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Brexit extended; UBS fined over IPO failures; OneSavings, Charter Court to merge


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Brexit extended; UBS fined over IPO failures; OneSavings, Charter Court to merge

S&P Global Market Intelligence offers our top picks of banking news stories and more published throughout the week.

Brexit updates

* The U.K. House of Commons voted in favor of postponing the March 29 Brexit date, avoiding, for now, the risk of crashing out of the EU without a deal. Lawmakers voted 412-202 to back a government motion to delay the departure from the bloc until June 30, as long as a Brexit deal could be passed by March 20. A proposal to trigger a second national referendum on leaving the EU was also turned down.

* The Bank of England's Prudential Regulation Authority has ordered several British banks to boost their stock of liquid assets ahead of Brexit to enable them to cope with the market meltdown expected to happen if the U.K. fails to reach a withdrawal deal with the EU, sources told the Financial Times.

Across the industry

* The EU updated its list of noncooperative tax jurisdictions, adding the United Arab Emirates and several others that now face restrictions on EU funding. Blacklisted jurisdictions are those that have declined to engage with the EU or to address shortcomings on tax good governance.

* Financial regulators from Latvia, Lithuania, Estonia and Sweden are calling for a "pan-European financial crime investigation authority" following a series of money-laundering scandals that rocked the region and spurred critics to levy blame on the watchdogs, the Financial Times reported.

On the deal table

* U.K.-based OneSavings Bank PLC and Charter Court Financial Services Group PLC agreed to an all-share merger that would create a combined entity with approximately £15.6 billion of net customer loans and £13.2 billion of customer deposits. The combined entity will reportedly have market capitalization of roughly £1.6 billion. The merger is expected to take effect in the third quarter.

* German Finance Minister Olaf Scholz confirmed that Deutsche Bank AG and Commerzbank AG are in talks over a potential merger as the country's top two largest lenders struggle with their performance, Reuters reported. The possible tie-up would create an entity with a 20% retail banking market share and an equity market value of more than €25.6 billion.

* Swiss private banking group EFG International AG will acquire a 51% stake in Australian financial service provider Shaw and Partners Ltd. for a consideration of up to A$61.2 million, or roughly CHF44 million.

* Russia's bad bank, National Bank Trust PJSC, finalized its merger with JSC Avtovazbank. The merger also includes the transfer of 340 billion Russian rubles worth of problem assets from Avtovazbank to Trust.

Regulatory matters

* Hong Kong's Securities and Futures Commission barred UBS Group AG from sponsoring IPOs in the city for one year, as well as reprimanded and fined it and three other investments banks, including Standard Chartered PLC's local unit, for failing to discharge their obligations as sponsors of three IPOs in Hong Kong as far back as 10 years ago.

* The U.K.'s Financial Reporting Council will be replaced with the new Audit, Reporting and Governance Authority, following an independent review that revealed several weaknesses in the FRC's effectiveness.

* The U.S. Treasury's Office of Foreign Assets Control imposed sanctions on JSCB Evrofinance-Mosnarbank Bank JSC, a Moscow-based lender jointly owned by Russian and Venezuelan state companies, for allegedly attempting to evade U.S. sanctions on Venezuela.

Entries and exits

* Romeo Lacher will step down as chairman of the board of directors of SIX Group AG at the Swiss stock exchange operator's annual general meeting in 2020 at the latest. Lacher is in line to become the new chairman of Swiss banking group Julius Bär Gruppe AG in April.

* Francisco González, the honorary chairman of Banco Bilbao Vizcaya Argentaria SA, has temporarily stepped down from his position amid an investigation into allegations that the Spanish bank spied on government officials and executives 15 years ago, Europa Press reported.

* Panagiotis Roumeliotis resigned as chairman and a board member of Greece-based Attica Bank SA.

* KBC Bank Ireland PLC named Peter Roebben its new CEO.

* Mihaly Patai, who serves as CEO of UniCredit Bank Hungary Zrt., could join the Hungarian central bank as its new deputy governor, replacing Ferenc Gerhardt, Reuters reported, citing Hungarian radio station Klubradio.

In other news

* U.K.-based online property finance hub LendInvest Ltd. is considering potentially launching a £500 million IPO, which could happen in 2019, insiders told Sky News.

* Swiss lender UBS Group has set aside a total of €450 million to cover potential fines related to a tax fraud case in France.

* Raiffeisen Bank International AG is not worried about anti-money laundering breaches linked to Russia, and it remains committed to that market, CEO Johann Strobl said. A recent data leak linked RBI to a Europe-wide money-laundering scheme centered around Russian investment bank Troika Dialog.

* The Benjamin de Rothschild family is seeking to take Edmond de Rothschild (Suisse) SA private. In its proposed plan, the Edmond de Rothschild Group aims to consolidate all its banking activities under the Swiss bank, which will become the operating holding company of the group's banking activities. The plan is expected to complete by the end of the third quarter.

* Lloyds Banking Group PLC, Royal Bank of Scotland Group PLC and Barclays PLC unveiled plans to launch joint business banking hubs across the U.K. following criticism that their branch closures were damaging small companies, Reuters reported. The banks will pilot six joint branches before making a final decision on the project.

Featured during the week on S&P Global Market Intelligence

Sharp drop in issuance of bail-in CoCo bonds by European banks: Over the past three years, European banks have cut the number of issuances of bonds that can be converted to shares.

Fintechs buying banks? It's more common than you'd think, say industry pundits: In a reversal of the trend of banks buying fintechs, German financial technology firm Raisin has bought its service bank MHB. Fintechs are keen to grab more of the value chain, industry experts say.

BNP Paribas' fund unit to reduce investments in coal mining companies: The new coal divestment policy will have an impact on less than 0.25% of the fund manager's assets under management of €399 billion.