Large US banks forming climate risk consortium; Wells scraps overdraft fees

TOP NEWS IN BANKING & FINANCIAL SERVICES

* A consortium formed by the Risk Management Association and 19 large banks, including Bank of America Corp., Wells Fargo and Royal Bank of Canada, plans to develop standards for measuring and managing climate risk, The Wall Street Journal reported.

* Wells Fargo & Co. will eliminate transfer fees for customers enrolled in its overdraft protection program and non-sufficient funds fees for depositors by the end of the first quarter. The bank will also give up to two days earlier access to direct deposits and a 24-hour grace period before incurring any overdraft fees by the third quarter. In addition, Wells Fargo said it will offer clients a new short-term loan of up to $500 by the end of 2022.

➤ Australian banks face tricky outlook with margin pressure, housing risks

Australian banks face a challenging new year as they contend with record-low interest rates, tighter lending requirements and the risk of the housing market cooling.

➤ US REIT M&A activity soared in 2021

U.S. real estate M&A activity involving publicly traded equity real estate investment trusts surged in 2021, with total transaction value reaching $99.28 billion across the 13 announced deals, according to S&P Global Market Intelligence data.

EARNINGS SPOTLIGHT

* Jefferies Financial Group Inc. reported adjusted net income attributable to common shareholders of $369.2 million, or $1.36 per share, for the fourth quarter of fiscal 2021.

BANKING

* South Carolina FCU plans to merge with Greenville, S.C.-based G.H.S. FCU, effective April 30, American Banker reported, citing a press release. As of Sept. 30, 2021, South Carolina FCU had $2.38 billion in total assets, while G.H.S. FCU had $56.1 million in assets, according to S&P Global Market Intelligence data.

* Citigroup Inc. plans to exit the consumer, small business and middle-market banking operations of Mexico-based Citibanamex. The businesses the bank intends to exit accounted for approximately $3.5 billion in revenue, $1.2 billion in earnings before tax, $44 billion in assets and $4 billion in average allocated tangible common equity in the first three quarters of 2021.

* Aiden Florida Bancshares Inc., a newly formed Florida corporation, is acquiring 65% to 80% of the outstanding shares of Dade City, Fla.-based Florida Bancshares Inc. from its current shareholders for a price equal to 1.9x its adjusted book value per share.

FINANCIAL SERVICES

* Ken Griffin's electronic trading firm Citadel Securities LLC received a $1.15 billion investment from venture capital firms Sequoia Capital Operations LLC and Paradigm Operations LP, valuing the Chicago-based firm at about $22 billion. Following the first outside investment, Griffin will own roughly 80% of the trading business, worth about $17.5 billion, according to a Bloomberg News report.

* The USDF Consortium, an association of Federal Deposit Insurance Corp.-insured financial institutions, launched to enable banks to further the adoption and interoperability of a bank-minted stablecoin that will facilitate the compliant transfer of value on the blockchain.

POLICY AND REGULATION

* The FDIC and the Financial Crimes Enforcement Network launched a tech sprint aiming to develop solutions to measure the effectiveness of digital identity proofing at financial institutions and regulatory agencies. The FDIC's tech lab and the FinCEN seek to increase efficiency and account security; reduce fraud and other forms of identity-related crime, money laundering and terrorist financing; and foster confidence in the digital banking environment.

Click here for a summary of indexes on the S&P Capital IQ Pro platform.

The Daily Dose is updated as of 8 a.m. ET. Some external links may require a subscription. Links are current as of publication time, and we are not responsible if those links are unavailable later.