|Bid||12.75 x 0|
|Ask||12.76 x 0|
|Day's Range||12.46 - 12.77|
|52 Week Range||9.07 - 13.07|
|Beta (3Y Monthly)||1.82|
|PE Ratio (TTM)||7.48|
|Earnings Date||Feb 5, 2020 - Feb 10, 2020|
|Forward Dividend & Yield||0.27 (2.18%)|
|1y Target Est||16.38|
to try to address their chronically poor profitability. Hemmed in by the European Central Bank’s long-term extension of negative rates, slowing economic growth, Brexit and burgeoning regulatory requirements, lenders across Germany, UK, France, Spain and Switzerland have collectively announced more than 60,000 jobs cuts this year. For the top ten banks in Europe by market cap, staff numbers have fallen a fifth since 2008 to 1.1m.
Dear readers, It has been a week of some not insignificant news on the corporate front — never mind the small matter of an upcoming UK election. An alleged accounting misstatement in Switzerland. A proposed ...
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 firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis 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.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.Germany is set to knock the U.K. off its perch as Europe’s most active property market, as yield-hungry investors bet the region’s traditional growth engine will bounce back from its current economic malaise.Investors poured 49.4 billion euros ($54.4 billion) into German commercial real estate in the 10 months through October, surpassing the 35.1 billion euros of deals in the U.K., according to broker Savills Plc. That puts Germany on course to best Britain this year for the first time in a decade.The German property market is booming despite its economy narrowly averting a recession in the third quarter. Buyers desperate for returns in a world of negative interest rates and feeble bond yields are increasingly willing to look past harrowing economic forecasts and snap up buildings with the potential for rising rental income.“At the moment the demand is strong, but all the surveys predict that German economic growth is slowing,” said Gert Waltenbauer, chief executive officer of KGAL GmbH & Co., an asset manager that invests in real estate, infrastructure and aviation. “We don’t have the feeling we should be really worried; we have to take a long-term view.”Read more: Germany Dodges Recession With Surprise Third-Quarter GrowthThe U.K., led by London, has long been the commercial real estate capital of Europe, attracting the lion’s share of international investment. But deals have fallen off amid the political turmoil and uncertainty surrounding Britain’s exit from the European Union. That has helped make Germany, with its relative political stability, economic heft and liquid market, a more attractive bet.Marcus Lemli, CEO of Savills’s German operation, said Brexit alone can’t be blamed for Britain falling behind. Germany’s economic fundamentals are what lure investors from around the world. And a limited supply of available buildings is making competition for assets increasingly fierce.“In Germany, construction is unable to keep up with demand in almost all major cities, particularly in the offices sector,” Lemli said. “The amount of capital trying to find a home in property is much larger than the available stock.”A case in point is the recent acquisition of a 49-property portfolio in Germany by Commerz Real for about 2.5 billion euros. The real estate arm of Commerzbank AG beat out more than half a dozen rivals to complete the deal, which had a yield of about 3%, based on current annual rental income from the properties and the sale price, according to people with knowledge of the matter who asked not to be identified because the sales process is private.‘Long-term Play’That’s an extremely low yield for a large German portfolio. Still, the deal made sense because the price per square meter worked out at about 8,000 euros, more than a third less than you’d pay for top buildings in Berlin, Frankfurt and Munich, according to Commerz Real CEO Andreas Muschter.That suggests Commerz Real has room to raise rents and boost returns for its investors, he said -- as long as demand for office space remains strong. Given Germany’s economic malaise, that’s a bold bet. “Pricing was aggressive, but it’s a long-term play and we’ll have the next 10 years to manage it to a higher level,” Muschter said in an interview. “That’s why you had so many parties going for it.”The intense competition for the portfolio -- unsuccessful offers totaled about 20 billion euros -- highlights the strength of demand for a limited supply of deals in Germany, the people said.Pending DealsThat capital that still needs to be invested, and deals are in the works. In Munich, Norway’s sovereign wealth fund is pushing forward the sale of a 400 million-euro office building, and an office campus owned by UniCredit SpA’s German subsidiary HVB is in the process of being sold for about 1 billion euros, according to people with knowledge of those deals.“We do not comment on rumors and speculation,” a spokeswoman for HVB said by email. A representative of the Norwegian sovereign wealth fund declined to comment.“We can discuss pricing forever, but our clients are giving us money and our job is to get the performance with the money they give us,” said Paul Joubert, managing director for European transactions at Invesco Real Estate. “Yields are going to go down for sure. All the institutions have the same problem.”(Updates with HVB comment in penultimate paragraph.)To contact the reporter on this story: Jack Sidders in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Shelley Robinson at email@example.com, Patrick Henry, Andrew BlackmanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg Opinion) -- Leonardo Del Vecchio’s sudden emergence as the biggest shareholder of Mediobanca SpA, Italy’s best-known investment bank, is fueling speculation of an even bigger shakeup in the country’s financial industry. The lender’s promise to pursue cautious growth looks vulnerable to a push for deeper change.Exactly what the eyewear billionaire has in mind for his 10% stake isn’t yet clear. Media reports suggest the 84-year-old Italian wants to lift his holding to as much as 20%, a huge undertaking — and not just financially. Considerable effort would be needed to obtain European Central Bank approval to own more than 10%. Del Vecchio must have grand ambitions.What’s more, the tycoon is not the best of friends with Mediobanca’s chief executive officer Alberto Nagel. The two have been at odds since a proposed investment by Del Vecchio in a Milan hospital was reportedly blocked by Nagel.Del Vecchio's recent comments appear critical of the Mediobanca boss. He hit a nerve by suggesting the bank might do better by expanding more aggressively in investment banking and relying less on income from its consumer finance business and its holding in the giant insurer Assicurazioni Generali SpA.UniCredit SpA, Italy’s biggest bank, could previously call the shots at Mediobanca before selling its own holding in the bank last week. That position let it wield influence over Generali too. Now the question is what Del Vecchio wants to do with the stake. He has also acquired a holding in Generali directly.While investors are right to fret about the peculiarities of Italian corporate governance, where minority shareholders can control the boardroom for their own interests, as a smart outsider Del Vecchio has spurred a useful debate. Mediobanca said on Tuesday that it wants to keep its 13% Generali stake until it finds an acquisition in wealth management that it needs to fund, and that he feels an obligation to keep it in Italian hands. But is it really a must have?At 4 billion euros ($4.4 billion), the value of the holding is far larger than what the bank might need for a rainy day. Proceeds from a sale could accelerate investment in more promising businesses such as private banking to generate higher returns — or they could be given back to shareholders. Or Nagel could do a bit of both. Under his four-year growth plan, Mediobanca sees returns on allocated capital in wealth management of 25% compared to 11% from Generali. Maybe it does make sense to shift more capital to the former.In fairness, that four-year strategy unveiled by Nagel this week should let the company build on its success in investment banking, consumer finance and wealth management. Mediobanca expects to bolster profitability to an 11% return on tangible equity from 10% and to boost investor payouts by 50% over the four years. Against a backdrop of Italian banks plagued by bad debt and an industry in Europe that’s mostly shrinking, Nagel deserves credit for dodging risky loans and focusing on the right businesses.Overall, Nagel is counting on average revenue growth of 4% and doubling the contribution to profit from wealth management by growing organically. But he’s still relying on returns from Generali too: The stake contributes one-third of income.It’s possible that Del Vecchio, who wields huge power at the eyewear giant EssilorLuxottica SA, will grow frustrated with the complications of investing in finance. Regulation has kept activist investors away from banking mostly. Even if he doesn’t stick around, Nagel may find his plans need to change.To contact the author of this story: Elisa Martinuzzi at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis 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.
Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of UniCredit Bank AG and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future.
Rating Action: Moody's assigns definitive rating to Impresa TWO S.r.l. Milan, November 11, 2019 -- Moody's Investors Service ("Moody's") has today assigned the following rating to the debts issued by Impresa TWO S.r.l. Moody's has not assigned any ratings to the EUR 3,319,908,880.00 Class B Asset Backed Fixed Rate and Variable Return Notes due December 2061.
(Bloomberg Opinion) -- European fund management companies spent 2018 watching their share prices steadily decline, battered by increased regulatory scrutiny, customers withdrawing money and the relentless squeezing of fees. They’ve rallied this year, but the industry’s biggest beast in the region is outpacing its peers by an astonishing margin.Investors in Amundi SA have enjoyed a total return of more than 60% in 2019, outpacing the Stoxx Europe 600 index by 35 percentage points. The stock has beaten the 32% gains at DWS Group GmbH and Standard Life Aberdeen Plc, the 39% return for Schroders Plc and Man Group Plc’s 19% rise.Amundi, 68 percent-owned by France’s Credit Agricole SA, recently announced record quarterly inflows of almost 43 billion euros ($48 billion) in the three months through September, breaking a streak of three consecutive quarters of client withdrawals. Its 1.6 trillion euros of assets under management — up from 952 billion euros when it listed on the stock market in November 2015 — make it Europe’s biggest money manager.The most impressive statistic, however, is the one element of Amundi’s financials over which it has most control: its costs.The company’s frugality has nudged its cost-to-income ratio lower in recent years; it fell to an industry-beating 51.1% at the end of the third quarter. By comparison, Deutsche Bank AG-controlled DWS aims to cut its ratio to 65% and doesn’t expect to achieve that until the end of 2021.What could knock Amundi off its perch? Well, DWS Chief Executive Officer Asoka Woehrmann told the Financial Times this month that he plans to challenge his rival’s dominance by finding a takeover or merger that would increase his firm’s 752 billion euros of assets. Earlier this year Switzerland’s UBS Group AG was reported to be considering strapping its fund management arm to DWS. Insurer Allianz SE was also said to be interested in the German investment firm. Any such deal would create a challenger with the scale to match Amundi.But the French fund giant’s CEO Yves Perrier is unlikely to just stand by if industry consolidation begins. Now that he’s finished absorbing Pioneer Investments, a fund management unit bought from Italy’s UniCredit SpA for 3.5 billion euros in 2017, the decks are clear. While these mega-mergers might not happen, Amundi is well placed if they do. With its shares trading at their highest in more than 18 months, Perrier has the currency to fund a deal.To contact the author of this story: Mark Gilbert at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Mark Gilbert is a Bloomberg Opinion columnist covering asset management. He previously was the London bureau chief for Bloomberg News. He is also the author of "Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable."For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
(Bloomberg) -- A bond-market warning light that glowed green for years is suddenly flashing red. The bad news for bondholders is that the last time this happened, it was accompanied by the biggest sell-off since the aftermath of the global financial crisis.That indicator is the term premium, which, for both Treasuries and German bunds, has snapped back from last quarter’s record lows. The U.S. gauge is now on track for the biggest three-month increase since late 2016.After a stellar rally through August, global bonds have pulled back in recent weeks as thawing trade tensions lightened the global economic gloom, sapping demand for the safety of sovereign debt. Rebounding term premiums now signal the sell-off has further to run -- the measure of extra compensation for holding longer-term debt versus simply rolling over a short-tenor security for years is in an uptrend that investors and strategists say has only just begun.The 10-year Treasury yield, a benchmark for world markets, climbed Thursday to a three-month high as investors’ animal spirits were sparked by the ebbing of the biggest headwind to global growth -- the U.S.-China trade war. That came as its German counterpart surged to levels unseen since mid-July and those in France and Belgium climbed back above 0%. The Japanese equivalent jumped Friday to its highest since May.Investor are increasingly worried about holding longer-term debt as easing economic anxiety raises the prospect of a capital flight out of haven assets into riskier ones. Such a trend is already driving up yields, which, combined with the Federal Reserve’s signal that it will hold interest rates steady for the time being, is boosting term premiums. In Europe, a still-accommodative policy is bolstering inflation prospects, adding to the upward pressure on the gauge.“Term premium was extremely depressed due to trade uncertainty, Brexit and you name it,” said Roberto Perli, a partner at Cornerstone Macro LLC. “These risks have abated so there is room for about a 50 basis point move higher in term premium. And given the Federal Reserve is on hold -- with no chance of lifting rates - there’s a lot of incentive for investors to take risk.”Ten-year Treasury term premium has climbed about 42 basis points since the end of August, on track for the biggest three-month increase since 2016, according to the widely followed New York Fed ACM model created by Tobias Adrian, Richard Crump and Emanuel Moench. It rebounded this week to as little as minus 0.84% -- from a record low of minus 1.29% in August, the least for NY Fed data provided back back through 1961.Understanding the trend in term premium isn’t just an academic exercise for bond wonks as it also helps gauge what’s driving debt yields and valuations. That margin of safety is one of three components that make up the yield of any given bond, according to former Fed Chairman Ben S. Bernanke -- the other two being market expectations for monetary policy and inflation. Basically, it’s an extra cushion against risk over the security’s relatively long lifetime.To be sure, a resolution to the U.S.-China trade spat still looks far, with President Donald Trump downplaying Friday the amount of progress made in negotiations.In Germany, the 10-year term premium began a swoon in mid-2014 after ranging from 100 to 250 basis points back since the euro was introduced in 1999, according to estimates by UniCredit SpA strategist Luca Cazzulani, using the methods as in the ACM model.The gauge for bunds slumped to a record minus 100 basis points at the end of September before rising to minus 88 in October, according to UniCredit data updated at the end of each month. It has likely risen further this month.“We have seen a continuation of upward in bund yields this month, and that should be related mostly to higher term premium,” Cazzulani said.Long-term debt has a higher duration that those with shorter tenors. That means that for each move up in yield, prices will fall more sharply than for its short-term counterparts, increasing the risk of being in long-maturity debt.QE EffectThe European Central Bank’s resumption of fresh bond purchases this month will exert marginal downward pressure on bund term premium, yet won’t be “a game changer,” according to Cazzulani. He estimates that quantitative easing will cause only a five basis point setback in the gauge, which would be too little to counter forces pushing it upward.After cutting rates and unveiling debt-buying plans last month, the ECB has been pushing for governments to add budgetary support for growth. The prospects of fiscal stimulus along with an ongoing push for more European banking integration bode for more upside for term premium and yields in the region, according to Ronald van Steenweghen, a fund manager at a portfolio manager at DPAM.“Term premium was driven to levels that were difficult to explain unless you think the economic outlook is very dire, which we don’t agree with,” DPAM’s van Steenweghen said during an interview at the firm’s Brussels office. “And the potential positive feedback loop on the economy of fiscal stimulus is very, very high. This, with stable ECB policy, improving growth and reduced uncertainty all will work to push yields higher.”The 10-year bund yield is on course to rise from about minus 0.26% to between 0.50% and 1% over the next one to three years, predicted van Steenweghen.That leaves him “more confident with having a shorter duration stance.”To contact the reporter on this story: Liz Capo McCormick in london at firstname.lastname@example.orgTo contact the editors responsible for this story: Paul Dobson at email@example.com, Anil Varma, Debarati RoyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Net interest income — the difference between what lenders earn from loans and pay for deposits, and a key profit driver for retail banks — fell 5% to EUR2.56 billion.
Slovenia's gross domestic product (GDP) growth is expected to lose less than 0.1 percentage point due to new loan restrictions, the Bank of Slovenia governor said on Wednesday. Bostjan Vasle, who also sits on the European Central Bank (ECB) governing council, told reporters household spending growth could fall by about 0.1 percentage point due to the rules while GDP on aggregate would be influenced by less than that.
The party of the Slovenia's centre-left Prime Minister Marjan Sarec asked the Bank of Slovenia on Monday to reverse restrictions on bank loans imposed this month, saying the policy will hurt many citizens. The central bank has ordered banks to halt lending if a borrower would have to pay more than 67% of net income to service debt, and has imposed a maximum seven-year maturity for consumer loans other than mortgages. It says the restrictions are necessary to curb excessive credit growth, with consumer lending rising faster than 10% per year.