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2 Iowa banks in deal; Moody's warns on Volcker rule; SEC's Jackson extends stay

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2 Iowa banks in deal; Moody's warns on Volcker rule; SEC's Jackson extends stay

In Iowa, Central Bancshares Inc. agreed to acquire Walcott Trust and Savings Bank in a deal expected to close by the end of 2019. Upon closing, Central Bancshares will have $1 billion in total assets.

Elsewhere in New York, National Holdings Corp., a full-service investment banking and asset management firm, is buying Boston-based employee-owned investment firm Winslow Evans & Crocker Inc. The transaction is expected to close by the first fiscal quarter of 2020 and maybe accretive to National Holdings' gross and adjusted EBITDA margins.

As banks continue to keep away from the cannabis industry thanks to regulatory concerns and disputes between state and federal law, Monroe Capital LLC's extension of a $50 million senior secured revolving credit facility to KushCo Holdings Inc. marks the latest lending deal between a private credit firm and a cannabis-related company, Bloomberg News reports.

House Financial Services Committee Chairwoman Maxine Waters, D.-Calif., continues to have doubts about Facebook's proposed cryptocurrency, Libra, CoinDesk reports. "While I appreciate the time that the Swiss government officials took to meet with us, my concerns remain with allowing a large tech company to create a privately controlled, alternative global currency", she said in a statement.

The final version of the Volcker rule, which bars banks from trading their own funds, could be credit-negative for many banks, according to analysts at Moody's. "When lower interest rates are putting pressure on bank net interest margins, the changes have the potential to encourage some banks to take greater risks, a credit negative," the analysts wrote.

The Securities and Exchange Commission's Commissioner, Robert Jackson Jr., will continue to remain in his position even though his term ended June 5. SEC commissioners can remain in their positions for up to 18 months after their term ends. The news comes as Democrats continue to consider candidates to succeed Jackson. According to a Reuters report, Georgetown University law professor Urska Velikonja and Caroline Crenshaw, an attorney on Jackson's staff at the SEC, are among potential candidates.

An American Banker report points out that banks are trying to add and retain key talent through mergers and acquisitions. It is difficult for smaller banks to have the right people to take on senior management roles and an M&A opportunity reportedy allows potential sellers to consider executive retention and buyers to add talent. CenterState Bank Corp., WesBanco Inc. and Prosperity Bancshares Inc. are a few that have opted for this strategy, according to the report.

In other parts of the world

Asia Pacific: Japan megabanks MOUs; Orix bank sale talks; India central bank surplus transfer

Europe: LendInvest delays IPO; Deutsche's India expansion; Bank of Cyprus sees H1 profit

Middle East & Africa: Nigeria sets bad-loan limit for banks; South Africa's JSE in 224.5M rand deal

Now featured on S&P Global Market Intelligence

Bank M&A 2019 Deal Tracker: CIT-Mutual of Omaha Bank deal largest in August : The number of U.S. bank deals is still down slightly in 2019, but deal value has skyrocketed this year thanks to the announced merger of BB&T Corp. and SunTrust Banks Inc., the largest deal in more than a decade.

Community banks feel the pressure as credit unions grow : Credit unions are growing at a faster clip than banks, and the nation's largest, Navy FCU, recently surpassed $100 billion in assets. Credit unions are also increasingly acquiring banks. Both factors are further exacerbating longstanding tensions between the two industries.

JPMorgan Chase 'playing catch-up' with North Carolina expansion plan : The largest bank in the country opened its first branch in North Carolina on Aug. 7 and plans to add 39 more branches and 80 ATMs in the state over the next three years. But experts say it will be playing catch-up with the expansion plan.

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng fell 0.06% to 25,664.07, and the Nikkei 225 rose 0.96% to 20,456.08.

In Europe, around midday, the FTSE 100 was down 0.19% to 7,081.68, and the Euronext 100 was up 0.20% to 1,039.93.

On the macro front

The Redbook Index for retail sales, S&P Corelogic Case-Shiller home price index, the Federal Housing Finance Agency house price index, the consumer confidence index and the Richmond Fed Manufacturing Index are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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