Partnerships offer European banks a way forward
European banks don’t have a continental market, right? Wrong. Even if they cannot do full-blown mergers, the cross-border consolidation of specific business lines offers a way of gaining some of the economies of scale that US and Chinese banks enjoy.
European banks are in desperate need of greater economies of scale, as negative rates make it ever harder for them to sustain their businesses.
But even if pan-European retail banks never really emerge – indeed, if global universal banks are out of fashion – chief executives in Europe are increasingly seeking synergies through looser kinds of cross-border partnership.
Speculation last year of a merger between France’s Societe Generale and Italy’s biggest bank, UniCredit, raised hopes of intra-European consolidation.