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Intesa/Generali rumors abound; Barclays chooses Dublin as 'hard Brexit' backup


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Intesa/Generali rumors abound; Barclays chooses Dublin as 'hard Brexit' backup

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

Intesa, Generali in spotlight

* Intesa Sanpaolo SpA confirmed this week that it is examining a possible deal with Italy's biggest insurer, Generali. Turin, Italy-based Intesa, was responding to press reports that a deal may be on the cards. Italy's La Stampa had suggested Intesa was putting together a potential offer with Germany's Allianz Group and France's AXA. Sources told S&P Global Market Intelligence that Intesa's interest may be being driven by Italian government pressure to avoid Generali falling into foreign hands.

Earnings highlights

* UBS Group AG touted the performance of its wealth management operations in 2016, despite seeing its full-year profit nearly halve from a year ago amid what it said were "very challenging market conditions." Banco Santander SA reported higher fourth-quarter profit, supported by growth in fee income. Nordea Bank AB (publ) raised its dividend as it reported increases in profits for both the fourth quarter and full year 2016.

* Royal Bank of Scotland Group Plc said it will book, in fourth-quarter 2016 results, an additional £3.1 billion in provisions related to the misselling of mortgage bonds in the U.S. The British government said it may not further reduce its 72% stake in the bank before the end of the decade.

* Iberian banks Banco de Sabadell SA, Banco BPI SA and Bankinter SA reported fourth-quarter 2016 results.

* Polish lenders mBank SA and Bank Zachodni WBK SA will most likely not pay dividends on their 2016 profits.

Brexit buzz

* Barclays Plc has reportedly chosen the Irish capital Dublin to serve as its base inside the EU in the event the U.K.'s departure from the bloc leaves banks without simple access to the single market.

* Credit Suisse Group AG is reportedly considering moving back-office jobs to Dublin as it adapts to Brexit.

Legal battles

* Delaware-registered company PPF Management LLC filed a $750 million lawsuit against PAO Sberbank of Russia, its CEO Herman Gref and investment arm Sberbank Capital over an alleged takeover of crushed granite producer Pavlovskgranit. PPF Management asked for compensation amounting to $500 million for material damages and $250 million for moral damages, claiming the defendants wanted to destroy the company as a market competitor and take over its assets.

* The attorney general of Cyprus initiated criminal proceedings against a number of former and current executives of Bank of Cyprus Public Co. Ltd. over the reclassification of its bond holdings.

* The Seoul Central District Court has ordered Deutsche Bank AG to pay 8.55 billion South Korean won to six plaintiffs of a class-action suit for losses it caused through the manipulation of stock prices. Separately, U.S. District Judge Jesse Furman in Manhattan, N.Y., on Jan. 23 denied Deutsche Bank's request to dismiss a lawsuit related to losses on RMBS.

In other news

* Deutsche Bank is considering a partial listing of its asset management unit to help boost its capital following a $7.2 billion settlement with the U.S. over its sale of mortgage-backed securities.

* Global IPO activity is set to increase to $167 billion in 2017, up from $133 billion in 2016, according to a forecast from law firm Baker McKenzie.

Featured during the week on S&P Global Market Intelligence

Basel IV in limbo as Europe digs in, world waits on Trump: Talks over overhauling global rules on calculating bank risk weights are stalling in the face of European resistance and uncertainty about how Donald Trump will approach financial regulation.

Politics seen driving Intesa/Generali deal amid regulatory, financial questions: A takeover of Generali by Intesa Sanpaolo would transform the landscape of Italian finance, but analysts doubt the wisdom of a merger and suspect that political pressures are playing a part.

Supreme Court ruling will not delay Brexit, UK government says: The British government said leaving the European Union will not be delayed, after the Supreme Court ruled that Brexit must be triggered by an act of Parliament.