Responding to the impact of the recession, Russia has taken steps to limit transaction clearing activities and international transactions, with the central bank taking on a more prominent position. The central government is preparing a broad bailout of the banking system, which could extend to a financing vehicle for national infrastructure projects. The bailout is being paid for using pension funds.
Hawaiian Electric Industries’ board of directors approved a plan to spin off its $5 billion banking subsidiary, Honolulu-based American Savings Bank. It is one of three large banks based in Hawaii. The bank’s operations are not expected to be affected by the change in ownership. The new bank holding company will be one of two surviving entities in a planned electric company merger.
In Portugal, the successor to the failed Banco Espírito Santo will soon stop using that name. Workers have begun changing signs at branches to the new bank’s name, Novo Banco. Meanwhile, Novo Banco is working on selling some divisions and assets to make way for a sale of the bank to a new owner next year.
A surprisingly strong November U.S. jobs report has observers speculating that the Fed could begin raising interest rates. The current crisis-level interest rates are beneficial for banks that are deep in debt, but the artificially low rates tend to reduce the size of the banking sector and make it difficult for banks to make a profit from normal banking activities.
A credit union was liquidated this week. Metropolitan Church of God Credit Union had 191 members, who were members of the namesake church in Detroit, Michigan. State regulators closed the credit union on Wednesday, and the NCUA was in the process of verifying member accounts.