* Jens Weidmann, president of Deutsche Bundesbank, warns against extending quantitative easing in Europe, saying it could lead to financial market instability since inflation is already rising, Frankfurter Allgemeine Zeitung writes. But Spanish Prime Minister Mariano Rajoy expressed concern about a hasty end to the ECB's ultra-loose monetary policy, saying that the central bank is "acting correctly" so far, Bloomberg News writes.
UK AND IRELAND
* As expected, the U.K. government yesterday unveiled a "straightforward" bill to trigger Article 50 of Lisbon Treaty to leave the EU. The government said the proposed legislation is expected to move through Parliament's lower and upper chambers before gaining royal assent prior to Prime Minister Theresa May's March 31 deadline to begin the Brexit process. The House of Commons will start the initial debate on the bill on Jan. 31, according to Bloomberg News.
* Barclays Plc insisted it will keep its global headquarters in London regardless of the outcome of Brexit negotiations, The Independent says, citing a spokesman for the bank. It followed a Bloomberg News report saying that the U.K. lender has chosen Dublin to serve as its European base in the event that the U.K.'s departure from the bloc leaves banks without simple access to the single market. The bank was also said to be planning to add some 150 employees to its operations in Dublin.
* U.K. Chancellor Philip Hammond ruled out cutting the government's stake in Royal Bank of Scotland Group Plc after the bank said it will take a further £3.1 billion in provisions related to the misselling of RMBS in the U.S., The Guardian reports. Hammond said the government regards the stake as a "long-term asset."
* TSB Banking Group Plc CEO Paul Pester said the company's profit this year will "definitely go down materially" due to a £200 million cost related to its use of former parent Lloyds Banking Group Plc's IT platform, the Financial Times writes.
* Yorkshire Building Society will close 48 branches in 2017 and phase out the Norwich & Peterborough building society brand as it shifts its focus to its core mortgage and savings businesses.
GERMANY, SWITZERLAND AND AUSTRIA
* UBS Group AG's annual net profit in 2016 fell by 47% year over year in 2016 to CHF3.31 billion, while fourth-quarter net profit dropped to CHF738 million from CHF949 million in the last three months of 2015. The Swiss lender confirmed an unchanged ordinary dividend of 60 centime per share for 2016.
* HSH Nordbank AG divested €1.64 billion of nonperforming legacy assets, according to an emailed press release. The company said the transaction is expected to reduce its nonperforming exposure ratio by around 1.3 percentage points and that further sales of such loans are expected by mid-year.
* Credit Suisse Group AG is looking into the possibility of expanding in Dublin and relocating various back-office jobs after Brexit, The Irish Times reports.
* The Swiss financial market supervisory authority said the new Swiss unit of Credit Suisse, Credit Suisse (Schweiz) AG, needs more independence from its parent and should restructure its supervisory board ahead of a possible IPO, Bilanz writes.
* Five Credit Suisse bankers who were prevented by their employer from joining Jefferies Group LLC and therefore backed out of signed agreements with the latter company may have to pay Jefferies up to $10 million in compensation, Bloomberg News reports.
* Julius Bär Gruppe AG CEO Boris Collardi said Swiss private banks have benefited from rising stock markets and increasing client interest in financial markets since the November 2016 U.S. elections, Reuters reports.
* Vontobel Holding AG is expanding to the Netherlands with structured investment products as part of its European expansion drive.
* U.S.-founded Bitcoin firm Xapo Inc. received approval from the Swiss financial market supervisory authority to set up its global headquarters in Zug, Switzerland, finews.ch says, citing a report in Weltwoche.
* Munich Re reduced its management board to nine from 10 after it disbanded its health business unit and merged it with the life insurances unit.
* Sparda-Bank Hessen eG scratched plans to expand to Austria, saying it was economically unfeasible, Börsen-Zeitung notes.
* Volksbank Karlsruhe eG and Spar- und Kreditbank eG say they started talks over a possible merger.
FRANCE AND BENELUX
* Rabobank will compensate 10,000 small and medium-sized-business customers whose investments in interest rate derivatives turned sour, 2,000 more than initially advised, Het Financieele Dagblad says. It is not clear if the Dutch lender will increase its €700 million provision to compensate these customers.
* Dutch Finance Minister Jeroen Dijsselbloem has warned about the risks Brexit and U.S. President Donald Trump's protectionist policies pose for the euro, pleading for free trade, Het Financieele Dagblad reports.
SPAIN AND PORTUGAL
* Banco de Sabadell SA today reported a net attributable profit of €710.4 million for 2016, up 0.3% from 2015.
* Banco de Fomento Angola SA accounted for just over half of Banco BPI SA's €313.2 million net profit in 2016, Jornal de Negócios writes. The Portuguese lender is set to relinquish its controlling stake in BFA to meet European rules on risky assets as part of a takeover bid by Spain's CaixaBank SA. Reuters also reports on the bank's earnings.
* The European Central Bank (ECB) has ordered Paulo Macedo, the incoming CEO of Portugal's Caixa Geral de Depósitos SA, to sever his ties with rival lender Millennium BCP as a condition for his assuming the helm of the state-run bank, Jornal de Negócios reports. Macedo, who has held numerous roles linked to BCP over two decades, reportedly asked the ECB to waive the demand but the regulator said he should end his ties with BCP to avoid any conflict of interest. Caixa's new management team is due to start work at the beginning of February.
* Bankinter SA CEO María Dolores Dancausa expects the lender's profitability to steadily increase over the next two years, Europa Press reports. The Spanish bank posted fourth-quarter 2016 consolidated net income of €90.1 million, up from €76.4 million in the same period in 2015.
ITALY AND GREECE
* Intesa Sanpaolo SpA will make an offer for Generali provided it does not weaken its capital strength or its ability to remunerate shareholders, all dailies including Corriere della Sera cite CEO Carlo Messina as saying. But he ruled out that Intesa board meeting today could decide on an offer, Il Messaggero adds. Reuters also covers.
* Intesa does not want to buy UniCredit SpA's stake in Mediobanca SpA, which is the largest shareholder of Generali, and UniCredit also does not want to sell its interest in the lender, Il Sole 24 Ore writes.
* JP Morgan will likely act as an adviser to Generali to come up with countermeasures against an eventual offer from Intesa, Il Sole 24 Ore writes, adding that some investors are betting on a plan to merge the insurer with Mediolanum SpA.
* The Italian government will not get involved in the talks between Intesa and Generali, a source in the economy ministry told Reuters, which separately reports that more than 100 Italian senators have asked the government to ensure the insurer remains in Italian hands.
* UniCredit's €13 billion capital increase should kick off on Feb. 6, with the price expected to be set on Feb. 1, Il Messaggero writes.
* Banco BPM SpA passed the ECB's SREP capital requirement tests, Il Messaggero writes. Meanwhile, the lender is considering selling its asset management unit Aletti Gestielle as it seeks to optimize assets, insiders tell Reuters, adding that Aletti was likely to pursue a combination with Anima Holding.
* Greek banks fear some companies they have lent to may default on their loans due to a delay in the implementation of new rules on extrajudicial debt settlement, Kerdos reports.
* Canada's TD Asset Management acquired a 5.24% stake in Bank of Cyprus Public Co. Ltd. according to Euro2day.
NORDIC COUNTRIES
* Danish mortgage lenders will find it more difficult to increase fees after new rules were introduced that make it cheaper for customers to switch providers if fees go up, Reuters reports.
EASTERN EUROPE
* Turkish Deputy Prime Minister Numan Kurtulmus called on banks to "make sacrifices" to help the economy, increasing the pressure on lenders to provide more loans, Reuters writes.
* The board of directors of financially troubled JSCB for Charity and Spiritual Dev of Fatherland PERESVET is set to meet Jan. 30 to consider the conversion of subordinated debt into capital, Rambler News Service reports.
* The Polish Financial Supervision Authority allowed AXA Polska SA to merge its nonlife insurance units AXA Towarzystwo Ubezpieczen i Reasekuracji SA and AXA Ubezpieczenia TUIR SA into one company, Rzeczpospolita reports. The legal merger is expected to be completed at the end of March, and the merged insurer will operate as AXA Ubezpieczenia TUiR.
IN OTHER PARTS OF THE WORLD
Asia-Pacific: China urged to join Trans-Pacific Partnership; AMP shutters venture capital biz
Middle East & Africa: Fitch cuts Nigeria outlook; Mashreqbank FY'16 profit dips YOY
Latin America: Banrisul could be privatized; Interacciones' Q4'16 profit rises 16.9%
North America: Capital One's Cabela deal may fall through; court throws out ICBA vs NCUA suit
North America Insurance: GOP governors voice concerns over ACA repeal; CMS denies extension to KanCare
NOW FEATURED ON S&P GLOBAL MARKET INTELLIGENCE
* P2P lending grows as banks hold back on lending to smaller UK companies: The U.K.'s peer-to-peer lending industry is small but growing, as banks shy away from lending to all but bigger companies.
* Green Investment Bank will not be sold to asset-strippers, UK government says: The British government will not sell the Green Investment Bank to an asset stripper, U.K. lawmakers were told in parliamentary debate.
* Nordea CEO says end in sight to net interest income attrition: Casper von Koskull said that after two years of negative interest rates, the bank's net interest income has effectively stabilized.
David Hutter, Arno Maierbrugger, Danielle Rossingh, Esben Svendsen, Beata Fojcik, Thanasis Kakalis, Ali Kayalar, Yael Schrage, Stephanie Salti, Praxilla Trabattoni and Helen Popper contributed to this report.
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