Several major European banks will do rights issues this year in a bid to downsize their balance sheets to meet Basel III requirements, said Neptune's Rob Burnett.
The head of European equities and manager of the £994m European Opportunities fund said banks including Deutsche Bank and SocGen are the most likely candidates for rights issues. Such a move would make him marginally more positive on Europe as a whole as the banks take steps to refinance. However, bank management teams are unwilling to do this because of fears over the impact on the share price, he added. Burnett pointed to the dramatic impact of UniCredit's recent rights issue on its share price. The Italian bank saw its share price dive 14% in one day and a further 17% the next day ...
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