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Home » Daily Briefing » Morning Briefing 07 June 2016

Morning Briefing 07 June 2016

Morning Briefing

A surge in issuance of "so-called wealth-management products" (WMPs) to Chinese bank customers looking for higher yields than the deposit rates available to them is casting a long shadow over China's banks, according to a report in the Wall Street Journal.

Issuance of off-balance sheet WMPs rose to 7.3 trillion yuan ($1.1 trillion) in 2015, an increase of nearly 75 percent on the previous year, the report cited Charlene Chu of Autonomous Research as saying.

Shanghai Pengxin Group is in preliminary talks to buy a controlling stake in Banco Indusval & Partners (BI&P), a Brazilian SME lender to the agricultural sector, as it seeks to grow its presence in Brazil beyond commodities, according to Reuters.

A trade group representing community banks in America has written to regulators calling for them to scrutinise fintech companies, as traditional lenders become increasingly concerned about their start-up opposition.

Karen Thomas, senior executive vice-president of Independent Community Bankers of America, which represents over 6,000 small banks, wrote to the Office of the Comptroller of the Currency: "ICBA believes that the recent problems that some of the online marketplace lenders have experienced with liquidity and earnings, as well as with compliance, makes it important that these lenders be subject to safety and soundness supervision and regulation."

"We have concerns about consideration of a potential limited purpose federal bank charter designed for financial technology companies that wish to access the banking system and avoid state consumer protection laws," she added.

German state-owned lender Bremer Landesbank has been told by the ECB to boost its capital to contend with non-performing loans to the shipping sector, according to sources cited in a Reuters report. However, a spokeswoman for the bank dismissed the information provided by the sources as "factually wrong and pure invention".

New bank safety plans criticised for encouraging risky loans
US banking: Branched out — with interest rates static, Wells Fargo is tweaking its retail operation in a bid to lift revenues
PBOC drains 70 bln yuan from market
Republican alternative to Dodd-Frank calls for banks to boost capital
HSBC to shake up global banking business to cut costs
Ex-Barclays chief Antony Jenkins sets up new fintech venture
What Costco has to say about the switch to Visa

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