Global Payments to buy TSYS; bitcoin rebound continues

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Consolidation continues
Global Payments announced plans to acquire TSYS in a $21.5 billion deal. This is “the payment industry’s third mega-merger of the year,” Bloomberg reports. Financial Times, New York Times

Receiving Wide Coverage ...

Targeted
Just five months into a five-year contract, Deutsche Bank’s investment banking chief Garth Ritchie may be on the way out after coming “under fire from investors for dismal results since he became the highest-paid senior executive at the embattled lender.” Last week CEO Christian Sewing said he was considering “tough cutbacks” in the investment unit. But Ritchie, who also is co-president of the bank, “has told colleagues he wants a payout if he is pressed to leave. If the bank fires Mr. Ritchie, he would be eligible for two additional years of his base salary, which last year was €3 million ($3.36 million), plus bonus.”

Ritchie has also “been weakened by a large protest vote against him at last week’s annual meeting. He was only supported by 61% of the shareholders and a Qatari investment vehicle — which is among the bank’s largest shareholders — voted against him.

Wall Street Journal

Riding the wave
Checkout.com founder and CEO Guillaume Pousaz is “a 37-year-old Swiss surfer who dropped out of college to ride waves up and down the California coast” and is now “the newest face of the payments frenzy that has investors cheering and bank bosses scrambling. Fresh off a nine-figure fundraising, the company” — a transaction processor for fast-growing internet companies — “is beefing up its presence in the U.S. and getting into other financial services, such as issuing cards.”

Rising risks
Real estate investment trusts are becoming a “key source of capital in the housing market … as the government’s role in the market shrinks.” But some analysts are worried that “these vehicles are putting more of the mortgage market into the hands of leveraged firms with minimal oversight. Some of the more risky mortgage REITs went bust during the last financial crisis.”

Financial Times

On the march
Goldman Sachs’ recent acquisition of United Capital will enable it to “speed up its assault on middle America’s wealth management market, deploying an army of investment advisers to target the employees of corporate clients.”

“United Capital ramps up our growth plan by five years,” said Goldman partner Larry Restieri, who is also CEO of Ayco, a workplace financial counseling service Goldman also owns. “There’s a huge base of clients that need financial counseling that we think we can serve. We haven’t even scratched the surface.”

New kid in town
Mexican banks, “already under pressure from lawmakers for charging ‘abusive’ and ‘usurious’ fees,” are facing new competition from Nubank, “a Brazilian fintech unicorn with 8.5 million customers and financial backing from China.” Nubank, the first new bank “in this closed market in a dozen years,” according to the paper, “is making its first international foray with the move into Mexico and hopes to launch its first product — possibly a credit card — by the end of this year.” The company “is taking advantage of a new fintech law in Mexico that will help it gain a foothold even without a banking license.”

Rebound
Bitcoin jumped as much as 10% on Monday to nearly $9,000, its highest price in a year, and is now up about 140% so far this year, including 70% so far this month. Other digital currencies are also up sharply following a huge drop last year. “The gains are reminiscent of some of the huge price rises seen during the cryptocurrency boom of late 2017. They make bitcoin and other cryptocurrencies some of the biggest beneficiaries of this year’s rally in riskier assets, which has been fueled by signs of yet more loose monetary policy from the Federal Reserve and European Central Bank.”

Artur Kamalov/eranicle - stock.adobe.com

Elsewhere

On hold
Deutsche Bank and Capital One will not have to immediately hand over President Trump’s financial records to two House committees, as a result of a filing to a U.S. district court in New York over the weekend. “The parties have reached an agreement regarding compliance with and enforcement of the subpoenas” while the appeal to the 2nd U.S. Circuit Court of Appeals is pending, the filing said. The agreement “on enforcing the subpoenas for Trump’s financial records was a rare accord between Trump’s attorneys, the banks and the House Intelligence and the Financial Services Committees.”

Quotable

“The crypto winter is gone.” — Manuel Ernesto De Luque Muntaner, founder and CEO of Block Asset Management, an investor in blockchain and cryptocurrency funds, commenting on the rebound in the price of bitcoin