How to fix European banking … and why it matters

The performance of the Eurozone economy is inextricably linked to the health of its banking system. This banking system, the largest in the world, provides three-quarters of corporate and nine-tenths of household financing, double and triple the proportion seen in the US. Such a heavy reliance on banks means the Eurozone economy is likely to stagnate unless its banks can build robust balance sheets, earn a competitive return on equity, and generate adequate capital to take on credit risk and market risk to support faster growth and innovation.

Today, the profitability of European banks is relentlessly being pushed down by three forces. First, stronger banks with surplus deposits are being taxed by a historically unprecedented policy experiment of negative central bank deposit rates. Second, banks in some peripheral countries are heavily reliant on direct long-term loan financing from the ECB and remain burdened with a large stock of non-performing loans. Third, banks across the Eurozone have to cope with an attitude of “full speed ahead, damn the torpedoes” in the implementation of a brand new, strongly pro-cyclical, regulatory and supervisory rulebook.

The belief that negative interest rates would ultimately force banks to extend more credit and that they would incentivise companies and households to borrow more for productive purposes has led the ECB to continue to hold on to its negative interest rate policy. This is despite evidence that the smell of panic which surrounds a negative rates policy is undermining the confidence of investors and savers. This policy is now penalising the stronger European banks by charging them about €8bn (40bps on the €2trn of deposits) per annum. At the same time, US banks receive about $40bn (2.4% on $1.65 trn) on their excess reserves. Indeed, negative interest rates have failed to restore the Eurozone to sustainable growth, even while being reinforced by the ECB’s historically unprecedented volume of asset purchases and its massive direct targeted lending to weaker banks. At a time when the US economy is expected to clock in at near 2.5% growth for 2019, the Eurozone is experiencing a rapid deterioration of economic performance and a return to positive rates will be as elusive as it has been in Japan.

Deutsche Bank

  

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Diverse Gurus über das aktuelle Börsengeschehen 7 [Alle anzeigen] , Rang: SieurKolou74(296), 14.11.18 22:12
 
Subject Auszeichnungen Author Message Date ID
Investorenlegende warnt Anleger
03.2.18 16:11
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RE: Investorenlegende warnt Anleger
04.2.18 06:01
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      RE: Investorenlegende warnt Anlegerinteressant
04.2.18 23:00
3
      @byronwien
05.2.18 05:44
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      RE: @byronwien
05.2.18 10:46
5
      RE: @byronwiengut analysiert
05.2.18 18:43
6
      RE: @byronwien
05.2.18 21:05
7
      RE: @byronwien
05.2.18 22:49
8
      crash
05.2.18 23:02
9
      RE: crash
06.2.18 10:15
10
      RE: @byronwien
05.2.18 23:14
11
      RE: @byronwien
05.2.18 23:34
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      RE: @byronwien
05.2.18 23:35
13
      RE: @byronwien
05.2.18 23:51
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      RE: @byronwien
05.2.18 23:59
15
      RE: @byronwien
06.2.18 00:14
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      RE: @byronwien
06.2.18 06:08
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      RE: @byronwien
06.2.18 07:11
18
      RE: @byronwieninteressantinteressantinteressant
06.2.18 07:35
19
      Auch Tokio stürzt mit
06.2.18 07:42
20
      RE: Auch Tokio stürzt mit
06.2.18 08:00
21
      VIX at 38 Is Waterloo for the Beloved Short Volatility ...interessant
06.2.18 08:07
22
      Here's Who Owned Those Crumbling VIX Notes as of Last F...
06.2.18 08:15
23
      Inverse VIX - how it works
06.2.18 09:56
24
      Volatility Jump Has Traders Asking About VIX Note Poiso...
06.2.18 11:39
25
      RE: Inverse VIX - Prospekt lesen zahlt sich gelegentlic...
07.2.18 22:22
26
      VIX-Knockout bei CS
12.2.18 14:32
27
      RE: @byronwien
06.2.18 12:07
28
      RE: @byronwien
06.2.18 17:45
29
      RE: @byronwiengut analysiert
06.2.18 17:57
30
      Inflation ist alles
06.2.18 18:01
31
      A healthy pullback
07.2.18 14:38
32
Fed implications of the employment report
05.2.18 08:41
33
`Buy the Dip' Takes Hold at Allianz to JPMorgan as Rout...
06.2.18 13:21
34
buying opportunity?
08.2.18 17:47
35
Wienerberger - Der ideale Übernahmekandidat
09.2.18 13:41
36
Max Otte: „Unser Finanzsystem kollabiert ...“
10.2.18 14:17
37
CTAs and Risk Parity funds
11.2.18 10:52
38
Die EZB werde die Zinsen heuer sicher nicht mehr anhebe...
11.2.18 18:55
39
Keine Bärenphase, sondern nur Korrektur? interessant
12.2.18 13:03
40
These Bonds Should Make ECB Hawks Apoplectic With Rage
12.2.18 13:43
41
Morgan Stanley Strategist Who Predicted Volatility Says...
12.2.18 16:45
42
Financial markets are all about stories
12.2.18 17:14
43
All the President's deficits
13.2.18 14:36
44
Schwere Zeiten für Bonds im Kommen
14.2.18 16:26
45
Ray Dalio's Short-Bet Puzzle Is Missing Some Pieces
18.2.18 17:26
46
Add Stock Buybacks to the Causes of the Market Downturn
18.2.18 17:56
47
Goldman Sees U.S. Interest-Cost Surge on Yield, Deficit...
19.2.18 10:03
48
We continue to think the Fed will hike four times each ...
19.2.18 14:21
49
The Q4 earnings season is in its final stages
19.2.18 14:45
50
Morgan Stanley Says Stock Slide Was Appetizer for Real ...
20.2.18 10:25
51
BlackRock Says Buy U.S. Stocks as Tax Plan Supercharges...
20.2.18 10:49
52
U.S. economic data right now is as 'good as it gets', G...
22.2.18 22:00
53
US Inflation
23.2.18 15:00
54
QE ending
25.2.18 15:02
55
Steve Schwarzman: The stock market's performance doesn'...
26.2.18 21:13
56
US stock buybacks are running at a record pace
03.3.18 10:23
57
Has the marginal equity buyer gone?
05.3.18 10:35
58
ECB Takes Steinhoff Losses in Its Stride
06.3.18 08:26
59
growth momentum is still robust and above-trend
09.3.18 10:50
60
The Tide Isn’t Turning on Trade
11.3.18 14:08
61
Our US Equity strategists remain positive
19.3.18 10:21
62
Our Global Equity Strategists remain constructive
19.3.18 10:23
63
      Oil has remained in range for the last six weeks
19.3.18 10:47
64
      RBI-Brezinschek: Bullenmarkt an den Börsen noch nicht z...
19.3.18 15:02
65
ZEW-Konjunkturerwartungen: Ausblick trübt sich deutlich...
20.3.18 12:31
66
Jim Rogers Says Trade War Is Making His Bearish View Ev...
22.3.18 10:03
67
Draghi's Success Is Double-Edged as Labor Boom Adds to ...
23.3.18 12:30
68
JPMorgan Sees Market Overcoming Stock Rout, But Beware ...
25.3.18 16:32
69
What perhaps stood out the most about the price action ...
26.3.18 12:08
70
What Keeps Dalio Up At Night:
26.3.18 17:03
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RE: Trump
27.3.18 09:56
72
Einfuhrzölle, Stagflationsgefahr und normale ­Aktiensch...
04.4.18 13:32
73
RE: Einfuhrzölle, Stagflationsgefahr und normale ­Aktie...
04.4.18 13:35
74
JPM: Eurozone to be bottoming out vs the US
10.4.18 16:09
75
Q1 reporting season that kicks off this week will remin...
12.4.18 15:17
76
Debatte um Banken-Verluste
17.4.18 08:51
77
Rates markets are busy with the shape of the yield curv...
16.4.18 12:57
78
Eroding the benefits of tax reform through America Firs...
17.4.18 14:42
79
Lessons From 15 Years Of Short Selling: 12 Reasons Not ...
23.4.18 16:20
80
10 Reasons To Short
23.4.18 16:27
81
The last days of Whitney Tilsons Hedge Fund
23.4.18 16:54
82
Lessons From 15 Years Of Short Selling: A Veteran's Adv...
30.4.18 21:38
83
Warren Buffett: Women make me 'very optimistic' about t...
23.4.18 19:29
84
JPM Equity strategists continue to see further upside i...
24.4.18 15:27
85
Warren Buffett explains how you could've turned $114 in...
25.4.18 15:05
86
The US reporting season has delivered strong earnings b...
30.4.18 15:19
87
Buffett warnt vor Bitcoin und lobt Apple
06.5.18 15:16
88
Das Warren Buffet Imperium grafisch dargestellt
07.5.18 10:53
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RE: Das Warren Buffet Strategie
07.5.18 10:57
90
Global equities remain in a consolidation mode
07.5.18 15:34
91
We remain positive on equities based on two strong fund...
07.5.18 16:49
92
      non-linear burst in wage and price inflation?
07.5.18 17:06
93
Trump twittert: "Freue mich auf Arbeitsmarktbericht"
01.6.18 16:22
94
RE: Trump twittert:
03.6.18 20:50
95
Our Global equity strategists believe that the fundamen...
02.6.18 18:52
96
RE: Diverse Gurus über das aktuelle Börsengeschehen 7
12.6.18 08:37
97
ECB policy announcement a material negative for the eur...
14.6.18 14:56
98
A yield curve inversion at the longer end also
18.6.18 09:14
99
Fed: This is not a consistent forecast
19.6.18 13:48
100
The tit-for-tat trade barbs intensify
20.6.18 16:31
101
Trade war tensions
27.6.18 11:03
102
RBI: Handelskonflikte derzeit größtes Risiko für Kapita...
27.6.18 14:07
103
Zwischencheck vor der Sommerpause
02.7.18 21:42
104
Trade war noch egal
09.7.18 10:36
105
Autos have never been this cheap
09.7.18 18:06
106
Handelskonflikte - RBI-Brezinschek: "EU kein Musterschü...
13.7.18 12:05
107
Economics:
15.7.18 12:41
108
Trade headlines driven dips as a buying opportunity
15.7.18 12:50
109
Let’s spend less time looking at the yield curve and mo...
16.7.18 15:15
110
How strong is corporate activity?
16.7.18 15:51
111
Fed-Chef sieht US-Konjunktur trotz Handelsstreit optimi...
18.7.18 09:45
112
Quantifying trade war is difficult
18.7.18 17:39
113
Trade war impacting soft data but not hard data
19.7.18 14:59
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RE: Trade war impacting soft data but not hard data
19.7.18 15:21
115
@realDonaldTrump: Euro ist manipuliert
20.7.18 14:51
116
RE: @realDonaldTrump: und die Zinsen auch falsch
20.7.18 16:31
117
RE: @realDonaldTrump: und die Zinsen auch falsch gut analysiertwitzig
20.7.18 16:51
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RE: @realDonaldTrump: und die Zinsen auch falsch
20.7.18 16:53
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RE: @realDonaldTrump: und die Zinsen auch falsch
20.7.18 17:04
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RE: @realDonaldTrump: und die Zinsen auch falsch
20.7.18 19:08
121
RE: @realDonaldTrump: und die Zinsen auch falsch
20.7.18 19:39
122
RE: @realDonaldTrump: und die Zinsen auch falsch
20.7.18 20:07
123
RE: @realDonaldTrump: und die Zinsen auch falsch
20.7.18 20:15
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RE: @realDonaldTrump: und die Zinsen auch falsch
21.7.18 11:30
125
RE: @realDonaldTrump: und die Zinsen auch falsch
21.7.18 13:10
126
RE: @realDonaldTrump: und die Zinsen auch falsch interessant
21.7.18 13:50
127
RE: @realDonaldTrump: Vorschlag: Drop all Tariffs
25.7.18 11:14
128
How late is the cycle?
21.7.18 09:05
129
Our Global Equity strategists believe Q2 reporting seas...
23.7.18 15:21
130
Our Global Equity strategists continue to have a constr...
29.7.18 17:14
131
Equity markets struggled this week despite strong earni...
05.8.18 17:03
132
Friday’s 157k jobs headline significantly understates t...
06.8.18 09:48
133
Interessante Perspektive zu Handelskrieg
06.8.18 11:29
134
Earning season so far
06.8.18 11:38
135
US outlook bends but doesn't break as trade stakes rise
06.8.18 14:29
136
I have just authorized a doubling of Tariffs on Steel a...
10.8.18 14:51
137
RBI-Ökonom Deuber: Österreich ist von Türkei-Krise weni...
12.8.18 12:18
138
Investor sentiment appears to be quite cautious
12.8.18 16:47
139
WIIW-Experte: Türkische Notenbank muss Zinsen deutlich ...
13.8.18 15:11
140
Turkey: What are the risks?
16.8.18 12:24
141
Trade War Won’t Dent China’s GDP
20.8.18 09:40
142
„Investment-Punk“ im Interview
02.9.18 22:45
143
RE: „Investment-Punk“ im Interview
03.9.18 05:44
144
      RE: „Investment-Punk“ im Interview
03.9.18 06:13
145
      RE: „Investment-Punk“ im Interview
03.9.18 10:09
146
      RE: „Investment-Punk“ im Interview
03.9.18 10:53
147
      RE: „Investment-Punk“ im Interview
03.9.18 11:24
148
Alois Wögerbauer: Investieren ist einfach, aber nicht l...
04.9.18 08:41
149
A stock-market bear signal is at a more-than-4-decade h...
10.9.18 20:41
150
Mining, Autos and Semiconductors are likely to bounce i...
17.9.18 12:32
151
Goldman Says Rising U.S. Rates ‘Boiling the Frog’ of Ri...
17.9.18 15:56
152
"Ohne Gegenmaßnahmen gewinnt Trump im Handelskrieg"
19.9.18 10:07
153
Das Fed-Problem
21.9.18 11:38
154
Cyclicals will rebound
23.9.18 16:33
155
Ölpreisprognoseanhebung
23.9.18 18:17
156
Nowotny, seufz
23.9.18 19:51
157
RBI-Brezinschek: Gute Aussichten für Wirtschaft und Fin...
28.9.18 16:02
158
JPMorgan Says U.S.-China Tariffs to Go All Out
30.9.18 15:47
159
„Schieferfelder sind relativ rasch leer gepumpt“
02.10.18 09:48
160
Insurance sector as a hedge on rising yields
09.10.18 14:31
161
Why are retail investors still cautious?
09.10.18 14:48
162
US-China tension and US equity selloff
11.10.18 12:34
163
Unfair to make comparisons between Italy and Greece
11.10.18 12:39
164
The
11.10.18 14:21
165
Update on Market Moves
12.10.18 19:05
166
JPMorgan: The dip should be bought
13.10.18 10:35
167
The direct impact of such a trade war is unlikely to be...
13.10.18 13:49
168
Global Equity Strategy View
13.10.18 14:06
169
Looming "cold war" will hurt US business in China
15.10.18 10:13
170
JPMorgan Global Equity strategists
21.10.18 16:31
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US: Majority of systematic selling behind (~80%)
21.10.18 16:33
172
Stocks are down a lot but long rates have barely moved
25.10.18 15:09
173
some downside risks are beginning to appear from capex
30.10.18 18:14
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Crowding out?
31.10.18 14:41
175
VIX has produced a buy signal
03.11.18 19:56
176
US economy remains the most competitive economy in the ...
05.11.18 07:55
177
Two competing narratives
06.11.18 10:51
178
split Congress is the best outcome for US and global eq...
07.11.18 18:08
179
Lower oil prices is good news
14.11.18 21:47
180
JPM Strategists continue to prefer US vs Europe equitie...
18.11.18 14:16
181
Will Value Come Back?
18.11.18 15:01
182
Our Global equity strategists advised to add to US Bank...
02.12.18 15:44
183
JPMorgan Asset Says Cash Better Than Stocks First Time ...
04.12.18 10:22
184
Goldman Sees Another Weak Year After a Lousy 2018
04.12.18 15:10
185
2018 will mark the year of the great de-rating
05.12.18 10:18
186
Tweaking an extraordinary US outlook: A look at 2019 an...
05.12.18 15:29
187
Erste-Fondsmanager für 2019 optimistisch: Mehr Chancen ...
05.12.18 16:57
188
No need to worry
07.12.18 08:21
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RE: No need to worry
07.12.18 10:23
190
We maintain a positive stance in equities vs. bonds
08.12.18 14:29
191
RE: We maintain a positive stance in equities vs. bond...
08.12.18 14:59
192
US Equities in 2019
09.12.18 18:15
193
RE: US Equities in 2019
09.12.18 19:00
194
      RE: US Equities in 2019
10.12.18 08:41
195
      Invest-Profi Ken Fisher rät ...interessant
10.12.18 12:56
196
      RE: Invest-Profi Ken Fisher rät ...
10.12.18 13:29
197
      2018 has delivered losses on almost every asset class
10.12.18 14:34
198
      Extreme Fear
10.12.18 17:43
199
      Re: Extreme fear
10.12.18 22:04
200
Gehälter steigen
12.12.18 19:30
201
China is rewriting its 2025 policy
13.12.18 16:02
202
RE: China is rewriting its 2025 policy
13.12.18 16:08
203
ECB: there was one surprise
15.12.18 20:03
204
Equity markets arrested their decline this week
16.12.18 13:05
205
RBI: Märkte dürften alte Sorgen auch ins Jahr 2019 mitz...
19.12.18 14:06
206
Making Sense of the December Risk-off
20.12.18 08:52
207
World’s biggest hedge fund says stocks aren’t pricing i...
21.12.18 16:22
208
RE: World’s biggest hedge fund says stocks aren’t prici...
21.12.18 16:24
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US rates are too high. Or S&P500 is too low
27.12.18 09:31
210
RE: US rates are too high. Or S&P500 is too low
27.12.18 11:03
211
USA Konjunktur: Sorgen der Märkte schwer nachvollziehba...
29.12.18 11:30
212
Next week we will find out how much damage the turbulen...
30.12.18 15:50
213
Our US equity strategists view the current sell-off, as...
06.1.19 16:47
214
Nowotny: "Mit dem Brexit schwächt sich Europa selbst"
12.1.19 10:58
215
RE: Nowotny:
12.1.19 11:57
216
      RE: Nowotny:
12.1.19 21:21
217
“How much of US recession risk is priced in?”
14.1.19 16:48
218
Global equity markets continued their recovery
20.1.19 11:55
219
2019
21.1.19 10:29
220
Poor Earnings Season May Not Stop a Market Rally, JPMor...
21.1.19 12:54
221
Chilling Davos: A Bleak Warning on Global Division and ...
24.1.19 14:51
222
Draghi glaubt nicht mehr an Zinserhöhung in seiner Amts...
24.1.19 21:22
223
dramatic increase in the supply of risk-free assets
27.1.19 18:48
224
Was macht die Fed
28.1.19 06:23
225
Global equity markets showed resilience this week
28.1.19 06:26
226
      In the US, buyback activity has been very strong
28.1.19 06:39
227
RBI-Chefanalyst erwartet im ersten Halbjahr Börsenaufsc...
28.1.19 11:34
228
Congratulations, Market. The Fed Is Officially at Your ...
30.1.19 21:48
229
Global Economy: Wind Chill Factors Abating
03.2.19 15:15
230
JPMorgan Says 2020 ‘Might Not Be Year to Think About Re...
03.2.19 16:25
231
The global economy is at the crossroads
08.2.19 15:03
232
January risk rally is not a dead cat bounce
10.2.19 22:15
233
Small- and mid caps outperformen
17.2.19 15:34
234
Problem mit Durchschnittszinsberechnung
17.2.19 22:33
235
      RE: Problem mit Durchschnittszinsberechnung
18.2.19 16:08
236
      RE: Problem mit Durchschnittszinsberechnung
18.2.19 16:26
237
Übersicht über die laufenden Überprüfungsverfahren nach...interessant
18.2.19 06:14
238
Global equity markets ended yet another week in the gre...
18.2.19 16:31
239
Raiffeisen-Experten - Brexit trifft vor allem britische...
21.2.19 07:40
240
Equity markets continued to advance higher this week
24.2.19 14:36
241
Fed-Chef plädiert für "geduldiges" Vorgehen bei Zinserh...
26.2.19 23:34
242
As trade tensions eased, global equity markets continue...
03.3.19 17:23
243
Against our expectations, the ECB adjusted its forward ...
08.3.19 06:19
244
RE: Against our expectations, the ECB adjusted its forw...
08.3.19 06:24
245
Global equities were lower this week on renewed global ...
10.3.19 17:12
246
Spring in Sight?
12.3.19 14:34
247
How to fix European banking … and why it matters
15.3.19 11:07
248
Europe Looks Set to Surprise on the Upside
17.3.19 11:58
249
Our global equity strategists remain constructive for s...
17.3.19 15:33
250

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