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IMF stresses NPL issue; SVG accepts Goldman, CPPIB offer; RBI, RZB to merge

Energy

Power Forecast Briefing: Fleet Transformation, Under-Powered Markets, and Green Energy in 2018

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S&P Global Market Intelligence

Cannabis Hashing Out a Budding Industry


IMF stresses NPL issue; SVG accepts Goldman, CPPIB offer; RBI, RZB to merge

IMF sees 'urgent'need for action on NPLs: The IMF saidEuropean banks need "deep-rooted reforms and systemic management" to reducesignificant risks to financial stability and should prioritize taking"urgent and comprehensive action" to address excessive nonperformingloans and capital deficiencies. Peter Dattels, the fund's deputy director ofmonetary and capital markets, saidEuropean banks have "too many branches with too few deposits" andurged them to revamp their business models.

* Joseph Stiglitz,Nobel laureate in economics, predicted that Italy and other countries wouldleave the eurozone in the coming years, Reuters writes, citing German newspaper Die Welt.Stiglitz added that the euro and austerity policies in Germany are to blame forthe bloc's economic malaise.

* ECB Supervisory Board member Ignazio Angeloni said the central bank does not see any risk of a bankingcrisis in the eurozone despite "individual cases" of banks withproblems, Reuters reports.

UK AND IRELAND

SVG accepts Goldman,CPPIB offer: said this morning that its board agreed in principle to a proposed sale of100% of its entire investment portfolio to a unit of and certaininvestment entities managed by the Canada Pension Plan Investment Board forapproximately £748 million, or 680 pence per share, representing a 6.8%discount to the value of the assets as of July-end.

* SVG had saidyesterday that it continues to recommend that its shareholders not acceptHarbourVest PartnersLLC's offer, which was deemed too low. Meanwhile,HarbourVest said Aviva Investors and Legal & General Investment Managementhave withdrawn their letters of intent to support HarbourVest's takeover bidfor SVG, Reuters notes.City A.M. also covers.

* Bidders for MBNA Ltd., including Lloyds Banking Group Plc and Santander UKPlc, were askedto table revised bids in two weeks' time, insiders tellSky News. A number of the bidders were trying to negotiate an indemnity forfuture payment protection insurance costs with MBNA owner Bank of AmericaCorp., but were turned down.

* Standard CharteredPlc named Mohamed Abdel Bary regional CFO for Africa and the Middle East, Reutersnotes.

* Gareth Murphy, Central Bank of Ireland's outgoing directorof markets supervision, is to join Standard Life Plc as chief risk officer of its assetmanagement arm and deputy group CRO in January 2017, The Irish Times reports.

* The FCA finedAviva Plc £8.2 million for failing toproperly oversee outsourced providers in relation to the protection ofclient assets.

*  picked CerberusCapital Management as a preferred bidder for Capital Home Loans Ltd.'s remaining mortgageportfolio, insiders tellReuters. The remaining mortgage book, comprising mostly buy-to-let mortgages,totals about £2.5 billion.

* U.K. Chancellor Philip Hammond is meeting with Wall Street banks andother financial services firms in a bid to reassure them of London's dominanceas the world's leading global financial center despite the country's decisionto leave the EU, Reuters writes.

GERMANY, SWITZERLANDAND AUSTRIA

RBI/RZB mergergreenlighted: The boards of Raiffeisen Zentralbank Österreich AG and subsidiaryRaiffeisen Bank InternationalAG yesterday approveda merger between the companies. RZB will be merged into RBI. Handelsblatt covers.

*  dismisseda media report that new CEO Walter Berchtold is facing pressure to find a buyerfor the bank, and said it is not up for sale, Reuters reports. Banque Heritage (Suisse) SA was reported to be apotential buyer.

* The German government is engaging in discreet talks withU.S. authorities in a bid to help reach aquick settlement over allegations that it missold MBS, insiders tellReuters. The government hopes that a near-term settlement well below the $14billion originally demanded will help alleviate pressure on the bank and giveit time to regain its footing.

* Former German Finance Minister Peer Steinbrück will serveas an adviser to ING GroepNV unit ING-DiBaAG's board, Les Echos reports.Die Zeit also reports.

*  was dismissedfrom a class-action lawsuit accusing it of conspiring to manipulate silverprices and exploit market distortions, Reuters reports.The U.S. federal judge, however, rejected efforts by and to dismiss thelawsuit.

*  agreedto pay the U.S. SEC a $90 millionfine to settle charges that it misrepresented a key performance metric relatedto its wealth management business. The regulator found that Rolf Bögli, formerCOO of the bank's private banking division, pressured employees to classifycertain high-net-worth client assets as net new assets.

* Herbert Scheidt, the newly elected president of the SwissBankers Association, tellsHandelsblatt that Swiss banks are notonly stable but among the most stable in the world, particularly Credit Suisseand UBS Group.

FRANCE AND BENELUX

Confusion on how todeal with Ethias: As EthiasSA submitted its new recovery plan to the Belgian national bank,the finance ministers of the Walloon and Flanders regional governments, whicheach, along with the federal government, hold 25% stakes in the insurer, launcheddiffering strategies. Walloon said it is ready to help recapitalize Ethias ifnecessary, while Flanders is looking for an investment bank to advise it on itsstake, L'Echo reports.

* CréditMutuel Group's Cofidis SA consumer credit unit was fined €100,000and ordered to pay nearly €1.3 million in costs after being found guilty of illegalselling in a solar panel fraud case dating to 2010, Le Monde reports.The company plans to appeal.

SPAIN AND PORTUGAL

Banco Popular tobring back dividends: BancoPopular Español SA CEO Pedro Larena said that in 2017 the bank willreturn to paying dividends and that in 2018 the entity would ensure a 40% cashdividend payout. In May, the lender suspended the payment of dividends for 2016after announcing a €2.51 billion capital increase, Europa Press writes.

* Separately, the bank acceleratedits employee layoff program, inviting trade unions to a meeting to negotiatethe conditions of the 2,900 job cuts planned for the coming months, El Mundo reports.

* The IMF estimatesthat in 2021 Portugal will have a budget deficit of 2.9% of GDP, the worst inthe eurozone, Público writes.

ITALY AND GREECE

Amundi offers €4B for Pioneer: made a roughly 4 billion nonbinding offerfor UniCredit SpA'sPioneer Global Asset ManagementSpA, while a consortium led by Poste Italiane SpA offered around 3.4 billion, IlMessaggero says.

* Talks with funds that earlier this year expressed interestin purchasing the four bailed-out Italian banks are resuming as authorities seeka backup plan for selling them should an alternative plan involving buying three of the four lenders fall through, Il Sole 24 Ore writes.

* International property asset managers and Italian propertygroup Prelios are among market players working on the creation of closed fundsalong the lines of the Atlante fund to invest in Italian NPLs, MF says.These funds are expected to launch next year.

* The IMF said Italy should do more to deal with NPLs,recommending that recent insolvency reforms introduced to accelerate assetrecovery in bankruptcies be extended to cover existing NPLs and that Italianauthorities monitor the asset quality of smaller banks not overseen by the ECB,Reuters reports.

* The Bank of Italy ordered Latvian bank to close its Italianbranch by the end of the year, Reuters says.

* is expectedto launch its voluntary redundancy plan this month, Kerdos writes,noting that the bank is required to reduce 2,100 staff by 2018. The cost of theplan is estimated to reach €118 million.

* The IMF considers the fiscaltargets contained in the Greek Memorandum for the period after 2017 to beunrealistic, and hence is not willing to further fund the Greek economy, Imerisia says.

* The ECB loweredthe cap on emergency liquidity assistance that Greek banks can draw fromthe Bank of Greece by €100 million to €51.8 billion.

NORDIC COUNTRIES

Swedbank namesdigital banking chief: namedLotta Lovén head of digitalbanking. She was previously acting co-head of the unit.

* Skandinaviska Enskilda Banken AB has more than tripledlending to Danish businesses since 2009, FinansWatch reports.From 2013 to 2015, business lending increased 35%.

* Danish pension company PFA Pension Forsikrings A/S is closing its Greenlandunit, FinansWatch reports.According to PFA, the expense per customer at PFA Soraarneq, which was founded16 years ago, was twice that in Denmark.

* Stefan Alexandersson, CEO of Swedish niche bank Collector,intends to resign, Dagens Industri reports.Alexandersson has been with the company for 12 years and was responsible for itsIPO. Collector expects to have a replacement for the CEO in spring 2017.

EASTERN EUROPE

Alior seeks toexclude Raiffeisen Bank Polska'smortgage book from deal: Alior Bank SA, which is negotiating the purchase ofRaiffeisen Bank PolskaSA, wants the RBI unit's entire mortgage portfolio excluded fromthe transaction, not just Swiss franc-denominated loans as per the agreementbetween the Polish FSA and RBI, Puls Biznesureports.

* The Polish FSA classified 12 Polish banks as "other systemicallyimportant institutions" and calculated additional capital buffers for thelenders that reflect their risk exposure.

* JSC RussianAgricultural Bank plans to reduce overdue loans to 15% of itsportfolio in 2016 and to 14% in 2017, from 20% at the end of 2015, Vedomosti writes.

* The Russian central bank revoked the license ofiMoneyBank, saying the lender invested in low quality assets and improperlyassessed risks, Interfax reports.Some of the shareholders of iMoneyBank were also co-owners of Finprombank,which lost its license in September.

* Oleg Tinkov and his partners intend to increase theirstake in TCS Group HoldingPlc by acquiring up to $10 million of its GDRs on the London StockExchange, Vedomosti says.

* Viktor Shevchenko will be named president of ,while Sergey Malyshev will be retail business head at , Kommersant reports.Both executives come from PAOSberbank of Russia.

* Safmar Group wants to use leasing company as a basis to form aholding that will bring together the group's pension, insurance and leasingbusinesses, RBK reports.Safmar hopes to conclude the main part of the deal by 2017. The consolidationplans will not include B&N Bank Group.

* Yapi veKredi Bankasi AS signed a syndicated loan agreement for $1.15 billion,Finans Gündem reports.

IN OTHER PARTS OF THEWORLD

Asia-Pacific: Chinese firms to acquire Singapore reinsurer; Switzerland asksMalaysia for legal help on 1MDB probe

Middle East & Africa: Fidelity Bank Ghana mulls IPO; FirstRand eyes M&A opportunitiesin Africa

Latin America: Itaú, Citi said to near deal; name change for Banco Nacional deMéxico

North America: Regulators release updated versions of living wills by 8 largebanks; CFPB issues new prepaid card rules

North America Insurance: Japan's Sompo to buy Endurance; Markel/Allied World deal talksfail

NOW FEATURED ONS&P GLOBAL MARKET INTELLIGENCE

Delta Lloydshould hold out for higher offer from NN Group, analysts say: DeltaLloyd is likely to get a better takeover deal from NN Group if it refuses the€2.4 billion on offer, analysts told S&P Global Market Intelligence.

Deutsche Bank tightensgrip on asset management unit despite capital pressure: DeutscheBank will fight to hold on to its prized asset management division despiteincreasing pressure to shore up its capital position, experts say.

Data DispatchEurope: Top 20 European banks by market capitalization: ChartWatch: There was relatively little movement among Europe's top 20banks by market capitalization during the third quarter, according to datacompiled by S&P Global Market Intelligence.

Xana Kakoty, Ed Meza, Danielle Rossingh, Esben Svendsen, Beata Fojcik, Thanasis Kakalis, AliKayalar, Heather O'Brian, Brian McCulloch, Praxilla Trabattoni and Mariana Aldano contributedto this report.

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