A proposed merger between OneWest Bank and CIT Group is facing increased scrutiny from federal banking regulators amidst concerns that the merged bank could hinder community-lending practices under the Community Reinvestment Act (CRA).
Potential CIT and OneWest Bank Merger Faces Public Hearing
Female Billionaire Urges BPI-BCP Merger to Thwart CaixaBank Takeover
Isabel dos Santos, daughter of the president of Angola and Africa’s sole female billionaire, is unhappy with CaixaBank’s takeover bid for BPI. As the second largest investor in BPI, Santos owns 18.6% of the Portuguese bank through her investment company Santoro Finance, just shy of the 20% benchmark at which BPI caps shareholder voting power. CaixaBank, a Spanish Bank that owns 44.1% of BPI, has offered €1.94 billion for the remaining 55.9% of BPI, or €1.329 per share. Unimpressed with this bid, Santos wrote a letter to BPI and Millennium BCP, a Portuguese rival to BPI, urging a merger. This attempt to thwart CaixaBank was followed by an 8% spike in BPI’s share price to €1.48 last Tuesday, while BCP rose 2.4%.
CIT and One West to Merge
Commercial Investment Trust, a private commercial lender that focuses mainly on middle-market lending in various industries, recently announced its intent to acquire fellow bank One West. The CEO of CIT, John Thain, wants to take advantage of the synergies that will be created by marrying the commercial lending of CIT to the residential lending that dominates One West’s asset sheet. Yet investors may not be as keen on the deal given the two banks rocky experiences with the financial crisis.
HSBC Struggling to Overhaul its Anti Money-Laundering System
Despite spending hundreds of millions of dollars to overhaul its anti-money-laundering system, the message to HSBC from U.S. officials is clear: it’s still not enough.
Central Bank Gets Blame for Cypriot Crash
The release of a Cyprus government report this past week reveals the enduring difficulties faced by central banks of small European nations, in their efforts to stabilize fragile economies while promoting the monetary interests of the wider Eurozone.
The Royal Bank of Scotland Will Help British Police Tackle Complex Financial Crimes
The Royal Bank of Scotland, in which the British government owns 81 percent, was allegedly involved in manipulation of foreign exchange markets and subject to various regulatory investigations along with several other major banks. The Department of Justice in Washington and the Serious Fraud Office in Britain are overseeing separate criminal investigations into these banks and their traders.
Big Banks’ Legal Costs Continue in the Face of Currency Manipulation Fines
At the end of October, many big banks edited their earnings reports to reflect increased legal costs, indicating that the banks were close to reaching a settlement with regulators over foreign currency market manipulation.
Bittersweet Results Shared After European Central Bank Stress Tests
The European stock market surged after stress tests revealed on October 26th that most European banks are healthy, where all but 13 of its leading banks have enough capital to survive another economic storm.
Theme in Big Banks’ Latest Earnings: Legal Costs
In the past few years, banks have combined to pay more than $5 billion in fines related to manipulation of the London interbank offered rate, or Libor, and other benchmark interest rates. In 2013, regulators in the United States, Britain, Germany, Switzerland, and Hong Kong started investigations into the currency markets. Dozens of foreign exchange traders, from some of the largest and most prestigious banks, including Barclays, UBS, and JPMorgan Chase, have been placed on leave over questions regarding collusion to manipulate benchmark currency rates.
Conflicts of Interest Spur Blackstone’s Divestiture of Merger Business
Blackstone Group LP, the world’s largest alternative asset manager, has announced plans to divest its merger advisory business. The recently announced plans will spin off Blackstone’s financial advisory business with the split expected to be finalized in 2015. Blackstone’s decision to spin off the firm’s oldest division came as somewhat of a surprise in the industry, as Wall Street firms have generally been reluctant to split in the past.