03 May 2016 by lberuti
UK investors were back from a 3-day weekend and some investors in continental Europe have a 4-day weekend in sight, it was therefore not surprising that liquidity was thin. It definitely amplified the magnitude of the moves today and exacerbated the weakness felt across the board. Financials were under particular pressure (irrespective of the quality of their results for these that reported this morning) and were the laggards - with the basic materials sector - among European credits. Among them, peripherals banks suffered the most. The move was driven by the failure of the listing of Popolare di Vicenza on the Milan stock exchange. The IPO attracted too little interest and because the resulting free float would have been very small, the bank did not get the green light to proceed. As a result, the Atlante fund, which had underwritten the capital increase, will own a 99.3% stake in Vincenza. That is roughly €1.5bln that will not be available to the fund to buy non-performing loans.