European bank stocks slide after money-laundering allegations; Dow futures slide 300 points

Europe Markets

Signage for HSBC (L) and the Standard Chartered Bank (R) are displayed on the local headquarters of each bank in Hong Kong on April 28, 2020.

anthony wallace/Agence France-Presse/Getty Images

Shares of Europe’s top banks dropped on Monday, after the publication of reports alleging they kept doing business with customers they suspected of money laundering and other wrongdoing.

The report, led by Buzzfeed News and including other media outlets around the world, was on the basis of what are called suspicious activity reports filed by the banks to the U.S. Treasury, that had been gathered for Congressional investigators to look at President Donald Trump’s 2016 campaign. The banks by law are not allowed to comment on the SARs they file.

Deutsche Bank

shares dropped 4% as its money laundering vulnerabilities were known by its top executives, according to the Buzzfeed report. Deutsche Bank said it has learned from past weaknesses and said “we are a different bank now.”

Standard Chartered
alleged to have done business with a company laundering money for the Taliban, fell 3%. The Asian-focused, London-based bank said “U.S. and U.K. authorities have publicly acknowledged that the Group has undergone a comprehensive and positive transformation over the last several years.” Barclays
Danske Bank

and HSBC Holdings

were also named in the report, as were several U.S.. banks.

The broader Stoxx Europe 600

fell 1.7%, with the losses for HSBC proving to be an anchor on the FTSE 100
which dropped 2.3%. The German DAX

and French CAC 40

also fell.

U.S. stock futures

fell, with futures on the Dow Jones Industrial Average

losing 340 points. Last week, the tech heavy Nasdaq Composite

fell 0.6%, while energy and industrial stocks rose.

On the move in Europe were shares of engine maker Rolls Royce
which on Friday said was considering raising up to £2.5 billion in new equity capital.

United Internet

shares tumbled over 20% after Telefonica Deutschland

said in negotiations that it would hike wholesale costs. United Internet said it’s appealed to the European Commission over the matter.

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