(AOF) – Euronext has much to celebrate. The pan-European stock exchange group recorded record activity on the primary markets in 2021. This represents 212 new share listings, for a cumulative market capitalization of 123 billion euros and 26 billion euros in funds raised. At the same time, Euronext also counted more than 14,600 new bond listings, including more than 400 ESG bonds.
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Key points
– First European financial center created in 2000, present in 20 states, bringing together the regulated markets of Amsterdam, Brussels, Dublin, Lisbon, Milan, Oslo and Paris, as well as several platforms;
– Revenues of € 1.4 billion, split between transactions for 30%, listing for 17%, advanced data services for 16% and custody & settlement-delivery for 13%…;
– Growth model based on 5 pillars: strengthening of the value chain (clearing activities, migration of the Core Data Center, etc.), expansion of the platform offer (Portugal, Norway, Denmark and Italy), expansion of the offer in quotes, innovative products and services, strengthening of positions in sustainable finance and pursuit of external growth;
– Open capital with reference shareholders holding 25.44% of the shares -ABN Amros, Caisse des Dépôts, Euroclear, SFPI, Cassa Depositi e Prestiti and Intesa San Paolo;
– Company incorporated under Dutch law, Stéphane Boujnah being Chairman and Chief Executive Officer of the 9-member board of directors;
– Maintenance of financial solidity after the purchase of Borsa Italia, financed by private placement, call to the market of € 1.8 billion and loan of the same amount.
Challenges
– “Growth for impact 204” strategy: annual growth of 3-4% in turnover and 5-6% in operating income, maintenance of the dividend policy (rate of 50%) and investments (3 -5% of turnover) / synergies with the Milan Stock Exchange of € 100 for integration costs estimated at € 160 million;
– 4 priorities for the innovation-digitization strategy, deployment of information sharing and co-design, strengthening of the efficiency of central technologies and integration of innovations such as tokenization, tailor-made trading models, etc.;
– Environmental strategy based on 2 pillars, internally reducing the carbon footprint and, for customers, expanding the range of services, accelerating the transition to sustainable finance: expanding the range of ESG indexes / catalog Green bonds and focus on Blue Bonds (linked to oceans and seas) / support for issuers in their ESG transition;
– Continuation of introductions in Europe, above their 2014 level;
– Maintaining competitive advantages – a single platform for transactions on regulated European markets and a range of services covering all the needs of financial market participants;
– High capacity for innovation, operating margin higher than that of its European competitors and speed of execution of integrations.
Challenges
– Weight and volatility of European regulation;
– Integration of the Milan Stock Exchange bought for € 4.3 billion in April and realization of the accretive effect on profit, expected from 2021, and cost savings;
– At 3
th
quarter 2021, increase of 10% (71% with Borsa italiana) in revenues and 46% (65%) in net profit.
Many challenges for European banks
The European retail banking model is particularly challenged by the digital boom. Some are withdrawing from this activity, as is the case with HSBC. In addition, there is an increase in risks. Thus, according to the ECB, the strong activity of the big banks in the market for leveraged transactions and the markets for equity-linked derivatives exposes them to excessive risk-taking.
As for French banks, since the health crisis, they have been increasingly exposed to cyber risk following the need to switch financial activities massively and rapidly towards teleworking and the provision of remote services.