S&P Global Market Intelligence offers our top picks of banking news stories and more published throughout the week.
Major shake-ups at Swiss banks
* Credit Suisse Group AG unveiled an overhaul of its Swiss Universal Bank unit, including investing hundreds of millions in the division's digital services and other areas through 2021. As part of the plan, the bank will form a new business area, dubbed Direct Banking, that will cater to retail and commercial clients, while carving out its investment banking operations from its corporate and investment banking segment.
* UBS Group AG tapped former Credit Suisse executive Iqbal Khan to co-head its flagship global wealth management business, replacing Martin Blessing. The bank also promoted Suni Harford to head of asset management, succeeding Ulrich Körner.
Coping with low interest rates
* Bank of Cyprus Holdings PLC will manage its funding costs and continue to reduce its cost base to deal with the threat posed by the low interest rate environment on its profitability. The bank swung to a statutory post-tax profit of €97.4 million in the first half from a year-ago loss of €54.0 million.
* Danish lender Sydbank A/S announced plans to levy negative interest rates on certain retail clients, citing expectations that the negative interest rate environment will continue for several years. The bank reported a profit of 184 million kroner in the second quarter, down from the year-ago 238 million kroner.
More earnings
* Landesbank Baden-Württemberg posted first half net consolidated profit attributable to shareholders of €219 million, up from the year-ago €206 million. German peer Norddeutsche Landesbank Girozentrale, which is awaiting a €3.6 billion state-backed recapitalization, also saw an increase in first half attributable profit, to €152 million from €64 million.
* National Bank of Greece SA said it expects to see a "faster than planned" reduction of its nonperforming exposures, as it reported second quarter profit after tax from continued operations of €122 million, up from €22 million a year earlier. Fellow Greek lenders Alpha Bank AE and Piraeus Bank SA also reported results.
M&A buzz
* BNP Paribas SA reportedly plans to bid on Deutsche Bank AG's equity derivatives book and hopes to clinch a deal within the next few weeks. The French lender is already set to take control of Deutsche Bank's prime brokerage business in September.
* Barclays PLC is said to be in discussions to sell its automated options trading business in New York to U.S.-based electronic market maker GTS Securities LLC, following calls from activist investor Edward Bramson to shrink its investment banking operations.
On the macro front
* Incoming ECB President Christine Lagarde said the regulator still has room to cut interest rates if needed, but urged caution in keeping interest rates below zero for a prolonged period due to their "adverse" impact. Meanwhile, ECB Governing Council member Klaas Knot said the current weakness in the eurozone economy and the inflation outlook may not yet warrant a restart of quantitative easing.
* Banks will move €1.3 trillion of assets out of London to the eurozone after the U.K. exits the EU, according to ECB supervisory board Chairman Andrea Enria.
In other news
* Swedbank AB (publ) named Jens Henriksson president and CEO, effective as soon as possible, as it seeks to regain its footing amid money laundering allegations. Henriksson joins from Swedbank's second-biggest shareholder, insurer Folksam AB.
* Deutsche Bank confirmed that it is in possession of tax returns requested by congressional Democrats seeking financial records related to U.S. President Donald Trump, his family and his businesses. However, it was unclear whose tax returns the lender had as names were redacted from the court filing.
Featured during the week on S&P Global Market Intelligence
European banks brace for 'lower for longer' interest rates: Banks across Europe are under pressure from the low interest rate environment, which is set to continue for longer than expected after the ECB signaled that a further rate cut could be on the horizon.
ECB's bond buying bazooka blunted by shortage of bonds as German debt shrinks: The scale of the European Central Bank's next bout of quantitative easing could be limited to less than half of its previous €2.6 trillion program by a lack of German debt, and limits on the percentage of a country's debt the central bank can hold.
Deadline in Britain's biggest financial scandal nears with claim surge expected: The regulator expects consumers to file last-minute claims as the long-running payment insurance mis-selling debacle finally draws to a close for U.K. banks, which have already paid out £36 billion in compensation.