Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

StockBeat: Europe Bank Stocks Soar as EU Loosens Capital Rules

Published 12/12/2019, 15:40
Updated 12/12/2019, 15:55
© Reuters.

© Reuters.

Investing.com -- European bank stocks soared on Thursday as the ECB’s top banking supervisor told the European Parliament that a new tweak to how it interprets capital requirements will cut the struggling sector more slack.

Andrea Enria estimated that the net impact of the ECB’s new approach would give banks an average of 90 basis points on capital relief, in relation to their common equity tier 1 ratio (the ECB’s preferred measure of financial strength).

The new approach, detailed under the EU’s Capital Requirement Directive V, would let banks met a bigger proportion of their overall capital requirements with subordinated debt instruments, which could if necessary be converted to equity by the regulator if a bank gets into trouble.

Spanish banks were among the biggest beneficiaries, with all six of the country’s largest institutions rising more than 3%. Banco Sabadell (MC:SABE) rose 4.7%, while Bankia (MC:BKIA) rose 4.5%.

In Germany, Commerzbank (DE:CBKG) rose 4.8% while Deutsche Bank (DE:DBKGn) rose 3.4%.

ABN AMRO (AS:ABNd) and Austrian-based Raiffeisen Bank International (VIE:RBIV) were also among the biggest beneficiaries.

Societe Generale (PA:SOGN) rose 2.4%, while Credit Agricole (PA:CAGR) rose 2.3%.

All the stocks in question also benefited from the broader uplift to markets given by news that the U.S. is preparing to make major concessions with regard to import tariffs on Chinese goods.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.