AGP Executive Report

Crypto Meets Banking: Kraken parent Payward agreed to buy Lithuania-licensed Saldo Bank, a deal that could give the crypto firm an EU banking foothold across five markets. Pending approval and expected to close in 2027, it would enable deposits, lending and euro payments. Markets: European shares edged higher, lifted by ASML’s outlook, even as hotter-than-expected US inflation pushed up rate-hike concerns and weighed on global tech stocks. Banking Risks: Regulators are stepping up scrutiny of AI in finance, including risks to cybersecurity and customers’ access to accounts. Digital Euro: EU negotiations are advancing, with a retail pilot planned for 2027; debate continues over how the project can strengthen Europe’s financial autonomy.

Markets: European shares edged higher as ASML’s stronger sales outlook and AI demand lifted tech stocks, while investors awaited US inflation data. Eurozone bond yields eased slightly as rate expectations and energy costs kept markets cautious. Asset Management: Ashmore reported $1.1bn in quarterly inflows, lifting assets under management by $500m to $54.5bn; subscriptions were evenly split between fixed income and equities. Digital Finance: Dutch regulator DNB authorised Qivalis, backed by 37 European banks, to issue electronic money tokens—clearing a key step toward its euro stablecoin launch. Kraken parent Payward also plans to buy a European bank, though it has not disclosed a target or terms. Banking and AI: Deutsche Bank has deployed on-premise AI across investment banking and capital markets teams in Europe and North America. Regulators are stepping up scrutiny of AI risks to financial stability and customer access. Public Finances: The IMF warned that rising borrowing costs are intensifying pressure on heavily indebted governments, urging credible action to rein in debt.

EU Funding: Hungary regained access to €4.2 billion in frozen EU funds after changes to anti-corruption and transparency rules; restrictions on its universities’ access to Erasmus+ and Horizon Europe are also set to lift. Bank Funding: VP Bank raised SFr130 million through a seven-year senior non-preferred bond, extending its funding profile and supporting its loss-absorbing capital requirements. Markets and Energy: European shares ended lower as technology stocks weakened, while gas prices climbed to their highest level since late 2022. EU storage was 73% full, below the five-year average of 89%, adding to winter supply concerns. Risk Outlook: The IMF warned that a sharp pullback in AI investment, rising debt and prolonged conflict could threaten financial stability and growth; banking watchdogs are also stepping up scrutiny of AI-related risks.

Market Rally: European shares climbed to a one-week high as oil prices and bond yields eased, with banks among the strongest sectors. Tech stocks fell, tracking an Asian sell-off over doubts about AI spending and valuations. Euro Under Pressure: The euro slipped to its lowest level since May as France’s fiscal and political turmoil unsettled investors; French borrowing costs neared 5%, their highest since 2002. Banking Risks: Regulators are stepping up scrutiny of banks’ AI use, focusing on cyber threats, third-party technology providers and systems that act with greater autonomy. Global Warning: The IMF sees risks to growth and financial stability from rising debt, prolonged conflict and a possible pullback in AI investment; a sharp correction could hit asset prices and global output. Crypto Security: Reports of tampered Ledger wallets at European retailers have raised fresh concerns about hardware-wallet supply chains.

Market Pulse: European shares rose, with banks supporting gains as bond yields eased; oil near $107 a barrel and worries over energy supplies kept inflation risks in view. Banking Rules: Albania has proposed lifting insured bank deposits from Lek 2.5 million to Lek 6 million, with coverage set to reach €100,000 after EU accession. Market Oversight: EU finance ministers reached a deal on financial supervision reform, while debate continues over the powers of the European markets watchdog. Digital Finance: The UK’s digital-bond pilot has named six lead banks, and Luxembourg’s CSSF issued its first guidance on fund tokenisation. Energy Risk: Bank of America warned European gas prices could rise by 30% this winter as low storage leaves the region exposed to supply shocks.

European Markets: Shares rose as easing oil prices lifted sentiment, with banks among the strongest performers; investors now look to earnings for signs of resilience amid geopolitical risks and high borrowing costs. Banking & Regulation: EU finance ministers backed capital-markets reforms and discussed banking priorities, while a broader agreement would shift oversight of major markets to ESMA. Bulgaria’s Fibank also partnered with Bitpanda to offer crypto trading through its mobile app, bringing digital assets into mainstream banking while highlighting their risks. Business Conditions: Hays reported a 3% like-for-like fall in first-quarter net fees, with permanent hiring particularly weak in Northern Europe; its shares fell sharply. Markets Under Pressure: France’s debt strains are weighing on investor confidence, while London faces a record wave of takeovers and few IPOs, raising concerns about the loss of listed companies. Financial Crime: Cyprus received more than 24,000 suspicious-activity reports in 2025, most from crypto-asset providers.

Bond-market Pressure: Rising US Treasury yields are spilling into Europe, where UK 10-year borrowing costs hit 5.53% and France’s reached 4.97%. The European Stability Mechanism warns that heavier US Treasury issuance can push German yields higher, adding to debt and refinancing pressures. Rate Outlook: A global bond selloff is tightening financial conditions and has led investors to scale back expected central-bank rate hikes. Market Rules: EU finance ministers have agreed capital-markets reforms and discussed banking priorities, while a wider overhaul would give the bloc’s financial watchdog new powers. Digital Finance: EU rules are tightening for crypto firms, which have been ordered to drop stablecoins that do not comply with MiCA.

Greek Banking: Banks have cut non-performing loans below 3%, but €72 billion in troubled debt still weighs on households. Greece is considering debt write-downs and lifetime occupancy deals to help struggling borrowers. Energy and Markets: EU gas storage is at its lowest level for this time of year since records began, raising the risk of higher winter prices and pressure on industries and consumers. Financial Oversight: EU finance ministers reached a preliminary deal to strengthen markets supervision, though limits on the watchdog’s powers have drawn criticism from the European Commission and ECB. Separately, ESMA gave crypto firms up to three months to wind down services tied to non-compliant stablecoins. Investor Access: Ireland’s planned state-backed investment account will let savers invest up to €12,000 a year in shares, bonds and ETFs, with tax-free growth up to €50,000. Bond Risks: Rising energy prices are feeding inflation worries and borrowing costs, while investors remain focused on France’s debt strains and the wider pressure on European bond markets.

Banking Protection: Albania is proposing to raise insured deposits from 2.5 million to 6 million lekë, bringing its rules closer to EU standards. EU–China Trade: A preliminary deal could halve projected Chinese electric and plug-in hybrid car imports into Europe while lowering tariffs on some EU exports; approval by EU leaders is still needed. Market Oversight: EU finance ministers agreed on reforms to financial supervision, though the scope of new powers for the bloc’s markets watchdog remains contentious. Investor Flows: UK-listed gold funds drew about $7.5 billion in the third quarter, helping drive record regional European inflows as concern over government borrowing supported demand. EU Budget: Ireland’s proposed 8% cut to the 2028–34 budget plan includes a 13% reduction in competitiveness and security spending, setting up difficult negotiations among member states.

Market Supervision: EU finance ministers agreed to give ESMA direct oversight of selected cross-border market operators, a step toward deeper integration that still needs legislative approval. EU Budget: Ireland’s presidency proposed a €1.6tn budget for 2028–34, setting up difficult negotiations over funding for the bloc’s priorities. EU-China Trade: Brussels and Beijing reached preliminary agreements on trade and investment, including steps on electric-vehicle exports and supply chains, easing immediate tensions but leaving details to be worked through. Markets: European shares rose 1% on Friday as oil prices and bond yields eased, erasing the week’s losses; France’s fiscal outlook remains a concern for bond investors. Investor Savings: Ireland plans tax-advantaged personal investment accounts from next July, raising questions about whether new savings will flow to Irish and European businesses or mainly overseas markets.

Market Supervision: EU finance ministers agreed in principle to give ESMA a bigger role overseeing major financial markets, though the deal drew criticism over limits on the watchdog’s powers. Public Finances: The IMF warned Hungary’s deficit could reach 7–7.5% of GDP as the government seeks to unlock €16 billion in EU funds; in Poland, rising debt and banks’ exposure to government bonds are adding to fiscal concerns. Startup Funding: European startups raised a record $25 billion in the third quarter, with AI accounting for $18.8 billion and Mistral AI securing a $3.5 billion round. Strategic Investment: The European Commission selected 46 critical-raw-materials projects, backed by more than €2 billion in public funding, to expand extraction, processing and recycling. Banking and Digital Assets: Bulgaria’s central bank approved Tokuda Bank’s merger into Bulgarian-American Credit Bank, while ESMA questioned whether tokenised collateral could withstand a market crisis.

Markets: European shares rebounded as oil eased on hopes of de-escalation with Iran, but telecom stocks slid after SpaceX’s reported $8bn spectrum deal rattled investors; Deutsche Telekom and Vodafone fell. Banking & Regulation: EU finance ministers are nearing agreement on a key part of the Savings and Investment Union, aimed at channeling household savings into markets and easing cross-border investment. BNY has expanded regulated crypto custody in the EU under MiCA, while ESMA is seeking views on tokenised collateral and has set a three-month exit period for non-compliant stablecoins. Investment: European startups raised $25bn in Q3, a four-year high, with AI accounting for three-quarters of funding. The EU also selected 46 strategic minerals projects expected to need €21.1bn in investment, as it seeks to reduce reliance on China. Bank Capital: National Bank of Greece repurchased €12.29m of its shares between September 30 and October 8.

Markets & Rates: European shares hit four-month lows as oil topped $104 a barrel and bond yields climbed. Bank of England Governor Andrew Bailey urged credible budget plans to calm investors, with French debt under particular pressure. Energy & Investment: US and Russian officials are discussing American investment in Nord Stream and a possible return of Russian gas to Europe after the war. Sanctions and Germany’s opposition remain major obstacles. Payments: Italy’s CDP Venture Capital led a $27 million investment in TrueLayer, backing its plan to expand its European pay-by-bank network, now active in 22 countries. Crypto Rules: ESMA gave crypto firms three months to drop some non-compliant stablecoins, while the UK sanctioned exchanges and payment platforms accused of helping Russia evade restrictions. Trade: EU and Chinese officials met in Beijing for talks aimed at addressing trade disputes through consultation.

Markets: European shares slid as oil topped $103 a barrel after Gulf shipping attacks, intensifying bond-market pressure and weighing on bank stocks. France’s fiscal strains are spilling into Italian and Greek debt, while the euro remains near a 17-month low. ECB: Policymaker Pierre Wunsch opposed raising charges on commercial banks, warning that forcing more reserves into unremunerated accounts could blur the line between monetary and fiscal policy. EU-China trade: Brussels is weighing tougher measures, including steps that could exclude Chinese firms from the European market, as trade commissioner Maroš Šefčovič heads to Beijing for talks. Investment: French food-tech startup Edonia raised €15 million to scale production of its microalgae protein, while Arkema opened a €150 million purification unit in France as part of its decarbonisation investment programme. Crypto rules: Greece is proposing a 10% tax on cryptocurrency gains, with annual gains up to €500 exempt.

Russia Sanctions: EU ambassadors agreed to add 1,646 names and entities to the bloc’s Russia sanctions list, including asset freezes and bans on providing financing; formal approval is expected Monday. Bond Market Stress: European shares fell 1.1% as French borrowing costs surged and bank stocks came under pressure. France’s 10-year yield neared 4.9%, reviving fears that fiscal strain could spread across the eurozone. EU Investment: Ursula von der Leyen warned that cuts to the next long-term EU budget would undermine investment needs as the energy shock raises costs. She backed targeted relief alongside faster electrification and grid spending. Banking Union: Eurogroup chief Kyriakos Pierrakakis said fragmented banking markets are holding back investment, despite Europe’s savings, and called for deeper integration to help fund strategic priorities. Greek Banks: DBRS said Greek banks’ government-bond holdings have climbed to nearly 300% of core capital, but holding most bonds to maturity limits their exposure to rising yields.

Banking & Wealth Restructuring: HSBC plans major UK wealth cuts, consulting on eliminating around 70% of advisers and roughly half of managers/specialists as it leans harder on AI. Markets & Rates: European stocks and the euro slipped as oil pushed above $100 and fiscal worries resurfaced, with France’s bond stress again in focus. Sovereign Debt Watch: Reuters highlights a new “hierarchy” in European debt as investors dump the riskiest names, with France hit hardest amid deficit and election concerns. EU Sanctions: Brussels is preparing its biggest Russia sanctions expansion yet, with about 1,650 new designations aimed at Russia’s military-industrial network. Ukraine Funding: The EU added €1.2bn more to Ukraine’s defence under the Ukraine Support Loan, taking total USL defence funding to nearly €13bn. Energy & Industry: TotalEnergies will invest €100m+ in Mistral AI to build frontier models for reservoir exploration and optimisation. EV Charging Interop: Powerdot and Hubject extend Plug&Charge compatibility to 7,000+ European chargers. Crypto/Identity & Compliance: Shufti and DeGaming integrate AI KYC/AML into player onboarding for web3 iGaming. Geopolitics & Trade: Turkish Trade Minister Bolat met EU ambassadors on customs union frictions and the EU’s Industrial Acceleration Act.