10 Dec, 2021
OTP snaps up Alpha's Albanian unit; UniCredit eyes €16B investor payout by 2024
S&P Global Market Intelligence offers our top picks of banking news stories and more published throughout the week.
Hungary's OTP Bank Nyrt. will acquire Alpha Bank Albania SHA from Alpha Services and Holdings SA, the parent company of Alpha Bank, in a €55 million deal that will create a combined group with a roughly 11% asset-based market share in Albania.
This could be OTP's third banking acquisition in 2021 and the latest in its M&A spree that dates back to 2014. It has said it aims to be central and Eastern Europe's most successful universal banking group.
For Greece-based Alpha, the deal forms part of its efforts to boost its capital and hold it above minimum requirements.
Strategic updates
* UniCredit SpA unveiled a new three-year strategy under which the Italian bank aims for at least €16 billion of shareholder returns through a combination of cash dividends and share buybacks. The lender is targeting a net profit of at least €4.5 billion and a common equity Tier 1 ratio of between 12.5% and 13% by 2024.
* Lloyds Banking Group PLC
Fintech focus
* Monzo Bank Ltd. has achieved a valuation of $4.5 billion following its latest $500 million funding round, the FT wrote. The British digital lender was valued at only about £1.25 billion in February after it suffered from the fallout of the COVID-19 pandemic.
* Online investment platform Crowdcube Ltd. is fielding interest from its members in the U.K. for shares in Klarna Bank AB (publ) as an anonymous investor in the Sweden-based buy-now, pay-later group seeks to cut its stake, The Sunday Times reported.
* Zopa Ltd. will withdraw from peer-to-peer lending and instead focus more on its banking and credit card business, according to AltFi. Zopa's loan portfolio will be transferred to its banking unit, City A.M. added.
Legal issues
* The U.S. Department of Justice warned Deutsche Bank AG that it may have violated a criminal settlement reached in January when it failed to disclose potential greenwashing at its DWS Group GmbH & Co. KGaA unit, The Wall Street Journal reported.
* Six former and current executives at Credit Suisse Group AG are being questioned by prosecutors in a long-standing investigation into the bank's potential criminal liability over fraud led by one of its former star bankers, Bloomberg News reported.
* Poland-based mBank SA launched its own pilot program to convert Swiss franc mortgage loans into zlotys, with the costs of conversion to be split between it and its clients.
Regulatory activities
* Ireland's competition authority will conduct a full phase 2 investigation into the plan of Allied Irish Banks PLC, Bank of Ireland Group PLC, Permanent TSB PLC and KBC Bank Ireland PLC to launch a mobile payments joint venture.
* Denmark's Financial Supervisory Authority ordered Danske Bank A/S to expand and extend an independent probe into its debt-collection practices to appropriately follow up on remediation efforts, Reuters reported.
* The Polish central bank raised its key rate by 0.5 of a percentage point to 1.75% amid growing inflation. Its Hungarian and Ukrainian counterparts also hiked their rates.
In other news
* Credit Suisse Chairperson António Horta-Osório violated quarantine protocols when he left Switzerland before a mandatory 10-day isolation period was up, news outlets including Bloomberg and Reuters reported.
* Netherlands-based ABN AMRO Bank NV is set for a €338 million fourth-quarter pretax gain after selling its head office.
* Apollo Global Management Inc. withdrew its interest in acquiring Metro Bank PLC, sources told Bloomberg. The U.S. buyout firm approached the British bank about a potential deal but decided in recent days not to pursue it.
Featured during the week on S&P Capital IQ Pro:
French banks eye record profits in FY'21 amid fresh COVID-19 turbulence: A strong first three quarters of 2021 has raised the possibility of a record year at some of France's largest banks, despite them having to navigate the ongoing impact of the COVID-19 pandemic.
European banks' payout ratio rises amid 'catch-up' dividends, buybacks: Banks including ING, BBVA and Nordea have kicked off share repurchase programs, while the likes of Swedbank, SEB and DNB have paid extra dividends to shareholders in the fourth quarter of 2021 after getting the green light from regulators.
European banks record 'material' rise in problem loans for pandemic-hit sectors: Europe's average nonperforming loan ratio in the accommodation and food service sector grew to 9.7% from 7.8% a year earlier, according to the European Banking Authority.