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MUFG to hike Vietinbank stake; court rejects Shinhan CEO arrest warrant

S&P Global Market Intelligence offers our top picks of banking news stories and more published throughout the week. Please note that some entries may have links to third-party sources that may require a subscription.

M&A corner

* Japan's Mitsubishi UFJ Financial Group Inc. is looking to raise its stake in Vietnam Joint Stock Commercial Bank for Industry & Trade, or Vietinbank, to 50% from 19.7%.

* Joint Stock Commercial Bank for Foreign Trade of Vietnam, or Vietcombank, may reportedly make 1 trillion dong in profit from selling part of its stakes in Military Commercial Joint Stock Bank and Vietnam Export Import Commercial Joint Stock Bank.

* City Savings Bank Inc., the thrift arm of Union Bank of the Philippines, is set to acquire a substantial stake in rural bank, Progressive Bank Inc.

* Thailand-based Bank of Ayudhya PCL is selling a 50% stake in its microfinance arm to a consortium led by CVC Capital Partners Asia Fund IV and Equity Partners Ltd.

Deal activity in India

* The Indian government is reportedly holding off on selling part of its stake in Axis Bank Ltd. due to volatile market conditions.

* State Bank of India will acquire assets from cash-strapped nonbanking financing companies, or NBFCs, of up to 450 billion rupees.

* Union Bank of India is looking to raise 7 billion rupees by selling its stakes in six companies.

* Federal Bank Ltd. obtained approval from the Reserve Bank of India to sell a stake of up to 45% in Fedbank Financial Services Ltd. to private equity fund True North Enterprise Pvt. Ltd.

Regulatory developments

* A South Korean court denied a prosecution request for a warrant to arrest Shinhan Financial Group Co. Ltd. CEO and President Cho Yong-byoung amid his suspected involvement into the company's hiring malpractices.

* Japan's financial regulator banned Suruga Bank Ltd. from extending new property loans for six months in the wake of a lending scandal.

* An independent review of Commonwealth Bank of Australia's remedial plan to address shortcomings identified by the prudential regulator showed that the bank's size and the complexity of the plan will likely pose ongoing execution challenges.

* Meanwhile, another class action suit that could exceed A$100 million was filed against CBA and its superannuation business Colonial First State from law firm Slater and Gordon.

* The Indian central bank kept its repo rate unchanged at 6.50%.

In other news

* Moody's expects the implementation of the International Financial Reporting Standard 9, or IFRS 9, to have a credit neutral impact on Asia-Pacific banks' profiles.

* According to Moody's, the Bank of Thailand's new mortgage-lending rules are credit positive for banks.

* Japan Post Bank Co. Ltd. will suspend part of its real estate and mortgage loan consignment to Suruga Bank starting Oct. 12 for a period of six months.

* Singapore-based United Overseas Bank Ltd. is reviewing its life insurance tie-up with Prudential PLC as it aims to get more value out of its insurance operations.

* India's Bandhan Bank Ltd. is considering three options, including M&A deals, to comply with the Reserve Bank of India's promoter shareholding rules.

* Bank of Shanghai Co. Ltd. obtained regulatory approval to increase its registered capital to 10.93 billion yuan from 7.81 billion yuan.

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