Michel Barnier, who is negotiating Brexit terms on behalf of the EU, told a closed-door meeting of members of the European Parliament that the EU needs to have access to London's banks after Britain leaves the bloc, according to minutes of the meeting. "There will need to be work outside of the negotiation box ... to avoid financial instability" after Brexit, Barnier said.
Treasury Secretary Jack Lew looks back on key events of 2016 and looks forward to major developments expected in 2017. He offers thoughts in an interview on topics including the challenges of globalization and the redesign of US bank notes.
JPMorgan Chase's profit increased 24% in the fourth quarter year-on-year, to $6.7 billion, surpassing analyst forecasts. Cost cuts, a 31% increase in fixed-income trading revenue and an 8% increase in stock trading revenue contributed to the company's growth, CEO Jamie Dimon said.
Mastercard has kicked off its Australian Open sponsorship with a spot that emphasizes the fun side of the tournament. "Happy Slam" was developed in conjunction with McCann Sydney, Digital Arts Network Sydney and Octagon.
Objections from investors last week forced a number of high-grade bond issuers to remove a clause that would prevent an investor from demanding a make-whole payment in the event of a default. Bond issuers including General Motors Financial decided to drop the clause -- which has been appearing with increasing frequency in recent bond documents -- in the face of opposition in the market.
The pound has dropped below $1.20 on currency markets for the first time since the "flash crash" in October, just before Prime Minister Theresa May gives a speech this week on Britain's plans for withdrawal from the EU. The pound's fall came after the Sunday Times of London reported that May plans to pursue a "hard Brexit" by withdrawing entirely from tariff-free trade with the EU.
DBRS downgraded the credit rating for Italy's sovereign debt from to BBB (high) from A (low). Moody's Investors Service, Standard & Poor's and Fitch Ratings have already taken away Italy's A rating.
Deutsche Bank, Credit Suisse and Barclays are among European banks pulling back from exposures to client clearing derivatives because of increasing regulatory restrictions. US Commodity Futures Trading Commission data show a sharp move away from derivatives clearing, with Deutsche Bank reducing its client segregated assets to $3.1 billion by November 2016 from $12.5 billion in early 2014.
The International Accounting Standards Board is reviving a project that would require banks to incorporate recognition of their portfolio hedging in financial reports. The initiative, which was put on hold in 2014, might face difficulties again in light of a European Banking Authority survey in which most banks said they would take advantage of an International Financial Reporting Standards 9 exemption that lets them keep their existing framework.
Restrictions need to be applied when trading currencies in thin markets, the Bank for International Settlements said in a report. Guidelines that start in May are intended to prevent sharp currency devaluations similar to the "flash crash" of the British pound in October, the report said.
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