A survey of over 1600 senior European corporates, treasurers and bankers conducted by EuroFinance revealed a prolonged pessimistic view of the market. Of major significance was the belief that banks are using the current financial crisis to unfairly set higher prices. Unsurprisingly, 84% of bankers maintain that this is not the case. Similarly, there was a clear divide between the two surrounding the topic of whether or not the G20 should be concerned by bankers’ bonuses. The results did, however, show a consensus among corporates and bankers that they expect more bad news to follow in 2010.
The main findings of the survey were:
- 57% believe that banks are using the crisis to unfairly set high prices.
- 71% believe more bad news is likely to follow.
- 58% believe the G20 should be concerned about bankers’ bonuses.
- 64% are bullish when looking towards 2010.
The survey also revealed the top three concerns among attendees at the EuroFinance conference in Copenhagen when looking towards 2010. Out of a list of seven choices, a quarter voted counterparty risk as their major concern, followed closely by the availability and cost of credit with 22%. Forecasting cash flow and the state of the economy were joint third, with 18% of the vote.
Carolyn Meier, managing director, EuroFinance, said: “This crisis has been particularly far-reaching and overwhelming, with its effects having been felt not only by investment grade companies, but also among highly rated household names. For banks, the crisis is nearly over, but for many corporates it’s just starting. Some firms are becoming more flexible and are beginning to allow people to delay their payments, as illustrated by the survey which reveals that a quarter of respondents are collecting invoices later than usual. However, for many other companies, the situation is very different with some finding orders being cancelled and in certain circumstances, suppliers going under.”
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