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In This List

UK suspends no-deal Brexit planning; Barclays urged to end fossil-fuel lending

StreetTalk – Episode 70: Banks' Liquidity Conundrum Could Fuel M&A Activity

Street Talk Episode 70 - Banks' Liquidity Conundrum Could Fuel M&A Activity

StreetTalk – Episode 69: Banks left with pockets full of cash and few places to go

Street Talk – Episode 69: Banks left with pockets full of cash and few places to go


UK suspends no-deal Brexit planning; Barclays urged to end fossil-fuel lending

* The U.K. has suspended with immediate effect its contingency plan for a no-deal Brexit scenario as it expects Parliament to approve Prime Minister Boris Johnson's Brexit legislation, Sky News reported, citing a leaked government document. Clare Moriarty, permanent secretary at the Department for Exiting the EU, said no-deal preparations for the Jan. 31 Brexit date had ceased after the House of Commons approved on second reading the Withdrawal Agreement Bill on Dec. 19, 2019.

* Global central banks are facing a "liquidity trap" that could affect their abilities to steer through a future economic downturn, Bank of England Governor Mark Carney told the Financial Times. The outgoing head of the British central bank warned that the condition will "persist for some time." Meanwhile, U.K. Chancellor Sajid Javid rejected the Labour Party's proposal to delay the appointment of Andrew Bailey as the new BoE governor until a review of the failures of the U.K. Financial Conduct Authority under his watch is completed, Bloomberg News reported.

UK AND IRELAND

* The U.K. FCA and the BoE plan to develop their data and analytics capabilities, with the FCA's new data strategy focused on the use of advanced analytics and automation techniques to further understand how markets function. The BoE also published a discussion paper on improving the timeliness and effectiveness of data collection from financial firms, and will be accepting written responses until April 7.

* The outlook for British banks in the new decade is stable, largely similar to that of the global banking sector, S&P Global Ratings said in a report. The agency noted that the result of the general elections last month "implies a more-certain political backdrop" and the outcome of the Bank of England's recent stress test illustrates that lenders can manage a global downturn.

* The U.K. FCA reminded insurers in the country to "embed healthy cultures" in light of recent non-financial misconduct in the wholesale general insurance sector. Jonathan Davidson, the regulator's executive director of supervision, retail and authorizations, ordered companies to identify weaknesses in their culture and quickly take steps to address them. Reuters and the Financial Times also covered.

* A group of Barclays PLC shareholders filed a resolution to stop the bank from financing companies in the energy sector and gas and electric utilities that do not adhere to the Paris climate agreement, news outlets including the FT and Bloomberg News reported. The resolution was filed by 11 institutional investors and over 100 individual investors and will be voted on in May.

* An ongoing outage of U.K.-based foreign exchange company Travelex's computer networks is related to ransomware attack Sodinokibi, which locks up a network's data in encrypted code, The Wall Street Journal reported. The U.K. Metropolitan Police is now investigating the matter after the hackers demanded a ransom, according to the FT. Travelex owner Finablr PLC said there is no evidence yet that any personal customer data have been compromised. Finablr also noted that its other six brands are unaffected by the attack and are operating normally, adding that the incident is not expected to have a material financial effect on the group.

* Neil Woodford and his business partner Craig Newman received dividends of £13.8 million each in the last financial year of Woodford Investment Management, which is currently being wounded down, despite huge outflows triggered by underperformance, the FT reported.

GERMANY, SWITZERLAND AND AUSTRIA

* Deutsche WertpapierService Bank AG confirmed yesterday that an IT glitch that affected German securities trading on Monday was far larger than initially thought, Handelsblatt reported. It affected a total of 1,288 institutions in all, including all Volksbanks and second-largest online bank DKB. Systems were all up and running again by lunch time yesterday, with warnings to check for duplicate transactions. DKB, however, was hit by a second IT glitch yesterday that rendered its online service and app largely unusable, Handelsblatt said. The bank has excluded an external attack and has also assured all customers that all data are not compromised for the moment.

* German comparison portal Verivox noted that the number of banks charging negative interest on current accounts has risen to 30 from 25, Handelsblatt wrote. The five new banks are all cooperative banks.

FRANCE AND BENELUX

* Carrefour Banque SA, a 60-40 joint venture of Carrefour SA and BNP Paribas Personal Finance SA, has changed its strategy and no longer aims to be a "neo-bank" offering a wide range of digital banking services, Les Echos reported. It said the C-Zam account at the center of the digital strategy had stagnated at the 150,000 account mark, with a number of the accounts not being active. Le Figaro also covered.

* AXA France SA is in talks to transfer 200 back-office jobs in AXA Banque SA to Arkéa Banking Services, a unit of Crédit Mutuel Arkéa SACC, Les Echos reported.

* ING Groep NV spun out its advanced analytics platform Katana into a stand-alone company in the U.K. called Katana Labs. The Dutch banking group noted that its ING Ventures arm plans to invest an additional £1.5 million as part of a £3 million financing round.

* Jaap van Manen has left his role as chairman of the supervisory board of APG, the Netherlands' largest pension manager after just a year, Het Financieele Dagblad reported. Van Manen quit his job on Jan. 1 for "personal reasons," the paper quoted APG as saying. Pieter Jongstra, the current deputy chairman of the supervisory board, became interim chairman.

* Belgian insurance trade body Assuralia appointed Hein Lannoy, who formerly worked for the FSMA regulator, as its new CEO, L'Echo and De Tijd reported.

SPAIN AND PORTUGAL

* Spain's acting Socialist Prime Minister Pedro Sánchez is set to be sworn in as head of the country's first coalition government after lawmakers voted 167-165 to confirm him as prime minister, multiple media outlets covered. Sánchez's party also secured the abstentions of those aligned with Catalan and Basque separatists.

* Portugal's Banco Montepio SA, formerly Caixa Económica Montepio Geral Caixa Económica Bancária SA, postponed a board meeting to approve the appointment of Pedro Leitão as the savings bank's new CEO to Jan. 9 from Jan. 7, Jornal de Negócios reported.

ITALY AND GREECE

* Mubadala Investment Co. PJSC, the sovereign wealth fund of Abu Dhabi, has trimmed its interest in Italy's UniCredit SpA to 2.02% as of December 20, 2019, Reuters reported. The fund's stake in the bank stood at 4.986% as of June 28, 2019.

* The Italian interbank deposit fund FITD and extraordinary administrators of Banca Popolare di Bari SCpA are launching a joint due diligence on the bank's accounts ahead of its bailout, which is expected to last about a month, MF said. FITD will also help to draft Popolare di Bari's business plan, which should be ready at the end February.

* Iccrea Banca SpA closed the sale of €230.5 million in nonperforming loans to Banca IFIS SpA, MF said.

* Cassa Centrale Banca Credito Cooperativo Italiano SpA, which now owns 8.34% in Banca Carige SpA and is destined to see its stake grow in the coming years, proposed Leopoldo Scarpa and Vittorio Cianciani Battain as candidates for Carige's new board, MF said. CCB should have one seat on Carige's new board and the interbank deposit fund FITD the remaining nine, Il Sole 24 Ore said.

* Credito Fondiario SpA is proposing a merger with Italian bad loan management group Cerved Credit Management Group Srl but an expected cash offer from Intrum is currently seen as the favored solution by parent company Cerved, Il Sole 24 Ore said. The Cerved board is expected to decide on the future of the business by the end of the month.

NORDIC COUNTRIES

* Nykredit A/S has introduced negative interest rates on deposits from private customers, leaving Danske Bank A/S the only large bank in Denmark not to have done so, Børsen reported.

* Danish financial regulator Finanstilsynet has relaxed the rules on the sale of bad debts, Finanswatch reported. The regulator previously demanded that personal data should not be disclosed when a loan is resold, but Danish banks will now be allowed to attach such data.

EASTERN EUROPE

* Bank Millennium SA, the Polish unit of Portugal-based Millennium BCP, intends to cut up to 260 jobs by March-end under planned group layoffs, news agency PAP reported. The redundancies will affect employees holding various positions.

* Santander Bank Polska SA decided to set aside provisions for legal risk associated with its foreign-currency mortgage portfolio and the proportional reimbursement of fees on consumer loans repaid ahead of schedule, Rzeczpospolita said. The provisions will have a total impact of 357 million zlotys on the lender's consolidated pretax profit for the fourth quarter of 2019.

IN OTHER PARTS OF THE WORLD

Asia-Pacific: China to boost banks' capital; Thailand revises rules on bank fees

Middle East & Africa: Absa Group to boost lending in Africa; UBS to split EMEA wealth unit into 3

Latin America: Banco BV plans IPO; Mexico approves 2,700 branches for Banco del Bienestar

North America: Blucora to acquire HK Financial Services; Citigroup amps up hiring of coders

Global Insurance: Australia bushfire insurance losses surge; Neon headed for runoff; cat bonds

NOW FEATURED ON S&P GLOBAL MARKET INTELLIGENCE

UK financial watchdogs to make greater use of 'skilled person' probes on banks: Goldman Sachs and Morgan Stanley have been given Section 166 orders authorizing accountants to check up on the banks' reporting procedures and more banks are likely to be affected in the year ahead.

4 MEA banking stories to watch in 2020: Qatar, Lebanon, South Africa, Nigeria: Banks in Lebanon and South Africa will be under increasing sovereign debt-related pressure, Nigerian lenders will face fines if they do not expand their loan books, and some Qatari banks will have to take steps to deal with asset quality.

Sheryl Obejera, Danielle Rossingh, Esben Svendsen, Beata Fojcik, Heather O'Brian, Brian McCulloch, Sophie Davies and Mariana Aldano contributed to this report.

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This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.