European banking: set to shrug off slow revenue growth

Sep 13 13:09 2017 Print This Article

European banks have frequently been in the headlines of the financial media this year. We have seen bank bailouts in Italy, mergers and acquisitions in Spain, large volumes of primary bank issuance as governments sold their stakes and the sector has remained a proxy for market sentiment on future European Central Bank (ECB) rate policy.

The wider European financial sector outperformed the MSCI Europe ex-UK index by 4% in 2017 through the first week in August, but has underperformed the index over the last few weeks.

In my view, the main reason for this recent underperformance is the sluggish state of European banks’ revenue lines. The European banks second quarter reporting season, which came into full swing in mid-August, was once again nominally strong. This followed five quarters of gradual improvements delivering better than-expected bottom-line income, contributing to stronger capital positions.

Read More

About Article Author

Investors Corner

BNP Paribas Investment Partners is the asset management arm of BNP Paribas, one of the largest and best-rated banks in the world. They are a global investment solutions provider, offering investors high-quality investment products and services for both mainstream established asset classes, thematic investing and specific regional financial assets in developed and emerging markets across the globe. The aim of this blog is to provide a forum for investment professionals from across the spectrum of BNP Paribas Investment Partners’ teams to share their analyses or wrestle with the strategic themes and issues confronting us as asset managers.

Related Items

February 16, 2018

HIMIPref™ Preferred IndicesThese values reflect the December 2008 revision of the HIMIPref™ IndicesValues are provisional and are finalized monthly Index MeanCurrentYield(at bid) MedianYTW MedianAverageTradingValue MedianMod Dur(YTW) Issues Day’s Perf. Index Value Ratchet 0.00 % 0.00 % ...

Top Funds' Activity in Q4 2017

Brandon Kochkodin, Hema Parmar and Katia Porzecanski of Bloomberg report, Hedge Funds Are Dumping Facebook and Google:Billionaire David Tepper’s Appaloosa Management more than tripled its stake in Apple Inc. and almost doubled its holding of Facebook Inc. in the final three months of last year.Ap ...

Schedule for Week of Feb 18, 2018

The key economic report this week is January existing home sales.----- Monday, Feb 12th ----- All US markets are closed in observance of the Presidents' Day holiday.----- Tuesday, Feb 13th ----- No major economic releases scheduled.----- Wednesday, Feb 14th ----- 7:00 AM ET: The Mortgage Bankers Ass ...

Book Bits | 17 February 2018

● The Divide: Global Inequality from Conquest to Free MarketsSummary via publisher (W. W. Norton) By Jason Hickel Global inequality doesn’t just exist; it has been created. More than four billion people—some 60 percent of humanity—live in debilitating poverty, on less than $5 per day. The s ...

History And Fibonacci Say We Topped On Friday

Fear ramped up with the early February selling and a capitulatory bottom (at least short-term) printed.  The Volatility Index ($VIX) doesn't hit the 40-50 zone often and, when it does, it typically coincides with a panicked selloff and bottom.  The last time we saw panicked selling (before the pa ...

Low-carbon shipping: will 2018 be the turning point?

Photo: Peter Hessels/Flickr As highlighted in a previous blog post, international maritime transport has not kept pace with other transport modes in the fight against climate change. While inland transport was included in the 2015 Paris Agreement and international air transport followed suit in 20 ...

Dollar Regains Ground Ahead of Fed Minutes

Higher US inflation fails to spark dollar revival The US dollar depreciated across the board versus major pairs despite consumer prices rising more than expected. Inflation anxiety had triggered a sell-off in global stock markets with the Fed expected to ramp up their interest rate hike path yet the ...

OPEC pops the question – will Russia say ‘I do’?

OPEC is drafting an agreement to tie Russia into a so-called “super group” of oil producers. Details on the proposal are vague and the Kremlin’s willingness to consider such a betrothal is uncertain, despite some positive vibes between Russia and OPEC kingpin Saudi Arabia at the moment. In ...

GFICC interest rate forecast refresh

Each quarter, lead portfolio managers and sector specialists from across our Global Fixed Income, Currency & Commodities (GFICC) platform gather at our Investment Quarterly (IQ) meeting to provide valuable insight into their sectors, debate factors likely to influence the markets over the coming qu ...

Every Setback Presents Fresh Opportunities

Traders who are "all in" on the long side hate days like this past Friday when the market got slammed big time, with the Dow down 2.6%, the NASDAQ down 2.1% and the S&P down 2%, the worst overall showing in two years. And if you're wondering if traders were scared on the selling all you have to do ...