Serra: bank equities insulated from ECB APP bubble

By Jasper Cox
08 Oct 2019

Davide Serra, founder and chief executive of Algebris Investments, presented a bullish case for financials on Tuesday, on the basis that their equity prices have been less manipulated by central bank asset purchase programmes than institutions in other sectors. But he thought that the European Central Bank (ECB) will end up buying banks’ senior unsecured bonds.

Serra, speaking at the Bloomberg Invest London conference, said that action by central banks “has basically manipulated every risk asset in fixed income”, and this affected the value of equity in most sectors.

“The lowering of the cost of the debt had an impact on the cost of equity ...

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