The report named nine financial institutions in all—
- Barclays BCS
- Société Générale SCGLY -0.43%
- UniCreditUNCFF -0.54% Group,
- Deutsche Bank, Barclays,
- Standard Chartered STAN -0.30%
- Sumitomo Mitsui Financial Group SMFG +0.25%
- Mizuho Financial Group MFG +0.00%and
- Mitsubishi UFJ Financial Group MTU +0.45% —
as likely to deliver subpar profits.
.. “Institutions that are not profitable might not be able to generate enough capital in the future should adverse shocks hit,” Tobias Adrian, the director of the IMF’s monetary and capital markets department, told reporters. “It might become a financial stability risk not to be profitable.”
.. The IMF said the consensus among private-sector bank-industry analysts was for a return on equity of less than 8% for each of those nine banks in the year 2019.
.. Deutsche Bank’s stock, for example, trades at less than half of its book value, or net worth, and has traded well below this level since 2010.