Finance

France’s BNP Paribas says there are too many European banks

Published

3 weeks ago

September 26, 2024

Business Finance News

A sign on the exterior of a BNP Paribas SA bank branch in Paris, France, on Friday, Aug. 2, 2024.

Bloomberg | Bloomberg | Getty Images

France’s BNP Paribas on Thursday said there are simply too many European lenders for the region to be able to compete with rivals from the U.S. and Asia, calling for the creation of more homegrown heavyweight banking champions.

Speaking to CNBC’s Charlotte Reed at the Bank of America Financials CEO Conference, BNP Paribas Chief Financial Officer Lars Machenil voiced his support for greater integration in Europe’s banking sector.

His comments come as Italy’s UniCredit ups the ante on its apparent takeover attempt of Germany’s Commerzbank, while Spain’s BBVA continues to actively pursue its domestic rival, Banco Sabadell.

“If I would ask you, how many banks are there in Europe, your right answer would be too many,” Machenil said.

“If we are very fragmented in activity, therefore the competition is not the same thing as what you might see in other regions. So … you basically should get that consolidation and get that going,” he added.

Milan-based UniCredit has ratcheted up the pressure on Frankfurt-based Commerzbank in recent weeks as it seeks to become the biggest investor in Germany’s second-largest lender with a 21% stake.

UniCredit, which took a 9% stake in Commerzbank earlier this month, appears to have caught German authorities off guard with the potential multibillion-euro merger.

German Chancellor Olaf Scholz, who has previously called for greater integration in Europe’s banking sector, is firmly opposed to the apparent takeover attempt. Scholz has reportedly described UniCredit’s move as an “unfriendly” and “hostile” attack.

Germany’s position on UniCredit’s swoop has prompted some to accuse Berlin of favoring European banking integration only on its own terms.

Domestic consolidation

BNP Paribas’s Machenil said that while domestic consolidation would help to stabilize uncertainty in Europe’s banking environment, cross-border integration was “still a bit further away,” citing differing systems and products.

Asked whether this meant he believed cross-border banking mergers in Europe appeared to something of a farfetched reality, Machenil replied: “It’s two different things.”

“I think the ones which are in a nation, economically, they make sense, and they should, economically, happen,” he continued. “When you look at really cross border. So, a bank that is based in one country only and based in another country only, that economically doesn’t make sense because there are no synergies.”

Earlier in the year, Spanish bank BBVA shocked markets when it launched an all-share takeover offer for domestic rival Banco Sabadell.

The head of Banco Sabadell said earlier this month that it is highly unlikely BBVA will succeed with its multi-billion-euro hostile bid, Reuters reported. And yet, BBVA CEO Onur Genç told CNBC on Wednesday that the takeover was “moving according to plan.”

Spanish authorities, which have the power to block any merger or acquisition of a bank, have voiced their opposition to BBVA’s hostile takeover bid, citing potentially harmful effects on the county’s financial system.

Finance

ELV, TSM, EXPE, LCID and more

Published

3 mins ago

October 17, 2024

Business Finance News

Finance

Robinhood debuts Legend for active traders, says futures markets are coming soon

Published

35 mins ago

October 17, 2024

Business Finance News

In this photo illustration, the Robinhood Markets, Inc. logo is displayed on a smartphone screen.

Rafael Henrique | Sopa Images | Lightrocket | Getty Images

Retail brokerage firm Robinhood is launching a new tool for more sophisticated traders as it looks for additional avenues for growth.

On Wednesday, the firm introduced Robinhood Legend, a desktop-based platform for active traders. The offering includes advanced charting tools for users who want to do detailed analysis of stocks.

“In looking at the landscape of trading tools and by talking with active traders, we realized there is frustration with legacy offerings,” Steve Quirk, chief brokerage officer at Robinhood, said in a press release.

“Specifically, moving back and forth between apps or charting platforms can be cumbersome and time consuming. So we set out to reimagine what a modern, intuitively designed active trading platform should look like, and built Robinhood Legend from the ground up so traders can do what they need in one place,” Quirk said.

Beyond the launch of Legend, Robinhood also said it will soon add futures trading and index options to its mobile platform. Customers must be granted approval to trade futures contracts, according to the press release, and futures and index options will eventually be added to Legend as well.

The new additions for Robinhood are another example of the firm looking to expand beyond its roots as a convenient platform for small-dollar traders. The firm’s rise coincided with the “meme stock” phenomenon in early 2021 as retail trading boomed in the aftermath of the Covid-19 pandemic.

Robinhood shares, all-time

Since then, Robinhood has been steadily adding new offerings, including a credit card for Robinhood Gold subscribers and a digital wallet to hold cryptocurrencies.

Robinhood said that it had $139.7 billion in assets under custody at the end of the second quarter, along with 11.8 million monthly active users. For the comparable quarter in 2021, near the height of the GameStop mania, Robinhood reported $102 billion in assets but 21.3 million monthly active users. The firm’s next earnings report is scheduled for Oct. 30.

Shares of Robinhood are up more than 100% so far this year.

The announcements on Thursday were part of HOOD Summit, a conference for Robinhood’s customers.