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08/11/2022 - Scope SE & Co. KGaA
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The Wide Angle – European bank profitability is no longer a major problem
Contrary to the broadly held market view that European banks continue to be insufficiently profitable, the sector’s bottom line is now reaching an adequate level. Analysts and investors should revisit their views that profits remain a risk for the sector.
Sam Theodore challenges three elements underpinning claims of sub-par bank profitability. Stable and sustainable earnings against a non-threatening risk profile should keep most investors reassured, even if profits fall short of being spectacular.