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The Market Online
3 days ago
- Business
- The Market Online
Interest rate poker and commodity chess: Deutsche Bank, Globex Mining, and Rio Tinto in focus
Geopolitical tensions are the new market standard, not the exception. Trade conflicts are escalating globally, tariffs are becoming a chess game over commodities and influence, and military shifts are destabilizing supply chains. At the same time, central banks are hesitating to cut interest rates despite lower inflation, keeping the pressure high. In this turbulent environment, an understanding of macroeconomic forces determines profit or loss. Those who read the signs will find opportunities. Which of these three players—Deutsche Bank, Globex Mining (TSX:GMX), and Rio Tinto—offers potential? This article is disseminated in partnership with Apaton Finance GmbH. It is intended to inform investors and should not be taken as a recommendation or financial advice. Deutsche Bank posted a pre-tax profit of EUR 5.3 billion in the first half of the year, more than twice as much as in the previous year. Adjusted for special items, such as those relating to the Postbank proceedings, earnings rose by as much as 37%. All four core businesses were drivers, with corporate customers and asset management performing exceptionally well. Income climbed 6% to EUR 16.3 billion. Cost discipline was maintained despite growth. Adjusted expenses stagnated at EUR 10.1 billion. With a return on equity (RoTE) of 11.0% and cost coverage of 62.3%, the interim targets for 2025 have already been achieved. Digitalization and leaner processes are bearing fruit. The EUR 2.5 billion efficiency program is 90% complete, thanks to branch optimization and smart staffing. At the same time, the Company is investing in innovation. Artificial intelligence and cloud technologies are set to open up new sources of income. The 'Global House Bank' strategy is proving effective, with customer deposits growing and the divisions working more closely together. Sustainable financing also increased significantly, with a record quarter of EUR 28 billion. The transformation into a more efficient, customer-focused institution is progressing according to plan. The bank is on a solid financial footing. The Common Equity Tier 1 (CET1) ratio climbed to 14.2%, providing a buffer that allows scope for investments and distributions. Even in the latest EU stress test under extreme scenarios, the ratio remained well above the minimum requirements. Risk provisions for loans fell by 2%, which is indicative of a healthy portfolio. Interest rate uncertainties and regulation continue to require flexibility. However, the institution currently appears more resilient than ever. Management is reaffirming its dividend targets, which is a clear sign of confidence to shareholders. The share is currently trading at EUR 29.24. Globex Mining – Broadly positioned in the commodities sector With over 250 projects in North America, Globex (TSX:GMX) offers exceptional risk diversification in the commodities sector. Around half of these are in precious metals such as gold and silver, whose prices have risen sharply this year. The debt-free company does not rely on its own production, but leases deposits to specialized partners in exchange for cash payments, shares, or options. These partners assume exploration costs and risks, while Globex receives royalties once the projects go into production. This model generates a continuous flow of news without tying up capital and positions the Company ideally in the current commodity boom. Recent announcements underscore the strategy. At the Bald Hill antimony-gold project near New Brunswick, a 3,150 m drill program confirmed mineralization over 400 m, open in all directions. At the same time, the mineral resource at the Duquesne West gold project in Quebec was upgraded to 1.46 million ounces at a grade of 1.69 g/t gold. Forty-four percent of the material is suitable for open pit mining, with the remainder suitable for underground mining. The goal is now to increase this to over 2 million ounces through further exploration. On July 23, Globex secured the Salt Spring project in Arizona, which covers approximately 334 hectares and has over 40 claims. Rock and soil samples have already revealed gold grades of up to 25.6 g/t. Globex's focus on North America is paying off. Trade conflicts and supply chain risks are increasing demand for raw materials from secure jurisdictions. While industrial groups are suffering from tariffs, the licensing model is benefiting from the search for secure sources. The Company is operating without risk. The partners are covering the exploration costs and, should they run out of money, the project will revert to Globex, which will then have new information about the property and its deposits. If the partner is successful and brings the project into production, Globex will collect royalties with minimal risk. In uncertain times, this risk-minimized approach with a broad metal mix is a decisive advantage. The share is currently available for CAD 1.33. *By clicking on the button, you activate the video. By activating the video, a connection to Google is established and personal data is transmitted. Cookies are also stored. More information in our Privacy. Rio Tinto – Robust operations despite price pressure Rio Tinto is one of the global heavyweights in mining, focusing on iron ore, aluminum, and copper. The current half-year results for 2025 show a company caught between solid day-to-day business and strategic realignment. Operating results for the second quarter were impressive. Iron ore remains on track for the slightly downwardly adjusted full-year forecast, while copper and bauxite are even slightly above it. Key projects such as Simandou in Guinea and Oyu Tolgoi are on schedule and within budget. Iron ore production reached a record high for a second quarter. Copper production rose sharply by 9% compared with the previous quarter to 229,000 t, driven by better ore grades and growing output at Oyu Tolgoi. Rio Tinto is systematically expanding its position in future markets. The integration of the billion-dollar Arcadium lithium acquisition is on track and is expected to make the Company a major global player in the battery raw materials market. In addition, joint ventures in Chile and own projects in Argentina and Canada are driving growth in the lithium business. At the same time, the high-quality iron ore projects Simandou, where the first deliveries are scheduled for the end of 2025, as well as Brockman Syncline 1 and Hope Downs 2 in Australia, are progressing rapidly. These investments diversify the portfolio away from its heavy dependence on iron ore. Rio Tinto continues to perform robustly financially, even though the massive growth investments are visible. Debt rose significantly, primarily driven by the Arcadium acquisition, but remains at a manageable level. The dividend remains at an attractive level despite a decline in profits compared to the previous year. Cost control is largely working, although external factors such as US tariffs on aluminum have brought noticeable but partially offset burdens. The forecasts for most core products have been confirmed or slightly adjusted upward. After the figures were released, the share price initially declined. A share currently costs USD 60.00. In uncertain times marked by geopolitical turmoil and hesitant central banks, the three companies analyzed are relying on different strengths. Deutsche Bank scores with solid operating performance, strict cost discipline, and successful digital transformation, which gives it a robust foundation for the challenges ahead. Globex Mining is leveraging its innovative, debt-free licensing model with over 250 projects to benefit from the commodity boom and the search for secure North American resources with minimal risk. Despite high investments in strategic future markets such as lithium and moving away from pure iron ore dependency, Rio Tinto remains operationally robust and is sticking to its attractive dividend policy. Conflict of interest Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as 'Relevant Persons') may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a 'Transaction'). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company. In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships. For this reason, there is a concrete conflict of interest. The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies. Risk notice Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and the like on These contents are exclusively for the information of the readers and do not represent any call to action or recommendations, neither explicitly nor implicitly they are to be understood as an assurance of possible price developments. The contents do not replace individual expert investment advice and do not constitute an offer to sell the discussed share(s) or other financial instruments, nor an invitation to buy or sell such. The content is expressly not a financial analysis, but a journalistic or advertising text. Readers or users who make investment decisions or carry out transactions on the basis of the information provided here do so entirely at their own risk. 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Canada News.Net
4 days ago
- Business
- Canada News.Net
EU lenders pass recession scenario in latest EBA stress test
MILAN, Italy: European banks are well-positioned to absorb a significant economic downturn triggered by geopolitical conflict and a global trade war, the European Banking Authority (EBA) said, following the release of its latest sector-wide stress test. The 2024 assessment simulated how 64 banks across the EU, including 51 from the eurozone, would fare in a three-year recession marked by surging energy prices, disrupted trade flows, and shrinking investment. None of the banks breached core capital requirements under the adverse scenario, and only one fell short of the minimum leverage ratio. "The results indicate that the EU banking system could withstand a severe but plausible macroeconomic scenario, reflecting the resilience built up by banks in recent years," the EBA said in a statement. It urged lenders to maintain adequate capital buffers. The stress test was designed to measure banks' vulnerability to a scenario involving escalating geopolitical tensions, U.S. trade tariffs, and instability in the Middle East. The EBA projected that these shocks would lead to a 6.3 percent cumulative contraction in EU GDP between 2025 and 2027. The simulation predicted total losses of 547 billion euros across the tested banks, higher than the 496 billion euros projected in the previous 2023 stress test. While the results varied by institution and country, the EBA concluded that the overall financial system remains robust enough to avoid systemic failure. In terms of capital reserves, the average Common Equity Tier 1 (CET1) ratio among participating banks would drop by 3.7 percentage points—from 15.8 percent in 2023 to 12.1 percent by 2027—under the adverse scenario. This decline reflects the cumulative effect of credit losses, lower income, and increased risk-weighted assets. The most significant capital hits were observed among banks operating in Ireland, Denmark, France, Germany, and Belgium. On an individual level, Germany's Landesbank Baden-Württemberg and two other regional German lenders saw the steepest projected losses, alongside France's Crédit Agricole and La Banque Postale. For 17 banks in the sample, the stress scenario would lead to restrictions or adjustments to dividend or bonus payments for at least one year during the test period. The EBA also noted that some of the risk factors in its model have already begun to materialize, including rising protectionism and geopolitical instability. The findings are particularly relevant as policymakers and regulators weigh the implications of prolonged global uncertainty and possible further economic shocks. Stress tests became a formal regulatory tool following the 2008 global financial crisis, which exposed widespread weaknesses in the banking sector and led to expensive taxpayer-funded bailouts. While there is no pass/fail threshold in the EBA's assessment, the results help supervisors evaluate bank-specific capital needs and feed into the broader regulatory framework under what's known as "Pillar 2" guidance.
Business Wire
5 days ago
- Business
- Business Wire
The Bancorp, Inc. and The Bancorp Bank, N.A. Receive Upgraded Ratings from KBRA
WILMINGTON, Del.--(BUSINESS WIRE)--The Bancorp, Inc. (NASDAQ: TBBK) today announced that Kroll Bond Rating Agency, LLC ('KBRA') has upgraded multiple long- and short-term credit ratings for both The Bancorp, Inc. (the 'Company') and its wholly owned subsidiary, The Bancorp Bank, N.A. (the 'Bank') (collectively 'The Bancorp'). For the Company, KBRA upgraded the senior unsecured debt rating to BBB+ from BBB, the subordinated debt rating to BBB from BBB-, and the short-term debt rating to K2 from K3. In addition, KBRA upgraded the Bank's deposit and senior unsecured debt ratings to A- from BBB+, and the subordinated debt rating to BBB+ from BBB. The Bank's short-term deposit and debt ratings of K2 were affirmed. In conjunction with the upgraded ratings, KBRA revised its outlook for all long-term ratings to Stable from Positive. Key Highlights from KBRA's Rating Announcement: Industry Leader in the BaaS Industry: The upgrades are supported by The Bancorp's long-standing position as a leader in the banking as a service industry, particularly in the prepaid and debit card space, where the Bank ranks as the largest issuer of prepaid cards by transaction volume; Non-interest Income Growth: The Bancorp has been able to generate above-peer fee revenues, including a 30% year-over-year increase in non-interest income in the first half of 2025, reaching fee revenues of $78 million, or 1.7% of average assets. Above-Peer Capital Levels: The Bancorp has maintained capital levels that exceed its peers, including a Common Equity Tier 1 (CET1) ratio of 14.4% as of the second quarter in 2025. The full KBRA rating report and press release are available at KBRA's credit ratings and analysis represent the agency's independent opinions and should not be considered statements of fact or investment recommendations by KBRA or the Company. About The Bancorp The Bancorp, Inc. (NASDAQ: TBBK), through its subsidiary, The Bancorp Bank, N.A., provides non-bank financial companies with the people, processes, and technology to meet their unique banking needs. With over 20 years of experience, The Bancorp delivers partner-focused solutions paired with cutting-edge technology for companies that range from entrepreneurial startups to Fortune 500 companies. Through its Fintech Solutions, Institutional Banking, Commercial Lending, and Real Estate Bridge Lending businesses, The Bancorp is the third-largest bank by asset size in South Dakota, earning recognition as the #1 issuer of prepaid cards in the U.S., a nationwide provider of bridge financing for real estate capital improvement plans, an SBA National Preferred Lender, a leading provider of securities-backed lines of credit, and one of the few bank-owned commercial vehicle leasing groups in the country. With a company-wide commitment to excellence, The Bancorp is recognized as the top-ranked publicly traded bank with assets between $5B-$50B by Bank Director Magazine, a Readers' Choice Top 50 Employer by Equal Opportunity Magazine and was selected to be included in the S&P Small Cap 600. For more about The Bancorp, visit Forward-Looking Statements Statements in this press release that are not historical facts are 'forward-looking statements' within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. Forward-looking statements provide management's current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Sentences containing words such as 'believe,' 'intend,' 'plan,' 'may,' 'expect,' 'should,' 'could,' 'anticipate,' 'estimate,' 'predict,' 'project,' or their negatives, or other similar expressions of a future or forward-looking nature generally should be considered forward-looking statements. While the Company considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory, and other risks and uncertainties, most of which are difficult to predict and many of which are beyond the Company's control. The Company undertakes no obligation to review or update any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by law.
RTÉ News
01-08-2025
- Business
- RTÉ News
Stress test shows AIB and BOI could withstand an economic shock
An EU wide bank stress test has found that the country's two largest banks currently hold enough capital to withstand an economic shock. The European Banking Authority exercise was conducted on a sample of 64 banks from 17 EU and EEA countries, covering 75% of EU banking sector assets. The results indicate that the largest EU banks would be resilient to a severe hypothetical stress scenario over a three-year period from 2025 to 2027. It assumes a simultaneous and prolonged recession across the EU and other advanced economies, driven by severe global disruptions. Under the scenario, the disruptions are caused by escalating geopolitical tension, particularly in the Middle East, and a rise in protectionist trade policies worldwide, including tariffs. It concluded AIB's transitional Common Equity Tier 1 (CET1) capital ratio - an important measure of a bank's financial strength - would stand at 13.4%. While the CET1 capital ratio for Bank of Ireland would stand at 13.9% under the adverse stress test scenario. Both are above the average 12% CET1 capital ratio, which is up from the avearge 10.4% in the 2023 exercise. AIB's Chief Financial Officer, Donal Galvin, said the bank's result of 13.4% fully loaded CET1 in the EBA's hypothetical adverse scenario "demonstrates our high capital base and capital resilience in the EBA adverse scenario". "AIB continues to be very well-capitalised with a CET1 ratio of 16.4% (1) at H1 2025 which remains substantially in excess of regulatory requirements," he added. The EBA said the strong performance of the EU banks in the 2025 stress test "is reassuring, nonetheless, this should not lead to complacency among banks or supervisors". The Director of Banking & Payments Supervision at the Central Bank, Domhnall Cullinan said: "On balance, the scenario in use for the EU area is broadly aligned with the 2023 exercise but the impact of the stress test is milder than the results from that exercise. "This is mainly due to banks entering the exercise with stronger profitability, and stable asset quality," he added. Mr Cullinan said despite prevailing uncertainty, "the benefits of resilience built up in recent years are evident, with banks having sufficient capital to absorb the impact of the severe scenario." "Given the uncertainty, there remains a need to maintain and continue to build resilience, both financial and non-financial."
Business Times
22-07-2025
- Business
- Business Times
Capture yield via high-quality US dollar bank bonds
[SINGAPORE] With the trajectory of interest rate cuts still uncertain and inflationary pressures lingering, investors are increasingly focused on stable income sources. One corner of the market that continues to attract attention is US dollar-denominated bonds issued by globally systemic banks such as HSBC, Barclays, Standard Chartered, Macquarie and BNP Paribas. These issuers offer a compelling blend of income and resilience amid a complex macroeconomic landscape. H1 2025: divergent performances, common strength The first half of 2025 highlighted the varying strategies banks are adopting to navigate persistent inflation, rising geopolitical tensions and the initial fallout from global tariffs. While Barclays capitalised on market volatility with stronger trading income, others such as HSBC and BNP Paribas remained more defensive amid credit deterioration and one-off divestments. Still, the overall sector remained fundamentally sound. Most banks saw improvements in income, albeit accompanied by modest increases in credit provisions. Net profits across these major players held steady, underpinned by solid balance sheets and robust capital buffers. Capital and liquidity strength A key source of confidence for investors lies in the banks' strong capitalisation and liquidity profiles. As at Q1 2025, average Common Equity Tier 1 (CET1) ratios remain well above regulatory requirements, with buffers ranging from 170 to 380 basis points. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Liquidity coverage ratios (LCR) also exceeded 130 per cent for all five banks – a reassuring sign of balance sheet resilience coupled with net stable funding ratios (NSFR) above regulatory minimum of 100 per cent. These position the banks with a solid footing to weather further macroeconomic headwinds while continuing to support bondholders. Highlights of major banks Barclays delivered robust results, with income buoyed by fixed income trading and a healthy rise in net interest income. Return on tangible equity exceeded both internal and long-term targets; and capital and liquidity remained comfortably above regulatory thresholds. BNP Paribas saw stable underlying momentum despite a year-on-year decline in reported profits due to the absence of one-off gains in Q1 2024. Liquidity and capital positions remain healthy, with CET1 at 12.3 per cent and LCR above 130 per cent. Standard Chartered posted a solid Q1 2025, with income growth driven by Hong Kong and improving operating profit. Despite higher overlays for China and Hong Kong commercial real estate exposures, the bank maintained strong CET1 and liquidity metrics. HSBC experienced a decline in headline earnings following the absence of prior-year one-offs and higher expected credit losses, especially in commercial real estate. Excluding these, earnings remained steady, and the bank reaffirmed its commitment to return capital via buybacks. Macquarie Bank saw moderate growth in FY25 despite headwinds from lower trading income and rising credit charges. Net profit rose 18 per cent year on year, with strong CET1 ratios and liquidity providing ample buffer. Quality amid uncertainty In today's environment, we believe high-quality USD bank bonds remain a reliable income-generating asset class where income and quality are both in focus. Bonds from these financial giants present attractive opportunities across a range of risk and duration profiles. • Senior bonds from names such as BACR 7.385% 02Nov2028 Corp (USD), HSBC 7.390% 03Nov2028 Corp (USD) and STANLN 6.301% 09Jan2029 Corp (USD) offer investors relatively lower-risk exposure with yields above 5 to 7 per cent and tenors within the three to six-year range. These are ideal for investors seeking stability and visibility on returns. • Subordinated Tier 2 bonds such as MQGAU 6.798% 18Jan2033 Corp (USD) and STANLN 4.300% 19Feb2027 Corp (USD) provide an appealing middle ground. They come with higher yields but also modestly higher risk due to regulatory loss absorption features. However, Basel III rules that reduce capital recognition post-call date offer a strong incentive for issuers to redeem on schedule, increasing predictability for investors. By combining senior and subordinated exposures from these issuers, investors can construct a diversified bond portfolio that balances income, duration and credit quality. The writer is a research analyst with the research and portfolio management team of a Singapore subsidiary of iFast Corporation
