Europe set for flurry of bank M&A when rules settle down

Tim Wallace
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BANKS are preparing for a wave of mergers and acquisitions as Europe’s new more co-ordinated regulation makes it easier to do business across borders, analysts at Scope Ratings said yesterday.

Few Eurozone banks have snapped up rivals in recent years, preferring to bolster their own positions and work to match ever-changing regulations.

But now the sector has been through a tough stress test, buyers will be less worried about picking up a bank which is full of unforeseen bad debts.

And Europe-wide regulation will help banks manage cross-border business, while new technology will also help.

“Multichannel banking has spread across Europe, but not to Italy yet so there is significant potential to cut cost bases,” said Scope Ratings’ Marco Troiano.

And it also cuts barriers to entry.

“For example a big Spanish bank could buy a small Italian bank and use it to roll out a digital offering,” Troiano added.