Global credit spreads are heading for the biggest weekly increase in four months as bubbling property market stresses prompt banks to increase bad-loan provisions.
Spreads on corporate bonds globally have widened eight basis points since last Friday, the biggest weekly jump since early October, while those on investment-grade financial bonds have risen seven basis points, Bloomberg indexes showed. Spreads on bonds issued by Asian lenders are about one basis point higher on average Friday.
Bad news stemming from banks’ real estate exposure is coming thick and fast. Shares in US regional lender New York Community Bancorp slid by almost 50% over the past two days after it ramped up provisions for loan losses, while Japan’s Aozora Bank Ltd. forecast an annual loss due to bad loans linked to US commercial real estate. Deutsche Bank AG more than quadrupled its US property loss provisions.
“For the first time since late October, market sentiment has turned markedly negative,” Goldman Sachs Group Inc. analysts including Lotfi Karoui in New York wrote in a research note. Investors should add “a dose of hedges to credit portfolio” as weaknesses in US regional banks add to the risk-off mood, they said.
Concerns are mounting about the potential pain for banks as elevated interest rates push down commercial property values in the US and elsewhere, and make it more difficult for developers in refinancing their debt. The downbeat news from banks comes just as the Federal Reserve this week pushed back against the prospect of an interest-rate cut in March.
Shares in Aozora Bank extended losses Friday, plummeting as much as 19% in Tokyo. Spreads on the bank’s dollar bonds maturing in 2026 have more than doubled over the past two days, according to data compiled by Bloomberg.
The looming threat of federal funding cuts to state and local governments has lawmakers weighing a levy that was phased out in 1981.
The fintech firms' new tools and integrations address pain points in overseeing investment lineups, account monitoring, and more.
Canadian stocks are on a roll in 2025 as the country prepares to name a new Prime Minister.
Carson is expanding one of its relationships in Florida while Lido Advisors adds an $870 million practice in Silicon Valley.
The approval of the pay proposal, which handsomely compensates its CEO and president, bolsters claims that big payouts are a must in the war to retain leadership.
RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.
As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.
