While Russian bank stocks were hit hard on European markets on Monday, Feb. 28, major European bank stocks were also nosediving while speculators moved in a big way into war industries. The British daily Guardian reported that the European Central Bank warned that Sberbank Europe, the European arm of Russia’s biggest bank, and two of its subsidiaries “are failing or likely to fail ... owing to a deterioration of their liquidity situation.” Austria’s Financial Market Authority said it imposed a moratorium on Sberbank Europe, which is based in Austria.
The European banking stock index fell 5.7%, compared with a 2.4% drop in the Euro Stoxx index of European blue-chip shares. The hardest hit, with the most exposure to Russia, was Austria’s Raiffeisenbank, which lost as much as 18%; while France’s Société Générale fell 11%, and the Dutch banking group ING and Italy’s UniCredit both dropped about 10%, Deutsche Bank and Commerzbank both lost 7% of their market value, BNP Paribas 8-9%. The British banks took a hit as well with HSBC, NatWest, Barclays and Lloyds losing more than 3% of their value and were joined by the insurers Prudential and Legal & General.
