Gloomy picture of banks/world economy…good for SocGen/Chariot9 May 2022 10:23
The following is from Reuters 3 days ago. It paints a gloomy picture of the global economy with banks having troubles and mentions SocGen. I believe this will put all concerned eg European governments, Morocco’s and banks, particularly SocGen under pressure to make Chariot’s gaz field financing a great success and very quickly.
I quote from it but would recommend the whole article as it talks about the impending global recession due to the war/sanctions on Russia effect on inflation due to oil/gaz prices. But Chariot will benefit greatly as a result, as the French would say “ la misère des uns fait le bonheur des autres” = the misery of some make the happiness of others.
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“From “Meanwhile, Russia's invasion of Ukraine has pushed Europe to the brink of recession and triggered losses for banks including France's Societe Generale and Austria's Raiffeisen.
French bank Credit Agricole and Italy's UniCredit have also provisioned against war-related losses but the effects, while felt most strongly in Europe, are rippling around the globe.
"The war, and its impact on price inflation, is a game changer," Carsten Brzeski, an economist at Dutch bank ING, said, adding: "Consumers will take years to recover their spending power, lost to inflation. And companies will be hit as well".
Some banks have scrapped plans to buy back cheaply-valued stock in view of their capital slippage, despite posting healthy investment banking profits helped by volatile financial markets.
"We expected huge buybacks then suddenly these were cancelled or moderated," said Barrington Pitt Miller, chief investment officer of Wykeham Overseas Advisors.
"People thought the big banks were sitting on huge excess capital positions ... that dynamic is now in shreds," he said.
While rising interest rates should in theory be good news for banks, which can normally increase their margins and therefore their profits, the situation is not so clear-cut in 2022”
https://www.reuters.com/business/finance/banks-face-reversal-fortune-war-great-depression-2022-05-06/
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