Thu, May 21, 7:58 AM
- Just having been hit with $3B over currency-rigging charges yesterday, Barclays (NYSE:BCS) and RBS will have to set aside another $11B within two years, according to JPMorgan.
- For RBS, it still faces billions in potential MBS costs, and Barclays isn't finished with forex-related fines. Both, says JPMorgan, will need to top up reserves to compensate customers for payment protection insurance they didn't want or need.
Wed, May 20, 10:10 AM
- Those facing criminal charges from the DOJ are UBS (already reported, the stock is up 3.4% today), Barclays (BCS +2.5%), Citigroup (C -0.5%), JPMorgan (JPM -0.4%), and RBS (RBS +1.6%).
- Bank of America (BAC -0.4%) faces a $205M fine by the Fed, but no criminal charges. Fines by the Fed for the other banks range from $274M-$342M.
- There are fines from other regulators as well, with the total for all the banks summing to $5.8B. Barclays looks to be hit the hardest on that front, with total monetary penalties of $2.4B.
Thu, May 14, 7:55 AM
- "Guilty" is the new "neither admitting nor denying the charges."
- Yes, the DOJ looks set to extract guilty pleas on felony charges from five big banks over forex rigging, but life will go on for the lenders without much of a hiccup (after paying billions in fines), according to DealBook.
- Barclays (NYSE:BCS), JPMorgan (NYSE:JPM), Citigroup (NYSE:C), RBS, and UBS are the five whose holding companies will plead guilty, according to the report.
- While the guilty pleas are a nice feather in the caps of prosecutors, they seem to me more symbol than substance - too harsh a penalty would imperil banking operations, and behind the scenes, bank lawyers are working the phones with regulators to assure the felons won't be barred from certain businesses.
Wed, May 13, 3:07 PM
- The British government still holds and 80% stake in Royal Bank of Scotland (NYSE:RBS) and a 20% stake in Lloyds (NYSE:LYG). JPMorgan had previously been tapped to advise on the re-privatization, but the U.K. is now putting the business back up for bid (not a totally unexpected move).
- The U.K.'s RBS stake is currently worth more than $50B.
- A slate of 18 banks, including JPMorgan, would be eligible for the advisory job - a pretty sizable one given the government's stake in RBS alone is worth more than $50B.
- Source: WSJ
Wed, May 13, 2:23 AM
- Philippe Selendy, a lawyer for the FHFA, expects Nomura (NYSE:NMR) and Royal Bank of Scotland's (NYSE:RBS) shoddy MBS conduct before the financial crisis to result in a judgment exceeding $805M.
- Despite the hefty amount, the two would likely receive the mortgage bonds in exchange, which are estimated to be were worth $434M-$479M.
- A proposed judgment is expected to be filed in court Friday.
- Previously: Court says Nomura, RBS misled investors (May. 12 2015)
Tue, May 12, 12:37 PM
- "There would be a massive impact across London if a bank the size of HSBC left," says Davide Serra, founder of hedge fund Algebris, and who has advised the government on its holdings of Lloyds (NYSE:LYG) and RBS. "We are talking 10% of London's GDP, if you factor things like personnel moving."
- What has HSBC along with Standard Chartered (OTCPK:SCBFF) considering pulling their HQ out of the U.K. is the country's bank levy - an annual tax on U.K. banks of 0.21% of assets (foreign banks pay that amount only on their U.K. liabilities). Serra: “The bank levy is totally unsustainable. If the U.K. takes 25% of U.K. banks’ profitability, no bank will want to be domiciled here. It is a total disaster for the U.K.”
- Algebris' long/short equity strategy is ahead 27% YTD, while its credit strategy is up 5.14%. Also among its bank holdings is the equity and credit of Lloyds, and Serra calls CEO Hora Osorio one of the bet bank chiefs in Europe.
Tue, May 12, 2:45 AM
- "The magnitude of falsity...is enormous," declared U.S. Judge Denise Cote, ruling that Nomura (NYSE:NMR) and RBS made false statements in selling MBSs to Fannie Mae (OTCQB:FNMA) and Freddie Mac (OTCQB:FMCC) before the financial crisis.
- The two banks have been the only ones out of 18 financial firms that took their case to trial, arguing that it was the housing crash, and not deceptive loan documents, that caused the bonds to collapse.
- The other firms — including Goldman Sachs and Bank of America — settled, together paying nearly $18B in penalties.
- Previously: Nomura wants day in court over mortgages (Mar. 16 2015)
Mon, May 11, 3:28 AM
- British Chancellor George Osborne is poised to fast-track a £35B sale of the government's stakes in Royal Bank of Scotland (NYSE:RBS) and Lloyds (NYSE:LYG) after the Conservatives' election victory on Thursday.
- Treasury officials are examining plans for an early disposal - at a loss to the taxpayer - of RBS shares, and a discounted £4B sale of Lloyds stock to the public, the Sunday Times reported.
- The British government currently owns 80% of RBS (which was rescued with a £45B state bailout during the financial crisis) and owns a 21.9% stake in Lloyds, down from a peak of 40% in 2009.
Thu, Apr. 30, 3:34 AM
- Royal Bank of Scotland (NYSE:RBS) posted a larger-than-estimated first-quarter loss after it put aside £856M to cover charges for past misconduct and litigation.
- RBS was also hit by restructuring charges as it continued to shrink its trading division and global business.
- Compared with £1.2B in profit in the year-earlier period, the lender reported a net loss of £446M.
Mon, Apr. 27, 4:36 AM
- Royal Bank of Scotland (NYSE:RBS) has sold another portfolio of North American loans to Mizuho Financial Group (NYSE:MFG), as it continues to sell off international assets to focus on domestic lending.
- The agreement swaps $5.6B of loan commitments for $500M in cash, generating an overall disposal loss of around $30M.
- Back in February, RBS agreed to sell different U.S. and Canadian loan commitments to Mizuho under a deal worth $3B, marking the largest move overseas by one of Japan's top banks.
Tue, Apr. 21, 1:52 AM
- The U.S. Department of Justice is now pushing for five banks, including JPMorgan (NYSE:JPM), Barclays (NYSE:BCS), Citigroup (NYSE:C), RBS (NYSE:RBS) and UBS (NYSE:UBS), to reach a joint mega settlement to allegations they manipulated the foreign exchange markets.
- The deal would see some institutions pay about $1B each and is scheduled for mid-May, FT reports.
- Last November, the banks (except Barclays) agreed to pay $4.3B to authorities in the U.S., U.K. and Switzerland in the first settlements announced in the forex investigation, although the DOJ was not included on that ticket.
Wed, Apr. 15, 3:19 PM
- A federal appeals court rejects claims from investors in the ADS's of Royal Bank of Scotland (RBS +0.8%) that the bank defrauded them by lowballing its subprime exposure ahead of the financial crisis.
- Dissenting from the 2-1 opinion, one judge says the bank materially misled investors by falsely denying on April 22, 2008 that the U.K.'s FSA had ordered a capital raise.
- Today's decision upholds a ruling previously made by a U.S. District judge.
Mon, Apr. 13, 1:31 PM
- Part of a continuing plan for the state-backed lender to return to being just a U.K. retail and commercial bank, Royal Bank of Scotland (RBS +1.4%) hired PwC to advise on a sale of the business, which has some €20B in AUM.
- One of the operation's largest clients is the European subsidiary of Industrial and Commercial Bank of China, reports the FT.
- Previously: Official: UBP to buy RBS's Coutts International (March 27)
Wed, Apr. 1, 10:45 AM| Comment!
Mon, Mar. 30, 10:00 AM
- After just a couple of months as executive chairman of the corporate and institutional bank at Royal Bank of Scotland (RBS +0.3%), Rory Cullinan will leave the company at the end of April.
- Cullinan is also in charge of the RBS's "bad bank" - named Capital Resolution - responsible for selling or closing noncore businesses and other unwanted assets. Those duties included overseeing the spinoff of Citizens Financial Group last year.
Mon, Mar. 30, 9:17 AM
- Unlike last year's stress test which focused on a U.K. property bust, this year's version deals more with how banks would handle a global economic slowdown and market tumble, suggesting lenders like HSBC, Standard Chartered (OTCPK:SCBFF), and Barclays (NYSE:BCS) could have a tougher go of it.
- The seven lenders tested will have to maintain a CET 1 ratio of 4.5% and a leverage ratio of 3%.
- Also to tested: RBS, Lloyds (NYSE:LYG), Santander U.K. (NYSE:SAN), and Nationwide Building Society.
- Results are due in December.
- Sources: Bank of England, WSJ
RBS vs. ETF Alternatives
Royal Bank of Scotland Group (The) PLC is an international banking and financial services company. The Company through its subsidiaries provides banking products and services to personal, commercial and large corporate and institutional customers.
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