Credit Agricole receives European Central Bank approval to increase Banco BPM stake to 19.9%
A branch of Credit Agricole, the French banking entity, is visible in Warsaw, Poland.
Jaap Arriens | NurPhoto | Getty Images
The European Central Bank has granted Credit Agricole permission to augment its investment in Italian bank Banco BPM to 19.9%, as announced by the French bank on Wednesday.
Gaining the ECB’s approval is necessary for investors wishing to increase their stake in a European Union bank beyond set thresholds.
As of Wednesday, Credit Agricole reported a 9.9% stake in Banco BPM acquired through derivatives since Q4 of the previous year and intends to convert this into physical Banco BPM shares, elevating its ownership to 19.8% of the bank’s total capital.
“Crédit Agricole S.A. has no plans to initiate a public offer for Banco BPM’s capital,” the French bank asserted. Banco BPM is already attracting acquisition interest from its Italian competitor UniCredit, which earlier in the day announced that Italian regulatory bodies had approved its offer document.
— Ruxandra Iordache
European stocks begin the day lower
On Wednesday, European stock markets opened in the red, with the Stoxx 600 index declining 0.36% by 8:04 a.m. in London.
The French CAC 40 and the German DAX both slipped about 0.35%, while the U.K.’s FTSE 100 decreased by 0.18%.
Chart displaying the Stoxx 600 index.
Investors eye potential tariff impacts, economist suggests
As the Trump administration signals its intent to introduce “maximum” reciprocal tariffs on trading partners starting April 2, the full extent of the potential impacts is still under evaluation, Florian Ielpo, head of macro at Lombard Odier, informed CNBC on Wednesday.
Ielpo mentioned that his estimates indicate markets are factoring in an effective tariff rate between 6% and 10%, considering various components like import levels and exemptions.
“Markets are prepared; they’ve been pricing in the immediate effects, rather than the long-term ramifications, which are harder to predict,” Ielpo stated.
“The worst-case scenario could reach approximately 17%, marking the highest increase in tariff duties in 125 years of tariff history. The VIX [Volatility Index], however, remains surprisingly low,” he added.
“The key takeaway for markets is to focus on the overall tariff levels rather than individual sectors, assessing the magnitude of their future application,” he recommended.
— Jenni Reid
Italian authorities greenlight UniCredit’s bid document for Banco BPM acquisition
The headquarters of Commerzbank AG, located in the financial district of Frankfurt, Germany, on Thursday, Sept. 12, 2024.
Emanuele Cremaschi | Getty Images News | Getty Images
The Italian securities regulator, Consob, has given its green light to the takeover bid document submitted by UniCredit for its Italian rival, Banco BPM, as announced by UniCredit.
The tender offer received approval for the period spanning from April 28 to June 23, allowing Banco BPM shareholders to receive 0.175 newly issued UniCredit shares with full dividend rights for each Banco BPM share they hold.
Following its unexpected acquisition of a stake in Commerzbank late last year, UniCredit made a startling $10.5 billion bid for Banco BPM in November. At that time, Banco BPM responded that the offer failed to reflect its profitability and potential for further value generation.
— Ruxandra Iordache
European pharmaceutical sector prepares for tariff implications
Bottles of Ozempic and Wegovy displayed at Children’s Hospital in Aurora, CO, Nov. 18, 2024.
Kevin Mohatt | The Washington Post | Getty Images
The pharmaceutical industry in Europe is getting ready for the possible effects of U.S. tariffs as the chances for an industry-wide exemption from U.S. President Donald Trump diminish.
Historically, the pharmaceutical sector has been exempt from trade tariffs; however, Trump confirmed last week that tariffs affecting the sector will soon be imposed.
Drug manufacturers are now lobbying the president for a gradual implementation of tariffs on imports to the U.S., as reported by Reuters on Tuesday, citing sources familiar with the matter. The actual announcement of these tariffs may not happen on Wednesday but appears unavoidable.
Read the full story here.
— Karen Gilchrist
European markets: Initial opening forecasts
On Wednesday, European markets are anticipated to start lower as global traders brace for trade tariffs from U.S. President Donald Trump.
The U.K.’s FTSE 100 index is projected to open 24 points lower at 8,558, Germany’s DAX expected to drop 38 points to 22,501, France’s CAC anticipated to decline 4 points to 7,872, while Italy’s FTSE MIB is expected to decrease by 74 points to 37,977, according to IG data.
No significant data releases are scheduled for Wednesday. Earnings reports are anticipated from Raspberry Pi.
— Holly Ellyatt
White House contemplating a 20% tariff on numerous imports, report indicates
Advisors at the White House have drafted a proposal that suggests imposing approximately 20% tariffs on various imports, as reported by The Washington Post on Tuesday.
The article references three insider sources and mentions that White House advisors warned that several proposals remain under consideration, which means that the implementation of the 20% tariffs is not guaranteed. An alternative plan being explored is a country-by-country “reciprocal” method, according to the Post.
This information surfaces ahead of April 2, the date when President Donald Trump is expected to reveal his broader strategy regarding global trade, an event that’s created uncertainty in the stock market, which has been shaky partly due to rapidly evolving trade policy.
Read the full story here.
— Jesse Pound
