BlackRock to pull US ETF assets from State Street; Biden's OCC pick withdraws

TOP NEWS IN BANKING & FINANCIAL SERVICES

* BlackRock Inc. will shift most of its $2.3 trillion in U.S. iShares exchange-traded funds assets from State Street Corp. to other banks beginning in the second half of 2022 in a process that will take 18 months to complete. The move will see 40% of the assets be transferred to Citigroup Inc., 30% to JPMorgan Chase & Co. and 15% to The Bank of New York Mellon Corp., while the remaining 15% will stay with State Street.

* President Joe Biden accepted Saule Omarova's request to withdraw her name as a nominee to lead the Office of the Comptroller of the Currency. Omarova wrote in a letter requesting withdrawal of her candidacy that "it is no longer tenable" for her to continue as a nominee "at this point in the process." Biden said he "will continue to work to find a nominee for this position" and that he plans to make an announcement "at a future date."

➤ November marks slowest month for US corporate bankruptcies in 2021

Markets awash in liquidity and a booming pace of deal-making are helping companies avoid bankruptcy, but the Federal Reserve's shifting policy on rising inflation suggests 2022 will be more challenging for distressed companies.

➤ Global systemic importance set to rise for China banks, fall for Japan lenders

China's top four banks are likely to increase their global systemic importance, while Japan's megabanks are set to see their global influence decline in coming years as their overseas strategies diverge.

BANKING

* Citigroup CEO Jane Fraser said the bank is planning to release sector-by-sector plans and targets in the following year for fulfilling the company's pledge to achieve net-zero carbon emissions by 2050 for its financing portfolio, The Wall Street Journal reported. Fraser added that the plan means the bank will have to be selective on which clients it will be serving and which ones it will have to cut off, according to the report.

* In an investor presentation, Synovus Financial Corp. disclosed that it expects to optimize its branch network by closing 15% in additional locations by the end of 2022. The bank estimates a run-rate savings of $12 million from next year's closures.

* KeyCorp is expecting a record year in investment banking fees, which have grown at an 11% compound annual growth rate over the last decade, Chairman, President and CEO Christopher Gorman said at a Dec. 7 investor conference.

* Bank of America Corp. CEO Brian Moynihan during a Dec. 7 investor conference said almost all of the bank's lines of business are seeing a similar pace of loan growth in the fourth quarter so far compared with its third-quarter performance. Moynihan said it is still early to assess any fallout from the emergence of the omicron coronavirus variant but added that spending has not slowed.

FINANCIAL SERVICES

* NewPoint Real Estate Capital LLC, a multifamily lending platform launched by mortgage brokerage firm Meridian Capital Group LLC and Barings BDC Inc., acquired certain assets of Housing & Healthcare Finance, including its FHA multifamily and healthcare origination business and its loan servicing portfolio.

* Buy-now, pay-later products may face fee pressure down the road, but Synchrony Financial believes its offering can lead to cross-selling other consumer lending and payment products, President and CEO Brian Doubles said.

* Visa Inc. announced the launch of its Global Crypto Advisory Practice, which is an offering within Visa Consulting & Analytics.

POLICY AND REGULATION

* The Consumer Financial Protection Bureau issued a final rule facilitating the transition away from the London interbank offered rate interest rate index for consumer financial products, establishing requirements for how creditors must select replacement indexes for existing LIBOR-linked consumer loans after April 1, 2022.

* CFPB Director Rohit Chopra said the agency is considering changes that would enable state attorneys general to access the agency's Civil Penalty Fund and partner with the federal regulator for enforcement actions, American Banker reported.

* Sen. Elizabeth Warren, D-Mass., again urged Federal Reserve Chair Jerome Powell to immediately release full information on the regulator's new policy against personal trading of its officials in stock, bonds and other investments; on Fed officials' trades; and on warnings from the Fed ethics office.

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