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Top 3 Japanese banks post Q1 results; CBA closes sale of global wealth arm

S&P Global Market Intelligence offers our top picks of banking news stories and more published throughout the week. Please note that some entries may have links to third-party sources that may require a subscription.

Earnings roundup

* Japanese megabank Mitsubishi UFJ Financial Group Inc. said its net profit for the fiscal first quarter ended June rose 24.1% year over year to ¥391.07 billion. Mizuho Financial Group Inc. posted a net profit of ¥162.44 billion, up 0.8% from the prior-year period, while Sumitomo Mitsui Financial Group Inc. said its net profit dropped 5% year over year to ¥215.73 billion.

* Japanese brokerage Nomura Holdings Inc. posted a 969% year-over-year surge in net income for the fiscal first quarter to ¥55.83 billion from ¥5.22 billion in the prior-year period.

* In Singapore, DBS Group Holdings Ltd. said its second-quarter net profit rose 20.2% year over year to S$1.60 billion, driven by corporate loan growth and a higher net interest margin, among others. United Overseas Bank Ltd. said its second-quarter net profit climbed 8% year over year to S$1.17 billion, and Oversea-Chinese Banking Corp. Ltd. posted a net profit of S$1.22 billion, up 1% from the prior-year period.

* Indian private lender ICICI Bank Ltd. posted a net profit of 25.14 billion rupees for the fiscal first quarter ended June, up from 49.3 million rupees in the prior-year period. Axis Bank Ltd. said first-quarter net profit jumped to 12.63 billion rupees from 7.22 billion rupees a year earlier, while Punjab National Bank posted a net profit of 10.32 billion rupees, compared to a loss of 9.87 billion rupees in the year-ago quarter.

* South Korea's Hana Financial Group Inc. said net income for the second quarter increased 3.8% to 658.45 billion won from 634.09 billion won in the prior-year period.

* Bank of the Philippine Islands' first-half net profit grew 24.6% year over year to 13.74 billion pesos. Meanwhile, BDO Unibank Inc. said net profit for the first half totaled 20.2 billion pesos.

* Vietnam Joint Stock Commercial Bank for Industry & Trade said net profit for the second quarter declined 2.4% year over year to 1.768 trillion dong as provisions for bad loans increased.

Analysis and commentary

* Australia's four largest banks — Commonwealth Bank of Australia, Australia & New Zealand Banking Group Ltd., Westpac Banking Corp. and National Australia Bank Ltd. — will need to increase their capital by A$36 billion to A$53.1 billion in aggregate to meet regulatory capital requirements by 2024, Moody's said in a note. By that time, the banks would have effectively increased their total capital ratios to 17% from 8%, the rating agency added.

* S&P Global Ratings said the Reserve Bank of India's decision to ease foreign-currency borrowing rules is credit positive for local companies, including nonbanking financial institutions, as it opens an alternate long-term funding channel amid tight domestic bank financing conditions.

* Moody's said the investments made by Industrial & Commercial Bank of China Ltd., China Cinda Asset Management Co. Ltd. and China Great Wall Asset Management Co. Ltd. in Bank of Jinzhou Co. Ltd. through their respective units is credit positive for the bank's creditors. Moody's expects the new creditors to facilitate further measures to strengthen the troubled bank's balance sheet and operations.

Regulatory updates

* The U.S. Court of Appeals for the District of Columbia Circuit upheld an earlier court ruling that held three Chinese banks in contempt for refusing to comply with subpoenas in a probe into violations of sanctions against North Korea, Reuters reported. The banks were not identified, but are believed to be Bank of Communications Co. Ltd., China Merchants Bank Co. Ltd. and Shanghai Pudong Development Bank Co. Ltd.

* Indonesia's Financial Services Authority plans to relax a policy that requires banks' domestic operations to be run by a single entity in an effort to encourage M&As and strengthen the sector against competition from financial technology firms, Bloomberg News reported.

* Taiwan's Financial Supervisory Commission granted virtual bank licenses to three consortiums led by Chunghwa Telecom, LINE Financial Corp.'s Line Financial Taiwan Corp. and Rakuten Inc., in partnership with IBF Financial Holdings Co. Ltd., the Taipei Times reported.

* Separately, the Taiwanese financial regulator fined CTBC Bank Co. Ltd., Cathay United Bank Co. Ltd. and Hua Nan Commercial Bank Ltd. over a number of violations, including misappropriation of funds by some of the banks' employees.

In other news

* Commonwealth Bank of Australia has completed the sale of its global asset management business, Colonial First State Asset Management (Australia) Ltd., to Mitsubishi UFJ Trust & Banking Corp. for net proceeds of A$4.2 billion, subject to completion adjustments.

* Debt-laden Dewan Housing Finance Corp. Ltd. is seeking approval from its major creditors for a restructuring plan that includes cutting the stake held by the family of its founder, Mint reported, citing two sources involved in the matter.

* Nomura expects to book an extraordinary gain of ¥151 billion from selling some of its shares in Nomura Research Institute Ltd. back to the consulting arm.

* National Australia Bank said a data breach impacted about 13,000 of its customers, adding that the compromised data involved customer names, contact details and, in some cases, a government-issued identification number.

* The Securities and Futures Commission and The Stock Exchange of Hong Kong Ltd unveiled new rules to restrict backdoor listings and shell activities, a tactic used by companies to achieve a listing of assets while evading the requirements that apply to a new listing applicant.

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This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.