All articles tagged with #european banks
Originally Published 10 days ago — by Yahoo Finance
European banks are planning to cut over 200,000 jobs by 2030 as they adopt AI and close physical branches, mainly affecting back-office roles, with similar trends seen in the US, aiming for increased efficiency but raising concerns about industry fundamentals.
Originally Published 28 days ago — by Reuters
European banks are expected to continue their strong rally in 2026, driven by AI-driven cost savings and improved earnings, despite economic uncertainties. AI is seen as a key factor in boosting operational efficiency and valuation, with investors optimistic about the sector's growth and shareholder returns. However, risks related to AI exuberance and geopolitical shocks remain.
Originally Published 1 year ago — by Fortune
German bank Deutsche Pfandbriefbank AG issued an unscheduled statement about increased provisions due to the "greatest real estate crisis since the financial crisis," reflecting concerns about exposure to the struggling commercial real estate sector. Lenders globally are facing increasing provisions on debt as loans sour, with the US commercial property market particularly affected. European banks, including Deutsche Bank and Aareal Bank AG, are experiencing bond slumps and warnings about potential losses. The situation has raised fears of broader contagion and echoes of the 2008 global financial crisis, with Germany's Landesbanks also feeling the pain of their exposure to commercial real estate.
Originally Published 2 years ago — by Reuters
European banking stocks are facing challenges as the boost from higher interest rates fades and recession risks increase. However, some investors believe that bank valuations are still too low, considering the dividend yield of almost 8% and the capital buffers held by these lenders. European bank shares are trading at around six times forecast earnings and at less than 70% of banks' own assessments of their asset worth. Despite improvements in profitability and solid fundamentals, investors fear lenders' profits may be impacted by bad debts. Analysts expect European banks to grow adjusted earnings per share by 25% this year and 6% in 2024. While there are concerns about credit issues, some investors see value in large-cap institutions and are adding to their positions in European banks.
Originally Published 2 years ago — by CNBC
Italy's new tax on banks, which initially caused a significant drop in European bank shares, continues to face criticism and controversy. The government is now scrambling to update the tax, acknowledging that it needs improvement. Critics argue that the tax could deter international investors and harm long-term investments in Italy. However, some politicians believe that banks should contribute to the country's economic recovery, while others emphasize the need to differentiate between large and small lenders. The measure has also received negative feedback from Intesa Sanpaolo, one of Italy's largest banks, which believes that the communication surrounding the tax has been inadequate.
Originally Published 2 years ago — by Reuters.com
Credit default swaps (CDS) are derivatives that offer insurance against the risk of a bond issuer not paying their creditors. The CDS market is worth around $3.8 trillion, but the market is well below the $33 trillion of its heyday in 2008. The biggest CDS market is for governments. CDSs were one of the financial instruments at the centre of the 2008 financial crisis. The current turmoil does not reflect a steep drop in the value of the securities that underlie the CDS.
Originally Published 2 years ago — by Yahoo Finance
Deutsche Bank experienced its biggest drop in three years and saw the cost of insuring its debt against default rise in a selloff that Citigroup analysts described as irrational. The bank's announcement to repurchase debt, normally seen as a sign of strength, failed to shore up confidence. The selloff prompted German Chancellor Olaf Scholz to publicly back the lender. The widespread declines undermine hopes among authorities that the government-brokered rescue of Credit Suisse last weekend would stabilize the broader sector.
Originally Published 2 years ago — by The Associated Press
Shares in Deutsche Bank fell sharply on Friday, dragging down other major European banks, after fears about the global financial system sent fresh shudders through the market. Deutsche Bank shares closed down 8.5% on the German stock exchange after falling as much as 14%. Rising costs on insuring debt were also a prelude to Swiss lender Credit Suisse’s government-backed rescue by rival UBS. Despite the rebound under CEO Christian Sewing, the bank was “a natural candidate” for a market selloff because of its previous troubles, large, sometimes complex holdings and market skepticism about its future profits.
Originally Published 2 years ago — by Kitco NEWS
Gold and silver prices are slightly up due to safe-haven buying amid uncertainty in the US and European banking sectors. Reports suggest stress for Deutsche Bank, while US banks drew on $165 billion from the Federal Reserve lending facility in the week ending March 22. The silver bulls have the firm overall near-term technical advantage, while gold futures bulls have the solid overall near-term technical advantage. The US dollar index is higher on safe-haven demand, while Nymex crude oil futures prices are sharply lower.
Originally Published 2 years ago — by CNN
European banking stocks fell on Friday, with the Stoxx Europe 600 Banks index down 5% in morning trade. Shares in Deutsche Bank, UBS, and Credit Suisse also dropped. The falls come after the US Department of Justice (DOJ) reportedly investigated whether staff at UBS and Credit Suisse had helped Russian oligarchs evade Western sanctions. The DOJ had sent subpoenas to those employees before UBS took over Credit Suisse, according to the report.
Originally Published 2 years ago — by Markets Insider
Deutsche Bank's shares fell by 10% in Frankfurt as investors worry about the health of Europe's banks after Credit Suisse's rescue by UBS last week. Credit default swaps linked to the German bank's bonds spiked to 173 basis points on Thursday, their largest one-day rise on record, according to data from Refinitiv. Other European bank stocks also fell on Friday. Deutsche Bank shares have shed over a quarter of their value in March alone.
Originally Published 2 years ago — by CNBC
Deutsche Bank shares fell by more than 9% after a sudden spike in credit default swaps on Thursday night, as concerns about the stability of European banks persisted. The emergency rescue of Credit Suisse by UBS has triggered contagion concern among investors, which was deepened by further monetary policy tightening from the U.S. Federal Reserve on Wednesday. Moody's suggested that, as central banks continue their efforts to reel in inflation, the longer that financial conditions remain tight, the greater the risk that "stresses spread beyond the banking sector, unleashing greater financial and economic damage."
Originally Published 2 years ago — by Yahoo Finance
Deutsche Bank shares fell by as much as 14.9% on Friday to their lowest in five months, after the cost of insuring the bank's debt against the risk of default shot to more than four-year highs. Deutsche Bank's credit default swaps (CDS) - a form of insurance for bondholders - shot up above 220 basis points (bps) - the most since late 2018 - from 142 bps just two days ago. The rise in CDS for major European banks reflects investors' reluctance to carry any risk on their portfolios going into the weekend. Despite the turbulence, market watchers highlight that European regulators and central banks have reiterated their intention to keep markets stable, and that the banks themselves are more strongly capitalised and regulated than they were back in 2007 just before the global financial crisis.
Originally Published 2 years ago — by CNBC
Wall Street has downgraded European banks and named stocks to buy in case the markets turn sour. The move comes as investors worry about the impact of rising bond yields on the global economy. The downgrades are expected to hit banks in Germany, France, and Italy the hardest. Meanwhile, investors are being advised to buy stocks in sectors such as technology, healthcare, and consumer staples.
Originally Published 2 years ago — by Reuters.com
Goldman Sachs strategist Lotfi Karoui said that the decision by Swiss authorities to write down Credit Suisse's Additional Tier 1 (AT1) bonds to zero could lead to a "potential permanent destruction in demand" for this type of debt in the long term. However, the risk of contagion across credit markets is limited due to the relative niche nature of the asset class. AT1 bonds issued by other European banks fell sharply on Monday as the treatment of Credit Suisse AT1 bondholders highlighted the risks of investing in this type of debt.