* Germany does not see any benefit in establishing a pan-European "bad bank" to help struggling lenders in some EU countries to off-load their soured loans, an insider tells Reuters.
* Global banks must plan for a hard Brexit and may need to devise two-step interim contingency plans, or risk breaching regulatory requirements and disrupting business, according to an industry report prepared by PricewaterhouseCoopers for the Association for Financial Markets in Europe, Reuters writes. The report indicates that banks could take up to two years or more to implement contingency plans.
* The EU may again extend the deadline for its ruling on Deutsche Börse AG's takeover of London Stock Exchange Group Plc to give regulators more time to market-test remedies offered by the companies, insiders tell Bloomberg News.
* Fintech bosses believe that the fine print of an EU legislation designed to boost competition in the name of open banking is being written in a way that gives too much power to banks, the Financial Times reports. The banks are said to be using their substantial lobbying power to water down the measure, which is being finalized by the European Banking Authority ahead of its rollout next year.
* Industry trade body Insurance Europe said the Solvency II regime, which took effect in January, treats Europe's insurers like traders making risky short-term bets and requires them to set aside too much capital, Reuters reports.
UK AND IRELAND
* The U.K. Financial Conduct Authority launched a consultation on proposed changes to its handbook to incorporate the new regulatory framework for insurance-linked securities. The consultation will close March 14.
* Top U.K. finance industry officials told the International Trade Committee they wanted a so-called mutual market access trading deal with the EU in the future, Reuters reports. The deal will still allow financial firms in the U.K. and EU-based clients to conduct business with each other, even after the U.K. loses its passporting rights to the bloc's single market following Brexit.
* AFH Financial Group Plc today announced the acquisition of the assets of independent financial advisory firm Taylor Frost Wealth Management Ltd. The maximum consideration payable is roughly £1.25 million.
* Irish Prime Minister Enda Kenny said some firms looking to relocate their operations in the wake of Brexit have confirmed that they wish to move to Ireland and will make formal announcements in due course, Reuters reports.
GERMANY, SWITZERLAND AND AUSTRIA
* Deutsche Bank AG is working on a new, less complicated and more transparent bonus system for its top executives after waiving 2016 bonuses for the management board, Handelsblatt reports.
* Bavaria is considering selling its 75% stake in Bayerische Landesbank as a "long-term option," WirtschaftsWoche reports.
* Julius Bär Gruppe AG reported full-year 2016 IFRS net profit attributable to shareholders of CHF619.4 million, up from CHF121.2 million a year earlier. "Despite the significant long-term investments made, the strong growth in AUM helped to drive Julius Bär's profit generation," CEO Boris Collardi said.
* Valartis Group AG CEO Stephan Häberle has decided to step down from his post and withdraw from the board of directors of group companies, effective Feb. 28.
* Swiss Life Holding Ltd. is merging the asset and funds management operations of its unit Swiss Life Asset Managers in Switzerland by pooling them in Zurich. The company is also closing the unit's branch office in Lugano.
* Insurance rating agency Assekurata Assekuranz Rating-Agentur GmbH estimates that German life insurers will have to set up provision of up to €20 billion this year to secure the coverage of bonus guarantees from life insurance policies, Börsen-Zeitung writes.
* Leonteq Securities AG said it will immediately begin with its planned cost savings program, which includes job cuts and a review of its branch offices in Singapore and Hong Kong, among other measures, finews.ch reports.
FRANCE AND BENELUX
* The Dutch government has scrapped a plan to merge state lenders NV Bank Nederlandse Gemeenten, Nederlandse Waterschapsbank NV and Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden NV into a single national investment bank, Het Financieele Dagblad reports.
* Crédit Agricole SA is preparing to launch an RMBS offering for an estimated amount of €1 billion, according to L'Agefi, citing a Moody's note.
* Oddo et Cie SCA and M&A boutique Messier Maris & Associes formed an alliance to actively participate in market issuance and the preparation of such deals.
* The life insurance sector in France has recorded €16.8 billion of net inflows in 2016, compared to €23.6 billion in 2015 and €22.6 billion in 2014, Les Echos writes. Unit-linked contracts have covered 84% of the new inflows, L'Agefi adds.
SPAIN AND PORTUGAL
* Banco Bilbao Vizcaya Argentaria SA reported full-year 2016 profit of €3.48 billion, up 31.5% from the previous year. The bank's fourth-quarter 2016 net income reached €678 million, down on a yearly basis from €940 million.
* Bankia SA said it would revisit its capital and dividend policies this year if a merger with Banco Mare Nostrum SA were to fail to go through, Expansión writes.
* The Spanish Congress of Deputies gave its greenlight to the Royal Decree that establishes an out-of-court mechanism for the payment of amounts unduly charged under floor clauses in mortgage contracts, ABC writes.
* Portugal's central bank and finance ministry expect to conclude Novo Banco SA's sale process at the end for February, Dinheiro Vivo reports. Finance Minister Mario Centeno noted that negotiations with potential buyer Lone Star are moving at a fast pace. Observador says the American private equity firm plans to keep António Ramalho as head of the bank once and if a deal is closed.
ITALY AND GREECE
* UniCredit SpA CEO Jean-Pierre Mustier told investors that the ECB is satisfied with the bank's turnaround plan and will not require it to book additional write-downs on bad loans, a source tells Reuters. Shareholder Cariverona said it will decide Thursday on the size of its participation in the bank's €13 billion capital increase. UniCredit's board is due to meet today to decide on the cash call's terms, MF notes.
* ECB data showed that banks in Italy have made little progress in reducing nonperforming loans, Reuters reports. The country's 14 largest lenders held €284.4 billion of NPLs at the end of September 2016, just €1.6 billion less than three months earlier.
* The threat of Banca Popolare di Vicenza SpA and Veneto Banca SpA being forced to convert junior debt into shares as part of capital-boosting measures hit the banks' bonds yesterday, Reuters notes. Analysts now estimate that the banks will need to boost capital by a total of about €3 billion, after sources said an initial estimate of €5.7 billion was excessive, Il Sole 24 Ore writes.
* There are six potential buyers for a 75% stake in Ethniki Hellenic General Insurance Co. SA, Euro2day reports. The sale process is expected to complete in March and the price is projected to reach up to €1 billion.
* The Norwegian central bank and FSA are worried that Norwegian banks will not be able to supply enough cash in a crisis situation and propose stricter requirements for the banks, E24 reports.
* Kerstin af Jochnick, first deputy governor of the Swedish central bank, said Sweden should ease its bank capital rules following the introduction of Basel III regulations. Af Jochnick called for a review of the national capital requirements for banks to determine the appropriate level in the context of Basel III being introduced in Sweden. Reuters has a report.
* Skandinaviska Enskilda Banken AB today reported fourth-quarter 2016 net profit attributable to shareholders of 4.24 billion Swedish kronor, down year over year from 4.60 billion kronor. The bank's full-year 2016 net profit fell to 10.62 billion kronor from 16.58 billion kronor.
* Nets Holding A/S has acquired the remaining 42.3% in Norwegian tech company Edigard for 37 million Danish kroner, Børsen reports.
* Nordea Bank AB (publ) has denied reports that it is closing down its equity operations in Finland, Realtid reports.
* Aktia Pankki Oyj will replace its current supervisory board with a body of a consultative nature that will not have the authority to appoint a board, Hufvudstadsbladet reports. The move is meant to simplify the bank's management structure, increase transparency in administration and provide cost savings.
* The Russian central bank banned JSCB ENISEY (PJSC) from carrying out current account and deposit transactions, Finmarket reports after Interfax. The bank asked the Krasnodar Regional Arbitration Court to declare the ban invalid, with hearings to start Feb. 1.
* Bad loans at Slovenian banks went up to €2.2 billion or 6.5% of the total lending portfolio in November 2016 from 6.3% in October 2016, Reuters reports, citing the Slovenian central bank.
* PZU SA CEO Michal Krupinski said the company plans to merge its investment fund manager TFI PZU with Pioneer Pekao Investment Management, which it will acquire together with Bank Pekao SA, Puls Biznesu writes, citing Bloomberg.
* The Slovak central bank decided to maintain a 0.5% countercyclical capital buffer for local banks, Reuters reports, adding that lenders must meet the additional buffer starting from August.
* Akbank TAS reported full-year 2016 consolidated net income from the group of 4.85 billion Turkish lira, up from 3.23 billion lira the previous year.
* Türkiye Garanti Bankasi AS reported net profit attributable to the group of 5.11 billion lira in 2016, compared to 3.58 billion lira earned in 2015. The bank warned that Fitch Ratings' recent downgrade of Turkey may negatively impact its capital adequacy ratio by about 105 basis points.
IN OTHER PARTS OF THE WORLD
Asia-Pacific: German online lender enters NZ market; Japan raises growth outlook
Middle East & Africa: 3 UAE banks post Q4 results; Njoroge warns of 'Trump effect' on Kenya
Latin America: Santander Chile's Q4'16 profit jumps almost 30%; Bancamía CEO to retire
North America: Fed announces CCAR relief; Green Dot to buy UniRush
North America Insurance: PE-backed brokers led '16 agency M&A; Aetna's Q4'16 operating earnings grow
NOW FEATURED ON S&P GLOBAL MARKET INTELLIGENCE
Deutsche edges closer to Postbank sale, but must walk fine line: A long-delayed sale of Deutsche Postbank might be more viable now for its beleaguered parent, but Deutsche Bank must still balance the desire to off-load the unit with the need to avoid seeing the sale dent its capital buffers.
'Little logic' in Allianz/QBE merger: Allianz may be on the lookout for acquisitions, but a tie-up with Australia's QBE looks unlikely despite the rumors, according to analysts.
London insurers say $200B megaloss would be manageable: The results of a war game examining the effect of a $200 billion loss suggest that prices for insurance and reinsurance would rise sharply but the increase would evaporate as capital flowed back into the market.
Sheryl Obejera, Arno Maierbrugger, Meike Wijers, Esben Svendsen, Beata Fojcik, Thanasis Kakalis, Ali Kayalar, Heather O'Brian, Stephanie Salti, Praxilla Trabattoni and Mariana Aldano contributed to this report.
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