Global investors seem to be getting bullish on banks Stateside, but the European banking system is still falling behind.
Plagued by a number of factors such as an ultra-loose monetary policy environment, high levels of non-performing loans, uncertainty caused by the U.K.'s vote to exit the European Union and massive fines, the European banking industry has a long way to go in order to catch up with its American counterparts.
Recently, for the first time since the financial crisis, the U.S. Federal Reserve did not object to any of the capital plans of 34 banks it reviewed in the second part of the annual stress tests implemented in the wake of the crisis. U.S. banking stocks rose sharply after the Fed announced its review. The impact was seen in Europe as well where bank stocks rose more than a percent following the optimism of their peers Stateside.