The Phaserl


Deutsche Bank, Credit Suisse Kicked Out Of Stoxx Europe 50 Index

from ZeroHedge:

What do you do when you are one of the biggest indices in Europe and are unable to rise simply because two of your biggest constituents, if not so much in market cap any more but certainly in terms of systemic importance, just can’t catch a bid? Why you delete them, of course even if the two names in question happen to be Europe’s two largest banks, Deutsche Bank and Credit Suisse.

Moments ago, STOXX Ltd, the operator of Deutsche Boerse Group’s index business, announced component changes in the STOXX Europe 50 Index due to the fast-exit rule. All changes become effective with the open of markets on Aug. 8, 2016.

What is the Fast Exit rule? “The rule states that a component is deleted from the Dow Jones EURO STOXX 50 or Dow Jones STOXX 50 indexes if it ranks 75 or below on the respective index’s monthly selection lists for a consecutive period of two months. Deleted components for all three indexes will be replaced by the highest ranking non-components on the monthly selection list. Component changes will be announced on the first trading day of the month following the publication of the monthly selection lists, implemented on the close of the fifth trading day and effective the next trading day.”

In other words, someone did not like how DB and CS were trading and decided to kick them out.

And here are the replacements.

And that is how you “boost” the performance of the constituent index. It was not immediately clear if there would be any forced selling as a result of these names getting kicked out of one of Europe’s 2 most important indices alongside the broader Stoxx 600 index.

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1 comment to Deutsche Bank, Credit Suisse Kicked Out Of Stoxx Europe 50 Index

  • rich

    JPMorgan Pays Prison Inmates Who Couldn’t Get Out of Jail Free

    Inmates leaving prison were required to get Chase debit cards
    Lawsuit claimed the bank swamped ex-inmates with steep fees

    JPMorgan Chase & Co.’s contract to provide debit cards to inmates released from federal prison is backfiring after the bank agreed to settle a class-action lawsuit filed by inmates who said they were charged exorbitant fees to access their money.

    JPMorgan agreed to pay a total of $446,822 to thousands of former inmates to reimburse them for fees they were charged, according to a filing on Monday in federal court in Philadelphia. The bank also agreed to pay as much as $250,000 in plaintiffs’ attorneys’ fees and costs, the filing said.

    The bank charged exorbitant fees that are inconsistent with the fees they charge other customers, former inmate Jesse Krimes, the lead plaintiff in the case, said in the complaint. The fees included inactivity charges, a $10 toll for withdrawing money from a bank-teller window and $2 for non-network ATM transactions, according to the suit.
    The complaint, filed in September 2015, said inmates released from all U.S. federal prisons since at least 2008 were required to get Chase debit cards to receive the balance in their inmate account, under the bank’s no-bid contract with the Bureau of Prisons. The inmates weren’t allowed to review or approve the terms and conditions, the plaintiffs’ group said. The group called JPMorgan’s contract a fraudulent scheme “to exploit one of the most vulnerable groups imaginable — releasees from federal corrections facilities.”

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