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Weekly news through May 6

Banking Essentials Newsletter - November Edition

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

StreetTalk – Episode 70: Banks' Liquidity Conundrum Could Fuel M&A Activity


Weekly news through May 6

S&P Global MarketIntelligence offers our top picks of banking news stories and more publishedthroughout the week.

Managing mischief

* , , , and three U.S. banks will pay a combined $324 million to settle a private U.S. lawsuit allegingthat they rigged ISDAfix from 2009 to 2012. The settlement requires approvalfrom the court, and resolves antitrust claims against the banks.

* A U.S. grand jury is evidence against currentand former officials at Rabobank, now known as Cooperative Rabobank UA, overalleged lapses that purportedly allowed Mexican drug cartel cash to belaundered through the bank, Bloomberg News reported. No individual has yet beenaccused of wrongdoing and it is unclear if anyone will be charged.

* Shareholderadvisory group ISS recommended that Deutsche Bank shareholders vote infavor of a special audit that would probe whether executives fell short intheir examination of legal issues. ISS said the sudden resignation of GeorgThoma, who was responsible for looking into potential wrongdoing withinDeutsche Bank's ranks, raise concerns about the lender's internal investigationsof potential misconduct. The U.K. Financial Conduct Authority meanwhile ordereda new independent review into the bank, having found "serious"failings in its money laundering and other controls.

* An Italian prosecutor isinvestigatingDeutsche Bank and five of its former managers on market manipulationsuspicions. The probe relates to the lender's sale of €7 billion of Italiansovereign bonds in 2011, when the country was on the verge of a debt crisis.

Q1 earnings watch

* 's first-quarterprofit dropped on ayearly basis to $4.30 billion from $5.26 billion amid challenging marketconditions. Officials said the group's net interest margin is set to as a result of the bank'sincreased issuance of bonds eligible to be classified as total loss-absorbingcapacity capital.

* booked of €1.81 billion inthe first quarter, up 10.1% from the year-ago period. CFO Lars Machenil saidthe bank's , which dropped 27.5% on a yearly basis to €757 million, will remain lowin the future.

* first-quarter group net incomeof €924 million, up from €868 million in the year-ago period. SocGen aims to afurther €220 million in in its wholesale banking division by 2017, in addition to the €323million already announced.

* reported of CHF707 million,down from CHF1.98 billion in the first quarter of 2015. CEO Sergio Ermotti saidthe weak market conditions seen in the first quarter of 2016 are not"the new normal."

* a year-over-year decline infirst-quarter profit to €163 million from €338 million. The bank, which refutedallegations that itused dividend stripping to avoid paying taxes, said it would be "morechallenging" in 2016 to reach the net profit posted in 2015.

Eyes on Atlante 

* The Borsa Italianadeclined to authorizethe commencement of trading in Banca Popolare di Vicenza SpA's shares after investorssubmitted requestsfor only 7.66% of the bank's global offering. As a result of the failure tolist, the subscriptions were deemed void and Atlante, Italy's newly createdbank bailout fund, will take up 100% of the global offering and end up with a99.33% stake in the bank.

* Chairman PierluigiBolla said the bank does not need Atlante's support for its €1 billion capital increase for now,following speculation that the bailout fund might have to underwrite the cashcall. Bolla said the lender would find out if it could raise the cash withoutthe fund's involvement after it starts pre-marketing for the share issue fromMay 12 to May 14.

* The ItalianTreasury could now begin investing in Atlante under a new law, Reuters reported.The decree allows the Treasury to invest in an -owned investmentvehicle, which in turn is now able to buy credits and other financial assets inthe market, including those related to the bailout fund.

In other news

* Barclays a 12.2% in , raisinggross proceeds of approximately 13.05 billion South African rand. The Britishlender will hold a 50.1% stake in Barclays Africa following completion of thetransaction.

* The EuropeanCommission completed state aid proceedings for and formallyapproved the transferof €6.2 billion in bad loans to the bank's major shareholders and the sale of afurther €2 billion in bad loans. The EC said HSH Nordbank must complete itsprivatization by the end of February 2018, subject to a six-month extension.

* Priit Perens, headof Swedbank AB(publ)'s Baltic unit, said the Swedish bank is looking to its operations in theBaltic region, targeting acquisitions in Latvia and Lithuania in particular.The development follows Swedbank's recent acquisition of ' retail bankingbusiness in the two countries.

* was set toprice its IPO at 68 Czech koruny per share, the of a revised price range thathad the top end of 70 koruny per share.

Featured during theweek on S&P Global Market Intelligence

: An attempt to steal almost $1 billion usingbanking's main international communications system came as financial servicescompanies pin their hopes on blockchain for a more resilient technologicalfuture.

: Swedish banks remain well-positioned comparedto many of their European peers, but pressure on interest, fee and tradingincome demonstrate the challenges faced across the continent.