Herro: Continue to Build Our Position in European Banks

The video discusses the impact of Article 50 on banks like Lloyds and RBS, highlighting their strong capital positions and ability to absorb uncertainty. It examines the resilience of European banks post-2016, noting their unexpected growth and reduced loan losses. The discussion shifts to investment strategies, focusing on Credit Suisse and the implications of their RMBS settlement. Finally, it explores international banking trends, emphasizing stability and the potential for banks to act as utilities with high dividend yields.

What was the primary concern for banks like Lloyds and RBS following the Article 50 referendum?

• Lower interest rates

• Higher loan losses and reduced loan growth

• Increased loan growth

• Increased capital reserves

How did European banks manage to grow steadily in 2016 despite challenges?

• By increasing loan losses

• By cutting costs and increasing fees

• By reducing interest rates

• By expanding into new markets

What was the initial expectation for European banks at the beginning of 2016?

• Rapid growth

• Widespread destruction of earnings power

• Stable earnings

• Increased capital reserves

What was a significant factor in managing Credit Suisse's position?

• Reducing interest rates

• Increasing loan losses

• Settlements and penalties

• Expanding into new markets

What was the perceived role of the Swiss banking unit IPO?

• To expand into new markets

• To increase their capital buffer

• To reduce loan losses

• To cut operational costs

What is the potential impact of regulatory constraints on banks?

• Increased competitive pressure

• Greater risk-taking

• Higher highs and lower lows

• More stability in earning streams

How are banks expected to behave in the future according to the final section?

• As high-risk ventures

• As utilities with some responsiveness to the macro economy

• As purely dividend-focused entities

• As aggressive growth companies