Ana María Llopis, independent director at Societe Generale explains that “the entity’s share price was at 40 euros before the crisis and now it is around 42-44 euros. So some banks have recovered. Then there are others still at low prices for particular reasons, or because they operate in China or Brazil.”
Fernando Barciela | Is the banking crisis over? I don’t think so. There is a lot of very bad news coming out from some of the biggest European banks these days. Deutsche Bank said on Thursday it would shed 35,000 jobs. The German lender reported a $6.6 billion quarterly net loss. So it will trim its investment banking operations and close operations in 10 countries.
BRUSSELS | May 7, 2015 | By Alexandre Mato | Plans to spin off Deutsche Bank’s retail business is the latest rumour to emerge from a changing European banking sector eagerly looking for ways to be more profitable under Basel III regulations. Too big to fail institutions are worried about a decline in their margins because of the low interest rates outlook. For these lenders, breaking up their investment and commercial business, as well as going on a shopping spree within the sector, seem to be solutions for growth.
MADRID | May 5, 2015 | By JP Marín Arrese | Banks have undergone a massive overhaul to meet demanding requirements under Basel III. They have substantially strengthened their core capital over the last couple of years to keep abreast of increasing requests tabled by regulatory bodies. The leverage ratio under implementation represents a new challenge which is likely to have a significant influence on their business strategy.
MADRID | The Corner | The escalation of the crisis in Ukraine has led to sharp asset prices and currency volatility with capital outflows from the region, particularly from Russia and of course Ukraine itself. UBS points out that the European banks within their coverage present “a meaningful exposure: the loans in Russia and Ukraine amount to over €60bn before taking into considerations any investment banking activity.”
MADRID | The Corner | ECB’s upcoming stress tests will have have the AQR findings incorporated (the so-called “join-up”), an element that was previously missing. And banks will be informed of the full and final results only shortly before they are communicated to the markets, as the central bank published on Thursday.
MADRID | By The Corner | Experts at JPMorgan think that it is largely due to positioning, regulatory concerns and profit-taking post ECB announcements in June. However, their funding costs have barely moved in the meantime and remain near historical lows. This is likely to have helped their earnings further in Q2.
MADRID | By The Corner | European banks have strenghtened their capital ratios for the upcoming stress tests and the AQR, whose results will be known after the summer. In that sense, between July 2013 and May 2014, EZ lenders increased their base capital by €45 billion, although it wasn’t entirely by issuing shares but contingent convertible bonds (CoCos), by which they would have raised around €35 billion.
MADRID | The Corner Team | Eurozone’s banks have yet to pay back €450 billion from the 2012 long-term refinancing operation or LTRO. Executive Director in Global Cash Equity Sales at JP Morgan Hugo Anaya maintains a positive outlook and believes that even the P/E re-rating in the Euro stock exchange may continue.