Deutsche Bank, my former employer, has hit a new log in terms of its stock price, nearing $10 per share. Brexit, brewing trade skirmishes and European fragility is taking a toll on the European Global systemically important banks (GSIBs).
While Deutsche Bank, Europe’s largest bank, fell to near $10 per share, it is not “the Lone Ranger” in terms of declining stock price. Germany’s other mega-bank, Commerzbank, is down to €8.1 per share. Italian giant Unicredit and France’s Credit Agricole are suffering as well.
Now, look at these 4 super banks since 2006. In this comparison, Deutsche Banks looks relatively “good” with Commerzbank and Unicredit as the big losers. The truth is that they all have suffered greatly since the financial crisis.
But my choice for the worst bank in Europe is …. Banca Monte Dei Paschi Siena that fell from over €9,000 per share in May 2007 to €2.51 per share today.
There are many other European banks and this is just a small sample.
Oh and the US Treasury 10Y-2Y slope just flattened to a new post-2007 low.