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My weekly notes on banking and financial services -
by Aivars Jurcans
Done! And Done
Canadian Imperial Bank of Commerce (CIBC) has agreed to acquire Cleary Gull, a Milwaukee-based boutique investment bank. Terms of the deal were not disclosed. Established in 1987, Cleary Gull focuses on entrepreneurs and family-owned private companies.
Source: Bloomberg
Piper Jaffray, a US investment bank, has acquired its rival Sandler O’Neill for USD 485 million in cash and stock. Piper Sandler Companies (as the merged entity is going to be renamed) will continue focusing on mid-market transactions worth less than USD 500 million.
Source: Financial Times, Bloomberg
Deals on the Table
Two Japanese regional banks, Bank of Yokohama and Chiba Bank, are said to be considering a business tie-up.
Source: Reuters
Generali, an Italian insurer with 5% market share in Portugal, is said to have outbid Grupo Catalana Occidente and has entered exclusive negotiations to buy Tranquilidade, a Portuguese insurer. The potential deal size is estimated at between EUR 550 million and 600 million.
Source: Reuters
Anbang is said to be prepared to sell 77.7% of its stake in Hexie Health Insurance. As a result of this transaction, Fujia Group will take a 51% controlling interest.
Source: Reuters
Julius Baer, a Swiss bank, has reiterated its intention to complete the disposal of Kairos, an Italian asset manager. Mediobanca, an Italian lender, indicted its interest to consider buying the business in April 2019.
Source: Financial Times
Societe Generale, a French lender, is said to be working on disposal of Kleinwort Hambros, its UK private banking business. Kleinwort Hambros managed about GBP 14 billion of assets at the end of last year. Purchase price for similar businesses tend to range from 1% to 2% of assets under management.
Source: Bloomberg
Thus Spoke the Markets
After the restructuring plan announcement Deutsche Bank’s shares still were trading at 0.25x times its tangible book value.
Source: Financial Times
Strategic Cuts
Deutsche Bank will target EUR 6 billion of cost cuts over the next 3 years to reduce annual expenses to EUR 17 billion. Restructuring would include “sizeable workforce reductions” of cutting 18,000 jobs.
Source: Financial Times
Up-and-Comers
Remitly, a Seattle-based fintech firm specialising in remittances, has raised USD 135 million at a valuation of nearly USD 1 billion (up from a USD 450 million valuation in 2017). Its users can currently send money from 16 countries and receive money in 44.
Source: Financial Times
Financial Lingo
“Capital release unit” – Deutsche Bank’s new bad bank comprising EUR 74 billion of risk-weighted assets, equivalent to EUR 288 billion of leverage exposure on the balance sheet.
Source: Financial Times
Exciting Numbers
Sovereign wealth funds returned 4% on average in 2018, compared with 9.4% recorded for 2017. Norway’s USD 1 trillion oil fund (the largest SWF in the world) posted a return of minus 6.1% in 2018.
Source: Financial Times
A Thought Worth Noting
“It’s not just Brexit itself but that no one knows which direction the UK is going in or who the leader will be if there is an election.”
Anonymous
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Aivars Jurcans has more than 20 years of corporate finance and investment banking experience. His services are currently available through MURINUS ADVISERS.
Photo by Daria Shevtsova on Unsplash
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