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Hiring freeze at CFPB; Scotiabank offers $2.2B for BBVA Chile stake

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Hiring freeze at CFPB; Scotiabank offers $2.2B for BBVA Chile stake

In the latest news on the leadership controversy at the Consumer Financial Protection Bureau, White House Budget Director Mick Mulvaney, on his first day as acting director of the bureau following President Donald Trump's appointment, imposed a temporary freeze on hiring, new regulations and on civil money penalty payments. The 30-day freeze is effective immediately.

Meanwhile, Democratic lawmakers filed an amicus brief arguing that Leandra English, who was appointed deputy director by Richard Cordray before he left his director post, should serve as acting director of the federal consumer watchdog until the Senate confirms a new director. On Nov. 26, English took legal action to block Mulvaney's appointment. Cordray, on MSNBC, said that the law is on his side in the legal fight with Trump over leadership at the bureau.

In other regulatory news, the Federal Reserve Board will likely have four of its seven seats open soon but Federal Reserve Bank of Minneapolis President Neel Kashkari said this is of no concern. Kashkari said that the central bank would be in a good position if President Donald Trump's future board selections are similar to his previous two selections. Kashkari was referring to Randal Quarles, who was recently sworn in as a governor and vice chairman of supervision, and Jerome Powell, who has been nominated as the next Fed chair.

The Senate Committee on Banking, Housing and Urban Affairs will conduct a hearing on Powell's nomination at 9:45 a.m. ET today. Powell, touted as a safe successor to Janet Yellen, will reiterate his intention to ease banks' regulatory burden without sacrificing the "core reforms" of capital and liquidity requirements, stress testing and resolution planning, according to his prepared remarks for the hearing. If confirmed, Powell said that he and his colleagues would aim to "sustain a strong jobs market with inflation moving gradually up toward our target." He added that the Fed would need to "respond decisively and with appropriate force" to threats to U.S. stability and economy.

In legislative news, Trump is expected to meet with Senate Republicans during a weekly luncheon today ahead of a vote on tax reform later this week.

In banking news, Wells Fargo & Co.'s foreign-exchange business — which is being probed by federal prosecutors and being audited by examiners from the Office of the Comptroller of the Currency — for years overcharged some customers, The Wall Street Journal reports, citing "more than a dozen current and former Wells Fargo employees." According to the unnamed sources, the bonuses of forex employees are solely based on the amount of revenue they bring, pushing the employees to overcharge clients. But after Wells Fargo moved its forex business into its investment bank earlier this year, the bank changed its compensation plans. This made bonuses "discretionary" and no longer solely based on revenue, the report adds.

TCF Financial Corp. is discontinuing its indirect auto loan originations, effective Dec. 1. The Wayzata, Minn.-based company expects the change to cause a fourth-quarter charge of approximately $73.4 million, after-tax, for goodwill and other intangibles, as well as a charge of $7.0 million to $12.0 million for restructuring-related items such as severance and asset impairment.

And on the M&A front:

Bank of Nova Scotia made a binding offer to buy Banco Bilbao Vizcaya Argentaria SA's 68.19% stake in Banco Bilbao Vizcaya Argentaria Chile SA and other related businesses for about US$2.2 billion. BBVA said it wishes to accept the Toronto-based lender's offer. Scotiabank also released its fiscal fourth-quarter before markets opened today, recording a year-over-year improvement in net income attributable to common shareholders of C$1.99 billion, compared to C$1.91 billion.

Chicago-based Byline Bancorp Inc. is acquiring Evanston, Ill.-based First Evanston Bancorp Inc. for approximately $169 million in cash and stock.

And in Florida, FCB Financial Holdings Inc. is buying Floridian Community Holdings Inc. in an $88.1 million all-stock deal.

In other parts of the world

Asia Pacific: China to halt approval of Hong Kong-focused funds; Challenger eyes AMP Life

Europe: Banks pass BoE stress tests; SocGen to cut jobs; $2B offer for BBVA Chile stake

Middle East & Africa: Bank of Ghana cuts key rate; Sompo sets up Israel fintech hub

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng slid 0.02% to 29,680.85 and the Nikkei 225 lost 0.04% to 22,486.24.

In Europe, as of midday, the FTSE 100 increased 0.62% to 7,429.76, and the Euronext 100 was up 0.71% to 1,044.21.

On the macro front

The international trade in goods report, Redbook, the Federal Housing Finance Agency's house price index, the S&P Corelogic Case-Shiller HPI, the consumer confidence report, the Richmond Fed manufacturing index, the State Street Investor Confidence Index, and Gallup's economic confidence index are due out today.

The Daily Dose is updated as of 7:30 a.m. ET. Some external links may require a subscription.