Nashville, Tenn.-based FB Financial Corp. agreed to acquire Scottsville, Ky.-based FNB Financial Corp. in a cash-and-stock deal valued at about $51.9 million. The deal is expected to be "marginally accretive" to FB Financial's EPS, excluding transaction costs and expenses, and neutral to the company's tangible book value per share at the close of the deal, set in the first quarter of 2020.
Tallahassee, Fla.-based First Commerce CU is purchasing and assuming certain assets and liabilities of Nashville, Ga.-based Citizens Bank, a unit of Nashville Holding Co., in a deal expected to close in the second quarter of 2020.
In West Virginia, Summit Financial Group Inc. agreed to acquire Cornerstone Financial Services Inc. and unit Cornerstone Bank Inc. in a stock-and-cash transaction worth about $28.5 million. The deal is expected to close in early 2020.
House Committee on Financial Services Chair Maxine Waters, D.-Calif., warned that the proposed removal of margin allocations for banks' transactions with their affiliates would be a "$40 billion giveaway to Wall Street megabanks" at the expense of U.S. economic stability and taxpayers. Waters issued the statement Sept. 17 shortly after regulatory bodies proposed the scrapping of the Obama administration-approved rule that banks should set aside billions of dollars in margin when engaging in derivative transactions with their own affiliates. Waters said such measure was put in place to prevent another financial crisis and added that megabanks that have been wishing for its removal found their allies in Trump regulators.
The U.S. Securities and Exchange Commission intends to update the statistical disclosures that bank and savings and loan registrants provide to investors to get rid of overlaps with commission rules, U.S. GAAP or IFRS. SEC Chair Jay Clayton noted that the existing industry guide "has not been substantively updated for more than 30 years." The regulator's proposal will be subject to public comments for 60 days after publication in the Federal Register.
The SEC fined three units of Raymond James Financial Inc. $15 million for improperly charging advisory fees on inactive client accounts and excess commissions for brokerage customer investments in certain unit investment trusts. The amount covers disgorgement of $12 million and $3 million in civil penalty. The three units of Raymond James involved in the charges, Raymond James & Associates Inc., Raymond James Financial Services Advisors Inc. and Raymond James Financial Services Inc., also agreed to make distributions to harmed investors.
CEOs of 51 companies from the Business Roundtable urged the U.S. Congress to pass a comprehensive consumer data privacy law to "strengthen consumer trust and establish a stable policy environment." Signatories to a Sept. 10 letter expressing such call included the CEOs of Bank of America Corp., Citigroup Inc., Mastercard Inc., JPMorgan Chase & Co. and S&P Global Inc.
JPMorgan is so far beating other Wall Street banks in the scramble for the coveted hedge funds left by Deutsche Bank AG since the German lender's recent exit from equities, Business Insider reports, citing people familiar with the matter. One source told the news outlet that JPMorgan has so far grabbed about $40 billion in new assets from top-tier hedge funds like Renaissance Technologies and D.E. Shaw. Morgan Stanley, Goldman Sachs Group Inc., Bank of America and Citigroup have also raked in billions, and now only about $75 billion of Deutsche Bank's nearly $200 billion in balances are left, according to the sources.
To enhance links with privately owned firms that may one day go public and deepen ties with large-cap clients, Citigroup is playing matchmaker between old companies yearning for growth and emergent startups in need of working capital through the Consumer Disruptive Growth Conference, Reuters reports. Citigroup started the event three years ago and intends to expand the strategy from consumer products to other sectors.
Big asset managers BlackRock Inc. and Vanguard Group Inc. are failing as company stockholders in the call for businesses to adopt measures that combat climate change, Bloomberg News reports, citing nonprofit group Majority Action. According to the group's proxy voting assessment of 25 global asset managers related to the U.S. energy, utility and auto industries, BlackRock and Vanguard voted against 16 climate-related shareholder proposals, while institutions like BNP Paribas SA and Pacific Investment Management Co. LLC voted for almost all the 41 climate change resolutions surveyed.
In other parts of the world
Asia-Pacific: ADB confirms president resignation; investors eye new Chinese bank
Europe: Metro Bank execs probed; HSBC French unit under review; Lloyd's H1 profit up
Middle East & Africa: Israel's tight election; Moody's expects Islamic finance in Africa to grow
Now featured on S&P Global Market Intelligence
With few advantages to gain, only 4 banking institutions adopt CECL early: Only a handful of institutions have chosen to adopt the current expected credit loss accounting method ahead of their deadline, according to second-quarter 2019 call reports. The CECL standard will be implemented for large public companies in the first quarter of 2020, but hundreds of smaller institutions will have more time to implement it.
Divided Fed likely to cut rates, keep door open to more easing: The Federal Reserve is poised to lower interest rates again Sept. 18 and keep the door open to additional policy easing should trade tensions escalate further. The Fed's expected 25-basis-point rate cut would be its second of the year, but the decision will likely highlight a divide among Fed officials over how worried they should be about a potential U.S. economic slowdown, analysts say.
FDIC board sets community bank leverage ratio at 9%: The board of the Federal Deposit Insurance Corp. passed a final rule on the community bank leverage ratio, setting the minimum required CBLR at 9%.
The day ahead
Early morning futures indicators pointed to a lower opening for the U.S. market.
In Asia, the Hang Seng lost 0.13% to 26,754.12, and the Nikkei 225 declined 0.18% to 21,960.71.
In Europe, around midday, the FTSE 100 rose 0.05% to 7,324.54, and the Euronext 100 was up 0.16% to 1,089.03.
On the macro front
U.S. housing starts, the U.S. Energy Information Administration Petroleum Status Report, the Federal Open Market Committee meeting announcement, the FOMC forecasts and the Fed chair press conference are due out today.
Click here (client-only access) to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.