|Bid||12.90 x 0|
|Ask||12.95 x 0|
|Day's Range||12.89 - 13.13|
|52 Week Range||9.07 - 13.69|
|Beta (5Y Monthly)||1.82|
|PE Ratio (TTM)||7.58|
|Earnings Date||Feb 05, 2020 - Feb 10, 2020|
|Forward Dividend & Yield||0.27 (2.05%)|
|Ex-Dividend Date||Apr 23, 2019|
|1y Target Est||16.38|
Banks around the world are on track for making their biggest round of jobs cuts in 4 years, according to Bloomberg. This year over 50 lenders have announced plans to cut nearly 80k jobs combined. Yahoo Finance’s Heidi Chung and Brian Cheung discuss with Barron’s Reporter Carleton English.
The world's biggest banks are looking to restructure in 2020. Morgan Stanley is the latest to trim its workforce, reportedly cutting 2% of its employees. Commerzbank, Deutsche Bank, HSBC, and Santander have also announced cuts, with banks totaling more than 60,000 job cuts this year.
(Bloomberg) -- Sign up here to receive the Davos Diary, a special daily newsletter that will run from Jan. 20-24.If European Central Bank officials use their review of monetary policy this year as a chance to connect with ordinary people, they need to be ready for some plain truths.At the heart of the assessment, likely to be announced on Jan. 23, is how price stability should be defined and targeted. But ask citizens how they feel about inflation and they’re likely to come up with wildly varying answers. In fact, as the Federal Reserve found in its own recent consultation, many may be less convinced than central bankers that prices are rising too slowly.While President Christine Lagarde says she wants to hear diverse views, it’s not yet clear how much that will involve people outside of economic and banking circles, nor how seriously policy makers will take the opinions submitted. If they did want consumers’ perceptions to influence how the review reshapes monetary policy, that could conceivably put the institution on a different path from the ultra-accommodative stance it has adopted for years.“It’s definitely going to add to the knowledge the ECB has about the inflation process, and the ways inflation affects different groups in society,” said Florian Hense, an economist at Berenberg in London. “How much that is actually going to affect the overhaul or the result of that overhaul is a bit difficult to say.”Lagarde, who wants to agree on the review at next week’s policy meeting, insisted last month that it will tap more than “the usual suspects.”“It will also include consulting with Members of Parliament and I’ve committed to that with the European Parliament. It will reach out to the academic community, of course. It will reach out to civil society representatives, and it will aim at not just preaching the gospel that we think we master, but also listening.”One example she might follow is that of the Fed, which held “community listening sessions” last year in places including San Francisco and Atlanta. The “Fed Listens” initiative heard how officials’ desire for higher prices wasn’t shared by lower-income workers, who fret about their living costs.Such an exercise would appeal to Bank of France Governor Francois Villeroy de Galhau, who insisted last week that what consumers and businesses think, particularly on inflation, is crucial for the review’s credibility. “They are the ones that ultimately set prices and wages,” he said.The approach has its problems though. A Bundesbank study published in December found “large differences” between German households on inflation perceptions depending on factors such as earnings, education, home ownership, job type and recent experience of price trends.Housing is a key area of contention. It is significantly underweighted in the European Union’s official inflation measure because of the challenge of collecting data, yet it’s also a major expense for many individuals. Property values and rents have tended to outstrip inflation in recent years. Data on Thursday showed annual prices of homes in the euro region rose 4.1% in the third quarter -- roughly four times the pace of consumer inflation at the time.Households not only tend to predict more inflation than investors, they also overestimate it. In July, former ECB Executive Board member Benoit Coeure cited a survey of citizens who believed annual price increases were near 9% in the 14 years through 2018, when the figure was actually 1.6%.What Bloomberg’s Economists say“The president indicated at the last press conference that inflation expectations will also be discussed. Which measures of inflation expectations tell us most about where headline CPI will be in two years? Economists have several to examine.”-David Powell and Maeva Cousin. See her ECB PREVIEWCoeure still noted that consumers are good at identifying shifts in inflation, and that their expectations can be “a better proxy” of company pricing decisions than financial markets. Under former ECB President Mario Draghi, policy makers tended to emphasize indicators of future inflation generated by investor bets, such as five-year, five-year forwards.“The mood has changed, also because the policy space is reduced,” said Marco Valli, an economist at UniCredit in Milan. “There’s more inclination to look at different types of inflation expectations -- especially households.”Lagarde’s strategy rethink is also an opportunity to better explain what the ECB is trying to achieve. Villeroy argues that if people can’t understand its goals, the effectiveness of its policies is blunted.“They are less convinced than economists of the need to boost price growth from 1% to 2%,” he told an audience in Paris. “I believe the economic analyses and theories; but I also believe that they only have a real-world impact if they are perceived, accepted and assimilated by common sense and public opinion.”Building a coherent view from a mass of public opinions is likely to be challenging, but it might be worth a try. At a time when many people in richer countries are furious at negative interest rates and quantitative easing, increasing the emphasis on their views could ultimately push the ECB to find more palatable ways to support the economy.In any case, addressing erroneous perceptions of the ECB, as Villeroy suggests, will likely require more outreach. Lagarde has acknowledged as much, saying that bringing the central bank closer to citizens in an age of populism is a priority.“It is important to me that our focus on connecting with the people we serve continues and grows stronger,” she told lawmakers in December. “Communication is a two-way street.”(Updates with house prices in 10th paragraph.)\--With assistance from Jana Randow and Zoe Schneeweiss.To contact the reporters on this story: Craig Stirling in Frankfurt at email@example.com;Catherine Bosley in Zurich at firstname.lastname@example.orgTo contact the editors responsible for this story: Simon Kennedy at email@example.com, Paul Gordon, Fergal O'BrienFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Big banks are making major changes to the way they invest in fintech companies, turning to fewer, but larger, investments as they look for partners who can help them turn around their core businesses. “No bank has spent that much on their own technology in recent years,” he said.
(Bloomberg) -- Companies around the globe, concerned that heightened tensions between the U.S. and Iran could roil bond markets, are rushing to borrow cheaply while they still can.Investment-grade firms have sold more than $61 billion of notes in the U.S. through Thursday, double the same period in 2019. In Europe, investment-rated and junk bond sales including company and country debt broke a 79 billion-euro ($88 billion) weekly record set a year ago. Borrowers from around the Asia Pacific region sold more than $28 billion in dollar notes this week, in a record start.Companies have reasoned that it makes sense to sell bonds now when conditions are still good and demand is strong. If the Iran situation were to worsen and sentiment turn, then borrowers “may end up paying more and demand for riskier assets will wane,” said Alex Eventon, a fund manager at Resco Asset Management.“No matter what comes next conditions are likely to be less good than they are now,” Eventon said.The high volume of U.S. investment-grade bond sales this week could translate to slower activity later in January, which is typically one of the busiest months of the year for borrowing. Wall Street strategists broadly expect blue-chip companies to sell around 5% fewer dollar-denominated bonds this year than last year on a gross basis, as they cut their overall debt levels and take advantage of comparatively lower yields in Europe. And in the near term, many companies are close to posting quarterly results, which limits how much debt they can sell for now anyway.Some of the major issuers this week in the U.S. included American Tower Corp., a company that leases out space on cellphone towers, which sold $1.5 billion of notes in two parts. Among issuers from APAC, Westpac Banking Corp. and Nomura Holdings Inc. led a handful of multi-billion dollar deals, with a large swathe of Chinese companies also selling. In Europe, a flood of bank deals materialized, including a 1.25 billion-euro sale from Italy’s UniCredit SpA.“Investor demand has been at, or close to, record levels in many instances,” said Lee Cumbes, a managing director in debt capital markets at Barclays Plc in London.Strong DemandThat demand is evident globally. In the U.S., money managers this week put in orders for far more bonds than companies were selling, and yields on new notes are almost equal to companies’ existing debt, instead of being higher.Demand is so strong that even companies with some of the lowest credit ratings, which might have struggled to borrow for much of last year, have been able to tap the market. Transocean Ltd., an offshore oil driller, sold $750 million of junk bonds on Wednesday. The notes carry a Caa1 rating from Moody’s Investors Service, putting them in the lowest tier of debt that companies typically issue. S&P Global Ratings has the securities the equivalent of one step higher at B-.The reason for the strong issuance levels globally is clear, money managers said.“As long as the market is open and investors are ready to buy, there’s always the potential for more uncertainty out there if you decide to hold off,” said Bob Summers, an investment-grade portfolio manager at Neuberger Berman in Chicago. “If a company has all its documentation lined up and ready to go, there’s really no reason to wait.”Escalation, De-escalationTension between Iran and the U.S. intensified last week after the U.S. killed Qassem Soleimani, a top Iranian general. U.S. President Donald Trump tweeted that Soleimani was planning to kill Americans. Iran vowed revenge, and fired missiles at two U.S. bases in Iraq on Wednesday. The attacks caused no casualties, and Trump on Wednesday appeared to shift away from talk of war. It’s unclear if Iran is done with reprisals, but investors are less worried about the conflict, and U.S. stocks are reaching fresh records.The U.S. investment-grade market is coming off a year with gains of 14.5%, according to Bloomberg Barclays index data, and only six weeks of retail outflows for all of 2019, according to Refinitiv Lipper. Yields are just 2.86% on average, hovering near lows last seen in mid-2016. Risk premiums are near the tightest levels in almost two years.New notes have traded well in the secondary market so far, a sign that investors still have money to put to work, building on last year’s momentum, according to Stacey Starner McAllister, head of investment-grade fixed-income research at Eaton Vance Corp.“Maybe investors are less concerned about Iran and geopolitical factors than issuers are,” she said. “We’re always talking about those potential risks, but right now it’s not changing our base-case outlook for credit for the year.”(Updates issuance number in second graph, adds details.)\--With assistance from Rizal Tupaz, Priscila Azevedo Rocha, Tasos Vossos and Finbarr Flynn.To contact the reporters on this story: Molly Smith in New York at firstname.lastname@example.org;Michael Gambale in New York at email@example.com;Hannah Benjamin in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Nikolaj Gammeltoft at email@example.com, Dan WilchinsFor more articles like this, please visit us at bloomberg.com©2020 Bloomberg L.P.
(Bloomberg) -- Europe’s primary bond market had a record-setting day, with at least 32.7 billion euros ($36 billion) of deals, as the Iran crisis failed to damp the usual early-January rush.Ireland and Portugal both sold 4 billion-euro sovereign notes, after each drew more than 20 billion euros of orders, according to separate people familiar with sales, who asked not to be identified because they’re not authorized to speak about them. The Netherlands’ BNG Bank NV issued a 2 billion euro note.Carmaker BMW AG brought the year’s first multi-part euro corporate deal, alongside about a dozen bank bonds, as the primary market racked up almost 60 billion euros of offerings in just two days. The post-holiday flood reflects investors’ struggle to find yield and issuers’ eagerness to kickstart annual funding plans before risks such as the Middle East and Brexit potentially scupper low borrowing costs.It makes sense “to frontload issuance, given how tight spreads are,” said Piers Ronan, head of financials debt syndicate at Credit Suisse Group AG. “Consensus is that it’ll be a stable year, where spreads if anything grind tighter, but everyone recognizes there’s meaningful downside risk.”Low rates and investor appetite helped Ireland and Portugal cut borrowing costs versus early 2019. Portugal priced its long 10-year note at 33 basis points above midswaps after paying 112 basis points on a similar deal a year ago. Ireland’s long 15-year bond had a tighter spread than a long 10-year note sold in January 2019.Euro investment-grade notes yield less than 0.5%, according to a Bloomberg Barclays index.German rail operator Deutsche Bahn AG and French utility Veolia Environnement SA also sold euro bonds on Wednesday as corporate activity picks up following a relatively slow start to the year. A unit of telecommunications provider Altice Europe NV will close books on two euro notes.Wednesday’s deal list also included notes of 1 billion euros or more from Santander UK Plc, UniCredit Bank AG and Finland’s Municipality Finance Plc.(Updates total in headline, first paragraph, Altice in seventh)To contact the reporters on this story: Alice Gledhill in London at firstname.lastname@example.org;Neil Denslow in London at email@example.comTo contact the editors responsible for this story: Hannah Benjamin at firstname.lastname@example.org, V. RamakrishnanFor more articles like this, please visit us at bloomberg.com©2020 Bloomberg L.P.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.European banking shares are kicking off the new decade with their best start to a year since 2013, thanks to some encouraging macro news.On the first day of trading in 2020, the Stoxx 600 Banks Index led the broader market with a 1.8% gain, following China’s latest policy move to support its economy. The sector, which lagged most peers in 2019 amid factors including a low-rate environment and poor macro data, is on track for its highest close since May.The strong start comes even as analysts mostly remain negative on banks, which have underperformed peers for years now. While 2019 ended with positive signs for a U.S.-China trade deal and a boost for U.K. banks after a decisive election win for the Conservative Party, the ratio between analyst rating upgrades and downgrades for the sector has dropped to the lowest level since March 2016.With the German economy most exposed to China, lenders Commerzbank AG and Deutsche Bank AG led gains on Thursday, each up more than 5%, after China’s central bank trimmed the amount of cash that lenders must hold in reserve, and signaled continued action in 2020 to reduce borrowing costs for companies. Other rate- and macro-sensitive names advancing in Europe included AIB Group Plc, Banco Santander SA and UniCredit SpA.To contact the reporter on this story: Jan-Patrick Barnert in Frankfurt at email@example.comTo contact the editors responsible for this story: Beth Mellor at firstname.lastname@example.org, Namitha Jagadeesh, Morwenna ConiamFor more articles like this, please visit us at bloomberg.com©2020 Bloomberg L.P.
Moody's Investors Service ("Moody's") has affirmed Berlin Packaging LLC's (Berlin) B3 Corporate Family Rating (CFR) and B3-PD probability of default. All other instrument ratings are affirmed and the stable outlook remains unchanged. The affirmation follows the announcement that Berlin has entered into a definitive agreement to acquire Netherlands based Novio Packaging Group B.V. The acquisition will be financed by an undisclosed amount of privately placed debt that will not be rated.
Some of Europe's biggest banks are being challenged by environmental groups to sever all lending to utilities which they say are still developing new coal-fired power plants. The call comes as some 190 countries meet in Madrid to assess progress on the 2015 Paris Climate Agreement, which demands a virtual end to coal power by 2050. A United Nations report last year said almost all coal-fired power plants would need to close by the middle of this century to curb a rise in global temperatures to 1.5 degrees Celsius, in line with the level scientists say is needed to stave off the worst effects of climate change.
Moody's Investors Service ("Moody's") has today affirmed the B2 local currency long-term deposit rating and senior unsecured debt rating, and the bank's B3 foreign currency long-term deposit rating of Yapi ve Kredi Bankasi A.S. (Yapi Kredi). The rating agency also affirmed the bank's b3 standalone Baseline Credit Assessment (BCA), downgraded the Adjusted BCA to b3 from b2, downgraded the subordinate debt ratings to Caa1/Caa2(hyb) from B3/Caa1(hyb), and downgraded the preferred stock non-cumulative to Caa3(hyb) from Caa2 (hyb).
So Much For A Christmas China Trade Deal The signing of the Hong Kong Human Rights and Democracy Act of 2019 had already put the prospects of a US trade deal with China in jeopardy, and now it seems that the chances of a deal by the end of the year have been completely scuttled. […]The post Market Morning: Trade Deal Scuttled, French Cheese Wars, Gronk Picks CBD over NFL appeared first on Market Exclusive.
(Bloomberg Opinion) -- Jean Pierre Mustier’s new four-year plan for Italy’s UniCredit SpA marks a victorious milestone for the chief executive officer. He’s managed to turn a sprawling European bank laden with bad loans into a simpler entity that promises to improve its returns to shareholders. It leaves him well-placed to plot his biggest move yet (should he so choose): cross-border M&A.The Italian bank has cut costs, sold non-core units and eliminated a bad-debt mountain. While he’s forfeited growth by exiting businesses in Poland and Italian online lending, Mustier has improved profitability. The group return on tangible equity is targeted to exceed 9% this year, up from just 4% in 2015.He’s convinced regulators that the bank doesn’t need as much capital and he’ll seek their approval for the company’s first share buyback since 2004. The 27.8 billion-euro ($31 billion) lender plans to return 8 billion euros ($8.9 billion) to investors in dividends and stock purchases through 2023, giving an implied yield of as much as 7%. That compares with a 6% average for the sector, according to UBS Group AG analysts.All this good work is just as well. While the Frenchman has made UniCredit a more stable, cross-border commercial lender, it still faces huge challenges. That was plain to see in some of the key targets in his “Team 23” strategic plan unveiled on Tuesday.Under assumptions for interest rates that UniCredit says are more severe than the market’s, it sees ROTE declining again. Under this scenario, the measure will be no higher than 8% through 2022, while the bank’s revenue will increase by a meager 0.8% on average annually during the four-year plan. That’s below analyst estimates. Mustier won’t be able to do much more on costs, either; they’ll remain little changed throughout the plan’s duration.Crucially, eking out that modest growth in revenue will depend on UniCredit expanding loans to Europe’s small and medium-sized businesses and consumers at a pace that exceeds GDP expansion.There are some more levers Mustier can pull. UniCredit plans to set up an Italian holding company for foreign assets that could lower its capital needs. It still owns 32% of the Turkish bank Yapi ve Kredi Bankasi, a stake that could be sold.But Mustier’s vision for a “pan-European winner” (his words) may require more radical thought. For the moment, he’s adamant there will be “no M&A,” pointing to smaller, bolt-on purchases. Valuations are a stumbling block to large deals. With UniCredit’s shares trading well below its book value, it makes more sense to pursue buybacks — as Mustier says.Nonetheless, the bank’s smaller, nimbler form positions it for a cross-border deal should the European Union ever complete its banking union. Germany’s Commerzbank AG is often mooted as a partner. If UniCredit’s share price ticks up in the meantime, that would certainly help.To contact the author of this story: Elisa Martinuzzi at email@example.comTo contact the editor responsible for this story: James Boxell at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Elisa Martinuzzi is a Bloomberg Opinion columnist covering finance. She is a former managing editor for European finance at Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
European stocks on Tuesday recovered some of the ground lost in the prior session, with gains tentative on continuing worries about trade tensions.
Shares of Italian bank UniCredit edged higher as it laid out plans to cut 8,000 jobs by the end of 2023. At its London capital markets event, UniCredit said it was targeting 2023 revenue of 19.3 billion euros ($21.4 billion) and an underlying profit of 5 billion euros, and the rollout of what it calls a "paperless retail bank" in Italy next year and in Germany and Austria in 2021. UniCredit said it plans to return 8 billion euros in capital to shareholders from 2020 to 2023.
European shares on Tuesday recovered from two-week lows hit in the previous session, getting a boost from technology and bank stocks, even as investors still grappled with prospects of fresh global trade disputes. Trade-sensitive German shares climbed 0.7%, although French stocks rose only marginally after U.S. threatened of punitive duties of up to 100% on $2.4 billion in imports from France including Champagne, handbags and cheese. The broader European stocks index, however, rose 0.5% by 0818 GMT, recovering from a slide to near two-week lows on Monday following U.S. President Donald Trump's move to restore tariffs on metal imports from Brazil and Argentina.
European Union lawmakers urged Maltese and EU authorities on Thursday to investigate Malta's top lender after the European Central Bank (ECB) found its risk monitoring had "severe shortcomings" that could have allowed money laundering or other criminal activities. Reuters reported on Wednesday about a confidential ECB review of Bank of Valletta (BoV) in which the Frankfurt-based regulator said BoV had failed for years to detect or address risks involving thousands of payments.