Oct. 10, 2014, 12:52 PM
- The banking industry is very close to resolving too big to fail, says Jamie Dimon (JPM +0.6%), speaking publicly for the first time since his cancer diagnosis (other than his July earnings call appearance). He's appearing at a conference roundtable alongside Morgan Stanley's (MS +0.8%) James Gorman, Deutsche's (DB -0.9%) Anshu Jain, and Bank of America's (BAC +0.7%) Brian Moynihan.
- Webcast here
- The most pointed remarks so far come from Deutsche's Jain, who tells those who would continue to further strangle the banks with more regulation to look to Europe. Straightforward banking - taking deposits and making loans - is far more the norm there then here, he says, and the forcing of banks to trim businesses and balance sheets is a large contributor to the Continent's stagnant growth.
- ETFs: XLF, FAS, FAZ, UYG, KRE, VFH, KBE, IYF, IAT, IAI, SEF, IYG, FXO, FNCL, KBWB, RKH, QABA, FINU, KCE, KRU, KBWR, RWW, RYF, KBWC, KRS, FINZ
Oct. 8, 2014, 2:18 AM
- Eighteen of the world's largest banks, ranging from Credit Suisse (NYSE:CS) to Goldman Sachs (NYSE:GS), have agreed to give up the right to "close out" deals on derivatives contracts if a financial institution runs into trouble, FT reports.
- The International Swaps and Derivatives Association is due to announce the agreement to change its “protocols”, which govern the $700T market, in the next few days. They will take effect from January 1, 2015.
- Related stocks: HSBC, JPM, OTC:BNPZY, DB, BCS, BAC, SAN, C, RBS,
Oct. 6, 2014, 3:42 PM
- Though the hope is for a deal before year's end, one person close to the talks says a settlement is more likely in early 2015. At issue is alleged manipulation of benchmark interest rates, and Deutsche Bank (DB +0.1%) would become lender number eight to be punished by the U.S. in recent months.
- The primary agencies going after Deutsche are the U.S. CFTC and DOJ, and the U.K. FCA.
- Late last year, the bank paid €725M to the EU over similar charges, and in Q2 Deutsche boosted its litigation reserves by about €470M to €2.2B. It also raised its pool for contingency liabilities to €3.2B from €2B, though this had more to do with MBS claims.
Oct. 1, 2014, 6:39 AM
- Deutsche Bank (NYSE:DB) is withholding several million euros in bonuses from its co-chief executives and other top managers, holding senior staff responsible for an exorbitant amount of costly legal and regulatory problems.
- The bank had to pay €3B in legal costs last year and it stocked up its reserves for litigation and regulatory fines by €450M to €2.2B in Q2 of this year.
- Deutsche is currently involved in at least a thousand legal disputes including the alleged rigging of Libor and its forex scandal.
- DB +1% premarket
Sep. 23, 2014, 10:12 AM
- Deutsche Bank (DB -0.6%) co-CEO Jurgen Fitschen and other former bank board members have been charged by German prosecutors with giving false testimony in the long-running court battle with the heirs of Leo Kirch.
- Those charged will be given time to respond to the allegations before a decision is made on whether to pursue the case (likely early next year). If convicted, the executives could face jail terms of 6 months to 10 years.
Sep. 5, 2014, 2:33 PM
- Deutsche Bank (DB +0.6%) Alternative Fund Services has been selected to provide fund administration services for various TIAA-CREF Asset Management alternative investment products.
- The Fund Services unit has more than $200B in assets under administration, and is part of the bank's Investor Services business which has more than 6K clients and $9T in securities administered.
- Source: Press Release
Sep. 5, 2014, 3:41 AM
- U.S. Federal Judge Denise Cote has ruled that investors may press claims against 12 major banks for violating antitrust law by limiting competition and fixing prices in the $21T CDS market, even though improved liquidity should have driven costs down.
- The defendants include BofA (NYSE:BAC), Barclays (NYSE:BCS), BNP Paribas (OTC:BNPZY), Citigroup (NYSE:C), Credit Suisse (NYSE:CS), Deutsche Bank (NYSE:DB), Goldman Sachs (NYSE:GS), HSBC (NYSE:HSBC), JPMorgan (NYSE:JPM), Morgan Stanley (NYSE:MS), RBS (NYSE:RBS) and UBS (NYSE:UBS).
Aug. 29, 2014, 7:12 AM
- Deutsche Bank (NYSE:DB) has been fined £4.7M by the U.K.'s Financial Conduct Authority for inaccurately reporting more than 29M equity swap contract transactions.
- The inaccuracies seem to have occurred due to a software coding error which caused the bank to misreport all these derivative product sales as purchases and vice versa.
- The fine comes on the heels of the NY Fed's announcement of the bank's shoddy regulatory reporting.
Aug. 28, 2014, 1:14 PM
- It's another round of fee cuts from Vanguard on a range of its European mutual funds and ETFs, as well as the company's entire suite of LifeStrategy funds. Annual management charges on Vanguard's index mutual funds will now range from 8 to 38 basis points, and fees on four ETFs have been cut by 7 to 29 bps, effective Monday.
- Vanguard came onto the fund scene in Europe five years ago and doubled mutual fund sales in 2013 to €8.6B, making it the 4th best-selling manager (from 20th in 2012). ETF flows look good as well, with $4.3B of inflows this year already surpassing $3.6B for all of 2013.
- Watching the competition are BlackRock (BLK -1.5%) and Deutsche Asset & Wealth Management (DB -2.1%).
Aug. 19, 2014, 4:20 AM
- Deutsche Bank (NYSE:DB) has hired two technology execs as an effort to step up its regulatory lapses identified by the New York Fed.
- "Over the next year, our local management team will be very focused on building our capabilities across all critical infrastructure areas to best support our growing U.S. franchise,” says CEO of North America Jacques Brand.
- The New York Fed warned Deutsche Bank over its shoddy financial reporting and weak technology systems last December, and it is now concerned that the bank will get its records in order by next year. In 2015, all large foreign lenders located in the U.S. will have to present how they comply with new strict foreign bank rules.
Aug. 18, 2014, 3:47 AM
- Eurozone banks are expected to borrow about €250B in cheap four-year money from the European Central Bank in September and December under the ECB’s "targeted long-term financing operations".
- The new loans would come on top of the more than €1T in cheap finance the ECB pumped into the financial system between late 2011 and 2012 to avert a financial crisis.
- The new funds are expected to boost lending to the region’s credit-starved businesses.
- Europe’s economic outlook has not been pretty. Last week, figures outlined a slowdown in Germany and France and Italy in recession.
- Related stocks: SAN, DB, IRE, CS, ING, BBVA, BCS, RBS, HSBC, LYG
- ETFs: EUFN
Aug. 6, 2014, 8:48 AM
- The Federal Reserve and the FDIC say the bankruptcy plans submitted by 11 of the largest banks make "unrealistic or inadequately supported" assumptions and "fail to make, or even to identify, the kinds of changes in firm structure and practices that would be necessary to enhance the prospects for" an orderly failure. Ouch!
- Full feedback
- The 11 dinged: BAC, BK, C, GS, JPM, MS, STT, and the U.S. units of BCS, CS, DB, and UBS.
- To review: Dodd-Frank requires banks annually submit a "living will" detailing their operations and exposures and how they could be dismantled without the need of a bailout in the event they near failure. Pleasing the regulators is a must as they have the power to force tougher capital rules or restrictions on growth, or even mandate a breakup of the lenders. As for the current failures, the banks have about a year to address D.C.'s concerns.
- "Despite the thousands of pages of material these firms submitted, the plans provide no credible or clear path through bankruptcy that doesn't require unrealistic assumptions and direct or indirect public support," says the FDIC's #2 official, Thomas Hoenig.
- ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, SEF, IYG, FXO, FNCL, FINU, RWW, RYF, FINZ
Aug. 5, 2014, 2:47 PM
- Goldman Sachs Asset Management (GS -1.3%) and DB Private Equity (DB -2.9%) are in talks to pay about $500M for NBGI Private Equity - the buyout arm of National Bank of Greece (NBG -2.7%), reports Bloomberg. That would be about one third less than the Greek lender originally invested in the business.
- The P-E arm has underperformed competitors, according to data seen by Bloomberg, with 10 of its 11 funds projected to lose about 25 cents for every dollar invested. Its high-living CEO Pavlos Stellakis, along with the rest of the management team, is in negotiations to remain with the firm after the deal has been completed.
Aug. 3, 2014, 10:28 AM
- Wall Street firms led by Goldman Sachs (NYSE:GS) are closing in on a deal to purchase a stake in chat and instant messaging start-up Perzo as an alternative to Bloomberg's similar application, Reuters reports.
- Bloomberg has dominated Wall Street for years, but banks have been looking for a substitute as sluggish trading volumes and higher regulations weigh on revenues. Bloomberg's trading and news terminal costs about $20,000 a year, while Perzo's applications are open-source and free. Bloomberg customers must also buy an entire terminal, and cannot just buy the messaging system and adapt it.
- Several other banks and asset managers have received term sheets for the Perzo deal and have recently signed non-disclosure agreements including Morgan Stanley (NYSE:MS), JPMorgan (NYSE:JPM), Bank of America (NYSE:BAC), Deutsche Bank (NYSE:DB), HSBC (NYSE:HSBC), and BlackRock (NYSE:BLK).
- Goldman has been looking at alternatives to Bloomberg's messaging program for years, and launched a project internally called "Babel" in early 2013 to develop a competitor.
Jul. 30, 2014, 4:01 AM
- The New York Department of Financial Services wants government monitors placed in the U.S. offices of Deutsche Bank (NYSE:DB) and Barclays (NYSE:BCS) as part of its investigation into the foreign-exchange market.
- The two banks have been chosen to host monitors because data collected over the course of the probe pointed to them for having the greatest amount of potential problems.
Jul. 29, 2014, 12:52 PM
- Deutsche's (DB -0.5%) long-term debt and deposit ratings DB)+to+A2%3B+Profitability+Dragged+Down+by+Litigation,+Legacy+Costs/9696756.html" target="_blank">are cut to A3 from A2, with Moody's noting the bank's "modest" profitability as being dragged down by litigation and restructuring costs and legacy losses, not to mention the bank's high dependence on capital markets earnings. The outlook remains negative.
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