SVM's Cuthbert doubles exposure to European banks

SVM's Hugh Cuthbert has more than doubled his exposure to banks in his Continental European fund this year as the sector has proved resilient in the face of regulatory threats.

Only seven out of 91 EU banks failed July’s stress tests, while Basel III funding requirements were diluted, leading the manager to increase his holdings in banks from 9.2% to 19.7%. However, he would consider paring this back if populist anti-bank political rhetoric translates into action, he says. The manager has cash reserves of more than 10%, and has trimmed individual positions in the fund to finance the move. Since July, Cuthbert has opened positions in UBS (2.3%) and Société Générale (2.4%), and has increased holdings in ING and DnB NOR to 2.6% and 3.5% respectively since th...