The growing pile of bailed-out, newly crushed European banks
Despite receiving some of the most generous public subsidies in recorded history, Europe’s financial sector continues to hemorrhage. In Italy, the total market value of Monte dei Paschi di Siena, the world’s oldest bank and Italy’s third largest, is a fraction over €500 million, as its shares hover just 23 European cents above zero.
In the EU’s largest economy, Germany, the country’s only G-SIB (Global Systemically Important Bank), Deutsche Bank, has seen its stock plummet close to 90% in the last 10 years,from €117 to €12.30. This year alone it’s down well over 40%.
Take a quick glance at many of Europe’s smaller big banks and things look even grimmer. Four of Europe’s 29 “biggest” banks now share the dubious distinction of being penny stocks: Spain’s Bankia (€0.79), Italy’s Monte dei Paschi (€0.23), the National Bank of Greece (€0.21) and Bank of Ireland (€0.20).
These banks all share one thing in common: they have all been — or in the case of MPS will probably soon be — bailed out with public money. Put simply, they are the ugliest zombies on the market, unable to do anything but groan, just waiting for someone to put them out of their misery.
And now there’s a new kid on the block…
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