RETAIL BANKING | Staff Reporter, Singapore

Weekly Global News Wrap: Credit Suisse goes into red over US legal dispute; Deutsche Bank to pay $125m on US bribery charges

And Italy's Monte dei Paschi di Siena will open books to possible partners.

From Reuters

Credit Suisse said it will sink to a Q4 loss after setting aside hundreds of millions of dollars more than previously expected for a legal dispute over property debt in the United States.

CEO Thomas Gottstein said in December he wanted to start the new year with a “clean slate” on legacy matters and has set aside some $850m to address disputes dating back to the financial crisis.

The bank had already set aside $300m in connection to a decade-long dispute with New York-based municipal bond insurer MBIA regarding a U.S. residential mortgage-backed security (RMBS), but said in December it expected the figure to rise to $680m.

From Reuters

Deutsche Bank will pay nearly $125m to avoid U.S. prosecution on charges it engaged in foreign bribery schemes and manipulated precious metals markets.

The lender agreed to the payout as it entered a three-year deferred prosecution agreement with the Department of Justice, and a related civil settlement with the Securities and Exchange Commission.

Almost all of the payout relates to charges Deutsche Bank violated the federal Foreign Corrupt Practices Act over its dealings in Saudi Arabia, Abu Dhabi, China and Italy, court papers show. Nearly two-thirds of the payout is a criminal fine.

From Reuters

Italy’s Monte dei Paschi di Siena (MPS) said it would grant access to confidential data to potential merger partners selected by its advisers, as the country presses ahead with plans to cut its stake in the state-owned bank.

MPS said its board had hired Credit Suisse to help Mediobanca in the task of studying strategic options and sounding out market interest for the Tuscan bank.

Despite the turmoil in the ruling coalition which risks precipitating a government crisis, the Italian Treasury is moving forward with plans to cut its 64% stake in MPS and meet pledges made to the European Union as part of the 2017 bailout.


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