Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Bolsa de Madrid  >  Banco Bilbao Vizcaya Argentaria    BBVA   ES0113211835

BANCO BILBAO VIZCAYA ARGENTARIA (BBVA)
My previous session
Most popular
  Report  
Real-time Quote. Real-time Tradegate - 08/15 10:37:53 am
5.478 EUR   +0.46%
08/14BANCO BILBAO VI : BBVA Compass’s “ownership” of cl..
PU
08/13BANCO BILBAO VI : Birmingham school receives BBVA Compass Iron City ..
PU
08/13European banks' exposure to Turkey
RE
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsofficial PublicationsSector newsTweets

Euro zone banks hammered for Turkish exposure

share with twitter share with LinkedIn share with facebook
share via e-mail
0
08/10/2018 | 06:46pm CEST
FILE PHOTO: Turkish Lira banknotes are seen in this picture illustration

FRANKFURT (Reuters) - Investors dumped euro zone bank shares on Friday on concerns about their exposure to Turkey, as the lira fell to yet another record low with a defiant government showing few signs it is ready to take decisive steps to stabilise the currency.

A widening rift with the United States, its main NATO ally, and President Tayyip Erdogan's grip on monetary policy under a new powerful executive presidency have helped to drive the lira down by more than 40 percent this year, a particular vulnerability for Turkish banks as over a third of their lending is in foreign currencies.

U.S. President Donald Trump said on Friday he had authorised higher tariffs on imports from Turkey, imposing a 20 percent duty on aluminium and 50 percent one on steel, as tensions rose between the two NATO allies over Ankara's detention of an American pastor and other diplomatic issues.

The euro zone bank sell-off was exacerbated by a report in the Financial Times that the European Central Bank is increasingly concerned about some lenders, particularly BBVA of Spain, UniCredit of Italy and BNP Paribas of France, as they have some of the largest operations in Turkey among euro zone banks.

The ECB declined to comment. Sources familiar with its work added that a review has been going on for several weeks and this was considered a prudent supervisory practice given the situation. This echoed the FT report, which said that the situation was not yet considered critical.

Shares in BBVA were down 5.7 percent late on Friday, UniCredit was off 6.4 percent and BNP dropped 4.4 percent, all exceeding a 4.3 percent drop in the euro zone bank index <.SX7E>.

Turkey accounted for 373 million euros of BBVA's its first half net attributable profit, 14 percent of the group total, suggesting that it may be the most vulnerable to the country's market turmoil. The bank declined to comment.

UniCredit, whose Turkish unit Yapi Kredi is viewed by Goldman Sachs analysts as the most vulnerable in terms of capital levels, played down its exposure in its recent earnings presentation.

It argued that the country accounted for less than 2 percent of group revenues and a 10 percent fall in the lira would affect its CET1 ratio - capital that must be set aside as a buffer against financial shocks - by only around 2 basis points. It declined to comment on Friday.

However, a report by Credit Suisse said Turkey remained a risk for UniCredit, Italy's biggest bank by assets, as the depreciation of the lira could further hit its core capital - which came in lower than expected at the end of June.

The Yapi Kredi stake is valued on the bank's books at $2.5 billion and is currently worth $1.1 billion, Credit Suisse said in a report on Friday.

"The Turkish risks may also come from potential asset quality deterioration as Turkish corporate could be under pressure due to its large amount of debt USD denominated," it said.

"We cannot rule out that the regulator may require an add-on on capital for the exposure." UniCredit is also exposed to the rouble's fall and widening Italian government bond spreads.

BBVA, which reported a lowly CET 1 ratio of 10.8 percent at the end of the first half, also said a 10 percent slump in the lira would shave 2 basis points off its core capital.

Data from the Bank of International Settlements indicate that banks' exposure to Turkey is about $82 billion in the case of Spain and $17 billion for Italy, relatively low figures given that top euro zone banks have combined total assets of more than 20 trillion euros.

Much of these exposures are also lira in the balance sheets of local subsidiaries, suggesting that the actual risk to their parent firms is even smaller.

While the lira's plunge could drag down the Turkish economy, the impact on euro zone banks in general is seen as modest, economists said.

"The surge in Turkish inflation, bond yields and the even more dramatic plunge in Turkey’s exchange rate in 2018 suggest that the country could now be in danger of heading for a bust," Berenberg economist Carsten Hesse said.

"The impact on euro zone GDP growth would be small," Hesse added. "The total damage from a Turkish recession would be smaller than 0.1 percentage point to the euro zone economy."

Still, the sell-off may not be over after the government struck a defiant tone on Friday even after Trump's move.

Erdogan, who says a shadowy "interest rate lobby" and Western credit ratings agencies are attempting to undermine Turkey's economy, said Turks should exchange their gold and dollars into lira to help the currency.

(Additional reporting by Stephen Jewkes, Helen Reid, Andreas Gonzalez Estebaran, Danilo Masoni, Inti Landauro and Frank Siebelt; Editing by Catherine Evans and David Stamp)

By Balazs Koranyi

Stocks mentioned in the article
ChangeLast1st jan.
BANCO BILBAO VIZCAYA ARGENTARIA -0.09% 5.453 End-of-day quote.-23.33%
BNP PARIBAS 0.25% 51.99 Real-time Quote.-16.69%
HSBC HOLDINGS -0.06% 715.3 Delayed Quote.-6.69%
ING GROEP 0.30% 11.852 Delayed Quote.-22.88%
UNICREDIT SPA -2.04% 13.146 End-of-day quote.-15.60%
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on BANCO BILBAO VIZCAYA ARGEN
08/14BANCO BILBAO VIZCAYA ARGENTARIA : BBVA Compass’s “ownership” o..
PU
08/13BANCO BILBAO VIZCAYA ARGENTARIA : Birmingham school receives BBVA Compass Iron C..
PU
08/13European banks' exposure to Turkey
RE
08/13European bank stocks lose more ground as concerns on Turkey spread
RE
08/13European bank stocks lose more as concerns on Turkey spread
RE
08/13BANCO BILBAO VIZCAYA ARGENTARIA : Garanti launches a campaign to support the Tur..
PU
08/13BANCO BILBAO VIZCAYA ARGENTARIA : BBVA sells more than 10 million units via digi..
PU
08/13BANCO BILBAO VIZCAYA ARGENTARIA : Holvi partners with Uber so their drivers can ..
PU
08/13BEYOND REGULATIONS : banks’ commitment to data security
PU
08/13BANCO BILBAO VIZCAYA ARGENTARIA : The challenges of transaction banking in Latin..
PU
More news
News from SeekingAlpha
08/13On Monday, Cold Turkey 
08/13A Turkish Italian Domino, If Not Now, Then By December 
08/12The Turkish Hamam Is Getting Too Hot For European Banks. Avoid The Bazaar! 
08/11I Called A Currency Collapse 
08/10PREMARKET LOSERS AS OF 9 : 05 am (8/10/2018) 
Financials (€)
Sales 2018 24 142 M
EBIT 2018 12 048 M
Net income 2018 5 330 M
Debt 2018 -
Yield 2018 5,35%
P/E ratio 2018 7,10
P/E ratio 2019 7,29
Capi. / Sales 2018 1,51x
Capi. / Sales 2019 1,47x
Capitalization 36 393 M
Chart BANCO BILBAO VIZCAYA ARGENTARIA
Duration : Period :
Banco Bilbao Vizcaya Argentaria Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends BANCO BILBAO VIZCAYA ARGEN
Short TermMid-TermLong Term
TrendsBearishBearishBearish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 29
Average target price 7,06 €
Spread / Average Target 29%
EPS Revisions
Managers
NameTitle
Carlos Torres Vila Chief Executive Officer & Executive Director
Francisco González Rodríguez Group Executive Chairman
Jaime Saenz de Tejada Pulido Chief Financial Officer
Ricardo Enrique Moreno Head-Engineering
Carlos Loring Martínez de Irujo External Director
Sector and Competitors
1st jan.Capitalization (M$)
BANCO BILBAO VIZCAYA ARGENTARIA-23.33%41 226
JP MORGAN CHASE & COMPANY7.21%388 955
BANK OF AMERICA5.66%311 534
WELLS FARGO-4.29%282 870
INDUSTRIAL AND COMMERCIAL BANK OF CHINA-13.23%274 436
CHINA CONSTRUCTION BANK CORPORATION-13.02%235 455