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US fund giants eye China market; bank deals in Pennsylvania, Massachusetts


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US fund giants eye China market; bank deals in Pennsylvania, Massachusetts

BlackRock Inc. and Vanguard Group Inc. are among at least six global asset management giants that have held talks with regulators in China to apply for fully foreign-owned mutual fund licenses in the nation, sources told Bloomberg News.

Voting 410-13, the U.S. House of Representatives passed the Insider Trading Prohibition Act, the country's first statute explicitly banning insider trading. House Financial Services Committee Chair Maxine Waters, D-Calif., said H.R. 2534, introduced by Jim Himes, D-Conn., creates a clear definition of illegal insider trading under securities laws so that there is a codified, consistent standard for courts and participants in financial markets, and to better safeguard the citizens' money.

In Massachusetts, Cambridge Bancorp, the holding company for Cambridge Trust Co., agreed to acquire in-state peer Wellesley Bancorp Inc. in an all-stock transaction expected to be completed in the second quarter of 2020.

Bristol, Pa.-based Fidelity Savings and Loan Association of Bucks County and Philadelphia-based Washington Savings Bank have agreed to merge with and into William Penn Bank (MHC), a unit of William Penn Bancorp Inc. (MHC). The mergers are expected to be completed in the second calendar quarter of 2020.

Jefferies Financial Group Inc. is poaching about a dozen professionals, including analysts, salespeople and traders from the equity division of CLSA Ltd. in India, on top of its hiring spree in Hong Kong, Japan and Australia this year, sources told Bloomberg News.

Despite the rise of online banks, younger people still consider physical bank branches to be an important factor when choosing a new bank, CNBC reports, citing a new retail banking survey by Jefferies. Respondents, particularly those aged 18 to 34, are still leaning on physical locations, according to the report.

The Financial Stability Oversight Council has "significant" concerns and about the increasing trend of nonbank financial companies underwriting mortgages, FSOC Chair and Treasury Secretary Steven Mnuchin said. At a hearing Dec. 5, Mnuchin told the House Financial Services Committee that one of the problems with the trend, which the FSOC is now "carefully studying," is that nonbanks do not have the liquidity banks have in advancing on mortgages.

At the hearing, Mnuchin also said Congress may have to help his department ease the transition to a new interest rate benchmark, American Banker reports. The lawmakers echoed regulators' concerns about the impending end of use of the London interbank offered rate in 2021, the news outlet reports. The Financial Stability Oversight Committee headed by Mnuchin cautioned in its 2019 annual report that this could "significantly disrupt trading in many important types of financial contracts."

Mark Dewar, JPMorgan Chase & Co.'s Australian head of trading, had a series of meetings from 2015 with the Australian Competition and Consumer Commission before the Australian regulator issued cartel charges against Citigroup Inc. and Deutsche Bank AG over a A$2.5 billion capital raising for Australia & New Zealand Banking Group Ltd., Reuters reports, citing Dewar's testimony in a court hearing Dec. 5. All three banks worked on the stock issue of ANZ in August 2015, but only JPMorgan was spared from charges of withholding information on the sale process to investors in an attempt to support the stock's price.

Wells Fargo & Co. will refund next year its checking account customers who were affected by some confusion on maintenance fees for their Everyday Checking and Opportunity Checking accounts, American Banker reports, citing CEO Charlie Scharf's Dec. 2 letter to Rep. Katie Porter, D-Calif. In a Nov. 21 letter, Porter pressed Scharf on the issue, which took place between 2013 and 2018, and asked Wells Fargo to repay the customers ahead of the holiday season.

Robo adviser Wealthfront has laid out its banking goals for 2020, American Banker reports, citing an interview with CEO Andy Rachleff. The goals include the launch of a debit card, automated bill pay and direct deposit by the first quarter and more automated features like rerouting of leftover money into clients' investment portfolios by the second quarter.

In other parts of the world

Asia-Pacific: SMFG to expand Indonesia biz; RHB Bank to exit Hong Kong; Yes Bank downgraded

Europe: Phoenix buys Swiss Re unit; EU approves NordLB rescue; Julius Bär eyes EFG

Middle East & Africa: Israel outlines open banking rules; Orange Bank's MEA plans; Bankia in Morocco

Now featured on S&P Global Market Intelligence

Credit union's deal for $747M bank rounds out record year: As bankers express concern about the growing trend of credit unions acquiring banks, those deals are only getting bigger.

Fintech M&A Deal Tracker — Deal volume plummets in November: Nearing the end of a year defined by staggering deal values, the number of fintech deals in November declined year-over-year and month-over-month.

Schwab leads S&P 500 Financials index in November following deal announcement: The S&P 500 Financials index gained 5.0% in November, outpacing the S&P 500's 3.6% total return. Among the 67 financial companies in the index, 61 closed the month in the green.

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng was up 1.07% to 26,498.37, and the Nikkei 225 inched up 0.23% to 23,354.40.

In Europe, around midday, the FTSE 100 rose 0.81% to 7,195.32, and the Euronext 100 gained 0.50% to 1,119.24.

On the macro front

The employment situation report, the consumer sentiment report, the wholesale trade report, the Baker-Hughes Rig Count and the consumer credit report are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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