TOP NEWS IN GLOBAL FINANCIALS
* Influential U.S. banks in various states are fighting back against Republican legislators' push to quash banks' support of environmental, social and governance advocacies, the Financial Times reported. According to the report, the Indiana Bankers Association, representing 116 banks, is lobbying against legislation that would require the state to divest and cancel contracts with financial groups that consider social, political or ideological factors, while Nebraska's bankers' association opposed a bill that seeks to stop lenders from considering such factors in investing. The head of North Dakota's banking association also testified against legislation requiring the state's treasurer to list financial companies accused of boycotting energy companies, the news outlet noted.
* Barclays PLC's statutory full-year 2022 attributable profit fell by nearly a fifth to £5.02 billion from £6.21 billion in 2021. The British bank booked £1.60 billion of annual litigation and conduct expenses, of which £966 million were related to its securities overissuance blunder in the U.S., plus £1.22 billion of credit impairment charges. Its fourth-quarter 2022 statutory attributable profit also slid year over year to £1.04 billion from £1.08 billion, with credit impairment charges totaling £498 million in the quarter.
➤ Some US banks grow lending to energy in Q4'22; BofA carries largest portfolio
Of 12 select U.S. banks with more than $50 million in energy exposure at year-end 2022, eight increased their loan portfolio to the energy sector, while four reduced their exposure in the final quarter of 2022, data gathered by S&P Global Market Intelligence showed.
➤ Berkshire further slashes stake in 2 US banks in Q4'22, reverses course on TSMC
Berkshire Hathaway Inc. drastically reduced its investment in U.S. Bancorp by 91.4% and in The Bank of New York Mellon Corp. by 59.7% during the fourth quarter of 2022 while also selling off most of its position in Taiwan Semiconductor Manufacturing Co. Ltd., or TSMC.
➤ US bank analysts trim net interest margin, EPS expectations for 2023
Analysts covering the largest U.S. banks curtailed their earlier expectations for 2023 earnings growth following fourth-quarter 2022 earnings reports.
AMERICAS
* Consumer lender CashCall Inc. must pay $167 million, including $134 million in restitution to customers harmed by its allegedly dodgy lending, U.S. District Judge John Walter ruled after an appeals court overturned a previous order that provided no relief for customers, American Banker reported. Walter found that CashCall customers "had no legal obligation to pay" interest and fees after the nonbank lender worked with now-defunct Western Sky Financial to evade state usury caps by overstating its links to a sovereign Native American tribe, the Cheyenne River Sioux, the report said.
* The U.S. Treasury Department's Financial Crimes Enforcement Network received more than 100 whistleblower reports over a three-week period this year after a U.S. law enacted Dec. 29, 2022, following Russia's invasion of Ukraine, encouraged whistleblower revelations on banks' Russia ties, Bloomberg News reported, citing people familiar with the matter.
Click here for more of the day's essential bank and financial services news in the U.S. and Canada.
EUROPE
* UniCredit SpA is in the early stage of exploring strategic options for its payments business as the Italian lender seeks to streamline its operations and cut costs, sources told Bloomberg News. Options being considered reportedly include team-ups with European or U.S. payment services providers, partnerships, and accords for specific business sectors. A UniCredit spokesperson declined to comment to Bloomberg.
* Turkey is funneling billions of lira from pension funds and state lenders into the stock market and could impose tax waivers for companies' share buybacks as it seeks to reverse the slump in companies' market value following last week's devastating earthquake, insiders told Bloomberg News. Authorities suspended trading in the aftermath of the disaster but will resume it today, according to the report.
Click here for more of the day's essential financial news in Europe.
MIDDLE EAST & AFRICA
* M&A activity in Saudi Arabia is expected to increase in 2023, much of it driven by the Public Investment Fund as well as consolidation in the insurance and cement industries, Bloomberg News reported, citing Zaid Ghoul, SNB Capital Co.'s head of investment banking. The investment banker said SNB Capital has been boosting its dealmaking capabilities as work on deals is anticipated to rise this year. In 2022, share sales dominated investment banking work in the country, with more than $8 billion raised through initial public offerings.
* The International Monetary Fund has appointed Leonard Chumo financial supervision adviser for the Bank of Ghana, Reuters reported, citing a statement. The Swiss-funded adviser, whose assignment started on Feb. 6, will give technical assistance to the bank's implementation of Pillar 2 and 3 of the Basel II and III capital frameworks and help build up its risk-based supervisory framework as the West African nation aims to secure executive board approval for a $3 billion bailout, the report said.
ASIA-PACIFIC
* Commonwealth Bank of Australia reported net profit after tax from continuing operations on a cash basis of A$5.15 billion for the fiscal half ended December 2022, rising 9% from the A$4.75 billion it reported in the prior-year half. Its fully franked interim dividend was A$2.10 per share. The Australian bank's loan impairment expense rose by A$586 million to A$511 million, reflecting ongoing inflationary pressures, rising interest rates, supply chain disruptions and a decline in house prices.
* India's Housing Development Finance Corp. Ltd. released a term sheet for its issue of secured redeemable nonconvertible debentures with an issuance size of 50 billion rupees and an option to retain an oversubscription of 200 billion rupees. The company said in a stock exchange filing that it plans to use the proceeds from the issue to augment its long-term resources.
Click here for more of the day's essential financial news in Asia-Pacific.
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