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Big UK banks pass stress test; UBS to revamp unit; UniCredit off-loads bad loans


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Big UK banks pass stress test; UBS to revamp unit; UniCredit off-loads bad loans

* The EU's objective to implement environmental goals in standards for financial institutions moved forward after the bloc's member states agreed to support a proposal on rules regarding green finance, Bloomberg News reported.


* All the main U.K. banks passed the Bank of England's 2019 stress test, for which the scenario was more severe than the actual financial crisis and included a disorderly Brexit, though banks saw greater losses on corporate exposures than previously. The BoE also increased the size of countercyclical buffer — a rainy day fund that is built up in good economic times — to 2% of risk-weighted assets from 1%.

* U.K. Prime Minister Boris Johnson is set to unveil new legislation that would rule out a two-year extension to the 11-month transition period that begins once Britain exits the EU on Jan. 31, 2020, media outlets reported. Johnson, meanwhile, reappointed Nicky Morgan as secretary of state for culture, media and sport, while Simon Hart was named secretary of state for Wales, Bloomberg News wrote.

* The BoE's Financial Policy Committee called for more consistency between the liquidity of open-ended funds' assets and its redemption terms in an attempt to prevent investor withdrawals from becoming out of control.

* BoE Governor Mark Carney said the prospect of Britain leaving the EU without a Brexit deal has decreased because of last week's election results, Bloomberg News reported.

* London Stock Exchange Group PLC said COO and Chief Information Officer Chris Corrado will leave the group at the end of the first quarter of 2020. David Shalders will succeed Corrado as COO, while Anthony McCarthy will take over as chief information officer, effective Jan. 1, 2020.

* U.K. digital lender Monzo Bank Ltd. said it will charge customers effective annual rates of up to 39%, effective April 2020, depending on their credit scores, The Independent reported, citing a statement from the bank. The move follows a decision by the Financial Conduct Authority in May to ban daily fees on overdrafts.

* U.K.-based robo-advice technology platform Wealth Wizards, which is backed by Liverpool Victoria Friendly Society Ltd., has mandated banks for a £30 million funding round, Sky News reported.


* A new study by consultancy Bain & Co. presumes that Germany's banks will continue to struggle with low profitability or losses in the mid term and "have no choice but to further thin out their branch networks and cut the number of employees," Handelsblatt wrote. Bain's German CEO, Walter Sinn, said rising expenditures for digitization and stricter regulation have annihilated all austerity efforts, while the ECB's low interest rate policy continues to limit interest income. In addition, commission surpluses have been stagnating for years, and the situation had recently worsened due to a decline in trading profit, Sinn said.

* Deutsche Bank AG plans to achieve 80% of its €1.2 billion savings target through the use of information technology to streamline costs in the middle and back office and replace employees, Efinancialcareers cited Ram Nayak, head of the German lender's markets business and co-head of the investment banking division.

* Lower Saxony's parliament approved a capital injection for Norddeutsche Landesbank Girozentrale, NDR reported. The German state intends to contribute roughly €2.3 billion to the €3.6 billion EU-approved bailout package for the bank.

* German financial market regulator BaFin expects local banks to cut variable remuneration for 2019. "Our expectation is that the banks adapt bonuses to reflect their earnings situation," Raimund Röseler, BaFin executive director for banking supervision, told Börsen-Zeitung.

* Andreas Götz, CEO of Kreissparkasse Ostalb, will take over the retail and savings banking business of Landesbank Baden-Württemberg by July 1, 2020, and later become a member of the company's management board, succeeding Deputy CEO Michael Horn, who will retire, Handelsblatt wrote.

* Wirecard AG CEO Markus Brown said on Twitter that the company is now expanding into China, which would be "a good indication for a very strong 2020." However, the company's business practices remain controversial, Handelsblatt wrote, adding that while large-scale investors and analysts are still positive about Wirecard's future, several hedge funds are betting on a slump in the company's share price.

* UBS Group AG's co-heads of wealth management, Iqbal Khan and Tom Naratil, plan to dissolve the bank's ultrahigh-net-worth unit to bring some clients under regional divisions, insiders told Bloomberg News. The restructuring of the wealth management business is expected to be included in the Swiss lender's strategy update in January 2020.

* Documents showed that Peter Goerke, Credit Suisse Group AG's former head of human resources, was followed by private investigators in February this year, suggesting that the shadowing of the bank's former wealth management head Iqbal Khan was not an isolated incident as it has said, Neue Zürcher Zeitung reported.


* Brussels-based Euroclear SA/NV has postponed a decision on a potential sale of the securities settlement company, due to shareholder disagreement over how to realize value of stakes in the group, the Financial Times reported.

* Dutch bank Kempen raised €193 million with its private equity fund, Het Financieele Dagblad reported.

* Dutch ATMs will be closed at night after a spate of ram raids throughout the country, Het Financieele Dagblad reported, citing the Dutch Banking Association.

* P&V, Belgium's sixth-biggest insurer, said it is buying Brussels-based Private Insurer as it tries to get a foothold in the market for investment insurance, De Tijd reported. Investment insurance policies, also known as tak23 life insurance policies, are on the rise in the industry amid historically low interest rates, the paper said.

* The Dutch regulator has given Volksbank NV permission to pay out a super dividend to its only shareholder, the Dutch state, Het Financieele Dagblad reported. Wopke Hoekstra, the Dutch finance minister, will receive €250 million this month, which is 50% lower than expected because the bank wants to boost its financial buffers.


* The Spanish stock market regulator CNMV has hired the National Economic Research Associates consultancy to advise on international arbitration procedures initiated by a group of 46 Mexican investors against Banco Popular Español SA, Europa Press wrote. They accuse the bank of the virtual expropriation of at least €470 million.

* Banco Santander SA Chairman Ana Botín purchased 3.3 million shares in the Spanish lender last week at an average price of €3.7 per share, Reuters reported.

* Portugal's state budget foresees a €600 million capital injection in Novo Banco SA despite officially keeping the subscription of an €850 million within the resolution fund, Jornal de Negócios reported. The paper, citing Expresso, said the fund has a total of €2 billion to invest in Novo Banco in the long term, but the possibility of injecting the full amount has not been ruled out.


* The Italian government is optimistic that the European Commission will give it the green light to rescue ailing Banca Popolare di Bari SCpA. Despite the government's optimism, the rescue plan may still come into conflict with EU rules on competition, with a spokeswoman for the EC on competition matters saying it is "in contact with Italy and stand ready to discuss with them on the availability and condition of the tools within the EU law framework," Bloomberg wrote. Italy's central bank, meanwhile, said a liquidation of Popolare di Bari is not a feasible option, saying such a move would spark a confidence crisis among depositors of other small lenders, Reuters wrote.

* Unione di Banche Italiane SpA completed the securitization of nonperforming loans with a gross value of €856.7 million along with the sale of the junior and mezzanine and junior tranches of the portfolio, said MF.

* UniCredit SpA sold €154 million in NPLs to Banca IFIS SpA, Guber Banca and Barclays Investment Bank, said MF.

* The gross volume of nonperforming loans on the books of Italian banks fell to €165 billion in June 2019 from €341 billion in 2015, according to data from PwC's annual report on the Italian bad loan market published by Il Sole 24 Ore.


* Klarna Bank AB (publ) CEO Sebastian Siemiatkowski told Reuters that the Swedish financial technology company intends to expand to Australia and other markets in 2020 following the launch of its service in the U.S.

* Norwegian financial regulator Finanstilsynet is threatening to fine several banks that have not asked customers to provide documentation, E24 reported. A new report from the regulator shows that banks have more than 760,000 customers that have not provided documentation in accordance with regulations. The banks have been given until Jan. 17, 2020, to rectify the situation, and will be fined if they do not.

* All members of the Swedish parliament's finance committee have strongly criticized financial regulator Finansinspektionen, Realtid reported. The parties said the regulator needs to be tougher in their supervision of banks in order to detect money laundering.


* Russian President Vladimir Putin signed a bill that will ban lenders from charging retail clients higher fees for money transfers between accounts opened in different regional divisions of the same bank, also referred to locally as "bank roaming," Vedomosti said. The new law will come into force six months after publication, the newspaper noted.

* Baring Vostok Capital Partners Ltd. intends to pay back to investors 5 billion rubles raised for the recapitalization of Russia-based Public Stock Co. Orient Express Bank due to the ongoing conflict between the lender's shareholders, Vedomosti and RBC reported. The central bank approved the 5 billion ruble capital hike for Orient Express already in 2018, but Russian businessman Artem Avetisyan, who currently controls the lender with his business partners, secured a court ban for the capital increase in 2019.

* Turkey's Financial Action Taskforce said serious shortcomings remain in the country's anti-money laundering and counter terrorist financing system with a need to improve measures to tackle such issues.


Asia-Pacific: South Korea OKs 3rd internet bank; Australia launches Westpac probe

Middle East & Africa: NCB, Riyad Bank drop merger talks; Groupe BPCE to sell stake in Tunisian bank

Latin America: BNDES mulls divesting stake in Petrobras; Brazil's B3 releases 2020 guidance

North America: Group files for Atlanta de novo; JPMorgan to up China investment

Global Insurance: Humana deal; US health insurance outlook; Mapfre warning; Japan Post probe


Know-your-customer compliance costing banks their corporate clients: Most treasurers polled in a new survey said they have reduced or limited the number of banks they work with to minimize know-your-customer requirements.

Sheryl Obejera, Arno Maierbrugger, Danielle Rossingh, Esben Svendsen, Beata Fojcik, Heather O'Brian, Stephanie Salti, Sophie Davies and Helen Popper contributed to this report.

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