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Lloyd's confirms Neal to be CEO; probe looking into $150B of Danske transactions

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


Lloyd's confirms Neal to be CEO; probe looking into $150B of Danske transactions

* The European Commission is preparing proposals that would give the European Banking Authority more resources and greater enforcement powers to probe activities of banks involved in illicit financing, the Financial Times reported. ECB executive board member Benoit Coeuré earlier urged EU to create a single agency to reinforce the enforcement of anti-money laundering rules. The commission is also looking to give the recently created European Public Prosecutor's Office powers to launch investigations into terrorist financing across EU member states beginning in 2025.

* The ECB is expected to increase the deposit rate by September 2019 to minus 0.2% from minus 0.4% despite continued risks from Italian politics and U.S. tariffs, according to a survey by Bloomberg.

* U.S. Commodity Futures Trading Commission Chairman J. Christopher Giancarlo warned that the EU's plan to tighten oversight of foreign clearinghouses could damage financial markets and limit economic growth, saying it will lead to "overlapping and confounding cross-border regulation," Bloomberg News reported.

* The European Central Bank has given international banks with a London hub until the end of June to apply for an EU banking license, The Times of London reported, adding that the ECB is said to be using the process to pressure lenders into disclosing more details on their plans to move staff to the continent after Brexit.

* The European Investment Bank is considering a capital increase to allow some countries, such as Poland, to raise their holding in the bank after the U.K. exits the EU and the EIB, Reuters reported, citing EU officials.

UK AND IRELAND

* U.K. cabinet office minister David Lidington said Britain should strike a deal with the EU by November at the latest to allow enough time for the review and approval of the text of any agreement, Reuters reported.

* Former QBE Insurance Group Ltd. head John Neal will take over from Inga Beale as CEO of Lloyd's of London on Oct. 15, Lloyd's has confirmed. In his new role, Neal is expected to plug gaps in the insurance market's management team, tackle electronic trading and address its high expense base.

* Old Mutual Global Investors (UK) Ltd. is set to raise £200 million by floating a new fund that will invest in unquoted private firms, The Times of London wrote.

* UK General Insurance Group Ltd. CEO Karen Beales stepped down from the role, effective Sept. 7.

* The U.K. High Court has approved QBE European Operations' restructuring plan, which is part of the company's preparations for Britain's departure from the European Union.

* Mobius Investment Trust PLC said it intends to launch an IPO of its ordinary shares on the London Stock Exchange to raise more than £200 million.

* U.K.-based legal finance provider Vannin Capital Holdings said it intends to launch an IPO on the London Stock Exchange, with the listing to comprise a roughly £70 million primary issue of new shares and the sale of part of shares held by existing stakeholders. The company also named David Morley chairman, effective immediately.

* Randall & Quilter Investment Holdings Ltd. announced a corporate restructuring to create a new division called Accredited, which will encompass the company's U.S. and European program management business. The company also renamed its Malta-domiciled insurance platform R&Q Insurance (Malta) Ltd. to Accredited Insurance (Europe) Ltd., effective Sept. 7.

GERMANY, SWITZERLAND AND AUSTRIA

* Deutsche Bank AG could lose up to €200 million in revenue annually on the back of a recent surge in funding costs, with executives of the bank focusing on reducing the cost of issuing debt, insiders told the Financial Times.

* Meanwhile, Deutsche Bank is moving only a small number of employees from London to continental Europe following Britain's exit from the EU, Handelsblatt wrote, citing comments made by Deutsche Bank board member Sylvie Matherat in an interview with Deutschen Presse-Agentur and financial news agency dpa-AFX. The bank, which employs about 7,000 people in the U.K., is moving its main booking center to Frankfurt following a decision made independently of Brexit, Matherat added.

* Chinese conglomerate HNA Group Co. Ltd. is considering off-loading its entire 7.6% stake in Deutsche Bank after being put under pressure by Chinese regulators to address its liquidity problems and mounting debt, insiders told The Wall Street Journal. The stake is worth about €1.5 billion based on current market prices, Reuters reported.

* Hans-Walter Peters, president of the Association of German Banks, told Welt am Sonntag that Germany's banks had to become more profitable, warning that they would face serious financial difficulties if Germany were to fall into recession. Peters also called for an easing of EU regulations, which he said were burdening European banks and making them less competitive, particularly against U.S. banks.

* Swiss Life Holding AG has hired former Amundi Switzerland CEO Marius Wuergler to lead its asset management unit, Finews.com wrote. Wuergler will become head of sales and marketing at Swiss Life Asset Managers in January.

FRANCE AND BENELUX

* Dexia SA reported first-half net loss group share of €419 million, expanding from a loss of €296 million in the same period in 2017. The Belgian lender also named Giovanni Albanese to replace Chief Risk Officer Johan Bohets.

* About €300 million has been unblocked to compensate shareholders of Fortis 10 years after the dismantling of the financial institution, from which Ageas SA/NV was created, according to L'Echo. Another tranche of compensation will be unblocked in December.

* Belfius Banque SA's board has agreed to float the Belgian state-owned bank, provided it gets European approval for a special €450 million payment to a small group of investors that lost money in the bankruptcy of former parent company Dexia, Het Financieele Dagblad reported. The bank, which was nationalized in 2011, plans to start selling shares at the end of October.

SPAIN AND PORTUGAL

* Spanish private bank Banca March SA has acquired a portfolio of €550 million in assets under management from BNP Paribas SA's private banking business, Europa Press reported.

ITALY AND GREECE

* Greece's prime minister, Alexis Tsipras, plans to implement tax reductions and increase spending in order boost economic growth and fix issues from austerity measures, Reuters reported. It comes after the country exited its third bailout in August.

* UniCredit SpA will assess its strategic options when it draws up a new business plan next year, Reuters cited Chairman Fabrizio Saccomanni as saying at the Ambrosetti workshop when asked about a possible merger with France's Société Générale SA.

* Banco BPM SpA is unlikely to complete by year-end the sale of up to €10 billion in bad loans in a deal that also involves the bank's debt collection business, Reuters reported, citing banker Corrado Passera whose Illimity bank is part of a consortium comprising also Fortress and doBank that has been shortlisted in the bidding process.

* An Italian court will meet Sept. 15 to hear a request by top Banca Carige SpA shareholder Vittorio Malacalza to block a rival list of candidates submitted by other leading investors for the Italian lender's board, insiders told Reuters.

* Generali CEO Philippe Donnet said the Italian insurer could buy more small and medium-sized asset managers in addition to its potential deal for a majority stake in France's Sycomore Asset Management, Reuters reported.

NORDIC COUNTRIES

* Danske Bank A/S is investigating whether it has been used by Russia-linked companies for money laundering and is looking at $150 billion of transactions that flowed through the accounts of its Estonian branch between 2007 and 2015, with many of the accounts linked to people in Russia and ex-Soviet states, insiders told The Wall Street Journal. Suspicious money-laundering transactions at the branch contained bank reference codes indicating which other banks sent and received the funds, according to the anti-money laundering expert who first examined the money flows.

* Meanwhile, Estonia wants to see a higher level of inter-state cooperation in the area of large-scale money-laundering policing and control. Estonia's plea for greater international collaboration emerges against a backdrop where the country's finance ministry is overseeing an investigation into substantial suspected money laundering at Danske Bank Estonia, Børsen wrote.

* Sweden could face a period of political deadlock after preliminary results showed the two main parliamentary blocs failed to secure enough votes to form a majority government.

EASTERN EUROPE

* Bank Pekao SA CEO Michal Krupinski said the Polish lender is considering buying a small digital bank abroad or starting one from scratch, Reuters reported. Pekao could also potentially merge its asset management unit with small independent asset managers, or acquire them outright, Krupinski added.

* Russian pension fund manager FG Budushchee said it has been taken over by Cyprus-registered private investment firm Riverstretch Trading & Investments, Reuters wrote. Boris Mints, whose family has controlled Budushchee, had reduced his indirect stake in the company to 1.42% from 89.72% in July, according to the report.

* Evision Holdings, through which Baring Vostok funds control Public Stock Co. Orient Express Bank, launched court proceedings to contest the recent appointment of Vyacheslav Arutyunyan as acting chairman of the lender's management board, Vedomosti reported. Arutyunyan is an ally of the lender's co-owner Artem Avetisyan, who is conflicted with private equity firm Baring Vostok and wants to take control of the bank, media reports said.

* Stroygazmontazh, a company controlled by Russian businessman Arkady Rotenberg, transferred its entire stake in JSC Bank Severny Morskoy Put to Rotenberg himself, news agency RBK reported, noting that the businessman's holding in the lender increased from 23.48% to almost 50%.

* Polish investment fund manager ALTUS Towarzystwo Funduszy Inwestycyjnych SA decided to close six out of its 10 open-ended funds with 168 million Polish zlotys worth of assets under management, news agency PAP reported. Participants of the liquidated funds will receive their money March 31, 2020.

* The Albanian central bank issued preliminary approvals for the merger of former local units of Veneto Banca SpA and National Bank of Greece SA with Intesa Sanpaolo's Albanian subsidiary and Tirana-based American Bank of Investments, respectively, SEENews reported.

IN OTHER PARTS OF THE WORLD

Asia-Pacific: ICBC gets nod for Austrian unit; India fines 3 lenders; Axis Bank names CEO

Middle East & Africa: Bahrain's Al Baraka eyes 2019 share offering; Zimbabwe names new finance chief

NOW FEATURED ON S&P GLOBAL MARKET INTELLIGENCE

Wirecard displaces Commerzbank in DAX as fintechs wrestle for payments dominance: Dropping out of Germany's benchmark DAX stock index after 30 years is the end of an era for Commerzbank AG, but it is also a sign of an upcoming reshuffle of powers in traditional retail payments, according to market observers.

Suspicious funds in Danske Bank must be linked to other banks, says expert: Meanwhile, the Danish lender's share price fell 6.5% Sept. 7 as its chairman said the money laundering problem at its Estonian branch was bigger than previously anticipated.

French lenders may be taking excessive risks to meet revenue targets: analysts: French banks may be taking excessive risks to meet revenue targets and may face earnings pressure for years to come because they are underpricing their loans.

Sheryl Obejera, Ed Meza, Danielle Rossingh, Gerard O'Dwyer, Beata Fojcik, Yael Schrage, Stephanie Salti, Praxilla Trabattoni, Mariana Aldano contributed to this report.

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