4th August 2014 - European Economic and Market News

Stock Port Associates is one of the world’s largest and most established offshore investment firms operating within a tax-favorable jurisdiction.
 
Aug. 4, 2014 - PRLog -- Stock Port Associates is one of the world’s largest and most established offshore investment firms operating within a tax-favorable jurisdiction. Whether it’s dealing with new regulations, setting up an offshore presence, attracting new investors or identifying independent directors, we have the expertise to assist you.

4th August 2014 - European Economic and Market News

Europe

FTSE          6,679.18 (-0.76%)

DAX        9,210.08 (-2.10%)

CAC 40          4,202.78 (-1.02%)   BEL 20   3,060.49 (-3.17%)

IBEX          10,514.00 (-1.80%)      SMI         8,409.84 (+0.01%)

Markets in Europe are expected to open slightly higher today after a last week saw a major drop off in the local indexes late in the trading week.

The key news in Europe is out of Portugal today after yesterday's announcement by the local government that Banco Espirito Santo would be broken into 2 banks and would be receiving a €4.9bn bailout form the Portuguese government.

Earlier in the year Banco Espirito Santo publicized loses for the first half of 2014 to the tune of €3.6bn and subsequently saw its share value plummet over 85%.

In what is seen as a test of resilience for the EU, with another banking collapse so soon after Portugal exited the bailout program provided by the IMF and EU which saw them receive €78bn, this time, the funds are coming from the Portuguese financial sector, with depositors being protected and shareholders taking the brunt of the financial pain. This will be the first time in the EU that shareholders will be responsible for a failing bank under the new reforms.

BES will be broken into two banks, Novo Banco taking depositors, mortgage and commercial banking with the remaining, poor performing accounts staying with Espirito Santo Group. Novo Banco will then be sold off to pay back the funds, returning it to the public and settling what was lent by the government.

Today, BES will be delisted from the local markets, making it a historical day in Europe for banks as this will now probably be the benchmark way of dealing with any financial institutions which fail so tremendously.

Whether this new process for dealing with large financial institutions is going to work, only time will tell. Exposure to foreign banks is limited in this instance and the speed at which the government and EU have acted will no doubt be applauded.

Expect the major indexes in Europe to reverse their loses of late last week as this news sinks in and concerns over another major bailout are put to rest.

Stock Port Associates (SPA) is one of the world’s largest and most established offshore investment firms operating solely within a tax-favorable jurisdiction. SPA employs seasoned market professionals with expertise in all asset classes with access to all major markets. To find out more please visit http://www.stockportassociates.com for more information or contact info@stockportassociates.com to be contacted by one of our representatives.

DISCLAIMER  The views, opinions, findings, and conclusions or recommendations expressed on this service are those of the author(s) and do not necessarily reflect the views of the Stock Port Associates.All market data within this release is for your general information and enjoys indicative status only. Stock Port Associates does not accept any responsibility for its accuracy or for any use to which it may be put. All share prices and market indexes delayed at least 15 minutes. 52 week high and low values are calculated from close price data.

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