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☆ Italy's UniCredit, Intesa fall as investors fret over bond portfolio risks
▼ + stars: | 2023-03-10 | by ( ) www.reuters.com time to read: +1 min

[1/2] A view of the Unicredit headquarters of which many employees are working from home due to a coronavirus outbreak, in Milan, Italy March 2, 2020. REUTERS/Yara NardiMILAN, March 10 (Reuters) - Shares in leading Italian banks UniCredit (CRDI.MI) and Intesa Sanpaolo (ISP.MI) fell sharply on Friday following a sell-off in U.S. and Asian banks driven by concerns lenders potentially face losses on their government bond portfolios. The rise in interest rates has hammered the value of those portfolios, with Italian banks seen as particularly exposed given the risk premiums investors demand to hold Italian paper rather than higher-rated German government bonds. By 0820 GMT shares in UniCredit lost 4.5% and Intesa around 4%. Reporting by Valentina Za Editing by Keith WeirOur Standards: The Thomson Reuters Trust Principles.

☆ Europe's lenders sucked into global banks rout
▼ + stars: | 2023-03-10 | by ( Alun John | ) www.reuters.com time to read: +2 min

[1/4] The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, March 8, 2023. The episode underscored the vulnerability of banks, many of which were propped up by taxpayers' cash following the global financial crisis more than a decade ago. Investors in SVB's stock had fretted over whether the capital raise would be sufficient given the deteriorating fortunes of many technology startups that the bank serves. But some startups have been advising their founders to pull out their money from SVB as a precautionary measure, the sources added. Writing By John O'Donnell; Additional reporting by Jo Mason; Editing by Elisa Martinuzzi and Toby ChopraOur Standards: The Thomson Reuters Trust Principles.

☆ One year of war in Europe: How the dollar, energy and food prices swirled
▼ + stars: | 2023-02-24 | by ( ) www.reuters.com time to read: +6 min

LONDON, Feb 24 (Reuters) - Russia's invasion of Ukraine has disrupted economies and markets around the world, from energy and food prices to European banks, emerging market stocks and the Russian currency. Below are five charts that show how Europe's biggest conflict since World War Two has shaped global financial markets in the last 12 months. But when Russian tanks rolled into Ukraine in late February, European natural gas prices rocketed by almost 400% in two weeks. Energy prices soared, bringing the threat of blackouts, recession and a worrying switch back to dirtier sources of fuel. Food price pressures are easing, but that does little to soften the blow for many developing nations, where food and energy prices make up a larger share of spending.

[1/4] A Russian police officer stands in front of a branch of the Raiffeisen Bank in Moscow, Russia, February 27, 2016. It made a net profit of roughly 3.8 billion euros last year, thanks in large part to a 2 billion euro plus profit from its Russia business. Of UniCredit's more than 20 billion euro total revenue last year, Russia accounted for more than 1 billion euros. Meanwhile, Russian savers lodged more than 20 billion euros with the bank, which offers a place to deposit funds with fewer sanctions risks. It banned investors from so-called unfriendly countries from selling shares in banks, unless the Russian President grants an exemption.

LONDON/FRANKFURT, Jan 27 (Reuters) - Rising borrowing costs are giving a long-awaited lift to Europe's beleaguered banks, but they come with a sting in the tail. Last year central banks ended a decade of rock-bottom interest rates as the U.S. Federal Reserve and then the European Central Bank moved towards tightening. But while rising rates are good news for bank profits, they herald a slowdown in an economy hit by war and runaway prices that squeeze borrowers and could prick pricing bubbles, most notably in property. "On the one hand, interest rates are going up, which is good and helps banks," said Jerome Legras of Axiom Alternative Investments. Germany's financial regulator BaFin recently warned that a rapid rise in interest rates could weigh on some banks, and that loans may sour.

[1/2] The logo of Deutsche Bank is pictured on an office of the company in London, Britain July 8, 2019. REUTERS/Simon DawsonSummarySummary Companies Wuermeling says banks should not tie their handsSees German banks maintaining capital ratiosFRANKFURT, Nov 23 (Reuters) - German banks should avoid making multi-year promises to their shareholders despite bumper profits this year as the outlook for the economy is worsening, Bundesbank board member Joachim Wuermeling told Reuters. "If you are bound by such promises, even though the environment has changed radically, you get into a very difficult dilemma." Wuermeling said German banks had only modestly raised their payout ratios in their own plans and most should manage to preserve their capital ratios even after taking into account large dividend increases in absolute terms. ($1 = 0.9740 euros)Reporting by Francesco Canepa and Frank Siebelt Editing by Tomasz JanowskiOur Standards: The Thomson Reuters Trust Principles.

☆ Russia to give central bank more time to complete Otkritie sale
▼ + stars: | 2022-11-09 | by ( Andreas Rinke | Christina Amann | ) www.reuters.com time to read: +1 min

MOSCOW, Nov 9 (Reuters) - Russia's government has submitted a draft law to parliament that would extend the central bank's right to sell bailed-out lender Otkritie to Russia's no. 2 bank VTB (VTBR.MM) without a tender for another year. The central bank and Otkritie did not immediately respond to a request to comment. The central bank bailed out Otkritie, once Russia's largest private lender, in 2017 as part of a years-long campaign to clean up Russia's banking sector. Following the bail-out and an asset review, the central bank had been looking to offload Otkritie, with Italy's UniCredit rumoured as a suitor for the bank.

☆ Factbox: Companies count the cost of ditching Russia
▼ + stars: | 2022-11-03 | by ( ) www.reuters.com time to read: +6 min

INDITEX (ITX.MC)Zara owner will book a provision of 216 million euros after agreeing to sell its Russia stores to UAE-based Daher Group. TRATON (8TRA.DE)Volkswagen's (VOWG_p.DE) truck division Traton in September said disposing of some assets in Russia would cause a 550 million euro loss. CREDIT AGRICOLE (CAGR.PA)Credit Agricole provisioned more than 500 million euros related to its Russian exposure in Q1. LINDEThe world's largest industrial gases company's exit from Russia recorded impairments of $993 million from its Russia exit. SIEMENS (SIEGn.DE)The Munich-based engineering and tech firm said in May it would take a 600 million euro hit in Q2 for exiting Russia.

Technology stocks (.SX8P) fell 1.8% to lead sectoral losses in Europe after their U.S. peers were dragged down by weak results from Microsoft Corp (MSFT.O) and Alphabet Inc (GOOGL.O). The European banking index (.SX7P) fell 0.7%. read moreItaly's UniCredit (CRDI.MI) was a rare bright spot as its shares rose 3.9% after the bank raised its 2022 profit goal. "Nonetheless, we are likely to see some hesitation, with the economic implications of rising interest rates yet to be felt. read moreReporting by Sruthi Shankar in Bengaluru; Editing by Arun Koyyur and Saumyadeb ChakrabartyOur Standards: The Thomson Reuters Trust Principles.

And Italy's UniCredit (CRDI.MI) raised its 2022 profit goal, helped by higher interest rates and lower loan loss provisions that also drove quarterly earnings above forecasts. For years, banks bemoaned ultra loose monetary policy, but now higher interest rates means banks can start to benefit from the increased gap between what they charge borrowers and what they pay savers. Standard Chartered's third-quarter profit surged 40% as higher interest rates boosted the emerging markets-focused bank's income, giving it ammunition to upgrade its revenue outlook despite a weakening global economy. For Santander, higher loan loss provisions in key markets like Brazil and the United States overshadowed better than expected third-quarter earnings. While benefiting from higher interest rates, banks also face the unwinding of a scheme that buoyed their profits for years.

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