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zeb/market flash (Issue 7 – October 2013)

By Dr. Dirk Holländer, Volker Abel, Dr. Ekkehardt Bauer

09/10/2013
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zeb.market.flash provides an overview of the performance of the world’s largest banks (measured by market capitalisation). The relevant factors are briefly and concisely described, analysed and classified by our experts. For our analyses, we take a close look at relevant indicators for the valuation of the capital market, such as stock returns, as well as macroeconomic and bank-specific drivers. This issue (Q3 2013) deals with the separation of banks (“Liikanen report”) as strategic and operational challenge for European banks. What’s in it for you?

State of the banking industry

In Q3 2013, the global banking industry and especially Western European institutions achieved excellent TSR performances of nearly 15% /
Again, BRICS financial institutions and commercial banks from growing markets lost some of their previously existing valuation edge

Key banking drivers

Economic conditions improved in mature markets in Q2 2013 – growth in emerging markets stabilized / Low interest rate regime persists in Western Europe and the US – yield curves in BRICS countries flattening

Special topic: Separation of banks (“Liikanen report”) as strategic and operational challenge for European banks

37 of the 50 largest European banks hit by Liikanen proposals / The implementation of the Liikanen model would lead to an increased market share of European top players.

Picture: Palace of Westminster und Elizabeth Tower, London