EU banks set to wipe out prof­its, Citi says

The Pak Banker - - COMPANIES/BOSS -

Europe's in­vest­ment banks will prob­a­bly see profit wiped out by re­struc­tur­ing costs in the fourth quar­ter as they make changes started by their U.S. com­peti­tors years ear­lier, ac­cord­ing to Cit­i­group Inc.

Deutsche Bank AG, Credit Suisse Group AG and UBS Group AG will post losses for the three months through De­cem­ber, while Bar­clays Plc will be "broadly break-even," Cit­i­group's An­drew Coombs and Ni­cholas Her­man wrote in a re­port on Wed­nes­day.

Europe's big­gest se­cu­ri­ties firms are im­ple­ment­ing re­forms taken by many of their U.S. com­peti­tors shortly af­ter the 2008 fi­nan­cial cri­sis. As the con­ti­nent's economies grow more slowly than the U. S., bank ef­forts to cut costs have taken on a new ur­gency fol­low­ing a rev­enue slump caused by volatile global mar­kets. "We ex­pect the Euro­peans to un­der­per­form due to struc­tural trends and rev­enue at­tri­tion on re­struc­tur­ing," the Cit­i­group an­a­lysts wrote.

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