European blue-chip index drops Deutsche Bank, Credit Suisse

AP News
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Posted: Aug 02, 2016 10:00 AM

FRANKFURT, Germany (AP) — Deutsche Bank and Credit Suisse have been dropped from a European blue-chip stock index in another sign of the woes hitting the financial sector in Europe.

The two banks were dropped from the STOXX 50 index after their free-float market capitalization — the number of outstanding shares that are traded times the price — fell sharply.

Deutsche Bank shares are down 65 percent in the past 52 weeks; Credit Suisse is down 60 percent over that period.

Bank earnings have been slammed by low interest rates that crimp lending margins, by regulatory requirements to strengthen their financial buffers, and by an uncertain economic recovery complicated by fears about the impact of Britain's vote to leave the European Union.