Greece is still seeking bridge financing from its current bondholders after being turned down by the IMF and others. The prospect of a default by Greece rattled stock markets in Europe and the United States today. Greece probably needs about $10 billion for about one year, and credit market spreads suggest that traders increasingly see that level of financing as unlikely.
Add another headache to HSBC’s long list of problems: a data leak affecting apparently about half of its U.S. legacy mortgage customers. The data leak included Social Security numbers along with account numbers and email addresses, so it is the kind of data loss that provides a foundation for fraud by criminal enterprises that purchase the leaked data. HSBC is running off its U.S. mortgage business, and this might make it look like a soft target to data thieves, based on the assumption that businesses can be reluctant to make new investments in data security for legacy operations.
Fallout continues from the long pattern of embezzlement that brought down Brazilian oil company Petrobras, with the indictment and resignation of a political party’s national treasurer. Investigators in Brazil believe that much of the stolen money was laundered through HSBC in Europe and are seeking bank records to try to identify other high officials who might have been involved. Separately, a Petrobras supplier, Grupo Schahin, has filed for bankruptcy protection and suspended offshore oil operations after being affected by the Petrobras investigation, falling oil prices, and the loss of overseas financing.
Giant banks in North America and Europe are reporting improved profits from the first quarter of 2015, based mainly on gains in currency and bond trading.
During the height of the financial crisis, BNY Mellon served as custodian for £1.5 trillion in assets for U.K. customers, and it was failing to properly account for them, raising the risk that customers could lose much of this money if the bank were to fail. The bank has agreed to pay a £126 million fine to the U.K.’s Financial Conduct Authority (FCA) and broadly improve its internal controls.
Deutsche Bank is paying yet another money laundering fine. What makes this one significant is not the size of the fine, $8 million, nor the extent of the wrongdoing, but the venue, Dubai, a place not known for vigorous investigations of banks. The fine covers not just the money-laundering activities themselves but also a multi-year cover-up by the bank, which initially ignored inquiries, then made false statements and provided fabricated reports to mislead regulators. Analysts note that bank executives failed to get involved, leaving the overseas branch to handle the problem itself even after it was clear that something criminal had gone on there. It is hardly an isolated case and seems to show that the international banks of the world have become too large to manage effectively.