(News Bulletin 247) – The Spanish bank fell on the stock market and dragged other banking groups in its wake. For its part, UBS published a profit below expectations.

We are very far from the bank panic that weighed on the values ​​of the sector last March. But with the approach of the results of the large establishments of the first quarter, which will take place next week for BNP Paribas and the following week for Société Générale and Crédit Agricole SA, the movement is notable.

The three French banks show marked declines on Tuesday at the start of the session. Societe Generale fell 2.8% around 11:15 a.m., the largest drop in the CAC 40, while BNP Paribas lost 2% and Credit Agricole SA 1.3%. In Frankfurt, Deutsche Bank dropped 2.7%.

This small resurgence of tension comes as several banks have already published their quarterly accounts, namely the Spanish Santander and the Swiss UBS. In the United States, First Republic, a regional establishment in the sights of the market, for its part announced a flight of deposits stronger than anticipated by analysts, of more than 70 billion dollars in the first quarter.

Santander penalized by Spain and Brazil

For Jerome Legras, head of research at Axiom Ai, it is nevertheless the Spanish bank that influences the prices of other European establishments.

“Santander published results which were not extremely bad, but not excellent either. The Spanish bank being one of the most important in the euro zone, this may explain the sectoral decline”, he explains.

“UBS has become a specific situation, I do not think that its results really weigh on the other banks. The same is true for First Republic whose problems remain quite far from us”, continues the specialist.

Santander loses nearly 4% on the Madrid Stock Exchange following its quarterly accounts. If its net profit, of 2.6 billion euros, exceeded expectations, its activities in Brazil and Spain are somewhat worrying investors. Jefferies notes that deposits in Spain fell 6% in the quarter, compared to the last three months of 2022, while its profit in Brazil disappointed expectations, which “could raise questions”.

UBS facing a herculean task

Note that UBS, for its part, fell 2.5% in Zurich. The Swiss bank published a net profit below expectations, at 1 billion dollars, against 1.7 billion expected by the consensus, according to Jefferies. The market is especially attentive to the finalization of the acquisition of Credit Suisse, which, according to a presentation by UBS published on Tuesday, should be finalized in the second quarter of this year.

This marriage of convenience was initiated by the Swiss authorities to stem the winds of panic that affected Credit Suisse in March, the second largest bank in Switzerland finding itself caught in a stock market storm due to chronic failures in its risk management, which resulted in a brutal crisis of confidence. The results published on Monday attest to this: Credit Suisse saw its deposits melt by 61.2 billion Swiss francs over the first three months of the year. “Outputs [de dépôts, NDLR] slowed down but have not yet reversed to date,” Jefferies noted.

Both the rating agency Standard and Poor’s and the Swiss market watchdog, Finma, have stressed that the integration of Credit Suisse by UBS would be a major undertaking. Finma even spoke of a “Herculean” ordeal.