Consolidation no panacea for mid-tier bank spreads

Tyler Davies

August 19, 2020 12:45 pm

UBI_Banca_PA_575x375_190820 — Intesa Sanpaolo has made an unsolicited offer of 4.9 billion euros (5.3 billion dollars) for its smaller rival Unione di Banche Italiane SpA in a midnight raid that could trigger a further consolidation among Italian banks in difficulty in Rome, Italy on February 19, 2020. (Photo by Andrea Ronchini/Pacific Press/Sipa USA) | Pacific Press/SIPA USA/PA Images

National champions have outpaced their smaller peers in the rally in bank bond spreads over recent months. Investors say individual valuations in the middle tier of the sector could pick up, but that the chances of consolidation may first have to improve.

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Tyler Davies