trending Market Intelligence /marketintelligence/en/news-insights/trending/Ekb-Dp37JERNKRo4C2KcJw2 content esgSubNav
In This List

EBA's MREL study results; Swedbank, Danske post Q2 results; S&P cuts Turkey


Banking Essentials Newsletter: 7th February Edition


Insurance Underwriting Transformed How Insurers Can Harness Probability of Default Models for Smarter Credit Decisions

Case Study

A Bank Outsources Data Gathering to Meet Basel III Regulations


Private Markets 360° | Episode 8: Powering the Global Private Markets (with Adam Kansler of S&P Global Market Intelligence)

EBA's MREL study results; Swedbank, Danske post Q2 results; S&P cuts Turkey

EBA releases MREL studyresults: TheEuropean Banking Authority's quantitative study into the minimum requirementfor eligible liabilities, or MREL, found that European banks may need to sell as much as €790billion in loss-absorbing liabilities to meet new regulations aimed atpreventing taxpayer money from being used to rescue banks.

* U.K. Prime Minister Theresa May told European CouncilPresident Donald Tusk that Britain will not assume its scheduled EC presidencyin the second half of 2017 as it "will be very busy with negotiations toleave the EU," City A.M. reports.The EC presidency will instead be taken up by Estonia, which was originally setto succeed the U.K. at the beginning of 2018.

* German Chancellor Angela Merkel said in a news conferencein Berlin with May that Britain must have "a very well-defined negotiatingposition" on the kind of relationship it wants to have with the EU beforecommencing negotiations on leaving the bloc, Reuters says.A spokesman for Merkel said the two leaders will not hold pre-negotiationsbefore the U.K. triggers Article 50, Reuters writes.


Bailey hints atintervention on overdraft fees: U.K. Financial Conduct Authority headAndrew Bailey told parliament's Treasury Select Committee yesterday that theregulator may intervene and cut high fees on unauthorized bank overdrafts afterexamining final recommendations from the Competition and Markets Authority'sretail banking review, Reuters writes.Some lawmakers urged the FCA to implement tighter rules on overdraft fees asthey were now higher than payday loan fees.

* HSBCHoldings Plc's global head of foreign exchange cash trading,London-based Mark Johnson, was arrested in New York by the U.S. Department of Justiceover alleged foreign exchange rigging. Stuart Scott, the lender's former headof currency trading in Europe, was also arrested for the same allegations,Bloomberg News reports.The U.S. Federal Reserve Board, meanwhile, prohibited Matthew Gardiner, who used to work as aforeign exchange trader with Barclays Plc and UBS AG, from working in banking for life after beingidentified as belonging to "the Cartel."

* Meanwhile,former UBS trader Kweku Adoboli, who in 2012 was sentenced to seven years jail for fraud, lost his appealagainst being deported from the U.K. to his native Ghana, the BBC reports.

* ICAPPlc today saidthat EBS BrokerTec CEO Gil Mandelzis will step down and leave the company"in due course."

* Bank ofIreland plans to close eight of its 36 branches in Northern Ireland asthese branches no longer had sufficient business volume to be sustainable,potentially affecting as many as 54 staff. The eight outlets that will be closedare the Belfast City Hall branch at Donegall Square South and others atCastlereagh, Draperstown, Antrim, Belleek, Castlederg, Newtownards and Maghera.

* Royal Bankof Scotland Group Plc will shutter six of its 10 retail branches in India from Oct.1 as the lender looks to wind down its business in the country. Meanwhile, U.K.workers' union Unite reactedto reports that RBS will be offshoring further jobs to India, saying such moveis an "ultimate betrayal" of its workforce. The group called on RBSto reconsider its plans.


Swiss help in 1MDBprobe sought: The Swiss Federal Office of Justice received a request fromU.S. authorities probing the alleged illegal transfer of funds from Malaysiandevelopment fund 1Malaysia Development Bhd. and has ordered the Office of theAttorney General to fulfil the request concerning documentation related tolenders, The Wall Street Journal also covers.

* , which faces criminal proceedings in Francefor allegedly assisting tax evasion and money laundering, has until Aug. 4 torespond to a report by a French investigating judge, Handelszeitung writes. An out-of-court settlement, whilepossible, is said to be out of the question for UBS as such a move would entailadmission of guilt.

* UBS reappointedMatthew Grounds as head of investmentbanking for Asia-Pacific, The Australian Financial Review reports. Grounds, who held the same position until2014 before becoming head of the Swiss bank's Australian and New Zealandoperations, will replace Matthew Hanning.

* Michael Kemmer, general manager of the Association ofGerman Banks, countered growing criticism of bank stress tests. "Any bank stress test can onlydeliver a diagnosis — the therapy and healing process are the responsibility ofothers," Kemmer said, ahead of the EBA'spublication of stress test results at July-end.

* The shareholderapproval rate for the merger of Deutsche Börse AG and London StockExchange Group Plcalready reached 55.5%,against the 60% threshold, Reuters reports. Deutsche Börse CFO GregorPottmeyer expressed confidence thatthe threshold would be met.


Crédit Mutuel completes GE biz buy: unit completed theacquisition of General Electric's leasing and factoring services in France andGermany, Les Echos reports.The services will operate in Germany under the name Targo Commercial Financeand in France under the names CM-CIC Leasing Solutions and Factofrance.

* ASR Nederland NV has been put on the recommendation listof a number of analysts after the Dutch insurer raised about €1 billion in anIPO last month in Amsterdam, De Telegraafreports.


Bankinter posts H1 result: Bankinter SA today reportedfirst-half net income attributable to the group of €286.0 million, up from €197.3million in the same period in 2015. Second-quarter net income reached €181.2million, compared to €102.2 million in the year-ago quarter. Excluding incomefrom Portugal or integration and strategic projects, second-quarter net incomereached €98.2 million.

* Spanish banking depositstotaled €668.5 billion in May, down 0.8% from the same period last year, El Economista reports.Loans fell 1.5% to €697 billion as demand for funding weakened.

* Spanish insurers generatedrevenues of €32.8 billion in June, an 18% rise from the same period last year,boosted by demand for car and business insurance, the Spanish Associationof Insurance and Reinsurance Institutions says.

* Apollo Global Management LLC'sacquisition of Portuguese insurer Açoreana Seguros SA will take effect from July 31 afterthe €130 million deal was given final approval by local and Europeanregulators, Diário Económico reports.Apollo unit Companhia deSeguros Tranquilidade SA takes control of the insurer, which wasowned by failed bank Banif-BancoInternacional do Funchal SA, and an indirect 29% stake in themanagement of Banif pension funds.

* Pressure has increased forPortugal's central bank to conclude the sale of this year after thegovernment said failure to do so by August 2017 could lead to the company'sliquidation, Jornal de Negócios reports.The central bank's margin for negotiation with four potential bidders haddecreased and the liquidation scenario had served to further devalue NovoBanco. Diário Económico also reports.

* Business leaders in Portugalcalled for less political drama and more progress in clarifying the situationat state-run lender Caixa Geralde Depósitos SA, Jornal de Negócios reports,as parliament approved a forensic audit of all the bank's loans. The audit is meant to identify thoseresponsible for any past irregularities, Diáriode Notícias and DiárioEconómico note.


Piraeus Bank chairman resigns: Michalis Sallas resigned as chairmanof Piraeus Bank SA'sboard of directors after 25 years in the role, Reuters reports.The board elected Charikleia Apalagaki acting chairman, Capital reports.

* Apollo is the sole bidder so far for four small-sizedItalian banks bailed out last year, for which the offer deadline has beenpushed back to today, Reuters says.Apollo's bid is expected to be significantly below the 1.4 billion to which the banks' value was written downlast April since further restructuring is needed.

* Unione diBanche Italiane SpA denied any interest in acquiring theAntonveneta business of BancaMonte dei Paschi di Siena SpA, Reuters writes.The Italian government is studying a state guarantee in the last instance forthe Monte dei Paschi's planned capital increase and could buy back bonds toshield retail investors from an eventual bail-in, MF says, as the bank's board meets todayon plans to dispose of nearly 10billion in net nonperforming loans.

* UniCreditSpA faces a potential capital shortfall of 4 billion to 9billion while Monte dei Paschi could need to boost capital 600 million to 3.5 billion, according toa stress test simulation of Italian banks conducted by Credit Suisse, MF reports.


Visa sale boostsSwedbank's Q2 result: Swedbank AB (publ) today reported a yearlyincrease in second-quarter profit attributable to shareholders to 6.27 billionSwedish kronor from 3.67 billion kronor, mainly driven by the 2.12 billionkronor tax-exempt income from the sale of Visa Europe. For the first half,attributable profit rose to 10.58 billion kronor from the year-ago 7.99 billionkronor.

* Danske BankA/S today reportedsecond-quarter net profit attributable to shareholders of 4.26 billion Danishkroner, down from 4.31 billion kroner a year earlier. First-half attributableprofit dropped on a yearly basis to 9.04 billion kroner from 9.14 billionkroner.

*Nordea Bank AB(publ)'s internal investigation into the involvement ofLuxembourg-based unit Nordea Bank SA in the Panama Papers scandal that while the unitoffered administrative services to customers, there was no evidence that itsemployees initiated the establishment of offshore structures or proactivelycontributed to the customers' potential tax evasion. Gøteborgs Posten notesthat 68 accounts were blocked during the investigation and are now subject tofurther analysis.

* Nordea'scustomer and branch operating structures are to be overhauled to prevent the bankfrom being used as a platform for tax planning, evasion or avoidance, Affärsvärlden reports.Group CEO Casper von Koskull said the bank would do all that is required toincrease internal monitoring and reporting systems and standards to ensure thatNordea remains fully compliant in all aspects of its obligations under generalbanking, money laundering and tax laws.

*Københavns Andelskasseis appealing a FSA decision requiring the company to replace four of its fiveboard directors, FinansWatch reports. The FSAquestioned the appropriateness of a series of decisions taken by the old board,noting that the bank had engaged in "reckless lending."


S&P cuts Turkey:S&P Global Ratings downgraded Turkey's foreign- and local-currencysovereign credit ratings to BB/B and BB+/B from BB+/B and BBB-/A-3,respectively, saying the recent failed coup will make it more difficult for thecountry to roll over its substantial amounts of external short-term debt. Theagency revised the outlooks on the ratings to negative from stable.

* Meanwhile, Fitch Ratings said therecent failed coup in Turkey and resultant political polarization haveincreased risks for the credit profiles and ratings of the country's banks. Theagency noted that the lenders' credit profiles are sensitive to country risks,access to foreign credit markets and the lira exchange rate.



Middle East and Africa:

Latin America: Peru'sCaja Piura may acquire struggling competitors

North America: Morgan Stanley's Q2 income down YOY; PIMCO names new CEO

North America Insurance: Health insurers to fight DoJ's opposition to pending mergers; recentBerkshire deal may trigger consolidation wave


Nordea'snet interest income could rise, as it aims for higher CET1 ratio:Nordea executives expect net interest income to improve and the bank to achievea CET1 ratio of 17.5%.

Incoming PIMCOchief, Man Group's Manny Roman, to try his hand as serial turnaroundartist: Manny Roman, who turned around the world's largest listedhedge fund, will now turn his attention to PIMCO, the California-based assetmanager that has struggled since founder Bill Gross departed in 2014.

Sanctionsthreat as UK banks ditch clients to trim £5B anti-money-launderingcost: U.K banks are dumping entire groups of customers perceived asposing a high risk of financial crime. The regulator isn't happy.

German banksslow to answer low rate bell: German lenders, particularly in thesavings and cooperative sectors, are proving slow to cut costs in response tothe pressure from low interest rates.

Passing legalmilestone, SCOR is well-placed to pick up French state biz: SCOR isa big step closer to grabbing business worth hundreds of millions of euros inpremiums after a tribunal ruled that the French natural catastrophe reinsurancemarket should be opened up to competition.

S&P Global Ratingsand Global Market Intelligence are owned by S&P Global Inc.

Sheryl Gesto-Obejera, EdMeza, Brian McCulloch, Danielle Rossingh, Jennifer Laidlaw, Helen Popper,Heather O'Brian, Thanasis Kakalis, Gerard O'Dwyer and Ali Kayalar contributedto this report.

The Daily Dose has aneditorial deadline of 7 a.m. London time. Some external links may require asubscription.