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Deutsche chair hunts for successor; Rabobank profit drops; Aegon, NN results up


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Commercial Banking Newsletter June Edition - 2022

Deutsche chair hunts for successor; Rabobank profit drops; Aegon, NN results up

* The ECB urged banks to accelerate their Brexit contingency plans for all possible scenarios, noting that they have so far transferred significantly fewer activities to euro-area entities than originally expected. The regulator added that banks should address operational challenges linked with relocating employees and setting up internal processes and systems and follow up on agreed commitments.

* Global banks so far disclosed plans to cut 48,500 jobs this year, a large majority of which coming from Europe, where lenders deal with a prolonged low-interest rate environment, an analysis by Bloomberg News showed. The total number of global bank layoffs is believed to be higher as there are other lenders that do not or have yet to disclose their plans.


* U.K. Labour Party leader Jeremy Corbyn is seeking the support from rival parties for his bid to become prime minister to block current Prime Minister Boris Johnson from delivering a no-deal Brexit, news outlets including Bloomberg News and The Guardian reported. In a letter to other political parties, Corbyn said he would seek to become the leader of a "strictly time-limited" caretaker government and push for a general election.

* The Bank of England will likely hold interest rates before the Oct. 31 Brexit deadline despite inflation breaching its 2% target, economists told Evening Standard. The central bank is far more likely to cut rates after Brexit.

* Prudential PLC posted first-half operating profit from continuing operations of £2.02 billion, up from £1.67 billion a year ago. The U.K. insurer expects to complete the demerger of M&G Prudential in the fourth quarter. Its U.K.-focused unit will list as M&G PLC, while the business for Asia and the U.S. will keep its current trading name, with a double listing in the U.K., Reuters reported.

* Admiral Group PLC's first-half pretax profit group share rose year over year to £220.2 million from £211.7 million. The personal lines insurer may issue a public securitization or debt to fund longer-term growth ambitions of its new loans unit.

* The U.K. National Crime Agency received freezing orders for eight bank accounts holding an aggregate of over £100 million suspected to be proceeds from bribery and corruption abroad.

* Barclays PLC has ended its partnership with cryptocurrency exchange Coinbase Inc. after the San Francisco-based company expanded in Europe, unnamed sources told Reuters.

* Investment frauds in the U.K. in the first half almost doubled year over year to 8,153 incidents, a sign that fraudsters are turning to investment scams from stealing pension savings, the Financial Times reported, citing data from London Police's National Fraud Intelligence Bureau.


* Paul Achleitner is looking for his potential successor as supervisory board chairman of Deutsche Bank AG although he intends to complete his current term, which ends in 2022, insiders told Bloomberg News. His move reportedly comes partly due to investor unrest over succession planning and a series of failed restructurings.

* A dispute has erupted between the Sparkassen-Finanzgruppe and the state of Lower Saxony over the rescue package for Norddeutsche Landesbank Girozentrale, Handelsblatt reported. The shareholders remain divided over the issue of dividends and the Sparkassen savings bank group is demanding a veto power. The parties aimed to resolve the conflict at a meeting yesterday evening.

* Swiss private bank Bergos Berenberg AG appointed Christof Kutscher chairman. Kutscher also serves as chairman of Axa Investment Managers SA, Paris. Bergos Berenberg, which split off from Germany's Joh. Berenberg Gossler & Co. KG last year, is in the process of reorganizing its executive management and has also named lawyer Patricia Guerra as a member of the board.

* FinLeap GmbH, the Berlin-based financial technology startup platform behind Germany's SolarisBank AG, is reorganizing its operations and will launch a new business unit called Finleap Connect on Sept. 1.


* Rabobank's first-half net profit dropped 29% year over year to €1.21 billion from €1.70 billion. The bank booked impairment charges on financial assets of €440 million in the period, compared to gains of €37 million a year ago.

* Aegon NV saw a 26% year-over-year increase in its first-half net income attributable to owners, to €618 million from €491 million.

* NN Group NV posted second-quarter net result of €606 million, up 30.7% from the year-ago €463 million. The group's first-half net result also increased 29.6% year over year to €1.12 billion.

* Achmea BV's first-half net result attributable to equity holders totaled €234 million, an increase from the year-ago €133 million. The Dutch insurance group will also launch an innovation fund with an initial capital of €100 million to operate beginning Oct. 1.


* Juan José Divassón was appointed director of digital products and data strategy at Banco Bilbao Vizcaya Argentaria SA in Spain, replacing Manuel Moure, who recently joined the bank's U.S. team in charge of developing solutions for retail customers, Europa Press wrote.

* Portuguese banks provided a total of €4.9 billion in housing credit in the first half. It is the highest amount since the first half of 2010, Dinheiro Vivo reported. On a daily basis, an average of €26.2 million loans are contracted, nearly a million more than the same period last year, according to data released by Portugal's central bank.


* Italy's 5 Star Movement and Democratic Party have set aside their differences and teamed up to block The League leader Matteo Salvini's bid for a no-confidence vote against the current coalition government and form a new government with his party securing a majority in parliament, The Wall Street Journal reported. Separately, Salvini would appoint ally Giancarlo Giorgetti as finance minister if he were to be successful in taking over as prime minister, Bloomberg News reported, citing Salvini's interview with newspaper Corriere della Sera. Salvini's plan could mean that he would accelerate efforts to cut tax and public works investments to bolster the country's fragile economy.

* Foreign holdings of Italian government bonds fell to €646.53 billion in May from a revised figure of €651.81 billion in April after increasing for the previous two months, according to Bank of Italy data cited by Reuters. Italy's public debt hit a record €2.386 trillion in June, central bank data published by MF showed.

* Activist fund Elliott injected €120 million into Credito Fondiario SpA, in which it owns 82%, in support of the transaction by which Credito Fondiario and Elliott in December acquired €7 billion to €7.8 billion in nonperforming loans from Banco BPM SpA and 70% of its bad loan management platform, said Il Sole 24 Ore.

* Unione di Banche Italiane SpA is evaluating the securitization of nonperforming loans with a nominal value of €1 billion backed by a state guarantee on the senior tranche, said MF, adding that a transaction could take place this autumn.


* The Luxembourg supervisory authority cleared Nykredit A/S' acquisition of a 75% stake in Sparinvest Holdings SE. The deal is now expected to close Aug. 30.

* Norwegian bank Sparebanken Vest formed a green bond framework and identified some 22 billion kroner in assets that can be financed under such framework.


* A Russian appellate arbitration court dismissed the appeal of Baring Vostok Capital Partners Ltd. unit Evison Holdings contesting an earlier court order to transfer a 9.99% stake in Public Stock Co. Orient Express Bank to Finvision, RBC reported. Evison transferred the stake in June.

* Russian President Vladimir Putin said in a meeting with VTB Bank PJSC head Andrey Kostin that he expects the cost of mortgage loans to drop further amid falling inflation and pointed to the need to monitor the situation in the consumer lending sector, RBC reported. Kostin noted that the bank already tightened control over the issuance of consumer loans and does not offer them to "the most problematic borrowers."

* Getin Noble Bank SA said it terminated activities aimed at finding a financial investor after it failed to reach an agreement with private equity funds interested in recapitalizing the Polish lender. Getin Noble will now focus on preparing an action strategy to strengthen its capital position and meet regulatory requirements by rebuilding profitability.


Asia-Pacific: StanChart to boost Asia private banking; Blackstone eyes Anbang property assets

Middle East & Africa: Q2 profits rise at Israel's Leumi, Discount Bank; Namibia, Mozambique cut rates

Latin America: Banco Pan prepares for follow-on offer; Banrisul stops guidance

North America: Virginia banks in $21.4M deal; bank trading rules set for overhaul

Global Insurance: Arch Specialty sues USC; UK's Admiral, Pru post earnings; Aflac TSX delisting


Motor insurance rates will keep rising because of claims lag, says Admiral UK CEO: The pending whiplash reforms could reduce prices less than expected because claims have tailed off, Cristina Nestares told analysts.

UK's Prudential mulls external funding, reinsurance to fuel US acquisitions: Prudential's U.S. unit Jackson is aiming to diversify its variable annuity book because still punches below its weight, according to its CEO Michael Falcon.

Sheryl Obejera, Ed Meza, Danielle Rossingh, Gerard O'Dwyer, Beata Fojcik, Heather O'Brian, Stephanie Salti, Sophie Davies and Mariana Aldano.

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This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.