When tadpoles become frogs?
José Carlos González Vázquez (UCM/MA Abogados) | Following the Anglo-Saxon model, the new European directive transforms the duties of directors – to the benefit of financial creditors. When? When insolvency is close.
Markets
Cryptocurrencies recover and increase capitalisation by 159%
Funcas | The capitalisation of cryptocurrencies increased 159% in the first half of 2019 and went from 125 Bn$ at the end of 2018 to 325 Bn$ at the end of June, according to the Report on “Cryptomarkets and Blockchain” by the Observatory of Financial Digitalisation (OFD) of Funcas and Finnovating.
Central banks do what they can
DWS | “First, do no harm.” That command may, or may not have been part of the Hippocratic Oath among medical practitioners since ancient times. Central bankers, however, appear increasingly keen to follow that maxim on both sides of the Atlantic. On Wednesday, the U.S. Federal Reserve (Fed) once again lowered key rates by “only” 25 basis points to a target corridor of 1.75%-2.00%. And once again, its reasons included subdued inflation as well as risks resulting from weaker global growth and various trade conflicts, justifying another insurance cut. In that sense at least, President Trump has seems to have influenced central-bank policy.
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).
Cellnex: lower capital costs 4.8%-4.9% (from 5.2%-5.6%)
Santander Corporate &Investment | We have adjusted our estimates (including its recent acquisition of Cignal in our forecasts). Nevertheless, the main novelty is the modification of our suppositions on the cost of capital to take into account the current interest rate scenario.
Telefonica seeks growth: O.P. de 7.2 €/share vs 9.2 €/share before
Renta 4 | Telefonica shares hit their lowest level in August since 2006, since when they have recovered more than +10%. We see that investors have turned their back on the operator, disappointed by a business evolution which has not improved at an operational level and lacking confidence in a significant and sustained improvement in the future.
Fund flows: 18 months of outflows from European markets
Santander Corporate & Investment | The global scenario has not been especially positive for the flow of funds in assets which traditionally imply greater risk, like equities and raw materials. The investment in fixed income has received the majority of new investment in the last six years. Nevertheless, the global high yield category (the kind of asset most like equities) has differed from this trend in the last three years, with hardly any new investment, reflecting the situation with equities.
Santander and BBVA best positioned for cut in ECB deposit rate
Bankinter analysis team believes that the cut in the deposit rate to -0.50% (from -0.4%) further penalises keeping excess liquidity in the ECB. Tiering (or the method of charging in tranches) only partially mitigates the impact with a volume of up to six times the coefficient of obligatory reserves (currently 1.0%) exempt. This favours banks with higher and more internationally diversified ratios of credit investment/typical resources like Banco Santander and BBVA.
SiemensGamesa in non-binding talks to buy assets from German Senvion
Bankinter | Non-binding negotiations to buy selected assets from Senvion group. Siemens Gamesa has just announced the beginning of exclusive, non-binding negotiations for the possible acquisition of selected assets, free from financial debt.
NH Hotels: NAV driven by its valuable hotels in ownership
Alphavalue | As a European leader in urban hotels, the Spanish chain has experienced a very positive first half of 2019, benefiting from solid momentum in European cities, especially noticeable in the strong recovery in Catalonia. However, the good results have not driven the group´s value, despite very attractive fundamentals, as 94% of the capital in in the hands of MINT (Minor International). The lack of liquidity, together with an unpredictable strategic plan from its Thai owner, have sadly driven investors away.