Under attack from all sides, few of Europe’s leading banks could claim to have won many battles in the past year, and fewer still could offer much optimism that they are winning the war. Whether it is the eurozone sovereign debt crisis and faltering economic growth on one front, or the spectre of another acute funding crisis, round of bailouts and onslaught of new regulation on the other, Europe’s leading banks are facing immense challenges, and the pressure is taking its toll. Driven in large part by staggering losses, the market capitalization of the western European banking sector has plummeted 58% from 2007 through to 2011, according to Boston Consulting Group, and European banks’ share of the entire banking sector’s global market capitalization was 23% last year – down from 35% in 2007. Revealingly, Banco Santander and BNP Paribas are today the only eurozone banks left in the world’s top 30 banks by market capitalization, illustrating just how far former titans such as UniCredit, UBS, Royal Bank of Scotland and Deutsche Bank have fallen. |
