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Deutsche raid; ex-Danske exec found dead; Credit Suisse spy drama deepens

* The IMF's executive board officially selected World Bank Group CEO Kristalina Georgieva as its new managing director. Georgieva will start her five-year term Oct. 1, replacing Christine Lagarde, who will take over as president of the ECB Nov. 1.

* Sabine Lautenschläger will resign from the ECB executive board and governing council Oct. 31, prior to the end of her eight-year term. Meanwhile, Italy nominated the director general of its central bank, Fabio Panetta, to replace Benoît Cœuré on the ECB executive board, insiders told Bloomberg News.

UK AND IRELAND

* U.K. Attorney General Geoffrey Cox said the government will soon put forward a motion in Parliament for snap elections, Reuters and the Financial Times reported.

* British Prime Minister Boris Johnson challenged the Scottish National Party and other small parties to table a motion of no confidence in his government in a bid to force a general election The Times of London reported. A spokesman for Johnson said that if MPs decline the offer to hold a no-confidence vote, it will be regarded as a green light for the government to proceed with its plan to take out the U.K. from the EU on Oct. 31, Reuters noted.

* Bank of England Governor Mark Carney urged financial firms to prepare to minimize the downside from increasing physical risks of climate change, Reuters wrote.

* Hong Kong Exchanges & Clearing Ltd. will likely increase its takeover bid for London Stock Exchange Group PLC, Jos Dijsselhof, CEO of Swiss stock exchange SIX Group AG, told City A.M.

* Barclays PLC named Dawn Fitzpatrick and Mohamed el-Erian nonexecutive directors of its board, and announced that the membership of the board of unit Barclays Bank PLC will be drawn exclusively from the group's board to create a more efficient governance structure. Fitzpatrick is chief investment officer at Soros Fund Management LLC, while el-Erian is chief economic adviser at Allianz SE.

* British insurer Prudential PLC is offering a one-off dividend of around £100 million, equivalent to about 3.85 pence per share, related to the proposed demerger of M&G Prudential. The planned dividend is in recognition that M&G will be operating without incurring certain costs, such as debt interest costs, for the majority of the 2019 financial year.

* British supermarket group J Sainsbury PLC said it will halt capital injections into its banking unit after the £35 million already planned for this year and immediately cease new mortgage sales as part of plans to bring down costs by roughly £500 million over five years.

GERMANY, SWITZERLAND AND AUSTRIA

* Officials of Frankfurt's public prosecution and the Federal Criminal Police Office yesterday conducted a raid at Deutsche Bank AG's headquarters as part of an investigation into the $200 billion money laundering scandal involving Danske Bank A/S' Estonian unit for which the German lender's U.S. subsidiary was a correspondent bank, Süddeutsche Zeitung wrote. The authorities seized documents linked to suspicious transactions from the German lender's Frankfurt headquarters, the Financial Times reported. Deutsche Bank is being investigated over whether it facilitated money laundering and whether it failed to notify authorities about suspicious deals, according to Reuters. Deutsche Bank said it voluntarily provided the documents and that it will continue to operate with prosecutors.

* Commerzbank AG is set to appoint board member Bettina Orlopp as its new CFO, Reuters reported, citing Frankfurter Allgemeine Zeitung. Orlopp currently serves as the German lender's head of human resources, legal and group compliance.

* Oswald Grübel, former Credit Suisse Group AG CEO, criticized the involvement of the bank's leadership in a private investigation scandal surrounding former head of wealth management Iqbal Khan, telling Schweizer Illustrierte that if the events really took place as reported the bank should take action immediately and replace current CEO Tidjane Thiam. The bank is looking to conclude this week an investigation into reports that it allegedly hired private detectives to spy on Khan to find out whether he was trying to lure its employees to rival UBS Group AG, an insider told Bloomberg News. Khan is understood to have gotten into a "very intense" argument with Thiam during an office party in January. Investigo, the investigating agency that Credit Suisse allegedly hired to spy on Khan, earlier contradicted reports that several private detectives followed Khan and tried to take away his mobile phone.

* Meanwhile, UBS Chairman Axel Weber told Bloomberg that he does not want to comment on the case. "We are not party here, and therefore, what apparently happened is none of our business," he said on Bloomberg TV, adding that he was sure he made the right choice to hire Khan since the bank has made due diligence on him.

* A New York court has dismissed three lawsuits against Credit Suisse in connection with a complex financial product with which investors lost substantial amounts of money, saying that the bank provided adequate risk information, Handelszeitung reported.

* Valiant Holding AG said it will make significant investment in the expansion of its business with private clients and small and medium-sized companies and merge the wealth advisory and international clients divisions with the private and business customers division, effective Oct. 1.

* Stefan Rensinghoff — CEO of North Channel Bk GmbH & Co. KG, which was involved in illicit cum-ex deals to the detriment of Danish and Belgian taxpayers up to 2017 — told Handelsblatt that the bank did "a big cleaning job," was able to legally conclude the chapter and already has five offers from new potential owners, among them private equity firms, banks and large investors.

FRANCE AND BENELUX

* BNP Paribas SA wants to substantially expand its wealth management and corporate banking business in Germany and set a focus on impact investing, Börsen-Zeitung noted.

* Dutch lender ABN AMRO Bank NV said it is being investigated by the Dutch public prosecutor in relation to money laundering and terrorism financing, adding that it will fully cooperate with the probe.

* Luxembourg-based KBL European Private Bankers SA named Colin Price group COO. Price will work alongside current group COO Eric Mansuy, who has been named group information technology and operations officer.

* Payments provider Checkout has been granted an e-money institution licence in France by regulator ACPR, L'Agefi and Les Echos wrote. Having raised $230 million in May, Checkout wants to expand its French business and grow its Paris office with plans to hire more than 50 new employees in the next year.

SPAIN AND PORTUGAL

* The European Commission approved the merger of the depository, custody and other related services of Spain's Banco Santander SA and French bank Crédit Agricole SA, Europa Press wrote. Specifically, the commission approved the complete acquisition of Santander Securities Services by CACEIS, which is owned by the French entity. It also approved joint control by both banks of a new Spanish company called S3 Latam HoldCo. The commission concluded that the operation does not pose competition problems because the overlaps between the activities of the companies involved are limited to markets in which they are not significant players.

* CaixaBank SA has brought forward to 2021 from 2022 a plan to reduce the number of its offices to 3,640 from a total of 4,219 in June, as part of a cost-reduction strategy, Europa Press reported.

* Millennium BCP CEO Miguel Maya warned that 2019 will be tougher than previously expected for the bank, Economia Online reported.

ITALY AND GREECE

* Banca Popolare di Bari SCpA CEO Vincenzo de Bustis told Il Sole 24 Ore that the group is planning to merge with a small bank by the end of the year to take advantage of tax benefits foreseen under recent Italian legislation, a move that is seen to boost the bank's capital by an estimated €350 million. De Bustis said the cooperative bank is also planning by June of next year to spin off a new digital banking business focused on providing services to households and companies into a publicly traded joint stock company.

* Attestor Capital is planning a €70 million to €90 million capital increase for Banca Intermobiliare, said Il Sole 24 Ore.

NORDIC COUNTRIES

* Aivar Rehe, the former head of Danske Bank's Estonian branch, was found dead, several news outlets reported, citing local police. His body was found in a garden in what appears to be a suicide, according to Bloomberg News. Rehe stood as a witness in the ongoing money laundering investigation, a spokeswoman for the Estonian prosecutor's office told Reuters.

* Danske Bank CEO Chris Vogelzang said trust in the Danish lender has "collapsed" amid its involvement in a money laundering scandal, Reuters wrote. Vogelzang said there were fewer incentives to control risks due to the high level of trust in Denmark, which led to the bank's problems outside the Nordic region.

* Nordea Bank Abp named Erik Bruce chief strategist at Nordea Wealth Management, e24.no wrote. Bruce is scheduled to take up his new role on Dec. 1 and will replace Sigrid Wilter Slørstad, who will move on to a new executive role, Finansavisen wrote.

EASTERN EUROPE

* Poland's Financial Supervision Authority could require Commerzbank AG to keep the Swiss franc mortgage portfolio of mBank SA when it sells its stake in the Polish lender, Reuters reported, citing KNF Chair Jacek Jastrzębski. Meanwhile, Polish Prime Minister Mateusz Morawiecki said any decision by state-run banks to buy Commerzbank's stake in mBank should be taken on business grounds, the news agency added.

* The Russian central bank decided to soften the procedure for calculating the liquidity coverage ratio under Basel III rules, news agency Prime reported. Coming into force from Oct. 6, the changes will allow Russia's systemically important banks to comply with the LCR requirement without using credit lines from the central bank, the regulator was cited as saying.

* PAO Credit Bank of Moscow wants to increase its authorized capital by 2.75 billion Russian rubles, with a relevant decision already approved by the lender's supervisory board. The lender intends to raise about 15 billion rubles during the offering of new shares, news agency Prime said. LLC Concern ROSSIUM, which controls the bank, reportedly plans to purchase part of the new issuance to preserve its stake in the lender.

* The National Bank of Georgia raised its monetary policy rate by 0.5 percentage points to 7.5%, saying the nominal effective exchange rate of the lari has remained undervalued and pressure on inflation has persisted.

* OTP Bank Nyrt. completed the acquisition of Societe Generale Banka Srbija a.d. Beograd, which will now operate as OTP banka Srbija AD Beograd. The Hungarian lender plans to merge OTP banka Srbija with its other Serbian unit, Vojvodanska banka a.d. Novi Sad, with the process to be completed by 2021.

IN OTHER PARTS OF THE WORLD

Asia-Pacific: Japan Exchange nears merger; Indian bank loans fall by 900B rupees

Middle East & Africa: Netanyahu to form Israel's new government; Old Mutual-Moyo dispute continues

Latin America: Argentina partly eases currency controls; Brazil central bank sees higher Q3 GDP

North America: Facebook delays Libra; CU deal called off; House may OK cannabis banking bill

Global Insurance: Nationwide E&S goal; 5th Atlantic hurricane; Blue Cross/Cambia merger on hold

NOW FEATURED ON S&P GLOBAL MARKET INTELLIGENCE

Greek banks get tougher on governance, sustainability: With Piraeus becoming the first Greek bank to sign the United Nations' Principles for Responsible Banking, Greece's lenders are starting to place more emphasis on sustainability and governance issues.

'Plenty of negative effects' from ECB cheap money - Deutsche Bank CEO: Speaking at the Sibos financial conference in London on Sept. 25, Deutsche Bank CEO Christian Sewing said recent actions by the central bank will not boost the slowing European economy.

UniCredit must walk a fine line between innovation and stability, CEO says: Italy's biggest bank is taking a pragmatic approach to innovation, recognizing that its ultimate role is to provide security and protect deposits, Jean-Pierre Mustier said.

Sheryl Obejera, Arno Maierbrugger, Meike Wijers, Gerard O'Dwyer, Beata Fojcik, Yael Schrage, Stephanie Salti, Sophie Davies, and Mariana Aldano contributed to this report.

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