GS Financials Conf This Week: More About M&A/Strategy Rhetoric Than Credit Moving

Goldman Sachs is holding its annual Euro financials conference (today to Thursday) so expect to see a slew of headlines but we'd make three points:

• Few mgmt teams ever issue materially financial information at these things, especially material enough to impact spreads. This is more of an equity event where nuances of strategy and financial outlook are often “tweaked” rather than changed. RegFD has made mgmts more reticent about altering guidance/outlook at anything other than a formal exchange announcement.
• What is often of interest is the M&A rhetoric that emerges, however. Unicredit’s CEO was recently quoted as being positive on European bank consolidation (echoing French President Macron’s comments about it being an avenue to capital markets union), BBVA is already bidding on Sabadell but there are a fair few other major banks who would be interested in deals, we feel. Excess capital abounds (as evidenced by widespread equity buybacks) so this is a logical next step.
• This is, however, just one of a range of conferences: Morgan Stanley is doing US financials next week, there’s an HSBC insurance conference also next week, UBS held a financials conference in February, and these are aside from the flagship Merrill financials conference in Q3.