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BlackRock to Amundi See Virtues in Europe’s Downtrodden Banks

  • Many big asset managers have a bullish stance on bank sector
  • Central bank policy, recession fears are keys to performance
A Banco de Sabadell SA bank branch in Barcelona.

A Banco de Sabadell SA bank branch in Barcelona.

Photographer: Angel Garcia/Bloomberg

Soaring inflation and recession concerns upended what was turning into a marquee year for European bank stocks. Yet from BlackRock Inc. to Amundi SA, some investors are becoming more optimistic on prospects for a sector that’s seen as well capitalized and trading near the cheapest levels in a decade.

A year that started so well for the region’s lenders began to go awry after Russia’s invasion of Ukraine led to fears over the impact on economic growth. After gaining as much as 15% in the first weeks of the year and outpacing all other sectors, the Stoxx 600 Banks Index has reversed the advance.