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BoE rate cut chatter; UniCredit under pressure; Commerzbank dividend accusations

Banking Essentials Newsletter - November Edition

Online Brokerage Space Should Remain Rich Source Of M&A

University Essentials | COVID-19 Economic Outlook in Banking: Rates and Long-Term Expectations: Q&A with the Experts

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BoE rate cut chatter; UniCredit under pressure; Commerzbank dividend accusations

Editor's Note: From May 10, S&P Global MarketIntelligence is proud to present our new Daily Dose for the Middle East andAfrica, which will offer a regional news overview published by 9 a.m. Dubaitime, Monday to Friday.

UK AND IRELAND

BoE rate cutspeculation: The issue of interest rate cuts may surface during the Bank ofEngland monetary policy committee meeting this week, after signs that thecountry's economy is losing momentum, TheGuardian writes.Any change to the 0.5% base rate is highly unlikely, but Bank of AmericaMerrill Lynch economists said at least one committee member is likely to vote fora reduction, Bloomberg News reports.The Sunday Times of London writesthat the BoE has spoken to banks to gauge their ability to manage a rate cut,the likelihood of which could rise should Britain vote to leave the EU.

* SchrodersPlc CEO Peter Harrison tellsthe Financial Times that the companyis looking to enhance its fixed income capabilities via an acquisition. He addsthat asset-backed securities represent a particularly "interesting market."

* XchangingPlc Group CFO David Bauernfeind will leavethe company in approximately a month's time when the delisting of the company'sshares becomes effective. Bauernfeind decided to leave following the company'sacquisition by Computer SciencesCorp.

* BarclaysPlc agreed on a tie-up between its Pingit bank transfer app andBottomline Technologies, a provider of corporate payment services, that willenable business customers to make payments via mobile phones, the Financial Times reports.

* Michael Noonan was reappointed Ireland's finance ministerFriday after Prime Minister Enda Kenny was re-elected, Reuters reports.

* Under a five-year agreement, 's willbecome a preferred provider of life and pension products for 's more than 500,000clients, the Irish Independent reports.

GERMANY, SWITZERLAND ANDAUSTRIA

FreshCommerzbank dividend allegations: Commerzbank AG's involvement in illicit cum-ex trades,which exploited loopholes in laws regarding tax refunds on dividends, could bedeeper than previously known, Handelsblattreports.Until now such trades had only been reported to have taken place at DresdnerBank, which Commerzbank acquired in 2008. Commerzbank has turned over toprosecutors an internal report carried out by PwC on cum-ex deals going back to2003 that identified such transactions as having taken place at the lender.

* Swiss prosecutors in Geneva are widening an investigationinto Credit Suisse GroupAG and one of its former wealth managers, Bloomberg News reports.The Geneva prosecutor's office has identified another three former employees assuspects in a case examining unauthorized trades on the accounts of wealthyeastern Europeans.

* Meanwhile, Credit Suisse confirmed a Schweiz am Sonntag report that it will give its Swiss universalbank and international wealth management divisions equal responsibility forasset management, Reuters reports.

* The ECB's interest rate policy is costing €300 millionannually, CFO Markus Wiegelmann tellsthe Börsen-Zeitung. Excluding thatloss, the bank's ROE would be 4 percentage points higher, Wiegelmann claims.

* Telefonica Deutschland announced that it will offer Germancustomers a bank account to go with their smartphones, the first large mobilephone company to do so in the country, the FrankfurterAllgemeine Zeitung reports.The product, O2 Banking, will be offered in partnership with Munich-basedFidor Bank AG.

FRANCE AND BENELUX

BNP Paribasdetails i-bank job cuts: BNPParibas SA has informed unions about the business areas that willbe mostly affected by its voluntary redundancy plan in the investment bankingdivision, accordingto Les Echos. Some 602 jobs willgo from the investment banking unit, with a further 83 from unit BNP ParibasArbitrage. The IT department will be the most heavily affected with 284 jobcuts, according to one union. At the same time, 221 new jobs will be created inthe digital and fintech areas.

* A group representing 1,000 shareholders of the Arcocooperative has proposed a new way to compensate the 800,000 Arco shareholderswho lost money through the collapse of Dexia SA, DeStandaard writes.The group proposes that BelfiusBanque SA, the Christian employers group and the Belgian state eachpay €550 million.

SPAIN AND PORTUGAL

Novo Banco saleupdates: Potential buyers of Novo Banco SA will have to submit their proposals inJune or July as part of the sale process being undertaken by the central bank,Luis Marques Mendes, former head of the Social Democratic Party and awell-known commentator, was quoted as saying by Jornalde Negócios and DiárioEconómico. He said proposals for the new sale bid can be flexible andinvolve full or 51% acquisitions and a stock market placement.

* Fernando Faria de Oliveira, head of Portugal's APB bankingassociation, tellsJornal de Negócios that he would notobject to a possible nationalization of Novo Banco if the state footed thebill. However, Faria de Oliveira said he doubted a state takeover would bepossible in the current framework.

* Spanish bad bank SAREB is set to make €41.9 million inrevenue this year with the sale of over 400 new homes that are part ofnonperforming real estate portfolios transferred by Spanish banks to theentity, Expansión writes.In 2015, the sales of such property developments raised €18.2 million.

ITALY AND GREECE

Intesaconfirms dividend target: Intesa Sanpaolo SpA on Friday confirmed that it will pay€3 billion in dividends this year as it reported first-quarter net profit of €806 million, downfrom €1.06 billion a year earlier, but ahead of market expectations, Milano Finanza notes.

* UniCreditSpA and its senior management are facing growing investor concernafter Italy's Atlante bank rescue fund had to salvage 's cashcall, for which UniCredit was underwriter, the Financial Times writes.Confidence in CEO Federico Ghizzoni and other UniCredit bosses has been shaken,top investors say, with one top 10 shareholder saying the bank needs morecapital but could not raise it under the current management.

* Conditions do not exist for to continue as anindependent entity, but it is too early to define a model for a potentialpartner, newly elected Chairman Stefano Ambrosini tellsClass-CNBC in an interview published in full by Milano Finanza. Meanwhile, Intesa CEO Carlo Messina said the bankwill not take a stake in Veneto Banca, noting that should its capital raise notsucceed, the Atlante fund would step in, LaRepubblica writes.

* The deadline to present nonbinding offers for the fourItalian banks bailed out in late 2015 has been extended to May 10, Il Sole 24 Ore writes. Meanwhile, Economy Minister PierCarlo Padoan tells Corriere della Sera that the European Commission has agreed toextend the deadline to sell the lenders to Sept. 30 from the end of April.

* Shareholders of Banco Popolare Società Cooperativa approvedthe €1.0 billion capital increase that will be used for the merger withBanca Popolare di MilanoScarl, Il Sole 24 Ore writes. Should the tie-up not gothrough, the funds would be used to reduce nonperforming loans. Il Messaggero says the merger could create synergiesof some €390 million, more than previously expected.

* Deutsche BankAG said it did not violate any rules and is "confident"that it "acted appropriately" in Italy after media reports thatauthorities in Trani are probing five former executives over alleged marketmanipulation in connection with sovereign debt sales in 2011, Bloomberg News writes.

* Greece's parliament yesterday passed new austeritymeasures covering most of the €5.4 billion of actions requested by itsinternational creditors, The Wall StreetJournal writes.The Eurogroup of eurozone finance ministers is set to meet today, but is notexpected to resolve a clash between Germany and the IMF over the achievabilityof targets for the beleaguered country.

NORDIC COUNTRIES

SEBtransfers accounts to DNB: Skandinaviska Enskilda Banken AB has negotiated theprovisional sale of a portfolio comprising 4,300 standard private bank customeraccounts to DNB ASAas part of SEB's plan to refocus on its large corporate clients in Norway, Dagens Næringsliv reports.The portfolio includes mortgage and deposit accounts that are mainly held byNorwegian customers.

* APP Insurance A/S is the latest newcomer to Denmark'sgeneral insurance market segment, FinansWatch reports.Product innovations will include calculating premium charges on car insurancebased on mileage rather than the vehicle's sale value.

* David Hofman, IMF mission chief to Denmark, warned thatwithout regulatory intervention, Danish housing prices may soon rise to a levelthat is "less comfortable," Bloomberg News reports.Fueled by the world's longest spell of negative interest rates, Danishapartment prices were up 11.6% year over year in February, with house prices up5.3%.

EASTERN EUROPE

Questions overHalkbank's Iran oil role: Speculation continues to surround the role ofTürkiye Halk BankasiAS in processing Iranian oil payments, Milleyet reports,after Indian Oil Minister Drahmendra Pradhan said the central banks of Indiaand Iran agreed to transfer pending oil payments of $6.4 billion to Tehranthrough European banks. The Reserve Bank of India reportedly refuses to makethe payments through Halkbank, whereas Iran is intent on doing so.

* HSBC BankAS has closed 50 branches across Turkey since March, Finans Gündem writes.According to sources close to the matter, the lender is planning to closenearly 150 retail banking branches and to focus on commercial and privatebanking.

* Polish President Andrzej Duda proposed Adam Glapinski toreplace Marek Belka as head of the Polish central bank, Parkiet reports.

* The value of trading in MONETA Money Bank a.s. shares amounted to 1.9 billionCzech koruny on May 6, following their IPO on the Prague Stock Exchange, E15 reports.It adds that the high volume could be a result of interest from foreigninvestment funds or small investors. Reuters also has a report.

* The Polish president's office is still working on thefinal version of the Swiss franc mortgage conversion proposal and it is tooearly to draw any definite conclusions at this stage, Rzeczpospolita reports,citing spokesman Marek Magierowski. A report Friday that Polish authoritiescould shelve the conversion plans boosted bank shares, with gaining as much as12.5%, Rzeczpospolita adds.

IN OTHER PARTS OF THE WORLD

* RizalCommercial Banking Corp. President Lorenzo Tan has resigned,Reuters reports. Themove comes even after the company determined he is not liable for a moneylaundering scandal stemming from the cyber theft of US$81 million fromBangladesh Bank's account at the U.S. Federal Reserve Bank of New York.

* BNP ParibasSA plans to trim cash-equities operations in Asia and shut thebusiness in Indonesia, sources tellBloomberg News. The company may cut about 40 jobs in the process.

* Three BancoSantander Chile executives resigned after admitting to having purchased investmentinstruments offered by Grupo Arcano, the Chilean private equity firm embroiledin a fraud investigation tied to its founder, Alberto Chang-Rajii.

* Hamilton, Bermuda-based Bank of N.T. Butterfield & Son Ltd. its purchase ofBermuda Trust Co. and HSBC BankBermuda Ltd.'s private banking investment management operations.

* HSBCHoldings Plc's Middle Eastern unit named Deputy CEO and COO RobinJones to serve as interim CEO after Mohammad al-Tuwaijri was named SaudiArabia's deputy minister of economy and planning, Reuters reports.Among other changes, Saudi Arabia named Ahmed al-Kholifey governor of the SaudiArabian Monetary Agency, Bloomberg News writes.

NOW FEATURED ON S&PGLOBAL MARKET INTELLIGENCE

Buyer bewareas Moldovan lender seeks investor: Moldindconbank is on the huntfor a majority investor, but questions over its true ownership, its assetquality and its links to allegations of financial crime mean that any potentialbuyer must do its homework.

New man in CommerzbankCEO hot seat raises hopes of better times ahead: The newCommerzbank CEO Martin Zielke needs to lift returns despite negative rates andpoor markets.

Data DispatchEurope: Spain's big two in the doldrums, but Santander outperformsBBVA: Banco Santander and BBVA both face tight margins and toughertimes in emerging markets. But only the bigger of the two exceeded expectationsin the first quarter.

Doubtssurround Italy's NPL cleansing, but discounts show signs ofreducing: The market has reacted badly to Italy's moves tostrengthen its banking system, although there are signs that discounts onsoured loans are reducing.

Middle East& Africa Monitor: SSA news through May 5

Rich Lovie, Ed Meza,Stephanie Salti, Praxilla Trabattoni, Chantal Groothengel, Beata Fojcik, HelenPopper, Mike Hatzidakis, Gerard O'Dwyer, Yael Schrage and Ali Kayalarcontributed to this report.

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