Goldman not yet talking 1MDB settlement; Standard Chartered plans buybacks

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Blocking move
President Trump, three of his children and his real estate firms filed a federal lawsuit to prevent Deutsche Bank and Capital One from complying with Congressional subpoenas for financial documents related to him and his family. Wall Street Journal, Financial Times, New York Times, Washington Post, American Banker

Good times
Standard Chartered said it would start a $1 billion buyback program “imminently,” its first in two decades, “a signal of its return to health after a multiyear restructuring and the settlement of a sanctions probe.”

“The move marks the first time in a generation that StanChart has bought back its shares and represents a shift in direction for a bank that has traditionally used excess capital to invest in growth opportunities.”

Wall Street Journal

Intercontinental Exchange’s plan to make it easier for consumers to use bitcoin to pay for purchases “faces further delays after the venture, called Bakkt,” said it was applying for a trust company license from the New York Department of Financial Services. “That status would let Bakkt hold bitcoin and other cryptocurrencies on customers’ behalf while abiding by regulations aimed at ensuring investors’ assets are kept safe. But it also means the launch of Bakkt, which was originally planned five months ago, is likely to be further held up.”

Separately, the cryptocurrency market expressed a collective yawn following last week’s accusation by the New York Attorney General’s office that the company behind Tether, a popular digital coin whose value is pegged to the U.S. dollar, used its reserves to cover up $850 million in missing funds. The currency was trading at around 99 cents, while the price of bitcoin has stabilized after falling following the news.

Less than zero
The amount of long-term European government bonds yielding less than zero percent has risen 20% already this year to about $10 trillion, the most since 2016. “The expanding pool of such bonds — which guarantee that a buyer will receive less in repayment and periodic interest than the buyer paid — highlights how expectations for growth in much of the developed world have deteriorated.”

Financial Times

No deal ... yet
Goldman Sachs CEO David Solomon said his bank has not talked with the Department of Justice about settling criminal charges over its alleged role in the 1MDB Malaysian corruption scandal. “We haven’t even started discussions with the Justice Department about any of that,” he said in an interview on Bloomberg TV, but added, “We are very focused on getting this resolved in the best way that we can.” Last week, the paper reported some senior DOJ officials want a guilty plea from the company.

Solomon was also interviewed by CNBC, where he talked about Goldman’s new co-branded Apple credit card, among other subjects.

A stockholder advisory group is urging investors in Metro Bank to block the reelection of founder and chairman Vernon Hill at its annual meeting later this month and said “the introduction of an independent chair should be a priority.” The firm, Glass Lewis, said Hill “risked further damaging the bank’s reputation after a string of recent issues” while also accusing the U.K. bank “of undermining basic pay principles by awarding its new chief financial officer tens of thousands of pounds in bonus payments for a period before he joined the bank.”

It ain’t over
An “incensed” European Commission said it will pursue an investigation into Danske Bank’s €200 billion money laundering scandal despite a decision by the European Banking Authority to end its probe without any findings. Vera Jourova, the EU’s justice commissioner, told the paper that “the case of Danske Bank is not closed for us, regardless of the decision of EBA.”

Danske reported a 39% drop in first quarter earnings and reduced its full-year outlook.

Nordea, another Nordic bank caught up in money laundering, took a €95 million provision “for a probable fine from Danish regulators due to weaknesses in its money laundering controls as it delivered worse than expected first-quarter results.”

Washington Post

Not amused
JPMorgan Chase’s attempt at humor didn’t register with at least two members of Congress, who criticized the bank for a Twitter post advising customers with low bank balances to “make coffee at home” or “eat the food that’s already in the fridge.” Sen. Elizabeth Warren, D-Mass., denounced the tweet — which was later removed after a few hours — while Rep. Katie Porter, D-Calif., demanded an apology from CEO Jamie Dimon.


“The market just doesn’t care. This community has an immense tolerance for pain.” — A cryptocurrency trader discussing the lack of movement in cybercurrency prices despite $850 million in missing funds at the company behind Tether

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Finance and investment-related court cases Bitcoin AML Crime and misconduct Social media Goldman Sachs JPMorgan Chase Standard Chartered