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Deutsche Börse/LSE merger clears a hurdle; Santander's restructuring woes; Brexit halts Virgin's SME plans


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Deutsche Börse/LSE merger clears a hurdle; Santander's restructuring woes; Brexit halts Virgin's SME plans

Hedge fund outflowsof $20.7B in June: Global hedge funds recorded net outflows of $20.7billion in June and total aggregate net redemptions of $10.7 billion in thesecond quarter, the Financial Times writes,citing data from eVestment. Reuters also reports.

* The ECB said the combined balance sheet of the ECB and theeurozone's central banks increased by €16.66 billion to €3.266 trillion in theweek to July 22, Reuters notes.


Virgin Money stallsSME plans: Virgin MoneyHoldings (UK) Plc will deferplans to enter the small and medium-sized enterprises and unsecured lendingmarkets to focus on boosting its digital business. CEO Jayne-Anne Gadhia tellsthe Financial Times that being asmaller bank protects it from the uncertainty following the Brexit vote.

* Legal &General Group Plc is in advanced discussions to acquire a stake inSmart Pension, a U.K.-based provider of auto-enrolment pensions, Sky News says.A potential deal will allow L&G to grow it presence in digital platformsfor financial products.

* A spokeswoman for Ulster Bank Ltd. in Dublin said the lender will notcharge small business customers and ordinary depositors on their creditbalances, the Irish Independent writes.The statement follows a BBC News report that Ulster Bankand Ulster Bank IrelandDAC parent Royal Bankof Scotland Group Plc warned that it may need to charge businessand commercial customers interest on their credit balances due to very lowinterest rates.

* Bank of England Monetary Policy Committee member MartinWeale signaled that he will vote for further stimulus measures at thecommittee's Aug. 4 meeting to counter the impact of the Brexit vote, changinghis previous stance on the matter, the FinancialTimes says.

* All but three of the 49 economists surveyedby Reuters expect the BoE to slash benchmark interest rates by at least 25basis points from the current 0.5% at the meeting next week.

* U.K. banks bid for and received £75 million of six-monthBoE funds at the current 0.5% bank rate, down from £250 million last week,reflecting very little demand for liquidity from the central bank, Reuters reports.


Deutsche Börseshareholders back LSE deal: Deutsche Börse AG said last evening that more than 60%of its shareholders backed its planned merger with ,exceeding the minimum acceptance threshold required to proceed with a deal.

* Deutsche BankAG this morning reported a decline in second-quarter unaudited net incomeattributable to shareholders and additional equity components to €18 millionfrom €796 million a year ago, driven by the "challenging revenueenvironment" across the group's divisions, particularly in global markets,private, wealth and commercial clients and corporate finance.

* The Swiss Federal Tax Administration said it plans to handover information regarding accounts at HSBC Holdings Plc unit to theU.S. Internal Revenue Service as part of a U.S. probe into tax evasion, Reutersreports.

*Sparkassen representatives in the German state of Baden-Württemberg are callingfor new residential mortgage loan regulations to berevamped, Handelsblatt writes. Lending has declined 20%to €2.58 billion since the rules were introducedin March.


BNP unit FirstHawaiian's IPO price range: Honolulu-based First Hawaiian Inc., a unit of , estimated that theIPO price per shareof its common stock will be between $21.00 and $23.00. A subsidiary of BNPParibas is selling 21,086,957 shares of First Hawaiian's common stock in theoffering.

* SCORSE this morning reported consolidated net income group share of€105 million in the second quarter, downfrom €152 million in the year-ago period.

* Potential buyers have shown interest in parts ofOptima Bank NV, whichcollapsed in June, De Tijd reports.A sale will potentially be finalized within a month.


Restructuring costsdent Santander Q2 profit: Banco Santander SA reported second-quarter profitattributable to the group of €1.28 billion, compared to €2.54 billion a yearago. The bank booked losses of €368 million from net capital gains andprovisions, which included €475 million in restructuring costs, compared to theyear-ago income of €835 million.

* MAPFRESA reported net incomeafter tax and non-controlling interests of €380.4 million in the first half, upfrom €315.6 million in the same period in 2015.

* Negative interest rates will impact the Spanish bankingsector more than any other country in the eurozone, Europa Press says,citing a Bank of Spain report.

* TheAngolan operations of accounted for threequarters of the higher-than-expected first-half profit announced by the lenderyesterday, Diário Económico and Diário de Notícias report. CEO Fernando Ulrich saidthe lender was "perfectly sustainable" without Angola unit .Shareholders at the bank, which reported a 39% increase in first-half netincome to about €106 million, have been locked in conflict over reducing thelender's exposure to Angola to meet new European banking regulations. Reutersalso covers.

* Separately, Ulrich confirmedthat Banco BPI has formally expressed interest in , Expressoand Diário Económico report.

* Meanwhile, Diário de Notícias writes that due to the complexand varying nature of the four bids, a decision on the sale Novo Banco will not be made until September, laterthan had originally been planned.


Monte dei Paschi in dire straits: BancaMonte dei Paschi di Siena SpA is working on a 5 billion capital increaseand hopes to have at least a pre-consortium ready by Friday, when the ECB isset to release results of the European bank stress tests, Reuters says.An EU official said authorities are making contingency plans for the possiblewinding down of the bank if it does poorly in the stress tests and no privateor public support is available, Reuters adds.The Financial Times also covers.

* UniCreditSpA is considering a cash call of up to 5 billion and could sell its entire stake in as it seeks toraise capital, Bloomberg News writes,noting that online lender FinecoBankSpA could also be put on the block. The lender also announced amanagement overhaulyesterday.

* BancaGenerali SpA raised its full-year target for net investment inflowsto 4 billion to 4.5 billion from 3.5 billion to 4.0 billion, MF says.

* Marzio Perrelli, CEO of HSBC in Italy, said the bank andother foreign lenders have been contacted regarding investing in a new Italianfund being set up to buy bad bank loans, Reuters notes.

* The Italian Competition Authority gave its approval to theplanned merger between BancoPopolare Società Cooperativa and Banca Popolare di Milano Scarl, Reuters reports.

* The Vatican saidyesterday that its Financial Information Authority and the Bank of Italy signeda cooperation agreement enhancing the exchange of information in financialsupervision to fight illicit financial activities.

* CEO AlexandrosAntonopoulos resigned, Euro2day reports,noting that several board members also resigned.

* Greek central bank Governor Yannis Stournaras said that going forward, an overview ofthe Greek financial system will be published twice a year, Imerisia writes.The review will evaluate the financial circumstances of the country's banks,insurers, non-banking financial institutions and credit markets.


Norges Bank rate cutforetold: DNB Marketsexpects the Norwegian central bank to cut rates, Dagens Næringsliv says.

* Swedish banks are applying the brakes on lending to residential and corporate sectors, Dagens Industri reports,attributing the trend to a variety of factors, including stricter loan amortization requirements,more rigid internal credit controls and the higher cost of capital.


Slovakia set for countercyclical capital buffer: The Slovak central bank decided to introduce acountercyclical capital buffer of 0.5%, to be applied on banks as of Aug. 1,2017, Sme reports.

* The planned merger between andPostna Banka Slovenije will come into effect Sept. 1, following approval fromthe ECB, SEENews reports.After the merger, Postna Banka Slovenije will cease to exist as a separatelegal entity and will operate under the name Nova KBM dd.

* changed the ratio atwhich Bank BPH SAshares will be exchanged for Alior shares as part of its acquisition of BankBPH's core business from GE, Parkiet reports. Due to dilution of capital at Alior, thenew exchange ratio was set at 0.51 Alior share for 1 share of BPH.

* Bank MillenniumSA CEO Joao Bras Jorge does not expect the lender's third-quarternet profit to improve year over year due to a banking tax, Reuters reports. The lenderposted net profit of 294 million zlotys for the second quarter.

* The Polish FSAagain asked Bank OchronySrodowiska SA to make changes to its financial recovery program, Rzeczpospolita reports.

* The Polish government will replace the Treasury Ministry,through which the state owns stakes in various companies, with a new,specialized entity from January 2017, Rzeczpospolitareports.

* The London Court of International Arbitration ruled thatTrellas Enterprises should pay €63 million to unit over afailed transaction involving the purchase of a 5% stake at Svyaznoy, a holdingcompany of Russian handset retailer Svyaznoy, Kommersant reports.


Asia-Pacific: Hanwha Life, UK firm to run US$10M fund; Meiji Yasuda eyes ANZ'swealth biz

Middle East & Africa: Troubled Congo bank attracts interest; Nigerian central bank hikesrate

Latin America: IRB-Brasil shareholders to decide on IPO in August

North America: Warren, Sanders reiterate calls to break up big banks; EverBankFinancial in advanced talks to be acquired for $19.50 per share

North America Insurance: 1-in-200 hurricane could erase 50% of ILS capital; Everest Re UScrop unit sale could jolt multiperil crop insurance market


With €220B NPLproblem, Italy's banks face glare of stress test spotlight:Europe's upcoming stress test results look set to emphasize differences in bankasset quality between Spain and Ireland, where the state has been able tointervene, and Italy, which is still trying to solve an enormous NPL problem.

Man Group eyesacquisitions, as Brexit has no negative impact: Despite a declinein performance fees, Man's flagship AHL product could generate substantialincome, analysts said, adding to a strong capital surplus that could be usedfor acquisitions.

PE firms runningthe rule over Ireland's Permanent TSB, but conditions for a deal aremurky: Majority state-owned Permanent TSB Group is reportedlyattracting private equity interest, but anyone buying into the Dublin-basedbank may face a long wait before the investment pays off.

Xana Kakoty, Ed Meza,Stephanie Salti, Meike Wijers, Jennifer Laidlaw, Helen Popper, Heather O'Brian,Thanasis Kakalis, Gerard O'Dwyer, Beata Fojcik and Ali Kayalar contributed tothis report.

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