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Japan plans bank stress test; Westpac flags A$341M profit hit


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Japan plans bank stress test; Westpac flags A$341M profit hit

S&P Global Market Intelligence offers our top picks of banking news stories and more published throughout the week. Please note that some entries may have links to third-party sources that require a subscription.

Philippines' RRR cut; more regulatory news

* The Philippines' central bank, Bangko Sentral ng Pilipinas, lowered the reserve requirement ratios for banks and nonbank financial institutions by 100 basis points to 14%. The move is expected to boost domestic liquidity and support economic growth.

* The People's Bank of China kept its one-year loan prime rates unchanged at 4.20% and the five-year LPR at 4.85%, a move that analysts say could probably heighten pressure on policymakers to ease further in the coming months.

* The Bank of Japan and the Financial Services Agency plan to conduct a stress test on major financial institutions amid fears of a global recession and risks from ongoing trade tensions between the U.S. and China, Reuters reported, citing undisclosed sources.

* The Australian Competition and Consumer Commission is investigating the strategies that banks employ to "prevent or discourage" consumers from switching to other lenders, The Australian reported. The competition watchdog will also look into whether the price of switching banks is high and whether the process of switching is relatively difficult.

Earnings corner

* KB Financial Group Inc. said its third-quarter profit attributable to shareholders fell to 940.3 billion South Korean won from 953.8 billion won in the prior-year period.

* Bangkok Bank PCL reported a 4.5% year-over-year increase in net profit for the quarter ended Sept. 30, to 9.44 billion Thai baht from 9.03 billion baht.

* Kasikornbank PCL said its net profit for the quarter ended Sept. 30. increased 2.1% year over year to 9.95 billion baht from 9.74 billion baht.

* India-based HDFC Bank Ltd.'s net profit for the September quarter rose 24.7% year over year to 66.38 billion rupees from 53.22 billion rupees.

* PT Bank Rakyat Indonesia (Persero) Tbk reported a 5.6% year-over-year increase in net profit for the nine months to Sept. 30.

* Westpac Banking Corp. expects its cash earnings in the fiscal second half of 2019 to be reduced by an estimated A$341 million provisions for customer refunds, payments and litigation related to its misconduct in financial advisory services.

In other news

* Australian banks closed nearly 300 branches and over 1,000 ATMs in total in the year ended June 30, according to the Australian Prudential Regulation Authority. Australia & New Zealand Banking Group Ltd., Commonwealth Bank of Australia, Westpac Banking and National Australia Bank Ltd. closed 211 branches in the year, The Australian reported.

* The Securities and Exchange Board of India approved Ujjivan Small Finance Bank Ltd.'s plan to raise 12 billion rupees in an IPO, Press Trust of India reported. The lender will list by Jan. 31, 2020, as per the banking licence issued by the Reserve Bank of India.

* A forensic audit of Dewan Housing Finance Corp. Ltd. found several gaps in the debt-laden company's financials and that billions of rupees worth of funds were diverted to private entities of its promoters, according to separate media reports.

* China's National Development and Reform Commission plans to implement new rules by Jan. 1, 2020, to make it easier for both foreign and domestic companies to do business in the world's second-largest economy, Reuters reported.

* India-based Kotak Mahindra Bank Ltd. opened its first overseas branch in Dubai.

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