The slump in equity prices has quickly wiped out unrealised capital gains in European banks’ permanent equity portfolios, according to a report by Standard & Poor’s. The ratings agency noted that the increasingly challenging economic environment throughout much of Europe has required provisioning that has substantially depressed the reported performance of these portfolios. The agency added that the inherent risks that permanent equity portfolios introduce into European banks’ credit-risk profiles goes beyond exposure to volatility in market valuations. ‘These stakes, which are usually characterized by a degree of permanence linked to a strategic or business-development objective, do not carry the benefits of diversification, as their returns are often affected by similar economic factors to those influencing the performance of banking business,’ said credit analyst Angela Cruz. ‘In addition, they may also lead to a higher concentration of exposure to specific entities, industries, and/or countries.’ The report found that from an economic perspective, permanent equity stake portfolios inherently bear a different, higher risk than banking business and should, therefore, be backed by a bigger capital cushion.
The annual BNP Paribas Cash Management University kicked off on Thursday morning with treasury professionals congregating in Paris from across Europe.
APIs may be a solution to MT940 challenges, says Karen Fagan, treasury operation manager, for British television company, ITV.
Kicking off the first day of the Singapore Fintech Festival, issues with cryptocurrencies were addressed by MIT media labs director, Joi Ito, and panels of technology leaders discussed how they’re using data analytics.
Sibos 2017 day two highlights: Brexit and banking, and why ‘data is the new oil’ in financial services
How nation first politics can impact global financial organisations It’s clear that data and regulation are the two key topics that are ... read more