NEWSLETTER of October 30, 2020

The following content has been added at finexpert:

PwC
VERGÜTUNGSSTUDIE 2020
Significant decrease in the remuneration of executive board members in German Dax companies: In 2019, CEOs earned a median of 5.5 million euros - almost 14.6 percent less than in 2018 (6.4 million euros). The decline in the compensation paid to the Board of Management is mainly due to the gloomy global economy at the end of 2019. The main reasons for this were the trade conflict between the U.S. and China and the Brexit negotiations. >more

Strategy&
RETAIL BANKING MONITOR AND OUTLOOK 2020
With up to 75% of European bank branches shut for more than three weeks during the lockdown, retail banking had one of the worst starts of 2020 out of all financial service sectors. Moreover, loan loss provisions increased visibly, and previous revenue forecasts had to be adjusted. To counteract the short- and medium-term challenges caused by COVID-19, retail banks accelerated their efforts to push online self-service and sales, boosted digitization in operations and leveraged their remote work infrastructures. >more

McKinsey & Company
YOU CAN'T BUY LOVE: REIMAGINING CORPORATE-STARTUP PARTNERSHIPS IN THE DACH REGION
Corporates and start-ups derive different but equally important benefits from their partnerships. Interviews with top executives from large DACH corporates confirm the importance of the partnerships. On their websites or in their annual reports, corporates talk about successful relationships with start-ups, noting key achievements such as faster product development cycles, access to new markets, and insights about new ways of working. >more

CMS Hasche Sigle / FINANCE
M&A PANEL OKTOBER 2020
The German M&A market is still affected by the coronavirus pandemic. Although the mood is gradually improving, uncertainty in the market is still noticeable and caution is still prevailing. The results of the second M&A panel of the international law firm CMS and the magazine FINANCE show how senior executives from M&A departments of German companies as well as investment bankers and M&A advisors deal with the current situation and how they assess the market. >more

FINANCIAL FRAGILITY IN THE COVID-19 CRISIS: THE CASE OF INVESTMENT FUNDS IN CORPORATE BOND MARKETS
Antonio Falato, Itay Goldstein, and Ali Hortaçsu
2020
In the decade following the financial crisis of 2008, investment funds in corporate bond markets became prominent market players and generated concerns of financial fragility. The COVID-19 crisis provides an opportunity to inspect their resilience in a major stress event. Using daily microdata, we document major outflows in these funds during this period, far greater than anything they experienced in past events. Large outflows were sustained over several weeks and were widespread across funds. Inspecting the role of sources of fragility, we show that both the illiquidity of fund assets and the vulnerability to fire sales were important factors in explaining outflows in this episode. The exposure to sectors most hurt by the COVID-19 crisis was also important. Two policy announcements by the Federal Reserve about extraordinary direct interventions in corporate-bond markets seem to have played an important role in calming down the panic and reversing the outflows. >more

THE DEATH OF TRUST ACROSS THE FINANCE INDUSTRY
Peter Limbach, P. Raghavendra Rau, and Henrik Schürmann
2020
Across all industries in the U.S., we document a significant and unique decline in the level of generalized trust among finance professionals relative to the decline of trust in the general U.S. population. This decline occurs in different age cohorts and among different levels of seniority. It is related to a lack of confidence only in institutions that are relevant to the finance industry. The relative decline of trust is associated with changes in economic conditions, the professional environment in the finance industry, and with the decreasing level of socialization among finance professionals. >more