Author Topic: European banks  (Read 6003 times)

John Hjorth

  • Hero Member
  • *****
  • Posts: 1843
Re: European banks
« Reply #10 on: June 04, 2018, 02:08:24 AM »
At least partly related to this topic:

Financial Times : UniCredit seeks merger with SocGen.

Personally, I have never looked at any of those two banks. Just posting it to share. It's actually the first time I have read that material bank consolidation cross border in Europe has been under consideration recently. Barclays - ref. the content of this topic so far - is also mentioned in the article.
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai


John Hjorth

  • Hero Member
  • *****
  • Posts: 1843
Re: European banks
« Reply #11 on: June 06, 2018, 07:48:14 AM »
I'm copying and quoting Spekulatius from the BAC topic here, because it's absolutely worth it, to me. I coulden't in any way phrase it better myself, with regard to the nuances in investing in European banks:

I think one must distinguish between the impact of the Great Recession and reforms on banks vs individuals. It is now clear that the ECB didn’t get the banking system reformed correctly, causing a dwelling crisis. Depending on location and country, the impact was quite felt different.

In Germany, the global financial crisis was felt as a swift decline followed by a quick recovery. As early as 2009, the Recession was over, wealth effect was negligible, because most Germans don’t own stock and real estate didn’t go down much at all. That is why so many Germans have difficulty to understand why other have a problem. There is very little symphaty for people, institutions or countries who borrow and then get into problems. Whether than is a correct viewpoint is an entirely different matter. It also doesn’t matter to the average German , if Deutsche  Bank goes to the crapper - deposits are insured and the banking systems backbone Sparkassen and Volksbanken (owned by local government or mutual organization).


This is very different from individuals who love in Ireland, Spain, Italy or worst of all Greece, who live now through a decade of economic stagnation (Spain is actually recovering nicely). I feel the ECB with their politic keeps the banking System afloat, but also keeps it from mending itself, which makes it a difficult sector to invest in. I do think that a selloff because of Italy will probably be a buying opportunity (except for Italian banks), since I think foreign banks have abstained from buying Italian treasuries after the first crisis a couple of years ago. So, maybe there is an opportunity to Maske a nice trade in the near term future.
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai

jouni1

  • Sr. Member
  • ****
  • Posts: 306
Re: European banks
« Reply #12 on: June 06, 2018, 12:00:58 PM »
there's an extraordinary amount of leverage in at least finnish real estate investing right now. Condos are being sold with 30% money down, and the debt is at the "building" level, not personal debt of the investors. the credit-worthiness of the buyers is not really checked at all if they can manage the down payment. first few years you pay only the interest on these loans.

sound familiar?

nordea was the first to introduce some limits to these loans given to the housing coops(? not sure about the term) a week or so ago.

Spekulatius

  • Hero Member
  • *****
  • Posts: 1595
Re: European banks
« Reply #13 on: June 06, 2018, 03:10:42 PM »
At least partly related to this topic:

Financial Times : UniCredit seeks merger with SocGen.

Personally, I have never looked at any of those two banks. Just posting it to share. It's actually the first time I have read that material bank consolidation cross border in Europe has been under consideration recently. Barclays - ref. the content of this topic so far - is also mentioned in the article.
UniCredit has a history of cross country mergers - in 2005, they bought thr mostly Bavarian Hypovereinsbank (once a blue chip bank) in Germany. I don’t think this merger can be advertised as a success though.
To be a realist, one has to believe in miracles.

John Hjorth

  • Hero Member
  • *****
  • Posts: 1843
Re: European banks
« Reply #14 on: June 21, 2018, 11:56:57 PM »
Old news, but worth posting in my opinion, to shed some light on the sentiment on this side of the Atlantic Ocean about particulary European banks:

Financial Times [June 13th 2018]: Big banks slip into bear market territory as rates rise.
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai

Spekulatius

  • Hero Member
  • *****
  • Posts: 1595
Re: European banks
« Reply #15 on: June 22, 2018, 03:13:15 AM »
Old news, but worth posting in my opinion, to shed some light on the sentiment on this side of the Atlantic Ocean about particulary European banks:

Financial Times [June 13th 2018]: Big banks slip into bear market territory as rates rise.

There was a blowout rise in most bank stocks that topped in January 2018, that wasn’t really justified by any fundamentals that I can see. If you discount that, the bear market argument looks quite weak.
« Last Edit: June 22, 2018, 11:46:00 AM by Spekulatius »
To be a realist, one has to believe in miracles.

John Hjorth

  • Hero Member
  • *****
  • Posts: 1843
Re: European banks
« Reply #16 on: June 22, 2018, 11:38:32 AM »
There was a blowout rise in mist bank stocks that topped in January 2018, that wasn’t really justified by any fundamentals that I can see. If you discount that, the bear market argument looks quite weak.

To me, true. Thanks Spekulatius.
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai

John Hjorth

  • Hero Member
  • *****
  • Posts: 1843
Re: European banks
« Reply #17 on: July 04, 2018, 12:13:54 PM »
...I have no position on Danske Bank A/S - but I happen to have an opinion on that, from an investment angle. I'm just not the right guy to open the topic here on CoBF, because I'm bearish [to some extreme extent] to the bank's exposure to Danish farming. ...

Here we go : The [Danish] agriculture asks for help to handle the drought.

Extreme drought within the last two months here. National prohibition of all kinds of fire in the open as of today. [You are allowed to use ie. your coal based Weber grill, if you have it on ground, that cannot burn, with good distance to your yellow lawn etc.] I have never experienced drought like this before in my whole life.

- So, now all those crazy guys, operating with a lot of leverage, no earnings, no real cash flow from operations, and no liquidity margin of safety "for a rainy day" [<- Sorry, I coulden't help it!] think it's all other Danish persons' problem, that they have gone all in with perhaps DKK 100 M in leverage in a highly cyclical business, that is now also to some extent hit by what could be considered a Black Swan event. [Pork prices has been on a downward trend recently, too.] Owners of Danish wine yards [yes, there are some], on the other hand, can't get their arms down.

Today I'm so happy that I passed some time ago on DAB.CPH. This will get really messy. The total debt in Danish agriculture [banks and mortgage institutions] is  ~DKK 350 B.
« Last Edit: July 04, 2018, 12:36:50 PM by John Hjorth »
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai

John Hjorth

  • Hero Member
  • *****
  • Posts: 1843
Re: European banks
« Reply #18 on: July 05, 2018, 02:27:36 AM »
Bloomberg [July 3rd 2018]: Danske Bank's Money Laudering Tops $8 Billion, Browder Says.

There is now an enormours pressure on the bank and the Danish FSA, and it reaches all the way up to the government. This is not ordinary daily cooking here in tiny Denmark.
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai

Jurgis

  • Hero Member
  • *****
  • Posts: 3979
    • Porfolio
Re: European banks
« Reply #19 on: July 05, 2018, 09:19:23 AM »
"Before you can be rich, you must be poor." - Nef Anyo