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RBS to buy back government shares; CaixaBank to cut jobs; Nasdaq eyes Oslo Børs

Banking Essentials Newsletter - November Edition

Online Brokerage Space Should Remain Rich Source Of M&A

University Essentials | COVID-19 Economic Outlook in Banking: Rates and Long-Term Expectations: Q&A with the Experts

Estimating Credit Losses Under COVID-19 and the Post-Crisis Recovery


RBS to buy back government shares; CaixaBank to cut jobs; Nasdaq eyes Oslo Børs

* The European Banking Authority has set out final guidelines on types of exposures to be associated with high risk under EU rules on capital requirements.

UK AND IRELAND

* Royal Bank of Scotland Group PLC said it will seek shareholder approval to buy back shares from the U.K. treasury in off-market deals as part of efforts to facilitate its return to the private sector. The lender is looking to repurchase a maximum of £1.4 billion of shares from the government, The Guardian noted.

* Lloyds Banking Group PLC has been granted a banking license for its planned new unit in Berlin, an insider told Reuters. The move is aimed at ensuring the group could continue to serve EU customers in the event of a no-deal Brexit.

* Brexit could lead to a simpler regime for small British banks that could help boost competition in the banking sector, Bank of England Deputy Governor Sam Woods said.

* Denis Casey, former CEO Irish Life & Permanent, now known as Permanent TSB Group Holdings PLC, has appealed to Ireland's Supreme Court over his conviction for his alleged role in a conspiracy to hide the financial state of Anglo Irish Bank in 2008, The Irish Times reported.

GERMANY, SWITZERLAND AND AUSTRIA

* Helmut Schleweis, president of the German Savings Banks Association, has warned of Norddeutsche Landesbank Girozentrale's possible liquidation and called on the board members of country's 384 sparkassen to support a joint effort to restructure the lender and turn it into a "super-bank," or a "sparkassen central bank," Handelsblatt reported. A share acquisition by private investors would have many disadvantages, he said, adding that Braunschweigische Landessparkasse and other subsidiary state banks could no longer remain part of NordLB if it happens.

* The size of Deutsche Bank AG's balance sheet and stalled efforts by the EU to unify its capital markets could potentially hamper any merger between the lender and a European peer, Bloomberg News wrote.

* Allianz Group has appointed Birgit König, currently CEO of Allianz Deutschland's private health insurer Allianz Private Krankenversicherung (APKV) and a member of Allianz Deutschland's board of management, to head the international unit Allianz Digital Health, effective April 1. Nina Klingspor, currently CFO of Allianz Global Corporate & Specialty SE, will succeed König as APKV CEO and on the Allianz Deutschland board.

* Liechtensteinische Landesbank AG said it expects a 23% drop in 2018 net profit to about CHF85 million. The bank will report its full 2018 results on March 14.

* Former Credit Suisse Group AG wealth manager Patrice Lescaudron was released less than 10 months into his five-year prison sentence over operating a fraud scheme that led to damages of over $140 million, Bloomberg reported.

FRANCE AND BENELUX

* French Prime Minister Édouard Philippe has triggered a plan to introduce measures aimed at dealing with a no-deal Brexit, The Guardian reported.

* Société Générale SA could close its Descartes proprietary trading unit as the division has struggled to make profits, insiders told Bloomberg. The unit had €4.1 billion of assets at the end of 2017. SocGen also agreed to sell its custody, trustee and derivatives clearing services in South Africa to Absa Group Ltd.

* Meanwhile, SocGen could cut bonuses for traders for a second straight year, while French peer BNP Paribas SA is considering cutting bonuses for traders in its global markets unit, insiders told Bloomberg.

* ING Groep NV is set to scale back its variable remuneration after a money laundering scandal caused a mega-settlement of €775 million last year, Het Financieele Dagblad reported. The bonuses for executives will be "considerably smaller" compared to 2017, when the bank paid more than €403 million to its employees.

* Belgian insurer P&V has entered a collaboration with French fintech company Shift Technology to employ robot detectives against fraud, De Tijd reported.

SPAIN AND PORTUGAL

* Spanish lender CaixaBank SA has informed unions that it plans to cut 2,157 jobs, or 7.3% of its workforce, as part of its strategic plan to reduce its branch network, according to Expansión. CaixaBank also reportedly plans to have 700 store branches, or advisory hubs, by the end of 2021, up from the projected 600 set out in its plan.

* The ECB is concerned over reports that Spain's Banco Bilbao Vizcaya Argentaria SA hired a former police chief to investigate a potential buyer as part of efforts to stop a takeover bid, insiders told Reuters. Some of the central bank's officials have reportedly raised the issue with BBVA and discussed possible risks to the lender's reputation, among other things.

* Novo Banco SA ended 2018 with 450 fewer employees as part of its commitment to targets established by the European Commission for 2021, Jornal de Negócios reported. For this year, there are no plans for significant job cuts.

ITALY AND GREECE

* Fitch Ratings downgraded struggling Italian lender Banca Carige SpA's long-term issuer default rating to CCC from CCC+ and placed the rating on Rating Watch Evolving, saying senior creditors are now facing an increased risk of losses after the bank was placed under temporary administration. Carige questioned the downgrade, saying the move showed Fitch's lack of understanding of the bank's situation, Reuters noted.

* Italian Finance Minister Giovanni Tria said Banca Carige has filed a request to tap a state guarantee for an upcoming bond issue and expects to get a response shortly, Reuters reported.

* Banca Popolare di San Felice has engaged Rothschild to help it find a buyer, MF said.

* Cyprus-based investment advisory services provider Woodbrook Group Ltd. is looking to establish a health and life insurance firm in Ireland, The Irish Times reported.

NORDIC COUNTRIES

* U.S. exchange operator Nasdaq Inc. is meeting the board of Oslo Børs VPS Holding ASA today to discuss a potential acquisition of the Norwegian firm, insiders told the Financial Times.

* Norwegian Prime Minister Erna Solberg has reached an agreement to form a center-right majority government with the addition of the Christian Democratic Party to her coalition, Reuters reported.

* Norwegian Norwegian Finans Holding ASA said the Norwegian Financial Services Authority is reviewing the calculation of write-downs of loans and note information on credit risk in its 2017 annual accounts. The regulator's probe will not impact the Norwegian bank's 2018 financial report, the company noted.

* An Estonian parliamentary committee dropped a proposed rule aimed at forcing people suspected of benefiting from questionable financial deals to prove that their wealth came from legitimate sources, saying the rule's wording is not specific enough, Reuters reported.

EASTERN EUROPE

* Polish lenders Getin Noble Bank SA and Idea Bank SA have signed a merger plan, under which Getin Noble shareholders will receive 0.185 new Idea shares for each of their Getin shares, PAP reported. The legal merger is expected to be completed in the third quarter, and synergies from the merger are estimated to reach 370 million Polish zlotys between 2019 and 2021 and 180 million zlotys per year from 2021.

* The Turkish Parliament has granted President Recep Tayyip Erdoğan sweeping powers to take necessary measures if the country's financial stability is seen at risk, Bloomberg News reported.

* Türkiye Halk Bankası AŞ' planned issuance of up to $2 billion worth of debt instruments has been greenlighted by Turkey's Capital Markets Board, according to Reuters.

* Chinese investment company Fosun or Harbin Bank Co. Ltd. may be interested in acquiring Russian lender PJSC Asian-Pacific Bank, market sources told Kommersant. Other Chinese financial institutions could also be interested in the Russian lender, but unlike Fosun or Harbin they are not authorized to purchase a bank in Russia.

* The Bulgarian central bank asked local lenders to apply conservative lending scenarios to mitigate potential risks arising from cyclical macroeconomic trends, according to SEENews.

IN OTHER PARTS OF THE WORLD

Asia-Pacific: SWIFT to set up Beijing unit; Indonesia keeps key rate

Middle East & Africa: NBK posts FY'18 profit rise; Angola to close more banks; South Africa holds rate

Latin America: Chile sets date for merger of regulators; XP Investimentos partner leaving

North America: Morgan Stanley Q4'18 net revenues down; BB&T profit up in Q4'18

Global Insurance: US P&C insurers log $4.7B underwriting gain; MGIC earnings; Mercer gets new CEO

NOW FEATURED ON S&P GLOBAL MARKET INTELLIGENCE

Mortgage growth to boost Irish margins in 2019, despite tracker fines: Improved asset quality and the lack of domestic competition will also help support profitability at Ireland's three largest banks even as they deal with regulatory penalties and potential legal action from borrowers.

SocGen shares slump as bank warns on revenue hit due to market conditions: The revenue warning is likely due to volatility on the financial markets in late 2018, particularly in derivatives, which has also hurt French peer Natixis, according to analysts.

Zurich's $100M cyber claim battle could trigger policy overhaul: Cyber underwriters may need to be clearer about how they intend to use war exclusions if Zurich successfully avoids a claim from U.S. food giant Mondelez for the NotPetya malware attack.

Sheryl Obejera, Ed Meza, Meike Wijers, Esben Svendsen, Beata Fojcik, Heather O'Brian, Stephanie Salti, Praxilla Trabattoni and Mariana Aldano contributed to this report.

The Daily Dose has an editorial deadline of 7 a.m. London time. Some external links may require a subscription. Links are current as of publication time, and we are not responsible if those links are unavailable later.

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.