Western Europe
LATEST ARTICLES
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The body responsible for settling about $6.5 trillion of global daily FX trades has decided against extending its deadlines to accommodate non-US participants who still want to use its next-day settlement service. But it expects the impact to be limited – far too limited to justify the complexity that a change would impose on its members.
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The two European banks are both trying to de-emphasise their investment banks and want to build up areas where they see weakness. Barclays is later to this party than Deutsche, but both will have found encouragement in the first three months of 2024.
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A private credit market growing so fast, away from the oversight of bank regulators, may be a new source of systemic risk. With smaller investors taking greater exposure to an asset class whose high returns and low losses look almost too good to be true, there could be trouble ahead.
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Quarterly survey reveals that UK finance professionals may be feeling more upbeat about prospects, but that this is yet to translate into a willingness to take greater risk onto balance sheets.
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UK fintechs attracted more investment than all European rivals combined in a tough funding market last year, but a broken IPO market leaves them with nowhere to go.
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The EU’s Instant Payments Regulation may have fired the starting gun on real-time payments in Europe, but many banks remain stuck in the blocks.
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The good news is that bank executives don’t see big loan losses ahead; the bad news is that they lack the confidence and vision to invest in the business.
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The Greek bailout fund’s exit from Piraeus Bank last month was the country’s biggest post-crisis privatization. The bank’s chief executive, Christos Megalou, tells Euromoney that this is more than a capital-return story. It’s also about growth: in the economy, in wealth and asset management, and, thanks to neobank Snappi, internationally.
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After a decade of restructuring, EFG International ramped up hiring last year – above all from Credit Suisse. Chief executive Giorgio Pradelli talks about the firm’s scope to lead a wave of Swiss-bank consolidation, while doubling down on new wealth from the Middle East and Asia.
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Credit Suisse’s domestic bank was arguably the failed group’s best and strongest division. One year after the rescue, UBS is not the only one trying to feast on its domestic wealth-management and corporate-banking leftovers. Other Swiss and international players also hope to benefit from the longer-term fallout in Switzerland. Will the rush to pick up the remnants of the fallen champion pay off?
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The decision by the US SEC to drop mandatory Scope 3 reporting weakens global emissions reporting standards. However, many corporate issuers are already using Scope 3 performance targets on sustainability-linked transactions for non-regulatory reasons. Are the debt and equities markets leading companies onto ESG ground upon which regulators fear to tread?
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While welcome, initiatives by the government and financial sector bodies designed to make it easier for companies to raise funds in the UK face a number of obstacles.
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A wall of liquidity among investors has helped to drive a busy start to the year for bond issuers, as they rush to capture tight spreads.
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The German lender’s decision to put its chips on southeast Asia is paying off handsomely. Under the leadership of Asia CEO Alexander von zur Mühlen, Deutsche Bank has doubled its capital in Vietnam and Indonesia, with more to come, moved a host of global roles to the region, and has seen Asean eclipse its India and China business in terms of growth and absolute numbers.
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Asset managers and industry regulators face operational challenges around the tokenization of private assets.
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Caution at local commercial banks – coupled with the eagerness of large investment banks to foster relationships with private equity players – means large real-estate deals fuelled by back leverage could be primed for a comeback in Europe.
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Corporates seeking to leverage sustainable investment opportunities continue to be restricted by the lack of reliable data on which to base their assessments.
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The Basel committee is shocked – shocked! – that some banks might be reporting inflated leverage ratios.
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The UK startup is now a fully regulated bank and private funds are backing its vision to embed regulated banking in non-financial companies as well as fintechs.
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With some big deals launching this week, Europe’s IPO pipeline is flowing at last. If they do well, they should put to bed the notion that ‘private IPOs’ are what is needed to provide exit routes for sponsors. A handful of recent deals shows that the biggest driver of success is doing the simple things well.
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The UK Chancellor has big plans for the tech sector.
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Thinner margins across the banking industry hit smaller banks harder. But investor pressures are also less of an issue for mutually owned lenders.
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For a deeply unpopular government with little room to manoeuvre, the chance to bribe voters with a cheap offer of bank shares is irresistible. The bank in question is now well-run and profitable while its stock still trades at a discount. But the great NatWest share offer will do little to revive UK capital markets.
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The UBS chief investment office’s sustainable and impact investing strategist wants to avoid measurement for the sake of measurement, but responding to client demand for more data while ensuring its readability remains a challenge.
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The newest ESG trend in retail banking might be a niche offering for now, but all banks will have to take it seriously someday.
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Leading commercial banks are focusing on their approach to relationship management to reassure corporate customers that they are being listened to.
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There are sensible elements to CEO Slawomir Krupa’s plans for Societe Generale, but their communication needs attention.
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In 2020, Deutsche Bank’s Asia chief, Alexander von zur Mühlen, placed more of his chips on fast-growing southeast Asia. As global firms diversify out of China, his prescience and willingness to deliver on his convictions is starting to pay off.
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Investors and staff at Societe Generale are slowly starting to understand chief executive Slawomir Krupa’s brutally honest approach to the bank’s many challenges. Taking them with him as he embarks on his restructuring plan may prove a more delicate task.
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Diego De Giorgi’s arrival as Standard Chartered’s CFO coincides with a shift away from asset shrinkage and a “final push” on digital transformation.
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A private debt hangover in real estate is threatening middle-class retirement savings across Germany. Local banks, which focused more on senior loans, should be safer. But are these lenders ready to finance the recovery in commercial property that the German market so badly needs?
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Even after the rally on its latest restructuring plan, investors still value the UK bank at such a wide discount to book that management must consider radical action.
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Barclays chief executive CS Venkatakrishnan intends to stop a low-returning investment bank from dragging the rest of the group down with it. He argues that most of the improvements are within the bank’s own grasp. That is debatable, and in any case hardly reassuring.
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The UK government’s impending sale to retail investors of a big stake in the bank informs the shadow-play guidance on this year’s earnings.
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Corporates continue to exhibit worrying levels of complacency when it comes to the implications of rate rises for their bottom line.
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Extracting value from Russia via a stake in Strabag previously owned by Oleg Deripaska shouldn’t be confused with a proper disentanglement from Russia by Raiffeisen. The main impetus for the transaction may, in fact, lie with Deripaska and Strabag’s other shareholders.
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Trade-receivables securitization transactions are flourishing as corporates seek more affordable access to long-term financing.
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Banks need to start quantifying the legal risks of both climate action and inaction.
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It is not hard to find short-term worries over global markets’ state of readiness for the US’s transition to one-day settlement in late May. But even if the UK, Europe and those Asian markets still using two-day settlement can adapt to the shift in the longer term, they will also face intense pressure to lessen their dislocation from the US cycle by copying its move. Many also fear the ultimate end-game of same-day or even instant settlement.
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The Sino-Swiss corridor, set up to encourage Chinese firms to sell global depositary receipts to international investors in the European state, took off fast in 2022. But a host of challenges, from Chinese regulatory concerns to an apparent lack of global interest, has stalled its progress.
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The midcap broker needs new business lines to survive a prolonged IPO drought.
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Record regional bank profits, plus strong capital ratios in Western Europe, have fuelled hope for more bank acquisitions in Central and Eastern Europe. The uncertain effect of recent court rulings on Swiss franc mortgages, however, is a big obstacle to deals in Poland.
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Corporates are adopting a variety of approaches to mitigate the impact of uncertainty in foreign exchange markets caused by divergence in economic policy and performance.
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They already dominate the investment banking business in Europe, and now the leading US banks have their eyes on an even bigger prize. They see their vast investments in the digital technology transforming payments and transaction services and their retained global presences as the keys to winning even greater revenues from Europe’s midsize corporates.
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Appealing to issuers by removing investor protections makes no sense when London’s decline as a listing venue stems from domestic investors abandoning the UK market.
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Collaboration between national banks has seen widespread adoption of mobile payments schemes. The French and German-led approach of focusing on a single European scheme could therefore be seen as a distraction. But is it the only real way of keeping US payment companies at bay?
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The London Stock Exchange Group’s head of sustainable finance strategic initiatives wants climate data to redefine the act of indexing.
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Ambitious brokerage firms have precipitated a shift in demand for FX licences, with interest in regulated European and Asian markets on the increase at the expense of offshore jurisdictions.
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After overseeing radical transformations at Bawag and Hamburg Commercial Bank, Cerberus Capital Management now has ultimate control of HSBC’s French retail bank. Former UniCredit banker Niccolò Ubertalli is running the new business, and reveals a very different strategy to the private equity company’s German-speaking antecedents in European banking.
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Outgoing supervisory chair Andrea Enria warns against ‘complacency’ – despite higher capital ratios at eurozone banks – as he announces new requirements on banks to tackle investment-banking leverage, liquidity shortages and leveraged finance risks.
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The chief executive of Newton Investment Management is a forthright believer in the power of active investors to effect change at the companies they invest in, and thinks tinkering with market rules is unlikely to boost the appeal of London-listed equities.
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Many corporates are realising the benefits of intercompany netting on FX risk, trading and cash-flow visibility.
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Barclays hopes to win over investors with new return targets and buyback commitments next February, but it really needs a revival in investment banking.
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Regulators are starting to take a more messaging-based approach to sustainable finance, but stopping greenwashing won’t automatically lead to a transition to net zero.
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The Signa Group of companies is complex, but its problems are simple: debt service costs are going up while property values are going down.
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More and more bond trading is automated. As volatility now shifts from rates to credit that will provide a stern examination of new trade execution tools.
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The overall use of cash will continue to fall, but the decline of bank branch networks means that businesses now face a headache in handling physical takings.
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When Kevin Gartside was medically discharged from the British army in 2012 after three tours of duty in Iraq, he was unsure what to do next. He saw cross-over appeal in banking, an industry with a surprisingly flat operating structure that prizes punctuality, teamwork, adaptability and decision making.
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Standard Chartered’s corporate and institutional bank can increase its profitability even when rates fall, divisional head Simon Cooper tells Euromoney. After reaping the benefit of investments in cash management, he is now turning to the financial markets business, especially credit – reinforcing efforts to grow clients in Europe and the Americas.
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Competition for deposits is influencing pricing decisions on commercial loans. However, the major cash-management banks insist that they have maintained both deposit levels and lending rates.
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The war in Ukraine has suddenly ramped up demands on the European Bank for Reconstruction and Development after the institution spent years searching for a new role. President Odile Renaud-Basso talks to Euromoney about the bank’s strategy and plans to boost its capacity through a €4 billion capital increase.
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Enel could trigger the largest step-up event in the sustainability-linked bond market if it misses its CO₂ emissions targets at the end of this year. How the market reacts will set the tone for the future of these instruments.
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The Swedish regulator digs deep into background of prospective senior managers.
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UK banks that focus on tech are seemingly rewarded with greater customer trust.
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Corporates are taking a big punt on markets remaining relatively benign, given their apparent lack of confidence in existing FX technology and systems.
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A $3.5 billion deal attracts $36 billion of demand, answering the question of whether Swiss banks can return to this market after Credit Suisse's collapse.
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Net interest margins are shrinking. Banks may need to find new sources to fund customer loans, perhaps even by lending to each other.
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Andrea Orcel’s complex deal with Alpha Bank ultimately opens a new front in the Milan-based lender’s pan-European strategy: Greece.
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In one of his last interviews in office, Ignazio Visco sets the record straight on his controversial 12 years as Italy’s central bank governor: a period of almost constant crisis. Today, the country’s NPL problems seem cured but, as he acknowledges, simmering risks remain.
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Banks may be retreating from lending directly to small and medium-sized enterprises, but by lending to credit specialists with good technology they can still be a source of funding for the sector.
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Sustainability-linked loans have faced growing criticism for their opacity and concerns around greenwashing. Sustainability-linked loan bonds could help to bring more transparency to the market and help legitimise these structures.
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It took five years for the invoice finance specialist Accelerated Payments to advance its first €1 billion, but just nine months for the next €500 million.
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Bidding $2.5 billion for the bulk of Credit Suisse’s sub-Saharan Africa ultra-high net-worth private bank book 18 months ago has been a ‘game changer’ for Barclays in the region, the UK bank’s Africa market head Amol Prabhu tells Euromoney.
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Even as the industry pleads its solidity, accidents keep happening.
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Just three weeks on from the rapturous response to Arm Holdings re-listing on Nasdaq, the prospects for a revival in IPOs suddenly look dim.
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A market-beating increase in UniCredit’s share price is just the beginning, chief executive Andrea Orcel tells Euromoney. He must now prove the many remaining sceptics wrong and show the bank can still thrive when net interest margins fall and credit costs rise.
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More banks have announced partnerships with asset managers to place loans into private debt funds that offer investors better risk-adjusted returns than bank equity.
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European corporates are finding a warm welcome from investors, pushing investment-grade volumes to a 2023 monthly record last month – their biggest total since the start of the interest-rate hiking cycle. But while investors are clearly ready to buy even the more adventurous stories, they still need the reassurance of sensible pricing.
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As a relative outsider, Slawomir Krupa might have appeared better suited to the chief executive job at Societe Generale precisely because it had done so badly under an establishment insider. BNP Paribas’ good performance, by contrast, would make the traditional background of its rumoured chief-executive-in-waiting, Marguerite Bérard, less of a barrier.
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BlackRock joins Allfunds initiative to distribute new variants of private equity and credit funds to wealthy individuals.
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Euromoney talks to Jacques Levet, chief digital officer at BNP Paribas, about the competitive advantage that newly acquired FX fintech Kantox offers.
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Slawomir Krupa may yet turn around Societe Generale. But it won’t be by shock and awe.
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Despite tweaks to improve efficiency, Societe Generale’s new strategy has received a lukewarm reception. New CEO Slawomir Krupa has lifted the capital target, but revenues will remain flat, and there is a lack of news on asset sales.
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Bankers at Lloyds say that progress in FX, fixed income and structured finance this year reflects chief executive Charlie Nunn’s strategy for targeted growth in corporate and institutional banking.
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Market participants have welcomed recent moves to enhance FX liquidity by increasing the efficiency of credit payments for trades.
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Borrowers that financed cheaply in 2021 will soon hit a maturity wall. Many will struggle to refinance at higher cost. Some will default. Private credit managers – still magnets for institutional capital – are set to step in and bridge some of the financing gap left by the banks.
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Financial market practitioners might be forgiven for reflecting on a job well done now that the final Libor panel has ended its submissions. The journey has been immense, but the focus is turning to loose ends, including the argument that just won’t go away: is there a place for credit-sensitive rates in a post-Libor world?
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As other investment banks cut staff, HSBC has been hiring to build a leading bank in tech and healthcare.
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Banks and investors opposed to European Union derivatives clearing plans have made an astonishing charge: the EU is worse than the US in jealously guarding its own markets.
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HKEx chief executive Nicolas Aguzin opened the group’s latest new office in London on Wednesday. His aim: to get more global firms to IPO in Hong Kong and convince investors to put money to work there. But against the backdrop of China’s economic situation, his team will have its work cut out.
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China is having a shocker of a year. Growth has stalled, deflation is back and global firms are moving production elsewhere as they de-risk from China to boost supply-chain resiliency. FDI is down sharply and exports are sinking. Just as Brexit reshaped the UK’s relationship with the world, has Covid done the same for China?
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The political response to rising bank profits should focus more on debt distress than on deposit rates and taxation.
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The domestic economy is flatlining while interest rates continue to rise, but the booming banking sector has helped overall UK corporate payouts keep pace with those elsewhere.
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The investment firm founded by securitization experts in 2015 has grown to an $8 billion portfolio of 60 companies without managing any third-party funds and still sees big potential returns, notably in football clubs, from applying the discipline of structured finance to operating businesses.
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Thames Water has become the highest profile example of a UK corporation that finds itself hamstrung by inflation-linked bonds issued at a time when persistent high inflation and economic stagnation seemed unlikely bedfellows.
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Accessing funds via debt capital or private placement may seem like an onerous task, but a growing number of corporates see it as an opportunity to mitigate the impact of changes to bank-capital deployment.
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Banks including NatWest and JPMorgan are struggling to put out reputational risk-management fires.
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The NatWest chief executive’s resignation ends a solid if unexciting three-and-a-half years at the helm.
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The increased corporate focus on environmental, social and governance issues is impacting treasury teams that can struggle to justify their initiatives.
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The German lender has named Claudio de Sanctis as its new head of private bank and created a single, unified division – part of longstanding plans to generate more income from the business by rooting out inefficiencies and tapping into new global income streams.
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All private banks are different: in how they project their brand, build business, serve clients and generate fees. But they all seem to have two things in common. They love lending to rich people with big art collections and chatting about ocean preservation.
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At €1.9 billion, international investors would happily have bought all of Europe’s biggest IPO since Porsche – even on the illiquid Bucharest stock exchange.
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The activist shareholder highlights concerns about a former poster child for private equity ownership of banks.
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Regulators forced banks to skip dividends during Covid, but let them make up payouts later on. They should now do the same for AT1s or risk that market failing.
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The global disclosure recommendations don’t stand a chance against mandated regional regulation.
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Societe Generale’s recent African exits, and BNP Paribas’s talks with Orange Bank, highlight how closely Europe’s banks tend to follow each other. Differences are often more a question of strength than strategy.
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High interest rates and low bank appetite for risk have created the perfect conditions for a renaissance in invoice factoring.
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Bankers are hopeful that they may soon be able to issue new AT1 deals again as the secondary market recovers from the Credit Suisse write-down.
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Extreme FX volatility is proving a challenge for some finance directors who are struggling to minimize the impact on their bottom line.
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The standardized approach for counterparty credit risk has not yet proved to be the catalyst for greater use of clearing in the FX market that some expected.
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Inflation is not beaten and rates may rise further. But high-grade bonds can still provide steady income and low risk, playing a new old role in investor portfolios.
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If the UK is to become an international crypto hub, it must focus on bringing regulatory certainty to the industry and the banks that back it.
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As interest rate volatility persists, corporates are taking a hard look at their trade finance options.
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Leading firms join a new network of networks, but crypto natives see just another walled garden.
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The banking sector appears to be quietly confident that the European Commission will row back on new regulation that, if enacted, could notably increase the cost of some trade-finance instruments.
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The big transaction banks are becoming increasingly active in the B2B marketplace as they seek to cash in on corporate digital transformation.
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The collapse of Silicon Valley Bank has fuelled an abrupt end to venture-capital exuberance. There are vital implications for fintech and for the banking industry.
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Pouncing on a firm with lots of corporate broking relationships at the low point for IPOs is a smart trade.
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The acquisitive fintech group reckons it can accelerate the transition from legacy FX technology by making it easier for tech firms to get their products to market.