TOP NEWS IN GLOBAL FINANCIALS
* Switzerland-based Credit Suisse Group AG set out a new three-year strategy, including a reorganization into four divisions — investment bank, Swiss bank, asset management and globally unified wealth management — starting from January 2022, as part of efforts to simplify its operating model. Under the plan, the Zurich-based bank will deploy roughly CHF3 billion of capital to its wealth management division through 2024, while the investment bank division will see an expected capital reduction of about 25% from 2020 levels by 2022 through the exit of its prime services business.
* South Korea's Financial Services Commission said it plans to relax reporting requirement rules for financial companies' foreign direct investment activities in overseas markets. Under the new rules, financial firms investing 10% or more in equity shares of foreign funds would be subject to the reporting rule only at the time of making an initial investment.
* TradeStation Group Inc. will become a publicly traded company through a business combination with special purpose acquisition company Quantum FinTech Acquisition Corp. The transaction, which values the combined company at an implied pro forma enterprise value of approximately $1.43 billion, is expected to close in the first half of 2022. At closing, 48% of the shares held by Quantum FinTech's sponsors will convert to unvested performance-based earnout shares or be forfeited.
➤ Specialty finance firms, mortgage REITs deliver mixed Q3 results
Mortgage real estate investment trusts recorded mixed results in the third quarter, while specialty finance companies and mortgage banks and brokers generally posted weaker earnings than in the previous quarter.
➤ Turkish banks Yapi ve Kredi, Akbank, Garanti see strong digital growth
Yapi ve Kredi added 1.1 million digital customers in the first nine months of 2021, exceeding its aim of adding 1 million per year.
US & CANADA
* Red Bank, N.J.-based OceanFirst Financial Corp., the parent of OceanFirst Bank NA, agreed to a merger, expected to close in the first half of 2022, with Salisbury, Md.-based Partners Bancorp, the parent of Bank of Delmarva and Virginia Partners Bank, under which Partners will merge into OceanFirst in a transaction valued at about $10.38 per Partners common share, or approximately $186 million in the aggregate. Upon completion of the merger, Bank of Delmarva and Virginia Partners Bank will each successively merge into OceanFirst Bank, with OceanFirst Bank surviving each bank merger.
* The Progressive Corp. is pulling back in the California auto insurance market due to rate inadequacy in the face of rising frequency and severity trends. President and CEO Tricia Griffith during a conference call to discuss third-quarter earnings said the company will reduce its marketing spending in order to slow its growth in the Golden State until it can demonstrate that its rates are inadequate to the state regulator.
Click here for more of the day's essential bank and financial services news in the U.S. and Canada.
LATIN AMERICA
* Brazil's Itaú Unibanco Holding SA posted a third-quarter recurring managerial income of 6.78 billion reais, 34.8% higher than the year-ago 5.03 billion reais. Managerial financial margin rose 15.3% to 19.52 billion reais, while provisions for loan losses declined 17.2% to 5.23 billion reais.
* Argentine financial technology company Bancar Tecnología SA, also known as Ualá, will fully acquire Mexico-based bank ABC Capital SA Institución de Banca Múltiple for an undisclosed amount, Bloomberg News reported, citing CEO Pierpaolo Barbieri. The deal is still subject to Mexican regulatory approval.
EUROPE
* William Kadouch-Chassaing is stepping down as CFO of Société Générale SA. The France-based lender named Claire Dumas as his replacement, effective Dec. 1. Dumas is currently deputy CFO and in charge of the supervision of all retail banking and financial services activities. SocGen, meanwhile, reported group net income of €1.60 billion in the third quarter, an 85.7% increase from €862 million a year earlier, as net cost of risk fell 62.2% to €196 million.
* Danske Bank A/S completed its review of the root causes of errors in its debt collection systems and identified a total of 7,800 debt collection customers as eligible to receive compensation and repayments as a result of overcollection. The Danish bank also suspended debt collection due to additional issues it identified for customers who have continued to repay debt.
Click here for more of the day's essential financial news in Europe.
MIDDLE EAST & AFRICA
* Saudi Arabia's Capital Market Authority approved Saudi Tadawul Group Holding Co.'s application to offer 36 million shares, representing 30% of its share capital, in an IPO. Meanwhile, Nayifat Finance Co. completed the bookbuilding process for its planned IPO on the Saudi Exchange, which was 136x oversubscribed and generated an order book of 162 billion riyals. The final offer price was set at 34 riyals per share.
* The United Nations launched the liquidity and sustainability facility, or LSF, a new repurchase agreement market for the African region aimed at improving sovereign access to international bond markets for African countries. It could save governments in the region an estimated $11 billion in borrowing costs in the next five years. London's Financial Times covered this.
ASIA-PACIFIC
* The Reserve Bank of New Zealand plans to increase the minimum core funding ratio requirement to its previous level of 75% on Jan. 1, 2022, subject to no significant worsening of economic conditions. It will also consult on a possible implementation of debt servicing restrictions to act against housing risks.
* South Korea's National Agricultural Cooperative Federation and France-based Crédit Agricole SA signed a memorandum of understanding to expand cooperation between the two financial groups, the Maeil Business Newspaper reported.
Click here for more of the day's essential financial news in Asia-Pacific.
Erin Tanchico and Ryan Jeffrey Sy contributed to this report.
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