Sun, Apr 26, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

As European banking union sputters, hedge funds see distressed opportunities

Thursday, October 31, 2013

Bailey McCann, Opalesque New York:

The European Banking Authority (EBA) has released its first risk dashboard, assessing the state of play in the bloated European banking sector as finance ministers tussle over the particulars of a proposed banking union. According to a statement from the Authority, the banking sector overall has improved and banks have more capital on hand but many of them still rely on central banks to serve as a backstop.

The overall size of the European banking system represents trillions of dollars in assets relative to its small geographic area and overall economic weakness. The risk dashboard notes that asset quality in the system remains a source of concern even as the eurozone has seen some stabilization. The ratio of impaired loans and past due loans (>90 days) to total loans was found to have increased. Profitability has shown some signs of recovery, but Return on Equity (RoE) remains at low levels.

This structural weakness presents a problem for not only the banks themselves, but the EU as a whole, the size of the banking system is a liability to the governments inside the EU should any major shocks upset this tenuous balance. Moreover, the broader credibility of the ECB is directly linked to its ability to help consolidate and unwind some of the toxicity in the system. "Part of the problem is the market is all over the place about where the problem is, you can find arguments for Italy, Germany, Spain and just as many arguments saying......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. U.S. does not want hedge funds to invest in offshore re-insurers for tax purposes[more]

    Komfie Manalo, Opalesque Asia: The U.S. Treasury Department on Thursday introduced a new rule aimed at limiting hedge funds’ ability to reduce their tax bills by investing in insurance companies in offshore tax havens. As a general rule, the U.S. tax laws does not allow hedge funds to use off

  2. Ruling: Hedge funds suing Argentina can have access to bond offering details[more]

    Komfie Manalo, Opalesque Asia: U.S. District Judge Thomas Griesa in Manhattan ruled yesterday that hedge funds are entitled to details of a recent bond offering by Buenos Aires, reports

  3. Fund managers express concern of overvaluation in both equity and bond markets[more]

    Komfie Manalo, Opalesque Asia: According to the BofA Merrill Lynch Fund Manager Survey, investors see growing overvaluations in both

  4. Update: Wall Street has strong feelings about Jon Corzine trying to make a comeback[more]

    From Businessinsider.com.au: Former New Jersey Governor Jon Corzine is thinking about starting his own hedge fund, according to the Wall Street Journal, and because of the way his last firm imploded, Wall Street has strong feelings about that. “Truth is the larger seeders would never give him money

  5. Opalesque Exclusive: Cybersecurity and hedge funds - A manager’s experience, Part Four[more]

    Benedicte Gravrand, Opalesque Geneva: Ruane, Cunniff and Goldfarb, Inc. used to have their own IT infrastructure. Todd Ruoff, Executive Vice President in charge of trading, operations and technology, was responsible for its maintenance. Then he started looking at outsourced providers a couple of

 

banner