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Goldman plans cash management entry; JPMorgan to hike trader, banker bonuses

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Goldman plans cash management entry; JPMorgan to hike trader, banker bonuses

Under Goldman Sachs Group Inc.'s planned cash management service, the investment bank will offer to pay existing clients more for their deposits, Reuters reports, citing people familiar with the plan. The service will be launched in the first half of 2020 and will enable Goldman to earn fees and capture an expanded client base for its foreign exchange business, according to the sources.

JPMorgan Chase & Co. is looking to raise its annual bonus pool at its corporate and investment bank, a source told Bloomberg News. Average percentage increases will be in the mid-single digits, but equities traders and investment bankers are likely to get a larger spike.

Federal Reserve Vice Chairman Richard Clarida said the central bank can afford to take a wait-and-see stance to see how uncertainties in outlook impact economic growth. According to Clarida, "monetary policy is not on a preset course" and the Fed will take a data-dependent approach as it weighs future changes to interest rates.

Deutsche Bank AG is offshoring about 60 accounting positions to Mumbai from Jacksonville, Fla., in an attempt to cut down costs, sources told Bloomberg. The move is part of a broader strategy to shift more jobs to India from the U.S. in 2019. Deutsche Bank has been under pressure after years of lackluster performance, according to the report. The German lender reported a net loss of €497 million in 2017 and a net loss of €1.36 billion in 2016.

The Securities and Exchange Commission and Wells Fargo Securities LLC have inked a settlement in connection with the failed $75 million deal with videogame company 38 Studios, Associated Press reports. The final approval of the settlement has, however, been delayed amid a government shutdown. The SEC in 2016 sued Wells Fargo and Rhode Island's economic development agency for allegedly making misleading statements about the bond offering to finance 38 Studios.

On the M&A front, Raleigh, N.C.-based First-Citizens Bank & Trust Co. is buying Spartanburg, S.C.-based First South Bancorp Inc. in a deal valued at $37.5 million.

Also, Resolute Investment Managers Inc. is purchasing a majority interest in SSI Investment Management Inc., the investment sub-adviser for First Trust SSI Strategic Convertible Securities ETF.

In people news, Michael Dreyer will retire as COO of Santa Clara, Calif.-based Silicon Valley Bank. He will be succeeded by Phil Cox, the SVB Financial Group unit's head of EMEA and president of the U.K. branch. Erin Platts, the head of relationship banking for Europe, will take over Cox's roles of EMEA head and U.K. branch president. The appointments will take effect April 1.

Perella Weinberg Partners LP is looking to reorganize its management and redistribute its partners' stake before launching its IPO, sources told Bloomberg. In connection with the reorganization, Peter Weinberg, who founded the investment bank with Chairman Joe Perella, is expected to become CEO. The sources added that former Treasury Department official Bob Steel will become chairman, and Perella will become chairman emeritus, according to the report.

In other banking news, big banks in the U.S. and Europe are looking to put in extra resources into their prime broking businesses to boost revenues in that area as the financial market turbulence has slowed down revenue inflow from other areas such as deal advising and fixed income trading, the Financial Times reports.

The U.K.'s Financial Conduct Authority has launched a formal probe into the work culture of Royal Bank of Canada's London branch following complaints by former staff members that they were subjected to unfair treatment, including wrongful termination, sources told Financial Times. The regulator initiated an informal inquiry into the Toronto-based bank in the summer of 2018, when several former employees alleged that they were terminated after pointing out legal and compliance issues at the bank.

In other parts of the world

Asia Pacific: Hong Kong fines FWD Life; Woori Bank ex-CEO sentenced to prison

Europe: Germany's sparkassen cut value of NordLB stakes; Popolare di Bari eyes cash call

Middle East & Africa: Brookfield drops bid for Abraaj's Turkish assets; Italy's Azimut enters Egypt

Now featured on S&P Global Market Intelligence

Consolidation of community banks causes headaches for bankers' banks: Bankers' banks are finding it difficult to keep customers amid the consolidation of community banks.

Stripe tops list of highest-valued US fintech startups: Payment processor Stripe Inc. has a $20 billion valuation, rivaling tech companies even outside the fintech space.

With cash to burn, private equity pushed up fintech M&A pricing in '18: The top three financial technology deals in 2018 and nine of the top 20 were private equity buyouts, and seven of the largest fintech deals were in payments.

The day ahead

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

In Asia, the Hang Seng increased 0.55% to 26,667.27, and the Nikkei 225 increased 0.97% to 20,359.70.

In Europe, around midday, the FTSE 100 was down 0.24% to 6,926.01, and the Euronext 100 was down 0.07% to 935.47.

On the macro front

The U.S. Treasury budget, the Baker-Hughes Rig Count report and the consumer price index 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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