S&P Global Market Intelligence offers our top picks of banking news stories and more published throughout the week.
Italy steps in for Carige
* The Italian government will establish a €1.3 billion rescue fund to cover the costs of emergency measures aimed at shoring up Banca Carige SpA. The state-backed measures include a precautionary recapitalization of Carige, but the lender said it would only consider this option as a last resort and has opted to access state-backed guarantees on bond issues. The 5-Star Movement's change of heart about using state funding to support Carige is a positive development for the bank, according to analysts.
* Carige is said to have sounded out 10 potential buyers, including Italian peers UniCredit SpA
* Italian deputy Prime Minister Matteo Salvini said the government would consider taking control of Carige. "If there are profits, the state will receive them, not some private bodies," he said, according to Bloomberg News.
Problems mount for Danske Bank, Deutsche Bank
* Danske Bank A/S said it could be placed under investigation again in an ongoing French probe into potential violations of money laundering laws from 2007 to 2014. The announcement comes after Hermitage Capital Management Ltd. co-founder and CEO Bill Browder urged French authorities to investigate the bank instead of treating it as an assisted witness.
* An institutional investor filed a class-action lawsuit in the U.S. against Danske and four of its former executives, including former CEO Thomas Borgen and former Chairman Ole Andersen, for allegedly providing false and misleading information about the lender's businesses and operations.
* German financial supervisory authority BaFin has instructed Deutsche Bank AG
* Germany-based private bank M.M. Warburg & CO Gruppe GmbH
* A series of internal audits commissioned by Deutsche and carried out by Freshfields showed that some of the lender's managers may have discussed the reputational risk of issuing withholding tax certificates at the center of a cum-ex share trading scheme, Reuters reported.
Legal and regulatory actions
* A group of 18 bond investors lodged a lawsuit against HSH Nordbank AG
* The Italian Competition Authority fined FCA Bank SpA
* TBC Bank Group PLC unit JSC TBC Bank
Bonus cuts and staff layoffs
* Deutsche Bank is looking to slash its bonus pool by about 10% in a bid to cut costs, a source told Bloomberg.
* Banco Santander SA
Stakes and sales
* Savings banks in the state of Lower Saxony, which own a 26.4% stake in Norddeutsche Landesbank Girozentrale, will write off the value of their holdings in the lender as zero for 2018, corresponding to a total write-off of €400 million, Börsen-Zeitung reported. Those in the state of Saxony-Anhalt and Mecklenburg-Western Pomerania are also considering writing off the value of their holdings, according to Handelsblatt.
* Netherlands-based ABN Amro Group NV agreed to sell a €2 billion loan portfolio to Nederlandse Waterschapsbank NV.
In other news
* The U.K.'s Financial Conduct Authority outlined plans to put in place the Financial Services Contracts Regime, which would allow finance firms in the European Economic Area, or EEA, to fulfill their existing contractual obligations in the U.K. The FSCR does not allow EEA firms or managers to take on new business after exit day; instead they will need to enter the Temporary Permissions regime and can notify the regulator of their intention to do so until March 28.
* The valuation of N26 Bank GmbH
* Female employees at HSBC Holdings PLC
* Edward Bramson, an activist investor with a more than 5% stake in Barclays PLC, will call for board changes at the British bank after he was denied a board position himself. Bramson is pushing for the lender to downsize its investment banking business, putting him at odds with CEO Jes Staley.
Featured during the week on S&P Global Market Intelligence
Transparency, liquidity to be in focus in future European banking wind-downs: Although Spain's Banco Popular has been hailed as a textbook example of banking resolution, future cases will need to address transparency and liquidity, and the system could be challenged by larger and more complex cases.
Doubts grow that the ECB will be able to raise rates in 2019: Weakening economic indicators and stubbornly low inflation have led many economists to re-evaluate whether the European Central Bank will be able to hike rates this year.
European banks worry higher funding costs may thwart new debt issuance in 2019: European banks see rising funding costs as a key barrier to their debt issuance in 2019 as most of them plan to expand bail-in-able debt buffers to comply with new regulations, a recent survey of the European Banking Authority shows.