Support 100 years of independent journalism.

  1. Business
  2. Economics
17 May 2012updated 22 Oct 2020 3:55pm

Not a good day to be a European bank

Bank jogs continue merrily along.

By Alex Hern

Today is not a good day to be a European bank. You may think the chance of a Greek exit would have been priced in to the markets by now, but each release of bad news brings a new hit to prices.

The worst affected is the Spanish bank Bankia, which was part nationalised last week. Reuters today reports that over €1bn has been withdrawn from the bank since the nationalisation, raising fears of a run – or jog, at least – on the bank. The news sent the bank down 12 per cent in 20 minutes, and although that has largely recovered, shares are still 11 per cent down on where they opened, hovering around €1.50. When the bank was listed in July, it was €3.75.

Bankia (BKIA). Source: Bloomberg

Other European banks are doing no better. UniCredit SpA is down 5.98 per cent, Banco Popolare 3.80 per cent, and Societe Generale 3.3 per cent.

Sign up for The New Statesman’s newsletters Tick the boxes of the newsletters you would like to receive. Quick and essential guide to domestic and global politics from the New Statesman's politics team. The best of the New Statesman, delivered to your inbox every weekday morning. The New Statesman’s global affairs newsletter, every Monday and Friday. A handy, three-minute glance at the week ahead in companies, markets, regulation and investment, landing in your inbox every Monday morning. Our weekly culture newsletter – from books and art to pop culture and memes – sent every Friday. A weekly round-up of some of the best articles featured in the most recent issue of the New Statesman, sent each Saturday. A weekly dig into the New Statesman’s archive of over 100 years of stellar and influential journalism, sent each Wednesday. Sign up to receive information regarding NS events, subscription offers & product updates.
I consent to New Statesman Media Group collecting my details provided via this form in accordance with the Privacy Policy

Even things which sound European are tanking. French Connection is down 26 per cent:

French Connection (FCCN). Source: Google Finance

Oh, alright. That’s actually because French Connection issued a profits warning this morning, saying:

It appears unlikely that our profit performance for the full year will meet current market expectations. . . The UK retail market remains particularly challenging and the combination of prevailing consumer caution and ongoing economic difficulties suggests that this will not improve in the second half of the year.