Constâncioseeks 'small' state support: ECB Vice President Vítor Constâncio yesterday called on policy makers toconsider allowing "small" state support for eurozone banks to helpimprove the stability of some banking sectors. His comments come amid talksbetween the European Commission and Italy over the country's plan to injectfresh capital into its banks without breaching EU rules on state aid.
* A study commissioned by the International Capital MarketAssociation foundthat ongoing ECB intervention is causing an "unsustainable disconnect"between primary market stability and secondary market liquidity, which directlyimpacts the ability of market participants such as investors, issuers, banksand broker/dealers to raise capital for funding investments.
* CitigroupInc. is merging its Middle East, Europe and Africa consumer bankingbusiness with the Asia unit, Reuters reports.
5US banks pledge support for London: , , Bankof America Merrill Lynch, JPMorganChase & Co. and Morgan Stanley yesterday in a joint statement with U.K.Chancellor George Osborne pledged to help London retain its spot as a world leading financial centerfollowing the U.K.'s decision to leave the EU. Reuters saysCiti, which was unable to attend the meeting with Osborne, signed the statementlater Thursday.
* S&P Global Ratings yesterday the outlooks to negative fromstable on a number of major U.K. lenders, including , and , saying thecountry's Brexit vote had increased the risks of adverse economic developments.The agency revised to stable from positive the outlook on .Separately, the agency revised to negative from stable the outlook onScottish Widows Ltd.and affirmed various ratings of PrudentialPlc and its core operating subsidiaries.
*Legal & General GroupPlc unit Legal &General Investment Management Ltd. further the value of its £2.3 billion U.K.property fund by 10%. Meanwhile, Aberdeen Asset Management Plc extended the temporary suspension ofits Aberdeen U.K. Property Fund and Aberdeen U.K. Property Feeder Unit Trustuntil Monday.
* Barclays named Tony Whittemore executive M&Achairman, Reuters writes. Whittemore most recently servedas Deutsche Bank AG'sco-head of Americas M&A.
* U.S. and Russian authorities approved 's planned merger with Deutsche Börse AG.
* Former Barclays traders have been served prison termsafter being convicted of manipulating U.S. dollar LIBOR. Jonathan Matthew andPeter Johnson were each sentenced to four years in prison, while Jay Merchantand Alex Pabon were sentenced to 6.5 years and two years and nine months,respectively.
* Prosecutorsin the U.S. dropped criminal charges related to LIBOR manipulation againstformer ICAP Plcbrokers Darrell Read, Colin Goodman and Danny Wilkinson after the three wereacquitted by a London jury earlier this year, Bloomberg News writes.
*Mohamed El-Erian, chief economist at Allianz Group, warned that if the U.K. does not"urgently get its political act together" after the Brexit vote andstep up to its economic governance responsibilities, the pound could fall toparity with the U.S. dollar, Reuters reports.
GERMANY,SWITZERLAND AND AUSTRIA
Bafin chief calls for higherbanking sector pay:Bafin President Felix Hufeld is calling for higher pay for board directors ofGerman banks, arguing that "quality costs money," Handelsblatt writes.
* Swiss Re CorporateSolutions appointed Jingwei Jia CEO for China, effective immediately. Jia was previouslythe Swiss Re Ltd.unit's COO for China.
*Alasdair Warren, head of corporate and investment banking in Europe forDeutsche Bank, said a Brexit will "probably curtail finance industryrevenue, including in investment banking, as companies worried about theeconomic aftermath are likely to hold off takeovers and share sales," BloombergNews notes.
*Laurent Bakhtiari, analyst at Geneva-based IG Bank, says he would "not besurprised" by a takeover of Credit Suisse Group AG, given its current"enormously low" market capitalization, Handelszeitung writes.
*Herbert Scheidt will replace Patrick Odier, chairman of the board of directorsof Bank Lombard Odier & CoLtd., as chairman of the Swiss Bankers Association, effective Sept.16, Reuters writes. Scheidt is chairman of Vontobel Holding AG.
AXAbows out of Serbia: AXA is set to exit the Serbian market after agreeing to sell its lifeand savings and property and casualty operations in Serbia to .
*Eric Van Rompuy will lead the parliamentary inquiry into the bankruptcy ofOptima Bank NV, De Tijd reports.
ECrecommends sanctions for Spain, Portugal: The European Commission saidit will seeksanctions for Spain and Portugal for breaching limits on budget deficits, Jornal de Negócios notesthat a final decision is expected at the end of July.
* Citigroup recommends that not seek to buyNovo Banco SA andfocus on its plans to acquire Banco BPI SA, Jornalde Negócios writes.
* Banco de Portugalapproved Teixeira dos Santos' appointment as executive president of , thePortuguese unit of Angola's BancoBIC SA. Público says all appointments proposed forthe lender's administrative board were also given the green light.
Banco Popolare complains to Consob: Banco Popolare SocietàCooperativa denounced a Morgan Stanley analyst report thatsuggested that the upcoming European bank stress test might reveal a capitalshortfall at theItalian lender. The Italian lender registered a complaint with market regulator Consob asits shares dropped in trading, Il Sole 24Ore writes.
*Former shareholders of BancaPopolare di Vicenza SpA who were not involved in the lender'smismanagement will have the right to buy the bank's shares at 10 cents pershare, MF cites Alessandro Penati, head ofQuaestio, as saying. He added that the bank will be re-launched and not split. IlSole 24 Ore, Il Messaggero and Reutersalso cover.
*Banca Monte dei Paschi di SienaSpA is working with authorities to find a structural and finalsolution to its nonperforming loans problem and will use the Atlante fund, MF reports.Il Sole 24 Ore adds that Quaestio is readying a dealfor Monte dei Paschi. Bloomberg News also covers.
*Banca Popolare dell'EmiliaRomagna SC is confident of passing the ECB's stress tests as thelender will soon close the sale of a €450 million NPL portfolio, with thedisposal of another €250 million to €300 million of NPLs due by the end of theyear, CEO Alessandro Vandelli tells MF.
*The board of Veneto BancaSpA resigned, but Cristiano Carrus returned to the role of CEO, MF writes.Il Sole 24 Ore adds that the shareholders' meeting toname a new board has been called for Aug 8. Reuters also covers.
* Greekbanks reduced their reliance on emergency liquidity by €2.5 billion to €58.6billion, Express says.
Nordea report triggers FSA audit: An FSA memorandum on 's capital levelsthat said the bank might need some 50 billion kronor to 80 billion kronor ofadditional capital has led to an internal review of the effectiveness andreliability of the Swedish banking supervisor, Svenska Dagbladet reports.The bank contends that any requirement would be significantly lower than whatwas stated in the FSA's memorandum.
* Banksoperating in Denmark have seen almost 138.2 billion kroner wiped off theirmarket value so far this year, FinansWatch writes,noting that a 30% drop has seen about 94 billion kroner wiped off the value ofNordea's shares. Danske BankA/S has seen about 26.8 billion kroner wiped off.
Serbiacuts rate: The National Bank of Serbia yesterday cutits key policy rate by 0.25 percentage point to 4% to help inflation returnwithin the target range in 2017. The central bank said "elevateduncertainties" in the international environment driven by the U.K.'sdecision to leave the EU warrant caution in the conduct of monetary policy.
* The Slovenian central bank confirmed that its head, BostjanJazbec, is being investigated for possible "criminal abuse ofoffice," Reuters reports.The Slovenian police dismissed the ECB's calls to return documents seized during recentsearches at the Slovenian regulator's premises.
* Hypo Alpe-Adria-Bank will start operating as Addiko Bank in Serbia andother Balkan countries as of July 11, SEENews reports.
* International Financial Club's main shareholder, MikhailProkhorov, was named chairman of the board of directors of ,Kommersant says. A 19.7% stake in IFC,eyed by businessman Viktor Vekselberg, is being sold by shareholder Alexander Abramov.
INOTHER PARTS OF THE WORLD
Asia-Pacific: BOC applies for Chilean branch license; Citi to merge EMEA, Asiaconsumer banking ops
Middle East & Africa: African mobile banking picks up; IMF critical of Israeli bankingreforms
Latin America: BM&FBOVESPA acquires almost 10% stake in Colombian stockexchange
North America: Citi may sell Yield Book; Avant cuts more than expected
North America Insurance: Justice Department skeptical about Anthem/Cigna deal; 2 BerkshireHathaway units receive cease-and-desist order
NOWFEATURED ON S&P GLOBAL MARKET INTELLIGENCE
Tradingsuspensions revive debate over safety of open-ended property funds:Suspensions of trading in more than half a dozen U.K. real estate funds havebrought long-standing concerns about liquidity mismatches into focus.
Uncertainty,NPLs and weak capital cast shadow over Portugal's banks: The futureof two of Portugal's leading banks has yet to be decided, while concerns aboutbank asset quality remain high. S&P Global Market Intelligence data showshow things stand now.
S&PGlobal Ratings and S&P Market Intelligence are owned by S&P Global Inc.
Xana Kakoty, Arno Maierbrugger, Meike Wijers, Gerard O'Dwyer,Beata Fojcik, Mike Hatzidakis, Ali Kayalar, Yael Schrage, Stephanie Salti,Praxilla Trabattoni, and Mariana Aldanocontributed to this report.
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