BNP says it ''regrets'' its massive sanctions fine, BES shares nosedive and Credit Suisse reveals it's also joining the list of banks under investigation for dark pool activities. Joel Flynn explores the earnings and other headline stories emerging from Europe's banking sector.
More concern for Europe's banks. BNP Paribas said on Thursday it tipped into a 4.3 billion euro loss in the second quarter. That's after a 9 billion dollar fine by U.S. regulators. Chief Financial Officer Lars Machenil. SOUNDBITE: BNP Paribas Chief Financial Officer, Lars Machenil, saying (English): "We regret what has happened that we've reached a settlement but that in particular we have taken steps to avoid it. And that for us is very important." Shares in the French bank were little changed though. Its capital markets business grew by a fifth - a sign clients have shrugged off the sanctions busting affair. But elsewhere more trouble. Swiss bank Credit Suisse is the latest to say it's been caught up in an investigation into alternative trading venues known as dark pools. It might not all be bad news. ETX Capital's Mark Priestly. SOUNDBITE: ETX Capital Head of Index and Equity Market Making, Mark Priestly, saying (English): "Generally, the banking sector has performed pretty well. The only slight caveat and the one thing that might play in the back of an investor's mind is the events in Portugal where we've seen Banco Espirito Santo post a EUR3.6 billion loss and I think, people are still slightly concerned that perhaps the Eurozone banking crisis isn't fully over yet." Banco Espirito Santo says it needs a capital injection after the loss. But that's complicated by the suspension of key staff members by the Bank of Portugal over suspected "harmful management". Lloyds shares dropped slightly despite reporting a one-third rise in profit for the first half, while Santander profits also jumped as its bad debts eased. Many are now worried about the currency though. SOUNDBITE: ETX Capital Head of Index and Equity Market Making, Mark Priestly, saying (English): "With the euro perhaps getting weaker and weaker, and other currencies such as the Pound getting stronger, it will affect these banks and I think there is still a concern about the longevity of the Euro currency." It all comes as the ECB mulls over a programme of quantitative easing. It cut all its interest rates in June and promised up to a trillion euros in cheap long term loans to banks from September. With euro zone inflation at its lowest since 2009, eyes at banks and beyond will be on what the ECB does next.