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CEO Rolet to leave LSE; Catalonia deadline looms; Novo Banco sold

Banking Essentials Newsletter - November Edition

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

Estimating Credit Losses Under COVID-19 and the Post-Crisis Recovery


CEO Rolet to leave LSE; Catalonia deadline looms; Novo Banco sold

* Catalan President Carles Puigdemont will today send a letter to Spanish Prime Minister Mariano Rajoy saying he is ready to proclaim Catalonia's independence from Spain if Rajoy applies Article 155 of the constitution that would allow the national government to suspend the region's autonomy, La Vanguardia reported. Meanwhile, the national government is ready to back away from threats to trigger Article 155 if Puigdemont calls for early regional elections in Catalonia, according to El País.

* The Netherlands, Portugal, Spain and 14 other EU member states have yet to fully transpose the MiFID II regime into national laws or regulations ahead of the directive's forthcoming implementation in January 2018, according to Bloomberg News.

* Meanwhile, Michael Kemmer, general manager of the Association of German Banks, criticized MiFID II as too costly and complex, saying the country's lenders will have to shoulder €1 billion of costs to get ready for the new regime, the Financial Times wrote. And Cowen & Co. analyst Jaret Seiberg wrote to clients that MiFID II could result in fewer IPOs in the U.S., as there will most likely be less coverage of smaller stocks by analysts, Bloomberg News reported.

* ECB Supervisory Board Chair Danièle Nouy said the central bank intends to provide "additional quantitative guidance" to banks that are "lagging behind" in reducing bad loans.

* Germany's constitutional court declined requests by a group of German academics and politicians to end the Deutsche Bundesbank's participation in the ECB's €2.3 trillion asset purchase program, Reuters reported. The court said blocking further Bundesbank purchases would "thwart" the program's plan to raise inflation to about 2%, Bloomberg News said.

UK AND IRELAND

* London Stock Exchange Group Plc announced that CEO Xavier Rolet will leave the group by the end of December 2018 and said it would start the process of identifying a successor. The group also reported third-quarter total income from continuing operations of £486.1 million, up 17% from £414.6 million a year ago. For the nine months ended Sept. 30, total income rose year over year to £1.43 billion from £1.20 billion.

* Financial services companies will trigger plans to move core operations out of the U.K. in the first quarter of 2018 if a Brexit transition deal with the EU is not agreed by the end of this year, senior City of London figures told U.K. lawmakers yesterday. Rolet said a three-year transitional period would be needed for the financial services sector, instead of the two years mooted by the British government.

* U.K. Chancellor Philip Hammond asked local financial enforcement agencies to probe HSBC Holdings Plc's and Standard Chartered Plc's possible ties to South Africa's controversial Gupta family, the Financial Times and The Guardian reported. Former U.K. lawmaker Peter Hain had raised concerns that HSBC and StanChart might have handled illicit funds linked to the Guptas via Hong Kong and Dubai.

* LCH Group Holdings Ltd. named Daniel Maguire its new CEO, effective immediately. Maguire replaces Suneel Bakhshi, who will serve as chairman of LSE Group's international advisory groups division.

* Schroders Plc reported AUM of £375.5 billion at the end of September, compared to £346.4 billion as of Jan. 1.

* Cabot Credit Management Group Ltd. will name Andy Haste chairman tomorrow, when it announces its intention to float on the London Stock Exchange, insiders told Sky News. Haste was formerly CEO of RSA Insurance Group Plc and is chairman of loan provider Wonga.

* Royal Bank of Scotland Group Plc is in discussions to sell its stake in financial markets infrastructure firm Euroclear Plc to an unidentified buyer, Sky News reported.

* Allied Irish Banks Plc will market for sale a portfolio of nonperforming loans with a face value of approximately €2 billion at the end of next month, the Irish Independent reported.

* AXIS Capital Holdings Ltd. completed its £477.6 million acquisition of Novae Group Plc after receiving clearance from all necessary regulators.

* ABN AMRO Group NV named Marina Shevtsova CFO for ABN AMRO UK.

* Irish Prime Minister Leo Varadkar said the government could raise taxes on banks or enhance powers for the Central Bank of Ireland unless lenders make further and faster progress in compensating customers who were overcharged for tracker mortgages, Reuters reported. The Irish central bank has already commenced enforcement investigations into Bank of Ireland and KBC Bank Ireland Plc over the scandal, according to The Irish Times.

GERMANY, SWITZERLAND AND AUSTRIA

* Zurich Insurance Group AG said it expects aggregate claims for its property and casualty business relating to hurricanes Harvey, Irma and Maria to reach approximately $700 million in the third quarter, net of reinsurance and before tax. Zurich Insurance said the losses, which will reach $620 million after tax, are not expected to significantly affect its overall financial strength and capital flexibility.

* German financial regulator Bafin in a letter to public prosecutors in Frankfurt strongly criticized an envisaged settlement with Deutsche Börse AG CEO Carsten Kengeter in an alleged insider trading case, Handelsblatt noted.

* Hong Kong-based financial conglomerate Mason Group Holdings Ltd. said it will buy Raiffeisen Privatbank Liechtenstein AG from Austria's Walser Privatbank AG and Raiffeisenbank Kleinwalsertal Beteiligungs-GmbH for CHF58.6 million.

SPAIN AND PORTUGAL

* After three years of trying to sell the state-rescued bank, Portugal completed the sale of Novo Banco SA to U.S. private equity fund Lone Star yesterday, Reuters, the Financial Times and Jornal de Negócios reported. Lone Star bought a 75% stake in the "good bank" carved from the remains of Banco Espírito Santo SA in exchange for a total capital injection of €1 billion. The remaining 25% will be held by Portugal's banking resolution fund.

* Haitong Bank SA, the former investment banking arm of BES, is expected to report third-quarter losses of more than €100 million, some €30 million more than the net loss posted for the first half, Público reported, adding that António Domingues, former CEO and chairman of Caixa Geral de Depósitos SA, would join Haitong as a nonexecutive director.

* Portuguese banks reduced their nonperforming loan portfolio by €4 billion in the first half, bringing total gross NPLs down to €42.3 billion from €46.3 billion at the end of 2016, and the bad credit ratio down to 15.5% from 17.2%, state news agency Lusa reported, citing data from the APB banking association.

ITALY AND GREECE

* Most leaders of the Democratic Party assumed a hard line against their party leader, ex-Prime Minister Matteo Renzi, after he called for the nonconfirmation of Ignazio Visco as Bank of Italy governor when his mandate expires at the end of the month, La Repubblica and others reported. Renzi indicated as possible replacements Salvatore Rossi, the central bank’s senior deputy governor, and Finance Minister Pier Carlo Padoan, Bloomberg wrote.

* Banco BPM SpA confirmed that it wants to sell €8 billion in nonperforming loans in 18 months, instead of the originally forecast three years, including €2 billion by the end of the year and another €3 billion with the GACS state guarantee in the first half of 2018, CEO Giuseppe Castagna told Class-CNBC in an interview published in full by MF.

* Banca Carige SpA's subordinated bond conversion was successfully completed, paving the way for the Oct. 21 bondholders' meeting and for the beginning of the road show for the €560 million capital hike in the coming days, MF reported.

* Attestor is expected to sign tomorrow the contract to buy Banca Intermobiliare from the liquidators of Veneto Banca SpA in a deal expected to foresee an €80 million cash payment and a €100 million capital increase, Corriere della Sera wrote. Meanwhile, BIM closed the sale of its BIM Suisse unit to Banca Zarattini & Co. SA for CHF40 million, Reuters reported.

NORDIC COUNTRIES

* Arne Blystad, one of the biggest shareholders in Monobank, plans to invest further in the consumer credit-focused Norwegian bank, Dagens Næringsliv reported. Blystad agreed to invest up to 40 million Norwegian kroner in a private share placement aimed at raising between 175 million and 225 million kroner. The capital injection will be used to grow Monobank’s presence in Norway and Finland, the latter of which Monobank entered in May.

* Meanwhile, Lendify, a Swedish startup that targets consumer lending, is seeking fresh funding for expansion, with CEO Nicholas Sunden-Cullberg saying the target is above the 90 million Swedish kronor raised in the company's first two funding rounds, according to Bloomberg News.

EASTERN EUROPE

* Slovenian Finance Minister Mateja Vranicar Erman will meet with European competition commissioner Margrethe Vestager on Oct. 26 to seek the European Commission's approval to postpone the sale of Nova Ljubljanska banka dd, SEENews reported. The Slovenian government believes that the privatization could be hampered by lawsuits launched against NLB in Croatia over Yugoslav-era saving deposits. Reuters also has a report.

* Holders of an Otkritie Financial Corp. Bank's subordinated eurobond maturing in 2019 consolidated 25% of the $500 million issuance and want to challenge the decision of the Russian central bank to write off the bonds at the London Court of International Arbitration, Vedomosti said.

* The Kazakh central bank approved the participation of ATFBank JSC, Eurasian Bank JSC, Tsesnabank JSC and Bank CenterCredit JSC in the country's support program for the banking sector, with 410 billion Kazakh tenge of assistance earmarked for the quartet. Other banks will be considered for participation after their management and shareholders approve the implementation of the regulator's requirements.

IN OTHER PARTS OF THE WORLD

Asia-Pacific: SBI to buy US virtual currency biz stake; HSBC Australia appoints execs

Middle East & Africa: More banks post Q3 results; African Bank CEO to step down

Latin America: Case vs. Banco Original closed; BNDES loan disbursements fall 20%

North America: SEC may grant reprieve over MiFID; US Bancorp posts higher EPS YOY

North America Insurance: Anthem forms pharmacy benefits manager biz; Assurant to acquire Warranty Group

NOW FEATURED ON S&P GLOBAL MARKET INTELLIGENCE

Data Dispatch EMEA: Credit Suisse i-bank not likely to survive as stand-alone biz, analysts say: A plan to spin off the Swiss lender's investment banking unit has not been well received by analysts.

Brexit uncertainty makes cost of new unit hard to define, Swedish bank exec says: Svenska Handelsbanken's plans to create a U.K. subsidiary to prepare for Brexit will add extra costs, CFO Rolf Marquardt told analysts during a call for the bank's third quarter earnings.

Rich Lovie, Arno Maierbrugger, Meike Wijers, Gerard O'Dwyer, Beata Fojcik, Yael Schrage, Stephanie Salti, Praxilla Trabattoni and Mariana Aldano contributed to this report.

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