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Banks reassured over capital buffers; LSE-Deutsche Börse merger protest; Spanish banks get relief


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Banks reassured over capital buffers; LSE-Deutsche Börse merger protest; Spanish banks get relief

Banks reassured over2016 capital buffer requirements: ECB Supervisory Board Chair Danièle Nouysaid yesterday that the level of Pillar 2 capital that the central bank willask eurozone lenders to hold this year "will be around what wasrequested" in 2015, Reuters reports.Nouy noted that the 2016 capital buffers will be divided between requirementsand nonbinding capital guidance.

* ECB Supervisory Board member Ignazio Angeloni saidyesterday that the central bank does not expect any strains on financial marketliquidity and bank funding in the aftermath of the U.K.'s vote to leave the EU,saying the immediate aftershock was handled well, Reuters writes.

* France criticized former European Commission PresidentJosé Manuel Barroso's appointment as nonexecutive chairman and senior adviserof Goldman Sachs' international arm, saying the move raises conflict ofinterest, Observador writes.The French government made a formal request for Barroso to renounce his newjob, Le Figaro reports.The BBC also covers.

* European investment banking turnover amounted to $8.2billion as of July 12, the lowest year-to-date figure since 2002, City A.M. writes,citing Dealogic. The amount was 22% lower than the year-ago period.  

* Former Google engineer Paul Taylor launched a firm aimingto build a new, blockchain-based operating system for banks, Reuters reports.The system, named Vault OS, would negate the need for banks to have in-housedata centers. 


Osborne replaced asUK chancellor: Theresa May officially became British Prime Ministeryesterday afternoon and appointed Philip Hammond to replace George Osborne as chancellorof the Exchequer. Boris Johnson, previously a favorite to succeed former PrimeMinister David Cameron, was named foreign secretary, while Amber Rudd became homesecretary. May also named David Davis to the newly created role of secretary ofstate for exiting the EU, accordingto BBC News.

* Prior to resigning as U.K. prime minister, David Cameronadvised May to "try to be as close to the EU" as possible to earntrade, cooperation and security benefits, Reuters reports.French President François Hollande separately calledon May to quickly begin Brexit talks with the EU.

* The Bank of England will announce today whether it willmaintain the bank rate at its current level of 0.5% or cut the rate for thefirst time since March 2009, City A.M.reports.

* The BoE said in its credit conditions reviewfor the second quarter that banks expect the demand for secured credit to fallfollowing the U.K.'s decision to leave the EU.

* AberdeenAsset Management Plc lifted the trading suspension on its fund after a weeklong freeze, CityA.M. reports.The Financial Times and SkyNews also cover.

* Man GroupPlc unit Man GLG hired five senior investment professionals to completeits emerging markets debt team.

* Cerberus Capital Management is set to name formerSantander UK Plc CFOStephen Jones a senior adviser with responsibility for identifying M&Aopportunities in the U.K. and Europe, Sky News reports.


LSE-DeutscheBörse merger draws Portugal protest: Portuguese Finance Minister MárioCenteno wrote a letter urging European Commissioner for Competition MargretheVestager to prevent the planned merger between London Stock Exchange Group Plc and , saying the dealwould negatively impact the function of the capital market, Reuters writes.

* Meanwhile, about 53% of Deutsche Börse shareholdersapproved its proposedmerger with LSE Group by mid-afternoon yesterday, indicating that the requiredthreshold of acceptance of 60% would be surpassed by the July 26 deadline.

* UBS GroupAG announcedit entered a partnership with NextShares Solutions LLC and will offerNextShares, a new type of actively managed exchange-traded funds, from 2017 toclients of its wealth management unit.

* Swiss financial watchdog FINMA opened enforcement proceedingsagainst former BSI SAAsia head Hans Peter Brunner and former bank lawyer Beat Ammann to determinewhether there were violations of supervisory duties at the bank in deals withMalaysia's scandal-ridden state fund 1Malaysia Development Bhd., Handelszeitungreports.

* Meanwhile, Brunner, who is also facing investigations bythe Singapore Attorney General over the 1MDB case, sued BSI for suspending abonus payment of $536,400, arguing that there was "no legal basis" todo so, Bloomberg News writes.

* Pia Tischhauser, executive committee member at BostonConsulting Group, tellsHandelszeitung that she sees Brexit as a "big chance" forZurich-based insurance companies as their London-based competitors will facedisadvantages over EU market access in the future.

* Clients withdrew €4.8 billion in capital from 's Deutsche AssetManagement in the first five months of 2016, Handelsblatt reports.

* CreditSuisse Group AG informed its clients in Switzerland that theirassets will be transferred to a new unit called Credit Suisse (Schweiz) AG, Tages-Anzeigerwrites.

* Credit Suisse hired Deutsche Bank investment banker CathalDeasy to become its new head of European M&A, the Financial Times reports.The bank also named David Kostel and Punit Mehta as global co-heads of healthcare investment banking, Reuters writes.


AXA Belgium CEOdeparts:  AXA Belgium SA CEO Frank Koster left the company becauseof "recent changes within the management and the organization of AXA Group," De Tijd reports. The Dutchman, who had beenoverseeing a wide-ranging restructuring of the insurer, will be replaced by JefVan In, a former ING Belgium banker who had been running AXA Bank Belgium since2011. L'Echo also reports.

* BinckBankNV will appeal a €750,000 fine that the Dutch stock marketregulator AFM handed it over misleading advertising, De Telegraaf reports. A spokesman for the online brokersaid the company had "carefully studied" the fine and it saw"concrete clues" to fight the decision.


Spanish banks win favorable EU court ruling: A senior judgeat the European Court of Justice drafted a nonbinding opinion advising againstforcing Spanish banks to reimburse customers for all excess interest chargesdue to floor clauses on mortgage contracts, the Financial Times reports.The court is highly likely to concur with the nonbinding opinion and rule infavor of the Spanish banks, which were previously required by a court toreimburse customers for any excess payments since May 2013. Reuters also covers.

* BancoPopular Español SA mandated Deutsche Bank and Ernst & Young tocarry out the sale of between €3.5 billion and €4.0 billion of real estateloans, Expansión reports.

* Portugal-based completed the sale ofits 49.99% stake in BancoInversis SA for €30 million. Spanish lender reacquired the stake,which it sold to Orey Antunes in January, to regain 100% control of thecompany, Expansión writes.

* In case of a failure ofCaixaBank SA'stakeover bid for Banco BPISA, Haitong Bank estimates that the target price for Banco BPI willfall to €1.01 per share from €1.11 per share, Jornal de Negócios reports.

* Carlos Brandão, 's CEO in Portugal,criticized the idea of creating bad banks to absorb toxic assets fromPortuguese banks in the event of a crisis, Jornalde Negócios writes.Brandão also said that there has to be a transformation in the bankingbusiness, where digital transactions are not only a necessity but an obligation.


Atlante-Montedei Paschi talks continue: Italian bank rescue fund Atlante is in ongoingdiscussions with Banca Monte deiPaschi di Siena SpA to acquire a portion of the bank's bad loans,sources tellReuters. Atlante could purchase a junior tranche of the bank's debt while asenior tranche could be backed by a state guarantee and sold to otherinvestors, accordingto MF.

* Meanwhile, Unione di Banche Italiane SpA Chairman Andrea Moltrasiosaid the bank is not studying a merger with Monte dei Paschi and is not undergovernment pressure to pursue a deal, Reuters writes.

* Private equity groups Apax, Lone Star and Apollo arepreparing to submit by a July 20 deadline offers for the healthy assets of foursmall Italian lenders that were bailed out last year, Il Sole 24 Ore says. Italy's government hascommitted to disposing of the healthy assets of , Cassa diRisparmio della Provincia di Chieti SpA, and by Sept. 30.

* BancaPopolare di Vicenza SpA's board mandated lawyers to evaluate legalaction against previous management of the lender, MF Dow Jones says.

* The European Commission Competition Directorategreenlighted National Bank ofGreece SA's proposed sale of assets, including 11 private equityfunds based in the U.K. and Guernsey, Express reports.

* Greek banks' reliance on the ECB's emergency liquidityassistance fell to €54.37 billion in June from €64.81 billion in May, Kerdosreports.


SEB posts sharp declinein H1 profit: SkandinaviskaEnskilda Banken AB today reportedsecond-quarter group net profit attributable to shareholders of 4.52 billionSwedish kronor, up from 3.93 billion kronor a year earlier. However, group netprofit for the first half dropped year over year to 2.23 billion kronor from8.58 billion kronor. SEB said all income lines in the first half were lowerfrom the year-ago period, reflecting the impact of negative interest rates anda more cautious business sentiment.

* StorebrandASA today reportedsecond-quarter profit attributable to shareholders of 705 million Norwegiankroner, up from 255 million kroner a year ago. First-half attributable profitrose year over year to 1.01 billion kroner from 501 million kroner.

* namedJohan Agerman CEO to replace retiring Sten Dunér, Dagens Industri reports.Agerman, who is currently managing director at insurance company Trygg-HansaAB, will take up his new role in 2017.

* TheSwedish central bank expects Nordea Bank AB (publ) to respond to calls to have higherliquidity coverage amid increasing liquidity-related risks, Dagens Nyheter reports,citing Riksbank Deputy Governor Cecilia Skingsley.

*Tryg A/S CEO MortenHübbe expects the slow to negative growth in revenues to continue for the restof 2016 and into 2017, Børsen reports.Tryg is losing several large corporate clients due to the sluggish Norwegianeconomy.


IMF saysRussian banks may need 3.7 trillion rubles of extra capital: The IMFcalculated that Russian banks would need additional capital equivalent to 4.5%of GDP or 3.7 trillion rubles in the next five years in a worst-case scenarioof prolonged fall of oil prices to $25 per barrel, Vedomosti and Kommersantreports. Also citing the IMF, Bloomberg News saysnonperforming loans in the Russian banking system might be 3.5 percentagepoints higher than the 9.2% level reported in March.

* Following recent hacker attacks, Russian lenders askedSWIFT to start working with them directly and remove intermediary company Alliance Factors, through which it hasbeen cooperating with local lenders to date, Vedomosti reports.

* The Russian banking sector posted a net profit of 360billion Russian rubles for the first half of 2016, compared with 51 billionrubles a year ago, Kommersant reports. Loan loss provisions in the banking system havegone up by 4.4% or 237 billion rubles since the beginning of the year.

* Citing Vnesheconombank head Sergey Gorkov, Prime reports that VEBcould sell Globex Bank and Interregional Bank for Settlements of the Telecommunications &Postal Services as soon as 2017.

* PAO Sberbankof Russia is said to be interested in taking over , WirtschaftsBlattreports,noting that former Bank Austria CEO Gerhard Randa just took over thechairmanship of the board of Sberbank's European business.

* Yapi veKredi Bankasi AS appliedto the Capital Markets Board for a certificate to issue debt instrumentsamounting JPY1 billion. The bank also looks to issue $550 million of debtinstruments with a seven-year maturity.



Middle East and Africa:

Latin America: Brazil's central bank outlines requirements for Bradesco followingHSBC purchase

North America: Horizon Bancorp acquiring CNB Bancorp in Indiana; Fed approvesKeyCorp/First Niagara deal

North America Insurance: Illinois pushes for rehabilitation of health insurance co-op; IFSratings are not comparable


IncomingUniCredit CEO Mustier moves fast to plug capital hole: IncomingUniCredit CEO Jean-Pierre Mustier faces a difficult restructuring task giventhe bank's weakness in Italy.

Liquidity-richDeutsche Bank may be stronger than CDS suggest: Credit defaultswaps are flashing red over Deutsche Bank again. But although investors caughtwith its CoCos may be concerned, the bank has plenty of liquidity.

Credit insurerCoface plots turnaround as emerging-market claims jump: Coface'snew managers are working on a plan to fix the credit insurer's troubles inemerging markets.

Sheryl Gesto-Obejera,Arno Maierbrugger, Brian McCulloch, Danielle Rossingh, Praxilla Trabattoni,Mariana Aldano, Heather O'Brian, Mike Hatzidakis, Gerard O'Dwyer, Beata Fojcikand Ali Kayalar contributed to this report.

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