April 2025

Newsletter April 2025

April Recap

April was a busy month for us. While some members were involved with Spring Weeks in London for banks such as Nomura, others had the opportunity to participate in a Stock Pitch Competition with the Bocconi Students Finance Society (BSFS). Divided into seven groups, we prepared stock pitches for either BKNG or ABNB, using financial modelling and identifying risks and catalysts to build our investment theses. The competition was a success and, by the end of the session, it was clear that everyone had learnt something new!

Moreover, some very interesting workshops took place this month. We kicked off with an interesting session on the link between Consulting and Finance. Specifically, the session focused on highlighting both the similarities and differences between the two fields, as well as explaining the application processes. The workshop was extremely useful to understand the skills consulting firms are looking for, and how these differ from other careers in finance. Additionally, we had a workshop on Private Equity, focused on the different areas within this sector and the experiences of members who had had the opportunity to intern within this area. At the end of the month, we held a picnic in Parco Ravizza to get to know each other better in the lovely spring weather!

Looking ahead, we have some exciting things coming up in May. Most importantly, on the 5th of May at 18.30, we will hold our open event "Creativity in Finance", focused on dealmaking in a world of uncertainty. With leading speakers from bulge bracket banks such as Goldman Sachs, Deutsche Bank and JP Morgan Chase & Co., the event will tackle engaging topics, especially due to the current volatility within the markets. See you there!

Don’t miss out on our social media where we post our weekly tips, market news and market quizzes as well as stories of women that keep inspiring us!

News Recap

The Trump Administration's Aggressive Tariff Strategy

On April 2, Donald Trump introduced what he called “Liberation Day” tariffs, signaling a radical shift in U.S. trade policy. The initiative imposed a blanket 10% tariff on all imports into the U.S., with additional country-specific surcharges; the most notable ones have been against China, where the effective rate reached up to 60–145%. Trump justified the decision as a necessary step to “reclaim American sovereignty” and curb long-standing trade deficits, especially inmanufacturing and technology.

Unlike previous tariffs which targeted specific sectors, this policy is broad and ideologically driven. Trump has also proposed a simplified tariff structure: a single flat rate to replace income tax for individuals earning under $100,000, suggesting tariffs could become a new form of fiscal revenue. Economists have raised concerns about how these ideas would be implemented and whether they are sustainable.

Currently, global trade partners are reacting with a mix of retaliation and recalibration. The World Trade Organization (WTO) has called for dialogue, while countries like China and Mexico have already implemented retaliatory tariffs and are continuing to evaluate additional countermeasures.

Private Acquisitions Strip Away $1tn from Public Markets inEurope

European equity markets are losing out in the face of a private capital boom. Private acquisitions have stripped away $1tn from public markets in Europe in the past decade.

A report by HSBC global research has concluded that the threat from private capital (1013 companies acquired by private equity) is significantly bigger than the threat of companies deflecting to Wall Street (130 companies moving to the US stock exchange). HSBC executives see a problem in the inability of European markets to recognize the value of companies.

Fund managers also warn that Donald Trump’s reciprocal tariffs could accelerate this trend by making listed companies cheaper and more attractive for private takeover, especially since buyout firms have large amounts of cash to do so.

There are several problems arising from this trend. According to Apostolos Thomadakis, head of research at the European Capital Markets Institute, private acquisitions pull investment away from Europe and worsen the already low participation in the region's market. The shift may also cause a reduction in transparency and a loss of control of strategically important companies.

Goldman Sachs chief executive David Solomon has stated that reasons to go public are getting pushed out since companies are now able to get capital privately, at scale, due to the sharp growth in private equity and debt markets. Companies no longer need to go through all the requirements of a public listing or debt insurance to obtain capital.

Central Banks Turn to Gold as Dollar Dependence Wanes

Recent analysis from UnHerd highlights growing signs that the era of U.S. dollar hegemony may be entering a slow but meaningful transition. Triggered by geopolitical rifts, such as Western sanctions and the freezing of Russian reserves, countries—particularly among the BRICS—are accelerating efforts to reduce reliance on the dollar intrade and reserves. This de-dollarisation trend has coincided with record-high gold prices, driven by central banks reallocating away from U.S. Treasuries in favour of more politically neutral assets like gold. While the dollar remains dominant, these shifts suggest a quiet restructuring of the global financial system is underway. The implications include a potential long-term weakening of the dollar and a growing “reserves deficit” in the U.S., where fewer foreign buyers may be willing to finance American debt at the same scale.

Dealflows & IPOs

Nomura to Acquire Macquarie Asset Management Units inits Biggest Overseas Deal Since Lehman

Nomura Holdings announced the acquisition of Macquarie Group's U.S. and European public asset management businesses for $1.8 billion in cash. The transaction, which is expected to close by the end of 2025, will increase Nomura’s assets under management by about $180 billion, taking the total amount to approximately $770 billion.

This acquisition is Nomura's biggest international expansion since its 2008 purchase of Lehman Brothers' Asian operations, and is part of CEO Kentaro Okuda's bid to reduce their reliance on volatile trading and investment banking. Nomura projects that, after the purchase, about 60% of its investment management revenue will originate from outside Japan, compared to 30% currently, strengthening its global investment management presence. It’s also important to mention that international growth isn’t the only goal behind the deal. An improved position for domestic shifts will be a major advantage to Nomura as the rising inflation in Japan is expected to put pressure on households to move wealth from cash and deposits into higher-yielding investments.

For Macquarie, the deal represents a bigger focus on private markets and alternative assets, areas where the firm sees higher growth potential. Macquarie will keep its public investments business inAustralia and continue to operate a full-service asset management platform in public and private markets. Additionally, Macquarie and Nomura have agreed to collaborate on product development and distribution, with Nomura serving as a U.S. wealth distribution partner for Macquarie's alternative investment products.

Prada Buys Versace in $1.38 Billion Deal

Prada announced its acquisition of Versace from Capri Holdings for $1.38 billion, marking a significant consolidation in the Italian luxury fashion industry. The deal reflects Prada's strategic move to expand its portfolio and strengthen its position against dominant French conglomerates like LVMH and Kering.

The acquisition price was notably reduced by more than $200 million compared to initial expectations. This adjustment was influenced by recent market instability and the impact of new U.S. tariffs introduced by President Trump. These tariffs have affected global luxury markets, leading to a decline in Capri Holdings' market value and prompting a reevaluation of the deal's terms.  

Donatella Versace, who led the brand's creative direction for almost 30 years, stepped down in March. Dario Vitale, who previously worked at Miu Miu, will take over as Chief Creative Officer. Donatella will stay at the company in a new role as Chief Brand Ambassador. She will help maintain the brand’s legacy and identity.

This acquisition not only reunites Versace with Italian ownership but also signifies Prada's commitment to diversifying its brand offerings. By integrating Versace's bold aesthetic with Prada's refined style, the company aims to appeal to a broader range of luxury consumers and solidify its standing in the global fashion market.

Pharma: Merck's Acquisition of SpringWorks for $3.9bn

This is the third-largest acquisition a European company has made inthe US since the beginning of the year. Merck, a German pharmaceutical group, has agreed to buy the biotech company SpringWorks for $3.9bn. The transaction is expected to take place inthe second half of this year and is said to be an all-cash deal.

Merck sees in SpringWorks, which is reported to have a $3.4bn enterprise value according to the analysis of Bank of America, an opportunity to increase its global presence, foster its innovation and leadership in cancer and rare disease treatments. The US accounts for 27% of its current revenues, and this position should be strengthened with the deal. Moreover, it would give Merck more flexibility and reduce some operating risks.

The opportunity is also quite a necessary move as the company has struggled with its recent experimental treatments. Above all, the Mavenclad patent, used for many of its sclerosis treatments, is set to expire soon.

Even with an uncertain situation concerning the tariffs under the presidency of Trump, Merck expects this deal to have great benefits, among them an increase in earnings per share as soon as 2027. The group also remains alert for new merger opportunities in the area of life science, healthcare or electronics.

Analysis of the Markets

'Liberation Day' Reactions

The markets did not take Trump’s ‘Liberation Day’ announcement well. By April 4th, both the S&P 500 and Nasdaq dropped almost 6% in just two days, the worst drop we have seen since the early COVID days in 2020. The Dow also lost over 4,000 points in that short span. This impact was not just contained in the U.S.; international markets tumbled too. Japan’s Nikkei 225 dropped 7% in one day, which triggered automatic trading halts, and Europe faced large losses as well.

In an attempt to stabilize markets, the Trump administration announced on April 9th a 90-day pause on the majority of the new tariffs (except for the ones targeting China). The announcement caused a huge rebound: the S&P 500 jumped 9.5%, and the Nasdaq soared over 12%, one of its best days ever.

However, that relief did not last long. With ongoing uncertainty around tariffs and global politics, markets remain tentative. Investors are still nervous, and it is clear that the tensions between the U.S. and China are far from over.

Split Season for Big Tech

Big Tech earnings this season have sparked a clear split in market sentiment, with AI-driven cloud firms faring better than their hardware-exposed peers. Microsoft’s standout Q1 report, featuring a 13% revenue rise to $70.1 billion and strong growth in AI-driven Azure, sent its stock up more than 8% the following day. Alphabet’s shares rose nearly 11% as investors cheered gains in both advertising and cloud.

Meanwhile, anticipation around Apple’s May 2 report is tense. With the company facing softening iPhone demand and trade-related headwinds in China, analysts are wary of a potential miss. This marks a broader concern for consumer electronics, facing tariff uncertainty and tightening consumer budgets. Samsung and Intel have both warned that trade uncertainty is an issue at the forefront of their businesses.

Technicals Explained:Understanding Credit Scoring

Credit scoring is a crucial tool in modern finance. It helps banks decide whether to give a loan or not. In fact, it is a statistical analysis performed by lenders and financial institutions to determine the creditworthiness of a person or a business, basically their likelihood to repay debts. Lenders use this credit score to assess risks and make decisions.

Credit scores are also important for borrowers and our everyday life since they impact renting apartments, job applications and insurance rates.

Credit scoring helps reduce the subjectivity of lending since, at the beginning of the 20th century, banks relied on personal relationships and personal judgments to determine if a person was trustworthy. This system was often biased.

After WWII, consumer credit increased and with it came the need for a fairer process.

In the 1950s, the engineer William R. Fair and the mathematician Earl J. Isaac founded Fair, Isaac and Company (now FICO), creating the first broadly adopted credit scoring model. It became the standard and is still used today. Determining Credit Scores

Credit scores are determined by several weighted factors and usually range between 300 and 850. At roughly 35%, payment history, the record of timely debt servicing, carries the most weight. Thirty percent is credit use, or total available revolving credit lines divided by outstanding revolving credit balances. Length of credit history, including the age of the oldest and newest accounts, accounts for 15%. Each roughly 10% is credit mix, which assesses diversity across mortgage products, revolving credit, and installment loans, and new credit inquiries, which take into account the frequency of recent hard pulls.

The two primary models are FICO and VantageScore. The Fair Isaac Corporation created FICO, the industry standard long established inunderwriting systems covering retail banking, consumer finance, and mortgage origination. On the other hand, VantageScore, developed by Equifax, Experian, and TransUnion, is gaining popularity and offers innovations, including generating scores for thinner files using machine learning and shorter credit histories. Although both models employ comparable ranges, VantageScore gives more weight to recent usage patterns and trending credit data.

Risk-based pricing policies in financial markets rely on credit scores. Scores are included into credit decisioning systems used by banks, mortgage lenders, and insurance companies, which affect interest rate spread settings, credit line allocations, and loan approvals. For example, reflecting the perceived likelihood of default, a borrower with a FICO score over 760 might qualify for prime mortgage rates while one below 620 might only qualify for subprime products with much higher annual percentage rates (APRs). Evaluating the Model

Whilst the numerical scoring model intended to eliminate the subjectivity of granting loans, there are still several criticisms. Approximately 90% of the top lenders use the FICO scoring model, which faces several key limitations in comparison to the newer VantageScore model previously mentioned. FICO relies heavily on historical financial data and repayment behaviour, which can disadvantage those with ‘thin files’ – limited credit history. These can include young people, recent immigrants, unbanked individuals and those who primarily use cash. These potential lenders can still be financially responsible but fall short of the thresholds used by banks with traditional scoring models. Additionally, this system can reinforce socioeconomic disparities as those with low credit scores are not granted a loan, and, henceforth, cannot build their credit score.

New developments in credit scoring can help limit some of these disadvantages. There is a growing use of alternative data being incorporated into models, which includes utility bills, rent payments, mobile phone payments and more. This additional information is especially useful when assessing individuals without traditional credit histories. Additionally, more innovative models, such as VantageScore, are being more commonly used in credit scoring. Banks can also leverage AI to help in this decision-making process. These developments of the scoring system can help bring transparency and fairness, as well as eliminate bias. The encouragement of these developments is essential in a tool that is fundamental in modern finance, highlighted by some of its uses discussed above.

Article Highlight: Asset Managers Shift Focus to Private Markets Amid Fee Pressures

Asset managers today face intense fee compression in public markets, driven by the rise of passive investing through ETFs, index funds, and robo-advisors. To preserve margins and deliver differentiated returns, many are reallocating capital toward private equity, real estate, and private debt - asset classes prized for their stability and attractive risk-adjusted yields in uncertain economic climates.

Meanwhile, the competitive landscape in public markets remains fierce. Giants such as BlackRock, Vanguard, and Fidelity leverage economies of scale to undercut fees, forcing smaller firms to either compete on price or pivot into niche private-market strategies. Those that successfully marry selective passive offerings with private-market expertise gain both breadth and resilience.

Beyond the active-versus-passive debate, two additional trends are reshaping asset-management priorities. First, ESG investing has gone mainstream, as millennials and institutional investors alike demand sustainability-focused portfolios. Second, the rapid growth of family offices offers a new capital source - asset managers that cultivate these relationships can tap significant, long-term pools of wealth.

In this evolving environment, the firms best positioned for success will be those that blend agile, low-cost index strategies with deep private-market capabilities, while also meeting growing client demand for ESG exposure and family-office partnerships. By integrating these elements, asset managers can craft a compelling value proposition, withstand fee pressures, and secure sustainable growth.

Ultimately, in a world of shrinking active-management fees and intensifying competition, the winners will be the ones who deliver both efficiency and differentiated returns - turning today’s challenges into tomorrow’s opportunities.

Woman of the Month: Elena Goitini

Our woman of the month is Elena Goitini, the country head of BNP Paribas Italy, and the CEO of BNL. A native of Milan, Goitini holds a degree inEconomics from Bocconi University. She furthered her education with management diplomas from SDA Bocconi, INSEAD in Paris, and IMD inLausanne.

After graduating from Bocconi, Elena joined PwC and then UniCredit, where she eventually became the Head of the Retail and Private Banking Division for Central and Eastern Europe.

In 2019, Elena joined BNL–BNP Paribas as Head of Private Banking and Wealth Management. Just two years later, she made history by becoming the first woman to be appointed CEO of BNL and Country Head of BNP Paribas in Italy. She now oversees over 11,000 employees and more than 700 branches. Her leadership is not only shaping the future of the bank but is also helping redefine what inclusive and innovative leadership looks like in European finance.

2 Truths & 1 Lie

Results will be posted to Instagram!

The term "duration" in bond investing measures a bond’s sensitivity to interest rate changes, expressed in years
Six major IPO deals for Q2 2025 were delayed due to uncertainty caused by new U.S. tariffs
The European Central Bank made a 50 basis point rate cut this April as inflation continued to decline and economic activity remained weak in parts of the eurozone

WiF Recommends

The Essays of Warren Buffet

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Barbarians at the Gate

This book was written in 1989 by journalists Bryan Burrough and John Helyar and features the leveraged buyout (LBO) of RJR Nabisco by private equity giant KKR. It exposes the egos, power struggles, and mechanics behind one of the largest takeovers in history.

Liar's Poker

A non-fiction, semi-autobiographical book by Michael Lewis describing the Wall Street culture during the 1980s. Drawing from his own experience as a young bond salesman at Salomon Brothers, the author touches on the rise of mortgage-backed securities, the reality of trading floors, and the personalities that shaped modern finance.

What’s next?

As we approach our last month of the academic year, we look forward to our final workshop and dinner, making the most of the time we have left.