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Feb 19, 2014
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U.S. rules show limits of global bank resolution

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By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Daniel Tarullo has delivered a hard lesson about the limits of global banking supervision. The Federal Reserve on Feb. 18 confirmed that European lenders will need separate capital for their American operations, which could hike their funding costs and limit their ability to compete. Banking will become less global as a result.

Feb 19, 2014
via Breakingviews

U.S. rules show limits of global bank resolution

Photo

By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Daniel Tarullo has delivered a hard lesson about the limits of global banking supervision. The Federal Reserve on Feb. 18 confirmed that European lenders will need separate capital for their American operations, which could hike their funding costs and limit their ability to compete. Banking will become less global as a result.

Feb 13, 2014
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Commerzbank could yet boost BNP’s bland strategy

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By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Commerzbank could yet jazz up BNP Paribas’ bland strategy. France’s biggest bank by assets unveiled underwhelming targets on Feb. 13: a 10 percent return on equity by 2016, a scarcely bigger dividend payout and another 800 million euros of cost cuts. A 4.5 percent drop in BNP’s share price suggests investors want something meatier.

Feb 3, 2014
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Lloyds still looks best of a bad bunch of UK banks

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By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Lloyds Banking Group’s past is delaying its promise of a sunnier future. The lender brought forward its annual results on Feb. 3, including the shock revelation of another 1.8 billion pounds of legal reserves to cover the mis-selling of payment protection insurance (PPI). The past weighs heavily on Lloyds, but its premium to peers still looks intact.

Jan 16, 2014
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Deutsche is wasting its Libor crisis

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By Dominic Elliott and Olaf Storbeck

The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

Deutsche Bank is wasting a crisis. In September 2012, newly appointed co-Chief Executives Juergen Fitschen and Anshu Jain said the German lender would be at the forefront of cultural change in the banking industry. That goal keeps moving away from them.

Jan 13, 2014
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Leverage reprieve may be short-lived

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By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Banks’ reprieve from leverage ratio prescriptions could be short-lived. The Basel Committee that oversees global banking rules has tweaked the way it measures a lender’s equity as a proportion of its assets. European banks with big fixed income trading operations, like Deutsche Bank and Barclays, stand to benefit most and their shares have rallied. But the flipside is that a common global measure could in time be raised more easily.

Dec 4, 2013
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Libor losers become EU cartel winners

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By Dominic Elliott and George Hay
The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

The rewards of early settlement in the Libor scandal are becoming more obvious. The first banks to settle with financial agencies over allegations of rate-rigging, Barclays and UBS, have just saved $930 million and $3.4 billion respectively in trust-busting fines after blowing the whistle on other miscreants to the European Commission. Their lenient treatment highlights the risks in delaying settlements, and the potentially extreme penalties when wrongdoing is categorised as anti-competitive.

Nov 22, 2013
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Banks need to lop another quarter off costs

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By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Big has been bad for shareholders in investment banks. That’s according to a report published by consultancy McKinsey on Nov. 20. The 13 largest investment banks made an average return on equity (ROE) of just 8 percent last year – below the 10 percent achieved by the next 200. Given banks’ double-digit cost of capital, the bulge bracket is still frittering away shareholders’ money. More cuts are needed.

Oct 31, 2013
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FX probe shows risks of benchmarks

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By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

A regulatory probe into allegations of rigging in foreign-exchange markets shows that the benefits of benchmark rates come with risks. Four investment banks – Barclays, Deutsche, Royal Bank of Scotland and UBS – confirmed on Oct. 29 and Oct. 30 that they were reviewing their FX trading practices. U.S., UK and Swiss regulators all said earlier in the month that they were investigating trading in currency markets. In anticipation of a potential backlash, Royal Bank of Scotland emailed select clients last week to reassure them about its FX rates-setting process, according to a person who has read the email.

Oct 29, 2013
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Deutsche’s fixed-income pain could exceed rivals’

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By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Deutsche Bank’s third-quarter hit in fixed-income trading could presage a painful loss in market share. The German bank suffered a 48 percent fall in third-quarter debt sales and trading revenue – as bad as any peer. And things could get tougher still.

    • About Dominic

      "Dominic is a London-based columnist covering investment banking. Prior to Breakingviews, he spent two years at moneydealer ICAP, where he brokered equity derivatives trades between investment banks, high-frequency trading firms and hedge funds. He has more than five years of financial journalism experience, including stints as news editor and investment banking editor at Financial News. He has also written for The Wall Street Journal Europe. Dominic holds an MA in Classics from Oxford University and an MSc in Development Management from the London School of Economics. Follow Dominic on Twitter @DominicElliott"
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