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Deutsche launches i-bank review; Malta regulator takes control of Pilatus Bank


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According to Market Intelligence, April 2023

Deutsche launches i-bank review; Malta regulator takes control of Pilatus Bank

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

On the deal table

* Royal Bank of Scotland Group PLC, via wholly owned, indirect subsidiary RBS BidCo, will buy cloud-based accounting solutions provider FreeAgent Holdings PLC for about £53 million.

* Spain-based Abanca Corporación Bancaria SA will buy Deutsche Bank's private and commercial client business in Portugal for an undisclosed price. The transaction will be completed in the first half of 2019, boosting the bank's net interest income by 5.0% and commission income by 20%.

* LC Corp BV, an investment vehicle of Polish businessman Leszek Czarnecki, raised about 128 million Polish zlotys from the sale of stakes in Getin Holding SA and Idea Bank SA. Both stakes were purchased by Getin Noble Bank SA, also controlled by Czarnecki. The transactions were carried out to help Czarnecki raise funds to participate in the upcoming 190 million zloty additional share offering by Getin Noble Bank.

* Banco Santander SA agreed to sell Banco Popular Español SA's 49% stake in WiZink Bank SA to Värde Partners Inc., which already owned 51% of the company. The deal, which will also see Banco Popular and Banco Santander Totta SA purchasing the debit and credit card business of WiZink, is expected to complete within the second half.

Upcoming transactions

* Meanwhile, UK Financial Investments Ltd., which manages Britain's stake in Royal Bank of Scotland Group, is confident that it will be able to off-load £3 billion worth of shares in the bank in the next financial year.

* The Ukrainian central bank refused to approve the acquisition of PJSC Sberbank by Belarus-based OJSC Paritetbank "due to failure to comply with Ukrainian legal requirements." Sberbank is the Ukrainian unit of PAO Sberbank of Russia.

* Intesa Sanpaolo SpA CEO Carlo Messina said the Italian lender is in discussions with various groups interested in acquiring part of its nonperforming loan portfolio.

Compensation matters

* Credit Suisse Group AG will pay its top 12 executives about CHF115 million in 2018 under a revised incentive plan, up 5.5% compared to the aborted scheme in 2017.

* A British court judge ordered Lloyds Banking Group PLC to award former CEO Eric Daniels up to £1.35 million after ruling that the bank has unlawfully withheld his bonus under a 2009 share-based long-term incentive program. The bank's former head of wholesale banking, Truett Tate, also brought a similar claim against the bank and will receive a bonus worth up to £933,230.

* JPMorgan Chase & Co. revealed that its male employees in the U.K. are paid salaries that are 26% higher than female colleagues and bonuses that are 41% higher on a median basis.

Business operations

* Deutsche Bank AG is conducting a review of its investment banking operations, which could lead to more cuts across its trading business. The review is being pursued by CEO John Cryan in light of the bank's poor performance in recent years, and aimed at restoring profitability amid reports that the bank is seeking to replace him. He is examining businesses to determine if Deutsche Bank should try to win back market share or exit them.

* Morgan Stanley plans to add 80 more staff in Paris after the U.K. leaves the EU, on top of the 200 jobs the U.S.-based bank will transfer to its Frankfurt hub.

Regulatory actions

* The Russian Deposit Insurance Agency will spend 113.4 billion Russian rubles to acquire additional shares issued by PAO Promsvyazbank, after which its holding in the lender will amount to 99.9%.

* The Malta Financial Services Authority took control of Pilatus Bank, the lender at the center of a corruption scandal, and ordered that its Iranian owner, Ali Sadr Hasheminejad, be removed immediately from the board and other executive posts he holds.

In other news

* Macedonia-based East Capital Explorer Investments AB and affiliated company Salink Ltd. sold their joint 13.076% stake in Komercijalna banka AD Skopje.

* Standard Life Aberdeen PLC's Aberdeen Standard Investments, which has a stake in Provident Financial PLC, is seeking compensation from the embattled British subprime lender for losses it incurred due to the latter's failure to disclose details of a U.K. Financial Conduct Authority probe into subsidiary Vanquis Bank Ltd.

* Croatian food and retail group Agrokor reached an agreement with PAO Sberbank of Russia regarding the withdrawal of the lender's lawsuits against the company and the recognition of Sberbank's claims.

* Portuguese digital bank Banco BNI Europa and Germany's Varengold Bank AG agreed to provide £90 million and £45 million, respectively, in funding to U.K.-based online lender MarketInvoice Ltd.

Featured during the week on S&P Global Market Intelligence

BoE: EU finance firms should plan to operate as normal during Brexit transition: Financial services firms from the European Union should plan on continuing to operate as normal during the Brexit transition period following the U.K.'s official departure from the bloc, the Bank of England has said.

CEO change of little use in Deutsche Bank's 'restructuring saga,' analysts say: John Cryan is not to blame for the lender's ongoing malaise, and his potential dismissal would be unlikely to lead to big changes in its corporate strategy, analysts said after reports surfaced that the CEO might be replaced.

Big banks set to gain as Basel eyes lower capital burden for market risk: The world's largest banks may have to set aside less capital against exposures to financial markets as of 2022, according to the Basel Committee of regulators.