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Phoenix buys Abbey Life; Barclays, Credit Suisse in US MBS talks


Banking Essentials Newsletter: January 11th Edition


Banking Essentials Newsletter December 21st Edition


The Road to Basel IV: Navigating the challenge facing European banks


Basel Framework- Utilizing data to analyze the capital position of European banks.

Phoenix buys Abbey Life; Barclays, Credit Suisse in US MBS talks

Banks embracingblockchain quickly: Research from IBM found that banks and other financialinstitutions are adopting blockchain technology "dramatically faster"than expected, Reuters writes.Some 65% of 200 banks covered by the study expect to launch blockchain projectsin three years' time.  

* ECB President Mario Draghi yesterday addressed Germanlawmakers and rejected criticism of the central bank's policies, saying themeasures helped avert a new Great Depression, The Wall Street Journal reports.The lawmakers indicated to Draghi that they see the ECB's low interest ratespolicy as a "hidden rescue package" for troubled eurozone countries,Reuters writes.

* European Banking Authority Chairman Andrea Enria yesterdaysignaled that state aid could be used to help rid the banking system of toxicassets if the process is "not going fast enough," the Journal reports.Enria noted that European banks' bad loan problem is "three times as highas other major jurisdictions such as the U.S. or Japan."

* Bank of France Governor François Villeroy de Galhauyesterday called for the creation of eurozone bonds as well as a commonTreasury and shared budget for the single-currency area, Reuters reports.Villeroy de Galhau recommended the creation of synthetic eurozone bonds, backedby actual debt issued by eurozone states, to provide banks with a safe asset touse as collateral.


Phoenix toacquire Deutsche Bank's Abbey Life: Deutsche BankAG agreed tosell its U.K.-based Abbey Life business to unit for£935 million in cash. Deutsche Bank expects the transaction to result in apretax loss of roughly €800 million, mainly due to impairment of goodwill andintangible assets.

* The U.K. Treasury is hiring an independent investment bankto help explore alternatives to a sale of Royal Bank of Scotland Group Plc's Williams & Glynbusiness, after RBS CEO Ross McEwan warned that the group may fail to disposeof the business by year-end, Sky News reports.The investment bank is thought to be Rothschild.

* The Bank ofEngland and the U.K. Financial Conduct Authority mapped out new measures aimed at strengthening accountability rules for senior managers in thefinancial services sector. The regulators want to extend existing conduct rulesto all nonexecutive directors of insurers and banks and to require U.K.branches of foreign banks to inform their employees about the whistleblowingprogram. The move comes as some companies are said to be trying to evade theexisting regulations.

* Bank of England Deputy Governor Minouche Shafik said yesterday that"further monetary stimulus will be required at some point" to helpthe U.K.'s economic recovery following the impact of its decision to leave theEU. The Independent, Bloomberg News and Reuters are among thosewith reports.

* The European Commission opened an in-depth to determine whetherthe proposed merger between Deutsche Börse AG and London Stock Exchange Group Plc would harm competitionin the industry. The commission has until Feb. 13, 2017, to take a decision onthe matter. Meanwhile, LSE Group and LCH Group Ltd. intend to explore apotential sale of LCH SA.

* Worldpay Group Plc named Kim Crawford Goodman CEO of itsU.S. unit, effective Nov. 7, Reuters reports.Goodman will replace Floris de Kort, who is leaving at year-end.


Deutsche Bank hullabaloo continues: Both the Germanfinance ministry and Deutsche Bank denied a Die Zeit reportthat the government was working with financial authorities on an emergency rescueplan for the lender in case it runs into financial difficulties as a falloutfrom a multi-billion-dollar fine in the U.S. The report had indicated that inthe worst case scenario, Germany could even take a 25% stake in the bank.

* Meanwhile, Yigit Bulut, chief adviser to Turkish PresidentRecep Tayyip Erdogan, said Turkey must consider acquiring Deutsche Bank througha new wealth fund or a conglomerate of state-owned banks, Bloomberg writes.

* Aside from Deutsche Bank, and are also intalks with the U.S. Department of Justice about the settlement ofinvestigations into their mortgage-backed securities dealings in the run-up tothe 2008 financial crisis, insiders tellBloomberg. A deal with Credit Suisse is expected to be announced within severalweeks.

* Clemens Fuest, president of the German Institute forEconomic Research, tellsNeue Osnabrücker Zeitung that the current problems of big Germanfinancial institutions such as Deutsche Bank and would entail high risksthat could trigger another financial crisis if not addressed.

* Credit Suisse Group CEO Tidjane Thiam said the Europeanbanking industry is in a “very fragile situation,” the Financial Times reports.Thiam also tellsBloomberg that as much as one-fifth of the volume of Credit Suisse's Londonoperations could be affected if the U.K. loses its passporting rights to accessthe European single market, but assures that Credit Suisse was in a “reasonableposition” to deal with any Brexit fallout.

* Meanwhile, the head of Credit Suisse’s internationalwealth management business, Iqbal Khan, said the bank expects to expand in theUnited Arab Emirates and Saudi Arabia to tap the potential of the risingnumbers of millionaires in the Middle East, Bloomberg reports.

* UBS GroupAG agreedto pay more than $15 million to settle U.S. Securities and Exchange Commissioncharges that failed to adequately educate and train its sales force aboutcritical aspects of certain complex financial products it sold to retailinvestors.

* Eric Sarasin, the former deputy CEO of who resignedin 2014 amid a criminal investigation related to a damage suit filed byclients, became an executive director at ATAG Family Office AG, a subsidiary ofBasel-based asset manager ATAG Private & Corporate Services AG, Handelszeitungwrites.

* FMS WertmanagementAöR became the next creditor of former Hypo Alpe Adria BankInternational AG to accept the buyback offer by and drop arelated lawsuit, Reuters reports. 


France simplifies procedures forfirms moving from London: French prudential supervisor ACPR and banking regulator AMF announcedthe creation of simplified welcoming procedures for U.K.-based companiesworried about the possible loss of passporting rights after Britain leaves theEU, Les Echos writes. 

*ING Groep NV sold46.7 million ordinary shares in Kotak Mahindra Bank Ltd. for roughly €490 million, reducingits stake in the India-based lender to 3.9% from 6.4%.

* 's board approved a newrestructuring plan that will be submitted to the Belgian central bank at theend of the week, according to L'Echo. The previous plan in2015 was found insufficient by the regulator.

* Belgianinsurer Integrale has now nearly completed the process to become a publiclimited liability company under the control of Nethys, L'Echo reports.The Belgian central bank last year ordered a financial recovery plan requiringIntegrale to strengthen its capital and improve its risk management.

*Optima Bank NVconsultants destroyed evidence of fraud from the bank's documents during a"spring cleaning" in 2011, DeTijd reports,citing magazine Knack.

*KAS BANK NV is set tosell its headquarters in Amsterdam, HetFinancieele Dagblad reports. 


Fosun moves closer to BCP stakeacquisition: 's board mandated theexecutive committee to proceed with and complete with exclusivity thenegotiations with Fosun Industrial Holdings Ltd., which seeks to acquire a16.7% stake in the Portuguese bank. BCP will carry out a 1:75reverse stock split Oct. 24 to satisfy one of Fosun's conditions for the stakeacquisition, Jornal de Negócios writes.

* The Portuguese government extended maturities on state loans to thecountry’s bank resolution fund in a bid to ease banks' payment commitments andreduce the likelihood of extraordinary contributions to the fund, Expressoand DinheiroVivo write. The measure also clears the way for Fosun to acquire astake in BCP.  

* Spanish bank restructuring fund FROB is analyzinga possible merger of BankiaSA and Banco MareNostrum SA and possible options to maximize the value of the twobanks. FROB will hire external advisers for the process.


Generali tosell 2 offshore units: Generali agreed to sell its units in Guatemala and Liechtensteinfor an undisclosed sum as part of a strategy to focus on more promising andless capital-intensive businesses. Generali will sell its entire 51% stake inGuatemala-based Aseguradora Generali SA and the entire share capital of FortunaLebens-Versicherungs AG in Liechtenstein.

* UnipolGruppo Finanziario SpA wants to find a merger partner for bankingunit Unipol BancaSpA, according to MF.

* UBI Banca's offer for Banca delle Marche SpA, and Cassa diRisparmio della Provincia di Chieti SpA could arrive Oct. 2, twodays after the official deadline, LaRepubblica writes. The ECBSupervisory Board will examine UBI Banca's offer today, Il Sole 24 Ore notes.

* UniCreditSpA will present its new strategic plan Dec. 13, Il Sole 24 Ore writes.

* Bank of Greece's director of banking supervision, SissyPapagiannidou, said Attica BankSA and its major shareholder were not willing to comply with any ofthe Greek central bank's instructions, Kerdosreports.  Papagiannidou blamed members of Attica Bank'sboard of directors for the irregularities in the lender, noting that thedirectors had no experience in the banking sector and were often absent inmeetings.  


Danske Bank,Nordea sell takes in shipping finance biz: Danish pension funds andPKA and Nordic equity fund Axcel will acquire a majority stake in shipping finance providerDanmarks SkibskreditA/S from shareholders including Danske Bank A/S and Nordea Bank AB. The transaction values DanmarksSkibskredit at 4.72 billion Danish kroner.

* The Swedish Bankers Association warned the Swedishgovernment that a proposed payroll tax on banks, insurers and pension fundswould jeopardize more than 16,000 jobs in the country's financial servicessector, Svenska Dagbladet writes. Thegovernment, which believes that banks and insurers are undertaxed, is looking ata special levy that could be imposed on the sector in the form of a tax onturnover or social security contributions, accordingto Sydsvenskan.

* Laurits Engstrøm, chief dealer in debt capital marketssyndicate at Danske Bank, has left the company, Thomson Reuters' IFR reports.It also emerged that Jeremy Spinney, former global head of debt syndicate atDanske Bank, retired in July.

* Talks between Danske Bank and remain deadlocked,FinansWatch reports.The two companies are trying to reach an agreement that would allow Danske Bankto integrate its smartphone-based Mobilepay service into Nets' Dankort mobilecredit card.  


Polish finance minister sacked: Polish Prime Minister Beata Szydlo dismissedFinance Minister Pawel Szalamacha and replaced him with Economy MinisterMateusz Morawiecki, Reuters reports.Szydlo said Szalamacha's dismissal was necessary to make an economic stimulusplan spearheaded by Morawiecki more effective.

* Moody's maintainedthe stable outlook on Poland's banking system, but warned that banks are facingchallenges to their profitability, some of which due to several unfavorablegovernment policies, such as the introduction of a bank tax.

* 's shareholders approvedthe lender's demerger into a core business, which will be transferred toAlior Bank SA, and amortgage business that will remain at Bank BPH, Rzeczpospolita reports.

* Erste GroupBank AG appointed Bernhard Spalt chief risk officer of its Romaniansubsidiary, Banca ComercialaRomana SA, Romania Insiderreports.Spalt will succeed Jon Locke, who left the company.

* askedits shareholders for financial assistance in order to increase the size of itscapital and strengthen its financial position, reports.

* CEFC China EnergyCo. Ltd. applied with the Slovak central bank for approval to increase itsstake in J&T Finance Group to 50% from 9.9%, Reuters reports.The acquisition of the stake will allow CEFC access to the banking market inthe Czech Republic, Russia, Croatia and Slovakia.

* said General Manager MusaÜlken is retiring and will leave the insurer Nov. 1. 


Asia-Pacific: ING to sell Kotak Mahindra stake; China, Europe to extend currencyswap

Middle East & Africa: Saudi Arabia's bond issue; Ghana's e-fraud worries

Latin America: Cade probes BM&FBOVESPA; Fenaban proposes 2-year wageagreements

North America: Stumpf to forfeit $41M in unvested equity; 2 Minnesota-based banksmerging

North America Insurance: Wellmark shrinks health coverage options in Iowa; Aetna to subsidizeApple watches for some customers


DataDispatch Europe: Falling price-to-book ratios demonstrate pressure on Europeanbanks: Just two of Europe's 30 largest banks by total assets areprojected to offer higher price-to-book ratios at year-end 2016 than they didat the end of 2015, according to data compiled by S&P Global MarketIntelligence.

Bondholderpanic contained as Deutsche rescue talk swirls: Deutsche Bank'sshares are at three-decade lows as it and the German government have beenforced to deny rumors of a state rescue plan, but debt markets have held backfrom the levels of panic seen earlier in 2016.

UBS CEO: Banksneed artificial intelligence to replace staff, cut costs:Technology that enables computers to acquire knowledge themselves can helpsolve the problem of diminishing profits in the banking sector, Sergio Ermottitold the Sibos conference in Geneva.

Leo Magno, Erin Tanchico, Arno Maierbrugger, Meike Wijers, GerardO'Dwyer, Beata Fojcik, Thanasis Kakalis, AliKayalar, Yael Schrage, Stephanie Salti, Praxilla Trabattoniand Helen Popper contributed tothis report.

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