Coverage: weekly note · Information to 3 August 2026
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TGB Weekly Research Note · 3 August 2026
Half-year results from Europe's large banks show surplus capital funding acquisitions and faster lending as well as buybacks, with several banks planning to run CET1 ratios down towards their stated targets.
The desk view
The clearest message from the half-year results season is that Europe's large banks again treat surplus capital as something to deploy. UniCredit's tender offer lifted its Commerzbank position to 47.59% of share capital, and Santander completed TSB at a cost of 55 basis points of CET1 while preparing for Webster. Intesa Sanpaolo said its Monte dei Paschi transaction would bring its plan targets three years forward. Organic growth is drawing on capital too: BBVA's loans rose 17.7% at constant exchange rates. None of this has displaced distributions. Our reading is that capital strength is again being treated as a licence to grow, and that the test now shifts to the returns earned on what is deployed.
Capital is being spent on franchises again
The most visible deployment is UniCredit's. On 8 July 2026 it reported that tendered shares, its direct stake and instruments added up to 47.59% of Commerzbank's share capital, or 49.65% of voting rights. Its CET1 ratio for 2Q26 was 14.3%, or 14.5% excluding the temporary impact of the larger Commerzbank position. The bank said it expects to deploy capital at an overall return on allocated capital of 15%.
Santander completed the acquisition of TSB on 30 April 2026, strengthening its UK franchise with over four million customers. Its CET1 ratio reached 14.0%; excluding the 55 basis point impact from TSB, the group generated 20 basis points of capital in the quarter. Allowing for the expected impact of Webster, it said it remains well positioned to meet a year-end CET1 target of 12.8% to 13%.
Intesa Sanpaolo, with a CET1 ratio of about 13.1%, said the Monte dei Paschi transaction would let it achieve its targets three years ahead of plan, and expects €2.9 billion of synergies.