September 2008
The future of banking: Why banks need to shape up or sell off
Before the September crisis, many banks were looking to sell non-core assets to raise capital. Now, safety in size means mergers are the order of the day. But when the market settles, will investors demand that banks concentrate on what they are good at to maximise returns?
Special focus: Banking 2008 and beyondBank valuations are at 10-year lows, while capital injections from private equity firms and sovereign wealth funds are drying up. In order to shore up balance sheets and return shareholder value, will they be forced to sell the crown jewels, or should they change their business models? Helen Avery reports.IN A SURVEY by Allen and Overy of chief executives of FTSE 350 and Fortune 500 companies in the summer of 2007, 21% of financial firms said they expected demerger activity in their sector before the end of June this year. Only in the technology, media and telecoms sector did chief executives foresee greater demerger activity. Demergers seemed the likely route as large financial conglomerates were faced with having to improve their balance sheets. A decade of merger activity had led to inefficiencies at the firms, and streamlining to unlock value seemed certain. Buyers were thought...
You must be a subscriber to access this archived content.
If your subscription includes access to the archive, please log in now to view.
To gain access to this content visit the subscription page or call our hotline on +44 (0)207 779 8999.
Subscribe online now and save up to 30% on your subscription.
If you are a trialist or subscriber, please enter your username and password at the top right-hand side of euromoney.com
Subscribers to Euromoney benefit from:
- 12 months access in print and online - on euromoney.com, read the latest issue early online, search for specific developments by region or sector, interrogate the results of Euromoney's benchmark polls, and view the archive dating back to 1996
- More than 30 specialist research guides free
- The results of Euromoney’s polls and surveys
- Tailored RSS news feeds direct to your desktop
- News delivered directly to your mobile device or PC
- Personalised email newsfeed of 'Top stories' and 'Breaking news'
Click here to subscribe