FRANKFURT - Bank lending to euro zone companies slowed for the fourth straight month as an economic downturn and increased caution from lenders appear to be taking their toll, European Central Bank data showed on Monday.
Lending to businesses in the 20 nation currency bloc expanded by 5.7% in February after a 6.1% rise a month earlier while household credit growth slowed to 3.2% from 3.6%.
Lending has slowed sharply in recent months on an economic downturn and the fastest rate hikes by the ECB on record, with surveys pointing to even weaker lending figures in the months ahead.
The monthly flow of loans to companies was a negative 2.6 billion euros after a mere 1.4 billion euro expansion a month earlier.
Growth in the M3 measure of money circulating in the euro zone meanwhile slowed to 2.9% from 3.5%, coming below expectations for 3.2% in a survey.
(Reporting by Balazs Koranyi; Editing by Fran...
FRANKFURT - German utility EnBW expects its core profit to rise by as much as 58% in 2023 on the back of its energy networks, renewables and trading divisions, reason enough for the group to accelerate its coal power phase-out by seven years.
One of Germany's largest utilities, its VNG trading division was hurt last year when Russia curtailed and then halted gas supply via the Nord Stream pipeline.
On Monday it moved forward its planned phase-out of coal-fired power generation to 2028 from 2035, a target already ahead of the 2038 deadline set by the government.
"We are promoting the transition to greater sustainability and plan to completely phase out coal as early as 2028, provided that the German government's policy framework allows," said Chief Executive Andreas Schell.
The company, which proposed an unchanged dividend of 1.10 euros per share for 2022, did not spell out which policy framework was required to implement tha...
- A group of shareholders of Nanoco Group have asked two top bosses to step down after alleging that the British quantum technology company gave misleading information about losses related to settlement prospects in a litigation with Samsung Electronics Co.
Shareholders led by Tariq Hamoodi, who holds an 4.23% interest in Nanoco, asked for CEO Brian Tenner and Chief Finance Offer Liam Gray to step down from their roles and board, according to a letter dated March 10, made public on Monday.
(Reporting by Radhika Anilkumar in Bengaluru;Editing by Nivedita Bhattacharjee)...
MOSCOW - Russian company Invest Plus on Monday said it had completed a deal to buy IKEA's largest Russian production asset, its Novgorod factory, more than a year after the Swedish furniture giant first paused its activities in Russia over the Ukraine conflict.
IKEA halted all retail and production operations in Russia soon after Moscow sent troops into Ukraine on Feb. 24, along with scores of other Western companies. IKEA briefly resumed online sales last summer.
"The process of concluding the deal was not easy and quite lengthy," Invest Plus owner Vadim Osipov said in a statement, thanking all parties involved - IKEA, Russian and Swedish regulators, and Russia's Ministry of Industry and Trade.
Brand owner Inter IKEA Group could not be reached for comment before working hours. It has previously said it was selling its four factories in Russia, in Tikhvin, Novgorod and Vyatka.
Invest Plus is a special purpose vehicle...
LONDON - European bank stocks rose for the first time in nearly a week on Monday, bouncing from last week's declines, after a buyer emerged for large parts of Silicon Valley Bank's deposits and loans, which helped ease some of the anxiety in the sector.
The STOXX banks index rose 2.3% in early trading, after sinking 3.8% on Friday, and largely outperformed the broader stock market, with the pan European STOXX 600 index rising 1.1%.
First Citizens BancShares Shares bought all the loans and deposits of SVB and gave the Federal Deposit Insurance Corp equity appreciation rights in its stock worth as much as $500 million in return, the FDIC said in statement. Frankfurt-listed shares in First Citizens rose 9.4%.
The Frankfurt-listed shares of several mid-tier U.S. lenders also rose sharply on Monday.
(Reporting by Joice Alves; Editing by Amanda Cooper)...
- European stocks rallied in early deals on Monday, as calm descended on markets following a turbulent week for banking shares that was fuelled by worries about stability in the sector after the collapse of Credit Suisse and Silicon Valley Bank.
The pan-European STOXX 600 index rose 1.3% by 0705 GMT, with investors drawing comfort from news that First Citizens BancShares Inc would acquire Silicon Valley Bank's deposits and loans.
European banks jumped 2.8% after shedding 3.8% on Friday when Deutsche Bank sparked a rout in the sector. The German lender's shares were up 6.1% after tumbling 8.5% on Friday.
Shares of Swiss bank UBS, which took over Credit Suisse in a rescue deal last week, added 2.5%, but still remained about 15% below the pre-deal levels.
Credit Suisse rose 3.6%. Swiss financial regulator FINMA said over the weekend that it was considering whether to take disciplinary action against the bank.
- UK equities surged on Monday, helped by a gain in bank stocks on renewed hopes that the turmoil in the sector will be contained following the buyout of Silicon Valley Bank, while Standard Chartered jumped after agreeing to sell its Jordanian business.
Standard Chartered Plc rose 2.2% after the lender said it would sell the business to Arab Jordan Investment Bank (AJIB) as part of its plan to narrow its focus to faster-growing markets in the region.
Overall, banks rose 2%, as U.S. lender First Citizens BancShares Inc said it would purchase the loans and deposits of Silicon Valley Bank.
The blue-chip FTSE 100 gained 1%, while the domestically-oriented FTSE 250 added 0.8% by 0707 GMT.
Bucking the trend, Genel Energy Plc tanked 8% after the Iraq-Turkey pipeline was shut down, despite the Iraqi Kurdistan-focused firm expecting the shutdown to be temporary.
(Reporting by Johann M Cherian in Bengalu...
LONDON - The Frankfurt-listed shares of several mid-tier U.S. lenders rose sharply on Monday, after a buyer emerged for large chunks of embattled Silicon Valley Bank's deposits and loans, which helped inject some much-needed calm into fragile markets.
Shares in Pacific West Bancorp surged 16% in thin volumes in Frankfurt, while those in First Republic rose 7%.
First Citizens BancShares Shares bought all the loans and deposits of SVB and gave the Federal Deposit Insurance Corp equity appreciation rights in its stock worth as much as $500 million in return, the FDIC said in statement.
Frankfurt-listed shares of First Citizens were indicated 7.4% higher.
Shares in Keycorp, Western Alliance and Zions were indicated between 3.6% and 8% higher, although no trading volume had gone through by 0700 GMT, according to Refinitiv data.
(Reporting by Joice Alves; Editing by Amanda Cooper)...
- Barclays raised its terminal rate forecast for the Bank of England's benchmark policy rate by a quarter point to 4.5%, following the central bank's eleventh straight hike last week.
Barclays had expected a pause from the BoE in the March meeting, but following a 25 basis points hike to 4.25%, and data last week that showed an unexpected rise in British inflation, the British bank retained its call for another quarter percentage point hike in May.
Barclays also raised its forecast for UK's gross domestic product (GDP) for the first three quarters of the year between 0.1-0.2 percentage points, encouraged by a rebound in manufacturing in the first three months of 2023, as well as a stronger-than-expected pick up in economic growth in January.
The new forecast implies a "minimal recession", Barclays economists led by Marian Cena said. They expect 2023 GDP to contract by 0.3% year-on-year.
Following the hikes this year, Barc...
- UK's anti-trust regulator said on Monday it was looking into whether FDF's proposed acquisition of General Electric Co's France-based nuclear turbine unit could lead to competition concerns.
The Competition and Markets Authority (CMA) said it was inviting comments from the companies concerned related to the impact the deal could have on competition in the UK.
EDF had entered into an exclusive agreement with GE to buy part of GE's Steam Power's nuclear power activities, bringing together nuclear steam turbine technology and service expertise.
The GE unit, estimated to be worth around $1 billion as per media reports, was owned by Alstom until 2015.
(Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Savio D'Souza)...
BERLIN/FRANKFURT - Airports and bus and train stations across Germany were at a standstill on Monday morning, disrupting millions of commuters and travellers at the start of the work week during one of the largest walkouts in decades in Europe's largest economy.
The 24-hour strikes called by the Verdi trade union and railway and transport union EVG were the latest in months of industrial action that has hit major European economies as higher food and energy prices dent living standards.
Two of the country's largest airports, Munich and Frankfurt, suspended flights, while long-distance rail services were cancelled by German rail operator Deutsche Bahn.
The Verdi union is negotiating on behalf of around 2.5 million employees in the public sector, including in public transport and at airports, while railway and transport union EVG negotiates for around 230,000 employees at railway operator Deutsche Bahn and bus companies.
By Anirban Sen and Renju Jose
-A buyer for large chunks of Silicon Valley Bank's deposits and loans helped cast an uneasy calm over fragile markets on Monday, which have been roiled by worries of a credit crunch and systemic bank stress.
First Citizens BancShares Inc bought all the loans and deposits of SVB and gave the Federal Deposit Insurance Corp equity appreciation rights in its stock worth as much as $500 million in return, the FDIC said in statement.
Seventeen former SVB branches will open as First Citizen branches on Monday. First Citizen acquires about $72 billion in SVB assets at a discount of $16.5 billion and the estimated cost of SVB's failure to FDIC's deposit insurance fund is about $20 billion, the FDIC said.
North Carolina-based First Citizens said in a statement it did not buy other assets or debts of SVB Financial Group, the former parent company of Silicon Valley Bank.
The deal has given markets...
A look at the day ahead in European and global markets from Wayne Cole
It's been a quiet Monday so far with Asian share markets mixed but U.S. and European stock futures higher, perhaps because they got through a weekend without another bank collapsing.
There is some relief that First Citizens BancShares Inc is in advanced talks to acquire Silicon Valley Bank. There was also some talk the Federal Reserve could expand its new lending programme for banks as another step to reassuring depositors.
Money is clearly flowing out of smaller banks toward their bigger siblings and to money market funds, which have seen an inflow of more than $300 billion in the past month to a record $5.1 trillion. BofA notes the prior two events like this in 2008 and 2020 were followed by Fed rate cuts.
Fund futures now show an 88% chance the Fed stands pat in May, while a July cut is priced at better than 90%.
Deposits at small banks fell b...
By Tatiana Bautzer and Nupur Anand
New York - As U.S. banks prepare to close the books on a tumultuous quarter, analysts say trading revenue and deposits are among the key numbers to watch when lenders report earnings in mid-April.
After two high-profile bank closures this month shook confidence in the industry, observers are focused on whether firms will become more conservative by reining in lending or suspending stock buybacks. JPMorgan Chase & Co., the biggest U.S. lender, will report its first-quarter results on April 14, followed by rival Bank of America Corp on April 18.
The financial industry is still reeling from this month's dramatic events, which rattled investors and whipsawed markets.
Regulators shuttered Silicon Valley Bank (SVB) and Signature Bank, the second and third largest closures in the nation's history. Authorities then took unprecedented action to backstop the collapsed companies' deposits and in...
By Klaus Lauer and Tom Sims
BERLIN/FRANKFURT - A massive strike in Germany was set to begin early Monday, crippling mass transport and airports in one of the biggest walkouts in decades as Europe's largest economy reels from soaring inflation.
In the hours running up to the strike, both sides dug in their heels, with union bosses warning that considerable pay hikes were a "matter of survival" for thousands of workers and management calling demands and the resulting action "completely excessive".
The strikes, which were scheduled to mainly start just after midnight and affect services throughout Monday, are the latest in months of industrial action that has hit major European economies as higher food and energy prices dent living standards.
Germany, which was heavily dependent on Russia for gas before the war in Ukraine, has been particularly hard hit by higher inflation as it scrambled for new energy sources, with inflation...
By Ankur Banerjee
SINGAPORE - The dollar was firm on Monday, while the yen hovered near its seven-week peak as investors assessed moves made by authorities and regulators to rein in worries over the global banking system.
The dollar index, which measures the currency against six rivals, was up 0.078% at 103.060, having gained 0.5% on Friday amid banking jitters, with shares of Deutsche Bank sliding nearly 9%.
Global banking stocks have been battered through the month in the wake of the sudden collapse of two U.S. lenders and the rescue of embattled Swiss bank Credit Suisse last week, with authorities stepping in to ease investors nerves.
On Friday, the U.S. Financial Stability Oversight Council said the U.S. banking system was "sound and resilient" despite stress on some institutions. Investors, though, remain wary.
"Pragmatic action by central banks, governments, and the private sector has thus far been...
By Wayne Cole
SYDNEY, - Asian shares followed U.S. stock futures higher on Monday on hopes authorities were working to ring fence stress in the global banking system, even as the cost of insuring against default neared dangerous levels.
Helping nerves were reports First Citizens BancShares Inc was in advanced talks to acquire Silicon Valley Bank from the Federal Deposit Insurance Corp.
S&P 500 futures firmed 0.5% in early trade while Nasdaq futures added 0.4%.
MSCI's broadest index of Asia-Pacific shares outside Japan edged up 0.1%, with trading cautious. Japan's Nikkei gained 0.1% and South Korea 0.2%.
The mood remained jittery after shares in Deutsche Bank fell 8.5% on Friday and the cost of insuring its bonds against the risk of default jumped sharply, along with the credit default swaps (CDS) of many other banks.
"The current level of credit default swaps for European banks is just a littl...
By Florence Tan
SINGAPORE - Oil prices climbed in early trade on Monday as concerns over turmoil in the banking sector eased, while comments by Russian President Vladimir Putin over the weekend ratcheted up geopolitical tensions in Europe.
Brent crude futures gained 33 cents, or 0.4%, to $75.32 a barrel at 0040 GMT. U.S. West Texas Intermediate crude was at $69.65 a barrel, up 39 cents, or 0.6%.
Brent rose 2.8% last week, while WTI rebounded 3.8% as jitters in the banking sector eased.
"There has been a bounce in risk assets on the open this morning, more around the absence of any new bad banking developments over the weekend rather than any positive new developments as such," IG analyst Tony Sycamore said.
The rise in oil prices was more a relief rally and part of a correction after a 16% fall in the prior two weeks, he added.
Prices were also supported after President Vladimir Putin said he will...
-First Citizens BancShares Inc was in advanced talks to acquire Silicon Valley Bank, a person familiar with the matter told on Sunday.
First Citizens could reach a deal as soon as Sunday to acquire Silicon Valley Bank from the Federal Deposit Insurance Corp (FDIC), according to Bloomberg News, which first reported the development.
First Citizens and FDIC did not immediately respond to requests for comment.
(Reporting by Maria Ponnezhath in Bengaluru and Anirban Sen in New Orleans; Editing by David Gregorio and Tom Hogue)...
By Howard Schneider and Tom Sims
WASHINGTON/FRANKFURT - Stress in the banking sector is being closely monitored for its potential to trigger a credit crunch, a U.S. Federal Reserve policymaker said on Sunday, as a European Central Bank official also flagged a possible tightening in lending.
Authorities around the world are on high alert for the fallout from recent turmoil at banks following the collapse in the United States of Silicon Valley Bank (SVB) and Signature Bank and the rescue takeover a week ago of Credit Suisse.
Last week ended with indicators of financial market stress flashing. The euro fell against the dollar, euro zone government bond yields sank and the costs of insuring against bank defaults surged despite assurances from policymakers.
In the latest effort to calm investors, the U.S. Treasury said on Friday that the Financial Stability Oversight Council agreed that the U.S. banking system is "sound and resil...