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Lloyds sells Irish loans; KBC, ABN Amro report Q1 earnings

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Lloyds sells Irish loans; KBC, ABN Amro report Q1 earnings

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

Deal table

* Lloyds Banking Group PLC agreed to sell its Irish residential mortgage portfolio to Barclays Bank PLC for a cash consideration of about £4 billion at current exchange rates. Lloyds said its exposure to Ireland will be minimal following the transaction. Barclays will securitize and sell on the mortgages, Reuters reported.

* AIB Group PLC agreed to sell a nonperforming loan portfolio to Everyday Finance DAC as part of a consortium arrangement with the Irish credit management firm and affiliates of U.S.-based Cerberus Capital Management LP for a cash consideration of about €800 million.

* Italy-based Banca IFIS SpA agreed to buy a controlling stake in debt services provider FBS SpA for €58.5 million.

Q1 earnings

* France's Groupe BPCE reported a 3.7% year-over-year decline in net profit attributable to equity holders of the parent, to €634 million, partly due to regulatory costs. Investment bank unit Natixis reported a 15% yearly increase in profit, boosted by growth in asset management and insurance. Fellow French bank Crédit Agricole Group reported first-quarter net income group share of €1.43 billion, down from €1.60 billion a year ago.

* Belgium's KBC Group NV reported first-quarter net profit attributable to equity holders of the parent of €556 million under IFRS 9, down from €630 million under IAS 39 in the year-ago period.

* Dutch bank ABN AMRO Group NV reported first-quarter consolidated profit attributable to owners of the parent company of €555 million, down from €601 million under IAS 39 in the same period in 2017. The group said it will close its Dubai operations or transfer them to other locations.

* Germany's Bayerische Landesbank AöR, or BayernLB, reported first-quarter consolidated profit after noncontrolling interests of €181 million, compared to €186 million a year ago.

* Raiffeisen Bank International AG posted an 81.4% year-over-year increase in first-quarter profit and a reduction in its exposure to nonperforming loans.

* VTB Bank (PJSC)'s first-quarter net profit attributable to shareholders of the parent was 55.6 billion Russian rubles, up from 28.1 billion rubles earned in the same period of 2017.

Legal and litigation

* The Boston Retirement System is suing nine global banks, including Banco Santander SA, Barclays PLC and Deutsche Bank AG, and their subsidiaries for allegedly conspiring to fix Mexican government bond prices between Jan. 1, 2006, and April 18, 2017.

* A review into Lloyds' handling of suspected fraud at unit HBOS PLC is unlikely to be completed until late 2019 because of the sheer volume of documents involved.

* Royal Bank of Scotland Group PLC's lawyers asked a former employee to permanently destroy all confidential documents in his possession, according to a letter seen by Reuters, making him liable to prosecution from the U.S. Department of Justice, his lawyer claims. The documents related to a lawsuit against RBS by shareholders alleging that they were misled ahead of a £12 billion rights issue in 2008.

* A U.S. court sentenced Türkiye Halk Bankasi AS Deputy Director General Mehmet Hakan Atilla to 32 months in prison for assisting Iran in evading sanctions.

Regulators at work

* Regulators told Bank of Ireland Group PLC that, by Jan. 1, 2021, it must meet a minimum requirement for own funds and eligible liabilities, or MREL, of 12.86% of total liabilities and own funds as at December 2016. Meanwhile, the Irish central bank confirmed its MREL target for AIB Group PLC, the holding company of Allied Irish Banks PLC, which equates to 28.04% of risk-weighted assets as of the December 2016 balance sheet.

* The ECB's Governing Council gave the green light to a request by Greece's central bank to lower the limit on emergency liquidity assistance available to Greek lenders by €2.5 billion to €12.2 billion.

* The European Central Bank said it could allow banks relocating operations to Europe from Britain more time to meet certain requirements such as local risk management capabilities and governance structures.

In other news

* Société Générale SA plans to set up a securities joint venture in China, in which it will hold a 51% stake.

* Santander expects to launch a stand-alone digital bank in the U.K. within months, focusing on small companies.

* Denmark's Danske Bank A/S invested 25 million kroner in budget finance application Spiir A/S.

* Iceland's Arion banki hf. plans to launch an IPO and list its shares on Nasdaq Iceland and Swedish depository receipts, representing its shares, on Nasdaq Stockholm.

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