Chapter 618 Natixis Bank
According to statistics, the losses suffered by France’s four major commercial banks due to the subprime mortgage crisis have exceeded 25 billion euros!
The four major commercial banks are BNP Paribas, Société Générale, Credit Agricole and Natixis Bank.
The one with the smallest losses was BNP Paribas. As early as June this year, BNP Paribas’ public data showed that its losses had just reached 2.3 billion euros. However, with the subsequent wave of the subprime mortgage crisis, During the outbreak, their losses have exceeded 5 billion euros, which is why they need to receive a government bailout of 5.1 billion euros.
However, the other three banks also criticized this. After all, BNP Paribas suffered the smallest loss, but received a bailout from the government, and they need to find ways to survive.
Take Industrial Bank for example. The Industrial Bank fraud case discovered in January this year alone caused them a loss of 4.9 billion euros. Including other losses, Industrial Bank currently conservatively estimates that it has lost at least more than 6 billion euros!
In order to meet the relevant capital adequacy ratio requirements, Industrial Bank obtained approximately 5.5 billion euros in funds through capital increase and share expansion, and was finally able to breathe a sigh of relief.
In addition to Industrial Bank, Credit Agricole Bank and Natixis Bank also suffered heavy losses, and they are each seeking capital injections.
“We participated in the share expansion financing of Industrial Bank and Credit Agricole Bank. We heard that Natixis Bank issued a large number of additional shares to William Weber Capital in order to obtain funds...”
“William -Weber Capital?”
After hearing Arnaud's words, Barron asked deliberately.
“Yes, it is an investment company related to the Weber family. I heard that they made a lot of money through short selling. Such a company is simply harming society. I don’t think Natixis Bank should accept it. Investment in this company.”
Well, after hearing Arnault complaining like this to his face, Barron didn’t say much. What would he do if he knew that the boss behind William Weber Capital was himself? How do you feel...
...
"We have reached an agreement with Natixis Bank and will inject 4.5 billion euros into them and acquire 30% of their shares to become this bank. The second largest shareholder..."
Next, Barron met Ashley Weber, CEO of William Weber Capital.
As Arnaud Lagardère mentioned before, as the fourth largest commercial bank in France, Natixis Bank suffered heavy losses in this crisis and was in urgent need of capital injection. Therefore, taking advantage of this opportunity, William -Webber Capital participated in their financing.
Natixis Bank is one of the largest commercial banking groups in France. It was formed in 2006 by the merger of subsidiaries of the French Caissement Bank Group and the Banque Populaire Group. Financial investment banking has always been the main source of income for Natixis Bank. , accounting for almost half of their net profits.
However, due to the impact of the subprime mortgage crisis, according to data disclosed by Natixis Bank, in the second quarter of this year alone, Natixis Bank’s losses increased by nearly 1.5 billion euros...
From The impact of this subprime mortgage crisis on the French banking industry can be seen from one data. Compared with the same period last year, the market value of BNP Paribas has shrunk by more than 40%, the market value of Société Générale has decreased by more than 55%, and the market value of Credit Agricole has decreased. Nearly 60%, while the market value of Natixis Bank has shrunk by a full 65%!
The most critical thing is that because of the losses in this subprime mortgage crisis, the capital adequacy ratios of these banks are already insufficient - according to the "Basel Accord", which is the basic standard for international banking supervision, the target standard ratio of commercial banks' capital adequacy ratios is 8%.
In order to achieve qualified capital adequacy ratios, these banks have successively carried out financing plans starting from Industrial Bank in March this year.
BNP Paribas has received a capital injection from the government. Both Industrial Bank and Credit Agricole have raised funds through additional issuances to shareholders. As for Natixis Bank, the decline in market value has been too "ferocious", including Industrial Bank and Rural Credit Bank. As a precedent for credit banks, their internal financing plan was not approved in the end and they could only seek external financing...
Why do you say this?
Take Industrial Bank as an example. How did they increase capital and expand shares? According to its capital increase and share expansion plan, shareholders of Industrial Bank have the priority to subscribe for one new share for every four Industrial Bank shares they hold. In the end, they issued 116 million new shares and received more than 5.5 billion euros in funds.
The most important thing is that the issue price of their new shares was 47.5 euros, while the share price of Industrial Bank at that time was 77.72 euros, which also means that they issued the new shares at a discount rate of nearly 40%... …
Of course, because their new share issuance is mainly to the original shareholders, it does not cause much dissatisfaction. On the contrary, its shareholders actively subscribe, which also shows their investment. readers still have confidence in it.
The Rural Credit Bank's capital increase and share expansion are somewhat similar to Industrial Bank's plan, except that the issuance price of new shares does not have such a high discount rate, but there is still a discount rate of about 20%.
When William Weber Capital was negotiating with Natixis Bank, their market value had fallen to less than 11.5 billion euros - a year ago, Natixis Bank's market value was as high as 32.5 billion euros.
Also because of the urgent need for funds, Natixis Bank made some concessions to William Weber Capital, and finally agreed to the conditions for William Weber Capital to purchase new shares accounting for 30% of its total share capital after the issuance at a price of 4.5 billion euros.
At this point, William Weber Capital has become the second largest shareholder of Natixis Bank, the fourth largest commercial bank in France, second only to the French Banque Public Group, which holds approximately 35% of its shares.
“Although our capital injection has temporarily alleviated Natixis Bank’s lack of funds, according to requirements, they also need to improve the home loan conditions for personal mortgage loans and carry out a certain degree of layoffs to allow them to The business situation is healthier and more stable.”
Yes. It is understandable to say that Ashley Weber seems to be very high-spirited now. After all, being able to become the second largest shareholder of Natixis Bank, and the shareholding ratio between her and its controlling shareholder is only 5%, also means that By William Weber Capital has a huge say in Natixis Bank.
The reason why William Weber Capital was able to invest in Natixis Bank was mainly because it had previously made a profit of 2.5 billion euros from NM Rothschild Bank through betting, and then aggressively shorted the French stock market, especially It is one of the bank stocks with huge profits.
In addition to investing in Natixis Bank, there is still a considerable surplus in the account of William Weber Capital...
“There is no need to worry about it. I think the impact of the crisis will continue, so we only need to invest in it at the right time. It’s time to increase our holdings in Natixis Bank. Also, is there any movement on the part of the Rothschild family?”
Hearing Barron’s question, Ashley shook her head and said:
“At first, they secretly investigated me, but I didn’t give them a chance, but now, I’m afraid they don’t have so much time to keep an eye on me. The LCF Rothschild Group is already a little overwhelmed. Their investment losses are not small.”
“You still need to be more cautious, Ashley. Although the Rothschild family is not as good as before, they will not be able to inherit it until now.”
Ashley Weber shrugged:
"I will pay attention, Your Highness the Duke."
(End of this chapter)