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’The rights are going out all over Europe
A rough ride for UniCredit shares, and rights to buy its shares as part of the bank’s €7.5bn cash call, on Monday — they fell, got suspended limit down, and are dropping again (down 6.4 per cent) at pixel time.
Debt swaps: we can do this the easy way or…
… we can just not call your bonds like you thought we would.
This is the tactic that Santander and Lloyds have seemingly been taking, as they try to get bondholders to exchange subordinated debt for senior bonds that improve capital.
S&P and Fitch downgrade Spanish banks
Where the sovereign goes, the banks follow. (And vice-versa, of course.)
Fitch and S&P downgraded a slew of Spanish banks on Tuesday evening. The rating rationales are pasted below.
There’s probably little new information here to FT Alphaville readers but a few things caught our eye and we’ve highlighted the excerpts accordingly.
Snap news
Breaking pre-market news on Friday,
- Santander UK posts £1.14bn trading profit before tax down 2 per cent on 2010 — statement and statement.
- ABN Amro reports €864m net profit in first half,
Tap tap tap – covered bonds on a drip
Hidden in the €144.2bn of euro-denominated covered bonds issued so far this year is a number.
€18.2bn.
About 13 per cent of total covered bond supply this year came not from new issuance, but from increases in existing benchmark covered bonds.
A pause in Spanish bank piggybacking?
It’s gone all quiet in the other letters that make up a certain eurozone peripheral acronym…
Spain and Italy have both been contenders for the next eurozone hotspot, of varying degrees. And while Spanish and Italian banks have both been rushing to raise capital or prefund in recent months,
Ants, grasshoppers and Spanish banks
Here’s one to add to the Spanish banks about to lose their loan buffers theme.
Joseph Dickerson, bank analyst at Espirito Santo and last seen on FT Alphaville quoting Woody Allen and slapping a big buy on Lloyds,
Snap news
Breaking pre-market news on Tuesday,
- BHP Billiton to buy Chesapeake shale gas assets for $4.75bn – statement.
- Moody’s changes Japan’s Aa2 rating outlook to negative – statement.
- Zurich Financial buys $1.67bn stake in Santander’s Latin American unit- statement.
SocGen on depleted Spanish bank loan loss buffers
For some months now, all the Spanish banking concern has been focused on funding and net margin issues. Worries about loan losses (so 2009) have ebbed away.
On Wednesday, Société Générale’s banking team says it’s time to revisit the issue.
More Spanish banking negativity
RBS is recommending a cautious stance on Spanish banks on Monday.
It’s nothing to do with provisioning for legacy assets or impairments, however.
Like UBS analysts before them, the RBS move is down to diminishing new business margins — and an increasing cost of funding — which,
Worst banking conspiracy ever
Have you ever heard of Inter-Alpha? We hadn’t until this weekend, although we tend not to frequent the conspiracy sites that lump it in alongside the world’s Bilderbergs, Rothschilds, and the Stonecutters.
Spanish bank: UK banks exposed to Ireland and Korea
If a crisis is a terrible thing to waste, two crises are seemingly an excuse for tenuous interesting juxtapositions.
In a note out today, Santander’s European Equity Research team look at UK bank exposures to Ireland and (obviously) South Korea.
Double agents in asset management
It may not be the workings of an Anna Chapman-style Russian sleeper cell.
But it is a case involving suspected double-agents. In the asset management industry.
As FTfm reports on Monday in their lead article:
Guess the Britain-wary bank
Competition time.
A curious aside in Richard Lambert’s final speech as head of the Confederation of British Industry on Monday, as reported by the FT:
Mr Lambert excoriated politicians for irresponsibility in caricaturing banks as casinos and demanded an end to what he called “Vince Cable versus Lombard Street” – a reference to the business secretary’s attacks on the banks.
Maturity magic
We knew it was coming.
But innovations to escape newly-created liquidity rules for banks have come rather sooner than we thought.
From the Bank of England’s latest quarterly bulletin:
Some of the attraction of these instruments is likely to reflect recent regulatory developments.
Missing in action — 80% of SocGen trades [updated]
And we were wondering how Jerome Kerviel got away with it… Update: It’s a bit unfair to cite Kerviel on this one, actually — it just concerns misreported transactions in the UK branch, not fraud against the French parent.
Snap news
Breaking pre-market news on Wednesday,
- Lloyds posts £1.6bn profit in first half, impairments at £6.55bn – statement.
- RBS sells UK branches to Santander for £1.65bn — statement and statement.
Snap news
Breaking pre-market news on Thursday,
- Royal Dutch Shell Q2 earnings $4.5bn; $7-8bn asset sales planned — statement.
- Santander group profit down 1.6 per cent; UK profit up 11 per cent — statement.
Market gives banks a ‘B’ ahead of the stress tests
In case you were wondering about market expectations ahead of the stress tests.
The below has just landed in our inbox. It’s the results of a Goldman Sachs survey of 376 mostly-European market “participants”
Banco Santander vs Bank of BMW
2010 is shaping up to be a good year for Germany’s luxury carmakers.
In April, Daimler caught investors on the hop with a sudden doubling of its profit expectation, and on Tuesday arch-rival BMW increased its profit and sales forecast for 2010.
Snap news
Breaking pre-market news on Monday,
- BP spill response cost $3.5bn to date, $165m claims paid — statement.
- Falkland Oil & Gas says no hydrocarbons found at Toroa well — statement.
- Kent Reliance confirms in restructure talks with JC Flowers — statement.
An €11bn stress test scenario for Santander, BBVA
Execution Noble has updated its original stress test scenario note for Spain’s Santander and BBVA banks, this time assuming a 10 per cent haircut scenario on Spanish sovereign bonds.
While their initial “adverse scenario”
More on Spanish credit lines
Spain’s latest auction of 10- and 30-year bonds was by all accounts pretty well received on Thursday, in the context of recent jitters about its sovereign debt.
So why the need for statements like this? As Reuters reports:
Charting Europe’s grim sovereign-bank loop
“If the Spanish state has difficulty in financing itself outside Spain, then the difficulties will be even greater for those in the private sector.”
- BBVA chairman, Francisco Gonzalez
June 14, 2010 (Via Reuters)
Spanish banks – Facts and Fiction
Worried about the Spanish banking system? Don’t be. The domestic economy could double dip, wholesale funding costs could spike and yet Spain’s banks wouldn’t need a massive infusions of new capital.
So says Bank of America Merrill Lynch in a 77-page report published on Monday,
BNP Paribas: ‘Avoid Spanish banks for now’
Add the credit analysts at BNP Paribas to the growing list of those concerned about the robustness of the Spanish banks.
In a note published on Wednesday, analyst Olivia Frieser observed, in a comment on the findings of the June 2010 edition of the ECB’s Financial Stability Review,