European banking correspondent
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Mar 25, 2014

Ukraine crisis forces bank bond investors to rethink risk

* Ukrainian crisis underlined risks in banks’ bond drive

* Banks issuing bonds to boost defences against potential

* Bankers still expect 2014 to be a record year for such

By Steve Slater and Aimee Donnellan

LONDON, March 25 (Reuters/IFR) – European banks such as
Societe Generale, Credit Agricole and Unicredit will likely have
to pay investors a higher return to buy the risky bonds that
banks use to strengthen their balance sheets after the crisis in
Ukraine forces a rethink about the potential dangers from such

So far this year, European banks have sold over 7.5 billion
euros of bonds to boost their core financial strength and
bankers expect that tally to reach a record 40 billion euros for
2014 as mainstream investors such as insurers and pension funds,
who need to boost returns, buy more of them.

Mar 24, 2014

HSBC to seek investor OK to sell ‘CoCo’ bonds

LONDON (Reuters) – HSBC (HSBA.L: Quote, Profile, Research, Stock Buzz) is to ask its shareholders for permission to sell bonds that would convert into shares and bolster its capital if it hits trouble, giving it the option to join a growing group of banks issuing the securities.

More banks are selling the contingent capital securities (CCS), dubbed “CoCos”, which convert into shares in certain circumstances, such as if the capital level falls below a certain level.

Mar 19, 2014

Thomson Reuters launches central registry for bank client data

LONDON, March 19 (Reuters) – Thomson Reuters Corp
said it has launched a central register of information
to help banks meet increasing compliance demands on who they
deal with and cut their costs by reducing duplication.

The news and information company said on Wednesday the
product would act as a central clearing house for banks,
corporations, asset managers, hedge funds and others to check
identity documentation for their counterparties.

Mar 16, 2014

Banking’s back room risk cops step into top jobs

LONDON, March 16 (Reuters) – Once modest of pay and profile,
risk experts are being reborn as rock stars of the banking world
- their status and salaries soaring as regulators force
financial institutions to clean up.

Industry-wide investigations into alleged exchange rate
manipulation, trading scandals at UBS, Societe Generale and
JPMorgan and HSBC’s $1.9 billion fine for lax money-laundering
rules have upped the ante for banks already under pressure to
curb reckless behaviour that led to the financial crisis.

Mar 14, 2014

Barclays reviews investment bank, more cuts expected

March 13 (Reuters) – Barclays has launched the
third review of its investment bank in as many years, and is
likely to cut more jobs and business areas as it battles to
improve profitability, people familiar with the matter said.

The review, already underway, will be completed by the
summer. It will aim to cut costs and focus on whether the
London-based bank should pull back harder in areas of
fixed-income trading that use a lot of capital and have recently
offered poor returns, the people said on condition of anonymity.

Mar 14, 2014

Lloyds: FSA had no “fatal concerns” over Co-op’s ‘Ferrari’

LONDON, March 14 (Reuters) – Lloyds Banking Group
codenamed Co-op Bank as “Ferrari” during its talks to sell it
more than 600 branches, before the mutual’s bid came to a
sputtering halt last year, the bank’s minutes showed.

Lloyds said it chose to sell the branches to Co-op, rather
than a rival bid from NBNK codenamed “Lotus”, because
execution risks were lower for the Co-op and it would have been
more attractive for staff and customers.

Mar 13, 2014

Barclays to review the shape and size of its investment bank: Sources

By Steve Slater

(Reuters) – Barclays (BARC.L: Quote, Profile, Research, Stock Buzz) is reviewing the size and shape of its investment bank, in a review that is expected to result in it shrinking and focusing on its most profitable areas, two people familiar with the matter said on Thursday.

The review – which will focus on whether the London-based bank should exit business that is balance sheet heavy and low-return – is already under way and will be completed by summer, sources said.

Mar 11, 2014

Barclays on “collision course” with shareholders over bonus bonanza

LONDON, March 11 (Reuters) – Barclays faces a backlash from
shareholders over its decision to raise bonuses despite a fall
in profits, with investors increasingly demanding CEO Antony
Jenkins give more money to them and less to his staff.

British banks have failed to rein in pay despite a new EU
cap, leading to a threat that politicians and regulators in both
Brussels and London might impose more curbs.

Mar 7, 2014

All change in UK bank auditing industry

LONDON, March 7 (Reuters) – Barclays is changing
its auditor of the past 120 years and Lloyds and Royal
Bank of Scotland could follow suit as Britain’s bank
auditing landscape gets shaken up by new rules.

Banks are being forced to change their auditors more
frequently to keep accountants on their toes after lenders were
given a clean bill of health just before they were rescued in
the 2008 financial crisis.

Mar 6, 2014

StanChart reassures on capital in face of ‘challenging’ 2014

LONDON (Reuters) – Standard Chartered Plc reassured investors about its capital strength on Wednesday, raising its dividend despite reporting its first drop in annual profits for a decade and giving a weak outlook for the first half.

Once feted for its exposure to Asia which helped generate years of record earnings, StanChart is now under pressure to show it can adapt to slowing growth and rising bad loans.

    • About Steve

      "Responsible for overseeing coverage of the European bank sector and direct coverage of the international UK-based banks, based in London. Have been in current role for three years, and for previous three years was UK banking reporter. Have over 15 years experience as a financial newswire journalist in London and New York."
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