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By Andrew Birse and Jane Bleeg
Investors in European bank shares have been rattled by recent turmoil in the sector. But many banks are in much better shape than widely perceived, and the sector is subject to
Is Europe Facing Another Banking Crisis?
Summary
- Banks in Europe generally have a much larger retail deposit customer base than their peers in the US, where money market funds are popular vehicles for deposits.
- Skeptics might be concerned about the impact of potential new regulation on banking earnings. However, we believe that the European banking sector is much less vulnerable to new regulation than the US industry.
- In Europe, we think the already-rigorous regulatory environment and a generally sound banking business model provide a robust backdrop for lenders to traverse diverse challenges.
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