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Spanish lender Santander Bank dimmed the Swiss gigantic UBS As the largest bank Continental Europe by market capitalization, as US tariffs throbbed through bruises in the region.
UBS – whose share accepted a deep campaign after the announcement of US President Donald Trump and mutual duties on Washington’s counterparties – had a market cap of 79.5 Swiss francs ($ 97.23 billion) on Wednesday, according to FactSet, from Banco Santander at 91.3 billion euros.
The shares of both banks have dispersed in recent months, and the Swiss lender shed 17.2% today, while Banco Santander scored almost 35%, according to LSEG.
Both banks, along with a wider banking sector of Europe, were injured after the introduction of protectionist trade policy of the White House, given the shrinkage of growth for tariff European countries and the prospect of recession in the US
Washington introduced 20% of import tariffs from the European Union, but reduced them to 10% at a 90-day pause announced on April 9.
Switzerland, which is not an EU member, threatens 31% more after raising, and Trump’s administration also threatens additional duties in import drugs. This can strike in the Swiss pharmaceutical industry that “reliably grew” In the fourth quarter And “they greatly contributed to the country’s exports during this period.
To a greater extent, European Union banks have gained an incentive to announce Initiative to transform the European Union In March, which should weaken regional financial rules and launch further borrowing to increase defense costs.
US
The two largest Continental European lenders have very different expositions in the US market.
Banco Santander-Fifth by magnitude lender in the country and expanded through Last Partnership With the telecommunications giant Verizon. However, it entered only 9% of the total profit for 2024.
European banks
Meanwhile, the US is a key market for the UBS’s profitable worldwide wealth department, approximately half of the deposited assets of the Swiss lender concentrated in a wide region of America.
The UBS’s forecast was also clouded by the shroud related to the potential of the new – and more steep requirements of the capital of the Swiss authorities. This stems from its expansion as a result of the absorption of the destroyed domestic loan lending, from which it also inherited a significant presence in the US. Lender waiting Get extra clarity in these guidelines next month.
UBS’s profitability can also affect a strong Swiss franc – a historically active shelter asset during market shocks – estimating approximately 8% against the US dollar after the introduction of the latest tariffs.
The grateful currency of Switzerland – whose power trading groups were labeled as a damage to the exports even before the tariffs came into force – they could, as well as depressed inflation in the country, see that the Swiss National Bank made further defensive decrees of interest rates, which were already reduced to only 0.25% in March.
For comparison, the European Central Bank also supposedly will cut its key deposit factor for a quarter points if it met later on Thursday, although it will take up to 2.25%.
A potential decrease in the interest rate will take place after the ECB stated in March that its monetary policy “becomes much less restrictive” – the signal in the signal that interpret as restraint when it comes to decreased rates.
Reduced national interest rates usually weighs net revenues from local creditors from loans.
