Tag Archives: Banks (NEC) (TRBC level 5)

The German city asked Berlin to cover the losses of Greensill Bank | Instant News


FRANKFURT (Reuters) – The German city of Osnabrueck is concerned about losing the 14 million euros ($ 17 million) it invested with Greensill Bank after the country’s financial regulator warned this week of “imminent risks” for lenders.

FILE PHOTO: Greensill Bank logo photographed in downtown Bremen, Germany, July 3, 2019. REUTERS / Fabian Bimmer / File Photo

Osnabrueck is Germany’s third municipal authority to disclose this week that it faces possible losses from a Bremen-based bank and a local finance official has asked the German government to step in.

“I ask the federal government to bear the damages incurred by the city government,” said the official, Thomas Fillep, in a statement.

A Greensill Capital spokesman declined to comment on Osnabrueck and investors similar to Greensill Bank, or the amount of unsecured funds held by lenders.

German regulator BaFin warned on Wednesday about the risk that Greensill Bank would become over-indebted and imposed a moratorium on any divestments or payments.

BaFin’s move was another blow to bank owner Greensill Capital, who said on Tuesday it was in talks to sell most of its business after losing support from two Swiss asset managers.

Founded by Lex Greensill, a former Citigroup and Morgan Stanley banker, Greensill Capital is the largest provider of non-bank supply chain finance. He said his technology-based approach provided $ 143 billion in financing in 2019 across 10 million customers and suppliers.

German deposit protection schemes protect individuals but do not protect institutional investors. Greensill Bank has about 500 million euros in unsecured funds, such as those from Osnabrueck and other cities, said someone with knowledge of the matter.

Like the cities of Monheim am Rhein and Bad Duerrheim in Germany which have announced similar concerns about Greensill Bank, Osnabrueck is attracted to lenders because it helps them avoid paying negative interest rates on deposits elsewhere.

Osnabrueck, which has a population of 170,000, chose Greensill Bank because its excellent credit rating means the city can consider it a very safe investment, said local Fillep officials.

He criticized BaFin for not notifying cities when concerns about the bank surfaced last year, saying Osnabrueck would reduce his involvement if he became aware.

BaFin said in a statement that it was acting firmly in 2020 at Greensill Bank, taking various enforcement actions including the installation of special monitors. However, BaFin said informing the public would violate confidentiality laws.

The German finance ministry declined to comment. Germany’s credit rating agency Scope did not immediately respond to a request for comment.

The parliamentary finance committee has put the Greensill Bank case on the agenda for a meeting later this month.

Osnabrueck began investing in time deposits with Greensill Bank last year and currently has nearly 14 million euros with maturities between April 2021 and March 2022. His most recent investment was 11.5 million euros in November.

Osnabrueck tried to withdraw funds after the credit downgrade but was unable to do so, the city government said.

($ 1 = 0.8382 euros)

Reporting by Tom Sims and Christian Kraemer; Edited by Hans Seidenstuecker and David Clarke

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Italian sovereign lenders approve the sale of the SACE export agent to Treasury -sources | Instant News


ROME, March 5 (Reuters) – Italian state lender Cassa Depositi e Prestiti (CDP) on Friday approved a preliminary agreement to sell SACE export agents to the Ministry of Finance in a deal that will add 4.25 billion euros ($ 5.07 billion) to that country’s public debt. , sources told Reuters.

SACE offers guarantees and financial support to Italian exporters. It is also working with banks to facilitate companies’ access to credit, a role that has grown since the coronavirus broke out in Italy a year ago.

The Ministry of Finance wants to directly control the export agency given its importance in supporting the economy.

Roma assists SACE as a co-insurer, in part sharing its exposure to risks that could potentially harm public finances over time.

SACE may also participate in plans to privatize the Monte dei Paschi bank in Siena.

Under the Treasury’s sponsored scheme, SACE and other private players will protect potential MPS buyers from a share of the 10 billion euros legal risk facing banks after decades of mismanagement.

The CDP board approved the agreement on Friday morning, paving the way for the Treasury Department to work out a decision to finalize the acquisition, two sources close to the matter told Reuters.

Sovereign lenders will transfer SACE to the Ministry of Finance in exchange for 4.25 billion euros in government bonds still to be issued. CDP’s liabilities do not count as public debt even though the Ministry of Finance controls it with 83% of the shares.

Rome’s debt pile of 2.6 trillion euros, equivalent to 155.6% of national output, is one of the largest in the world.

The deal reverses a divestment made during the sovereign debt crisis of 2012 by technocrat Mario Monti’s government, which sold SACE to the CDP for about 6 billion euros.

As part of the deal, CDP will buy SACE’s 76% stake in service provider SIMEST, which is partly owned by a group of Italian banks, for around 230 million euros. ($ 1 = 0.8386 euros) (Reporting by Giuseppe Fonte in Rome, Editing by Gavin Jones and Matthew Lewis)

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The German city asked Berlin to cover the losses of Greensill Bank | Instant News


FRANKFURT (Reuters) – The German city of Osnabrueck is concerned about losing the 14 million euros ($ 17 million) it invested with Greensill Bank after the country’s financial regulator warned this week of “imminent risks” for lenders.

FILE PHOTO: Greensill Bank logo photographed in downtown Bremen, Germany, July 3, 2019. REUTERS / Fabian Bimmer / File Photo

Osnabrueck is Germany’s third municipal authority to disclose this week that it faces possible losses from a Bremen-based bank and a local finance official has asked the German government to step in.

“I ask the federal government to bear the damages incurred by the city government,” said the official, Thomas Fillep, in a statement.

A Greensill Capital spokesman declined to comment on Osnabrueck and investors similar to Greensill Bank, or the amount of unsecured funds held by lenders.

German regulator BaFin warned on Wednesday about the risk that Greensill Bank would become over-indebted and imposed a moratorium on any divestments or payments.

BaFin’s move was another blow to bank owner Greensill Capital, who said on Tuesday it was in talks to sell most of its business after losing support from two Swiss asset managers.

Founded by Lex Greensill, a former Citigroup and Morgan Stanley banker, Greensill Capital is the largest provider of non-bank supply chain finance. He said his technology-based approach provided $ 143 billion in financing in 2019 across 10 million customers and suppliers.

German deposit protection schemes protect individuals but do not protect institutional investors. Greensill Bank has about 500 million euros in unsecured funds, such as those from Osnabrueck and other cities, said someone with knowledge of the matter.

Like the cities of Monheim am Rhein and Bad Duerrheim in Germany which have announced similar concerns about Greensill Bank, Osnabrueck is attracted to lenders because it helps them avoid paying negative interest rates on deposits elsewhere.

Osnabrueck, which has a population of 170,000, chose Greensill Bank because its excellent credit rating means the city can consider it a very safe investment, said local Fillep officials.

He criticized BaFin for not notifying cities when concerns about the bank surfaced last year, saying Osnabrueck would reduce his involvement if he became aware.

BaFin said in a statement that it was acting firmly in 2020 at Greensill Bank, taking various enforcement actions including the installation of special monitors. However, BaFin said informing the public would violate confidentiality laws.

The German finance ministry declined to comment. Germany’s credit rating agency Scope did not immediately respond to a request for comment.

The parliamentary finance committee has put the Greensill Bank case on the agenda for a meeting later this month.

Osnabrueck began investing in time deposits with Greensill Bank last year and currently has nearly 14 million euros with maturities between April 2021 and March 2022. His most recent investment was 11.5 million euros in November.

Osnabrueck tried to withdraw funds after the credit downgrade but was unable to do so, the city government said.

($ 1 = 0.8382 euros)

Reporting by Tom Sims and Christian Kraemer; Edited by Hans Seidenstuecker and David Clarke

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GAM Switzerland closes a fund linked to Greensill Capital | Instant News


FILE PHOTOS: Greensill Bank pictured in the center of Bremen, Germany, July 3, 2019. REUTERS / Fabian Bimmer

(Reuters) – Swiss asset manager GAM Holding will suspend funds linked to Softbank-backed financing group Greensill Capital a day after Credit Suisse closed its funds linked to British firms.

GAM said it took the decision to close down GAM’s $ 842 million Greensill Supply Chain Finance Fund because of “market developments and the resulting media coverage” associated with supply chain finance.

Greensill did not immediately respond to a request for comment.

Specialized lenders, who provide financing to help companies spread the cost of their supply bills, rely on investors to buy their assets and the GAM and Credit Suisse movements are depriving them of their funding sources.

The Wall Street Journal reported on Monday that Greensill had appointed Grant Thornton to look into possible restructuring, while the Financial Times said the company was seeking bankruptcy protection in Australia. Greensill has declined to comment on the report.

Credit Suisse’s asset management arm said on Monday it was stopping redemption of the $ 10 billion fund supporting the company’s London-based lending operations over concerns about their ability to accurately assess them.

GAM said on Tuesday that the Greensill supply chain fund consisted only of investment grade assets and they had no “valuation problem”.

“We therefore anticipate an orderly liquidation and return of client assets under normal circumstances,” said Peter Sanderson, GAM chief executive.

($ 1 = 0.7183 pounds)

Reporting by Rachel Armstrong; Edited by Simon Jessop and Carmel Crimmins

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Italy’s MPS seeks to reduce legal risks as the EU considers the viability of the bank | Instant News


FILE PHOTO: The logo of the Monte dei Paschi bank in Siena is seen at the entrance of a bank in Rome, Italy, 16 August 2018. REUTERS / Max Rossi

MILAN (Reuters) – Italy’s Monte dei Paschi (MPS) said on Thursday it was working to reduce its legal risk as the European Union assessed the ability of state-owned banks to stay in business before opening up more public aid.

Italy saved the MPS in 2017 at a cost of 5.4 billion euros ($ 6.6 billion) to taxpayers. Now it stands ready to cover at least part of the 2.5 billion euro shortfall in lenders, but wants to first find a buyer for it.

MPS said it would proceed with a cash call if the merger failed to materialize.

In a statement on Thursday, it said that significant uncertainty was clouding its planned capital increase due to an assessment by the EU competition authority on the bank’s ability to stand on its own.

($ 1 = 0.8212 euros)

Reporting by Valentina Za; Edited by Gareth Jones

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