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AIB, Unicaja to launch IPO; Barclays' Africa sell-off; EU approves MPS rescue


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AIB, Unicaja to launch IPO; Barclays' Africa sell-off; EU approves MPS rescue

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

IPO corner

* Outgoing Irish Finance Minister Michael Noonan has greenlighted Allied Irish Banks Plc's long-awaited IPO, outlining plans to list around 25% of the government's stake in the bank on the Irish and London stock exchanges. The listing, terms of which are expected to be published mid-June, could fetch the government up to €3 billion.

* Spanish lender Unicaja Banco SA intends to launch an IPO of 625 million new ordinary shares to be offered to institutional investors and seek admission of its shares to the Spanish stock exchanges in Madrid, Barcelona, Bilbao and Valencia. The new shares will represent 40.4% of Unicaja Banco's share capital immediately after the IPO, assuming that the underwriters do not exercise their overallotment option to subscribe for an additional 62.5 million shares.

* Meanwhile, SpareBank 1 Østlandet said its IPO has received orders covering the issue, including the overallotment option, within the indicative price range.

Buyers and sellers

* Barclays Plc will sell 285,691,979 ordinary shares in Barclays Africa Group Ltd., representing a 33.7% stake in the African unit, up from the previously planned 22% on the back of strong investor demand. The U.K. lender's stake in Barclays Africa will drop to 16.4% after completion of the transaction, the aggregate gross proceeds of which are expected to be £2.22 billion.

* Separately, Barclays Bank Plc agreed to sell its majority stake in Barclays Bank of Zimbabwe Ltd. to Malawi-based First Merchant Bank Ltd. as part of the group's strategy to exit noncore operations. The deal is expected to complete by the end of the third quarter, pending regulatory approvals. FMB will pay $60 million for the stake, according to Zimbabwe Independent.

* Banco Popular Español SA extended the deadline for interested investors to submit bids to acquire the bank from June 10 to the last week of the month. Elke König, chairman of the Single Resolution Board, a key European bank watchdog, said the troubled Spanish bank may need to be wound down if it fails to find a buyer.

* Deutsche Bank AG is said to be working on a sale of its Polish operations as part of its drive to exit noncore businesses. Potential bidders reportedly include Commerzbank AG, Banco Santander SA and Millennium BCP unit Bank Millennium SA. Analysts said Deutsche Bank is likely to have to accept a substantial discount to book value given the unit's low profitability, among other things.

* Intesa Sanpaolo SpA agreed to sell a €2 billion nonperforming loan portfolio to U.S.-based funds Christofferson Robb & Co. LLC and Bayview Asset Management LLC.

* Bank Pekao SA signed a preliminary agreement to acquire a 51% stake in Pioneer Pekao Investment Management SA from Pioneer Global Asset Management S.p.A. for a total consideration of €140 million.

Regulatory boulevard

* The European Commission has agreed in principle with the Italian government to let the latter inject capital into Banca Monte dei Paschi di Siena SpA as a precaution after the bank undergoes in-depth restructuring to ensure its long-term viability, with the bank's shareholders and junior bondholders also having to contribute to the costs to limit the use of taxpayer money.

* The Federal Reserve Board slapped Deutsche Bank with a $41 million penalty and consent cease and desist order over "unsafe and unsound practices" related to anti-money laundering law compliance in the company's operations in the U.S.

* Singapore's central bank fined Credit Suisse Group AG S$700,000 for breaching anti-money laundering rules in transactions related to Malaysia's troubled 1Malaysia Development Bhd., or 1MDB. Separately, Swiss financial regulator FINMA sent the bank a written reprimand over shortcomings in its money-laundering processes.

Bottom line

* Bank of Cyprus Public Co. Ltd. reported first-quarter profit attributable to owners of the company of €2.2 million, down from €50.2 million a year ago. In a conference call, CEO John Hourican said the Cypriot lender is gearing most of its operating income toward eliminating bad loans and will continue to do so for the foreseeable future.

* Norddeutsche Landesbank Girozentrale reported first-quarter consolidated profit attributable to owners of 231 million under International Financial Reporting Standards, compared to an attributable loss of €75 million in the same period in 2016. In an earnings call, Deputy Chairman Hinrich Holm said the Hanover, Germany-based bank would sell Deutsche Hypothekenbank AG only if it would significantly boost its capital ratios.

In other news

* Troubled Italian banks may have to suffer additional writedowns of approximately €10 billion from the sale of their bad loans at current market prices, Italian central bank Governor Ignazio Visco has warned.

* Intesa Sanpaolo CEO Carlo Messina is finalizing a new strategy that could include plans to boost the lender's insurance business and asset management activities, while reducing hundreds of millions of euros in costs and shutting down hundreds of branches.

* Atlante's shareholders are unwilling to inject more capital into Banca Popolare di Vicenza SpA and Veneto Banca SpA, whose shareholders voted to request more aid from the Italian bank rescue fund.

* Royal Bank of Scotland Group Plc is in discussions to raise its settlement offer for the remaining group of investors claiming compensation over its ill-fated crisis-era rights issue, with the bank considering increasing its offer of 82 pence per share by 20 pence per share.

* Co-operative Bank Plc aims to launch a debt-for-equity swap to raise approximately £450 million, the Financial Times reported.

Featured during the week on S&P Global Market Intelligence

Carige's boardroom drama blights restructuring plans, casts doubt on governance: The Italian lender is going through a boardroom conflict at a time of financial and regulatory uncertainty, leaving analysts to question whether it can complete a capital raise needed to start clearing its balance sheet of bad loans.

Macron likely to further delay EU financial transaction tax: The long-awaited European financial transaction tax will likely be delayed once more with the arrival of new French President Emmanuel Macron, who has argued that the U.K. must agree to the plan if it wants to stay in the single market after Brexit.

Close German banks, not branches, to achieve meaningful cost cuts, experts say: Achieving a meaningful reduction in costs and higher profitability in the German banking sector demands wholesale consolidation in the industry, on top of branch closures and staff cuts, according to experts.

German public banks to show greater resilience than private lenders in 2017: Germany's savings and cooperative banks look better poised than their privately owned counterparts to weather the challenges in the domestic market.