although it layered recovered to 4.82/$). This had a negative impact on the share price of BBVA, which holds 49.85% in the Turkish bank Garantí.
Santander has put on sale a portfolio, known as Apple, of €6 Bn of housing assets, and hopes to close the agreement on their transfer this month. Last summer, just after acquiring Banco Popular, Santander agreed to sell to Blackstone €30 Bn worth of housing assets originating in Popular.