By Geoffrey Smith
Investing.com – A banking section of the banking sector finds out that it has a weak start to Thursday in Europe's stock markets.
Germany's two largest private-sector banks, Deutsche Bank (DE 🙂 and Commerzbank (DE :), have called off their merger talks, under pressure from shareholders, regulators and unions.
The mooted merger was never the preferred option of either bank, as both are more preoccupied with trying to turn around chronically unprofitable operations. The talks only came about because of political pressure from Germany's finance ministry to ensure the survival of a national champion.
Such logic did not regulators, who feared the creation of a new 'too-big-to-fail' bank
German was up 3.2% on relief at the time of writing the nightmare of such a politically charged merger, although the shares' Valuation at only 0.24 times their book value shows that it still has huge challenges ahead. Commerzbank's stock is down 2.0%.
Even so, it's not possible that a bidding was able to emerge for the bank: Italy's Unicredit (MI 🙂 SpA and Dutch-based ING BNP Paribas (PA 🙂 had so looked at Commerzbank a couple of years back.
Elsewhere, Barclays (LON 🙂 what down 2% in spite of a decent set of results notable for its investment bank division again faring better than many US rivals in the tower quarter of the first quarterback. Who would like to meet with CEO Edward Stewart on the board?
Meanwhile, Royal Bank of Scotland's (LON 🙂 shareholder meeting is preceded by news that CEO Ross McEwan is to step down. He'll still serve for the next year. Under McEwan, RBS has returned to the last decade.
None of this is stopping a wave of profit taking in markets across the continent, however, the benchmark was down 1
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