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Regulators plan global sandbox; Goldman Sachs probed over 1MDB scandal

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Regulators plan global sandbox; Goldman Sachs probed over 1MDB scandal

The Consumer Financial Protection Bureau, together with 11 other financial regulators and international organizations, is planning to launch a global sandbox for financial services and technology companies. The plan is to build a regulatory framework called the Global Financial Innovation Network to help companies adapt to different rules and expectations in different countries when they expand globally. It will also encourage cooperation between regulators, and allow companies to conduct trials of cross-border services or products.

U.S. prosecutors are investigating whether Goldman Sachs Group Inc. is also culpable in the 1Malaysia Development Bhd fund scandal, sources for The New York Times say. The bank, which generated about $600 million in fees for its work in the fund, has continuously denied any wrongdoing. Goldman Sachs spokesman Michael DuVally added that the company had "no visibility into whether some of the funds [it] helped raise for 1MDB may have been subsequently diverted to other purposes."

JPMorgan Chase & Co. reportedly requested its law firm to have more women and minorities arguing for the company's cases in courtrooms, according to American Banker.

Elsewhere, Starwood Property Trust Inc. is acquiring GE Capital Corp.'s energy financial services' project finance debt business and loan portfolio for $2.56 billion. The deal is expected to close in the third quarter.

In asset management news, Golden Gate Capital is buying Australia-based Pacific Current Group Ltd.'s 23.4% stake in Aperio Group LLC for approximately $73 million. The transaction is expected to close in the fourth quarter.

An appeals court affirmed a federal court's decision ordering J.P. Morgan Securities LLC to arbitrate Reading Health System's claims over several pre-2008 auction rate securities offerings, Law360 reports. In the appeal, the investment bank cited clauses in two agreements executed by Reading where it had contractually agreed to bring its complaint in court, which supersedes its right to arbitration. However, the court disagreed, saying that the clauses did not amount to an implicit waiver of right to arbitration.

And in the credit union sphere, Hornell Erie FCU is merging into First Heritage FCU, effective Aug. 18.

In other parts of the world

Asia Pacific: CBA full-year profit drops; former Malaysian PM to face money laundering charges

Europe: UniCredit unfriends Facebook; Munich Re, ABN Amro report Q2 earnings

Middle East & Africa: Nedbank H1 headline earnings up YOY; Nigerian central banker hints at rate hike

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* Energy Transfer's appetite for M&A is good business for Citigroup, Barclays: Over the past five years, Citigroup and Barclays have served as financial advisers for parties involved in Energy Transfer M&A deals worth about $100 billion.

The day ahead

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

In Asia, Hang Seng climbed 0.39% to 28,359.14, while the Nikkei 225 fell 0.08% to 22,644.31.

In Europe, around midday, the FTSE 100 gained 0.86% to 7,785.15, and the Euronext 100 rose 0.04% to 1,081.78.

On the macro front

The MBA mortgage applications report and the EIA Petroleum Status Report 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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