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Banca Carige's woes; NordLB-Helaba merger talks halt

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Banca Carige's woes; NordLB-Helaba merger talks halt

S&P Global Market Intelligence offers our top picks of banking news stories and more published throughout the week.

Banca Carige struggles

* Struggling Italian lender Banca Carige SpA was placed under temporary administration by the European Central Bank following the resignation of most its board members. The bank, weighed down by a large amount of bad loans, had a share sale blocked by its biggest shareholder. An analyst told S&P Global Market Intelligence that finding a buyer was the only viable option for the bank. The Italian Treasury's bad bank is in talks to acquire some €3.7 billion of bad debt from the bank to help clear its balance sheet and make it more appealing as a takeover target.

* Carige on Jan. 4 said lawyer Gianluca Brancadoro was appointed chair of the surveillance committee that the ECB established as part of the temporary administration.

Legal and regulatory action

* The U.S. Department of Justice said former bankers of Switzerland-based Credit Suisse Group AG Surjan Singh, Andrew Pearse and Detelina Subeva were arrested in London on charges relating to a $2 billion fraud scheme involving loans to state-owned firms in Mozambique, The Wall Street Journal reported.

* Deutsche Börse AG former CEO Carsten Kengeter will have to pay a fine of almost €5 million to settle the insider trading allegations against him, Handelsblatt reported Dec. 28, 2018.

* The National Bank of Ukraine imposed a 94.7 million Ukrainian hryvnia fine on PAO Sberbank of Russia unit Sberbank JSC for repeated violations of the country's financial monitoring regulations. According to the regulator, the lender was fined, among other things, for involvement in large-scale cash withdrawal transactions from its corporate clients' accounts, which could have been associated with money laundering and fake business operations.

* The latest stress tests conducted by the Ukrainian central bank showed that 13 of the country's 24 biggest banks would need additional capital amounting to a combined 42.1 billion Ukrainian hryvnia, although this sum dropped to 19.7 billion hryvnia at the end of 2018 after JSC VTB Bank was declared insolvent and several lenders took measures to fulfill their capital needs.

* The Russian government completed the implementation of a 2-tier licensing system for banks. Lenders with a basic license are subject to lower capital requirements and simplified regulations but will not be allowed to execute certain banking operations.

Buying and selling

* Portugal-based Novo Banco SA completed the sale of its majority 87.5% stake in Paris-based Banque Espírito Santo et de la Vénétie SA to Promontoria MMB SAS — an affiliate of U.S.-based Cerberus Capital Management LP.

* Aareal Bank AG completed the purchase of Düsseldorfer Hypothekenbank AG on Dec. 31, 2018. The deal will lead to a positive one-off effect from initial consolidation of roughly €52 million, the acquiring lender said.

* Italy's Banca IFIS SpA acquired €1.16 billion bad loan book from Banca Monte dei Paschi di Siena SpA. The portfolio consists of consumer loans and unsecured small-ticket banking loans.

* Italy's doBank SpA intends to acquire NPL service provider Altamira Asset Management in a deal that has been valued at €412 million. DoBank could acquire 85% of Altamira, while the remaining 15% stake could also be acquired from Spain's Banco Santander SA.

In other news

* Talks between Landesbank Hessen-Thüringen Girozentrale and Norddeutsche Landesbank Girozentrale have ended, and a tie-up between the two German banks will not materialize, according to a Reuters report.

* Two Baltic-based Luminor Banks will transfer their Nasdaq memberships to their continuing unit, Estonia-based Luminor Bank AS, on the completion of their merger. The banks are Latvia-based Luminor Bank AS and Lithuania-based Luminor Bank AB. NASDAQ OMX Tallinn AS approved the combined entity's membership to its securities market exchange, effective Jan. 2, 2019.

* Paul Achleitner will continue to serve as chairman of the supervisory board of Deutsche Bank AG until his mandate ends in 2022, he revealed in an interview with Handelsblatt. He also ruled out the need for state aid to help the bank.

Featured during the week on S&P Global Market Intelligence

Bank M&A to be key theme in Germany in 2019, amid talk of 'super landesbank': There has been much speculation about the fate of NordLB, as well as that of Deutsche Bank and Commerzbank.

Ten years after the crisis, experts question value of bank stress tests: Capital requirements are inadequate and regulators use flawed accounting methods to judge whether banks meet them, according to former Bank of England chief economist Sir John Vickers.

The year in fintech: Rise of digital banks, fall of cryptocurrencies: As 2019 approaches, the industry is watching four major areas within the fintech industry: banks (and nonbanks) going digital, regulation, Wall Street's involvement in cryptocurrencies and high-profile mergers and public offerings.

Deutsche faces tough new year after nearly 60% stock slump in 2018: The troubled German lender is contending with a host of challenges heading into 2019, including a share price slump and long-term restructuring that has dragged on profitability and investor confidence.

Finding a buyer is 'only option' for embattled Banca Carige, says analyst: The troubled bank is unlikely to be able to continue unaided after a failed capital raising, the resignation of most of its board and the recent ECB intervention.