4 Financial Stock Stories Kicking Off a New Trading Week

The Goldman Sachs Group Inc. (NYSE:GS): Current price $161.14

It is expected that Goldman Sachs will divest its majority interest in its European Insurance Unit London-based Rothesay Life Ltd. during a period of one year. The decision comes just after the advent of stringent new capital rules issued by regulators. Holding $9.66 billion in assets as of June 30, Rothesay was created in 2007 by Goldman so as to capitalize on the sprouting opportunities in the United Kingdom pension market. The sale of this underwriting division by Goldman forms part of its strategy to grow its capital prior to the implementation of new capital regulations.

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Citigroup Inc. (NYSE:C): Current price $50.67

Citigroup says that Argentina’s plunging foreign reserves are an indication that the least-creditworthy borrower in emerging markets could elect to impose losses of $5.8 billion of debt on bondholders. Dollar-denominated bonds due in 2015 and sold under Argentine legislation have jumped to a 17-month high of 95.86 cents. Meanwhile, investors transitioned from notes governed by New York law on speculation that the local debt will be isolated from holdout creditors suing in United States courts.

Citigroup says that bondholders, among which include AllianceBernstein LP and MFS Investment Management, are low-balling the risk of losses following reserves that are used for debt payments falling at the fastest rate in over a decade — to a six-year low of $37 billion.

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Morgan Stanley (NYSE:MS): Current price $26.45

Last week, Hajime Kitano, who was the sole Japan-based equity strategist at Morgan Stanley MUFG Securities Co., exited after working just over three months on the job. Morgan Stanley spokesman Natsuo Nishio confirmed the departure and that Kitano was the bank’s only stocks strategist in Japan. Kitano came to the investment firm on May 1, and before that, worked for JPMorgan Chase & Co. from 2006 until 2013, said data compiled by Bloomberg. Kitano was ranked as Japan’s number-one equity strategist this year by Institutional Investor, claiming the position for the third time since 2007, according to that magazine’s website.

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Deutsche Bank AG (NYSE:DB): Current price $45.51

Inside sources say that the German financial supervisory authority Bafin could advise Deutsche Bank as soon as this month to improve its controls so as to avert a repeat of attempts to manipulate benchmark interest rates. Bafin is completing its first report into the rigging of Libor and similar benchmarks and will submit it to the lender as soon as this month, according to the source, who elaborated that Bafin will present its findings to Deutsche Bank management, directing them to abide by standards set by the regulator. Under the rules, Bafin is not permitted to publish the findings or disclose actions it takes on individual banks without the firm’s consent.

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