RETAIL BANKING | Staff Reporter, Singapore

Weekly Global News Wrap Up: Banks may need $50b additional capital post-Brexit; European banks beat US rivals; Swedish banks launch robots

And the Financial Conduct Authority considers banning unarranged overdraft charges.

From Bloomberg: Banks may need to find $30 billion to $50 billion of additional capital to support new European units in the aftermath of a hard Brexit, and some smaller firms may abandon their operations on the continent altogether as profitability plunges, according to Oliver Wyman Inc. The extra money is equivalent to 15 percent to 30 percent of the capital wholesale banks commit to the region, the management consultant said in a report Tuesday. In addition, operating costs could rise by $1 billion as functions currently handled in London are duplicated on the continent as banks scramble to establish new hubs to ensure prized access to the European Union’s markets.

From Reuters: European investment banks coped better with tough market trading conditions than U.S. rivals in the second quarter, when historically low levels of market volatility left investors struggling to make directional bets. FICC (fixed income, commodities and currencies) revenue at the five European banks to report second-quarter earnings fell 12 percent on average, according to Reuters calculations. HSBC (HSBA.L) and Societe Generale (SOGN.PA) will report next week.

From Bloomberg: Aida is the perfect employee: always courteous, always learning and, as she says, “always at work, 24/7, 365 days a year.” Aida, of course, is not a person but a virtual customer-service representative that SEB AB, one of Sweden’s biggest banks, is rolling out. The goal is to give the actual humans more time to engage in more complex tasks.

From BBC: Charges for unarranged bank overdrafts could be banned, under one option being considered by the Financial Conduct Authority (FCA). It said the charges for those who go into the red without agreement can be high and complex. Earlier this month, the UK's largest lender, Lloyds, said it was getting rid of unarranged overdraft fees altogether from November. Barclays has already stopped all unauthorised lending. However, other banks charge about £6 a day, or up to £90 a month.

From Bloomberg: Some international banks are serving Qatar from London and New York instead of Dubai’s financial center as a regional dispute makes it harder to do business with clients in the gas-rich Gulf state, according to people familiar with the matter. Lenders that handled clients such as the Qatar Investment Authority and wealthy family offices out of the Dubai International Financial Centre are shifting coverage to other global financial hubs to avoid damaging relations with the United Arab Emirates and Saudi Arabia, said the people, asking not to be identified because the matter is private.

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