Wed, Aug 5, 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. Activist News - Celgene says patent-fighting hedge fund manager wants to short its shares[more]

    From Reuters.com: Celgene Corp, one of the world's largest biotechnology companies, has accused U.S. hedge fund manager Kyle Bass of attempting to profit from his attempts to wipe out several major drug patents through his Coalition for Affordable Drugs. The company asked the U.S. Patent and T

  2. Einhorn's Greenlight Capital hedge fund slumps 6.1 percent in July[more]

    From Reuters/Thefiscaltimes.com: Hedge fund mogul David Einhorn's Greenlight Capital slumped 6.1 percent in July and is now down 9 percent for the year after gold, one of the fund's top holdings, tumbled to five-year lows last week. Greenlight notified clients of its returns late on Friday, ac

  3. Performance - Some hedge fund small-cap energy stocks have been free falling, Dan Loeb's simple strategy destroys the market, Baupost lost 1.4% last quarter as energy bargains proved elusive[more]

    Some hedge fund small-cap energy stocks have been free falling From Marketrealist.com: According to a July 28, 2015, Bloomberg article, there was a 34% fall in small-cap energy stocks over the past three months. These shares are tracked by the Russell 2000 Energy Index. Small-cap energy

  4. Legal - Hedge funds hit Rothstein Kass with $75m malpractice suit, JPMorgan questioned on private bank’s hedge fund disclosures, Kijani fund, seized by regulators in Cayman Islands, spotlights risks in lightly regulated market[more]

    Hedge funds hit Rothstein Kass with $75m malpractice suit From Law360.com: Two investment funds have sued Rothstein Kass & Co. PC for at least $75 million, claiming the New Jersey auditing firm committed accounting malpractice by failing to properly scrutinize overblown valuations of the

  5. Assets - Hedge funds are getting smoked by the commodities slump, Global ETF assets could more than double by 2020[more]

    Hedge funds are getting smoked by the commodities slump From Businessinsider.in: The collapse in commodity prices has burnt another hedge fund. Vermillion, a commodity hedge fund backed by Carlyle Group, has seen its flagship fund's assets fall from nearly $2 billion to less $50 million,

 

banner