Weekly Financial Biz Recap: Jamie Dimon’s Rant, More Citigroup Fines

Monday

Bank of America (NYSE:BAC) and Goldman Sachs (NYSE:GS) are listed as lead underwriters for a $1 billion initial public offering with Empire State Realty Trust. The Real Estate Investment Trust (REIT) – owner of the Empire State building in NYC – says it will be listed on the NYSE under the symbol ESB.

Investing Insights: Bank of America and 2 Stocks Leading the Dow Higher.

AIG (NYSE:AIG) feels the heat from the Securities Exchange Commission again, as the regulator presses for more disclosures in the company’s quarterly reports on guaranteed interest rates in its life insurance business. Insurance firms have increasing issue with guaranteeing lifetime payments without taking on too much risk with interest rates at rock bottom.

E Trade’s (NASDAQ:ETFC) average daily trading volume in January was down year-over-year, but up 20% from December. ETFC added 30,298 brokerage accounts last month to around 2.8 million, and customer assets total $185.4 billion, up 2.3% year-over-year and up 7.5% month-over-month.

Don’t Miss: ECB’s Free Lunch Saves Banks €120B.

Tuesday

Deutsche Bank (NYSE:DB) is  close to an agreement to pay around 800 million euros ($1 billion) to settle a decade-old claim that a former chief executive helped drive German media company Kirch Group into bankruptcy. A settlement, if approved, could be included in either the company’s fourth quarter report or first quarter 2012, though DB has already set aside 1 billion euros as a capital cushion for litigation.

Investing Insights: Is Wall Street Buying into Bank of America?

Capital One Financial’s (NYSE:COF) proposed a $9 billion acquisition of ING’s (NYSE:ING) United States online bank. The Federal Reserve considered the deal yesterday and promised a decision soon, though this is the second delay within a week. It’s the first market and analysis the Federal Reserve is looking at under new Dodd-Frank rules.

Jamie Dimon (NYSE:JPM) continues to rail against over-regulation, telling Fox Business that policies coming out of Washington have led to a slower and more troubled recovery: “It could have been better. I do think we have made this recovery slower and worse by uncoordinated policy, the debt ceiling crisis and tons of other things that were misguided.”

Goldman Sachs (NYSE:GS) is the lead candidate to purchase the Columbian coal assets of Brazil’s Vale (NYSE:VALE). The move could lower its transportation costs by giving it better port and railway access to move coal around. Executives with Vale hope to close a deal by the end of the year.

Don’t Miss: Austerity: The Real Cost of Greece’s Bailouts.

Wednesday

In a move interpreted as a step towards carrying out an expected £4B-£5B IPO later this year, RBS’s (NYSE:RBS) insurance business has rebranded itself as Direct Line Group, dropping its former name. As a part of its bailout in 2008, the new Direct Line group has to divest the ops, and is open to a sale, besides a listing.

Don’t Miss: Fed Minutes: Bernanke Remains Cautious, No More Quantitative Easing For Now.

The secondary private equity arm and other affiliates of Credit Suisse (NYSE:CS) have raised $2.9B for their latest fund, which includes an $87M commitment from Credit Suisse.

To settle claims from its actions in a federal home-loan insurance program, Citigroup’s (NYSE:C) mortgage unit has agreed to pay $158M. Additionally, Citi has admitted that it submitted loans to be insured by HUD, which did not meet the requirements for underwriting.

Investing Insights: Financial Stocks Investors Put in Play After Earnings.

Thursday

AIG (NYSE:AIG) is increasing its holdings in its former mortgage bonds, despite their role in the near-collapse of the insurer and the financial crisis. This buyback failed last year but now AIG has managed to repurchase some of the paper from institutions and banks.

Investing Insights: Heavy Volume Stocks: Microsoft Breaks Out, BofA Pops, Morgan Stanley Rallies.

Morgan Stanley (NYSE:MS) could have its long-term ratings cut by up to three notches by Moody’s, as the latter’s warnings of a rating downgrade for several banks is scrutinized. Goldman Sachs (NYSE:GS) and JPMorgan Chase (NYSE:JPM) could be dropped by two notches each.

Some 23% of its individual investor customers in Fidelity, the largest money-fund manager, would stop using money funds if 3% of their investment were held back for 30 days before they could redeem it, according to a survey by that company. The SEC’s “30-day” rule in its plan to shore up the money market mutual fund industry has some investors concerned about”liquidity”.

Don’t Miss: January Core Producer Price Index Up Significantly.

Friday

Three companies — NYSE Euronext (NYSE:NYX), CME Group (NASDAQ:CME) and IntercontinentalExchange (NYSE:ICE) — have submitted bids for the London Metal Exchange, according to sources. The commodities business is being valued at up to £1B. Bidding closed on Wednesday with at least seven companies participating in the first round, with the LME due to consider its offers on Feb. 23.

Don’t Miss: Bernanke: How Easy Money Lending is Affecting Community Banks and the Economy.

Logical buyers for the various pieces of Ally Financial, should it decide to sell all or part of its auto lending and banking businesses, include JPMorgan (NYSE:JPM), Toronto-Dominion (NYSE:TD), Wells Fargo (NYSE:WFC) and GM (NYSE:GM). Although it’s looking more and more remote, an IPO is still a possibility.

BofA (NYSE:BAC) submitted its emergency-planning list to the Fed last year, and more details are emerging. BofA would consider the sale of its retail-branch network in Texas and its U.S. Trust wealth-management unit, should a market shock or severe downturn that requires the raising of capital occur. However, executives might also decide to issue common stock before letting go of key parts of the business.

Don’t Miss: CMA: How Wells Fargo is Weathering the Storm.

Months of internal discussions at Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS) have culminated in a decision to change the accounting that affects a portion of corporate loans with a combined value of over $100B, this according to sources and financial filings. The firms have reduced their use of “mark to market” to shield themselves from swings in the values of some loans.

Following the regional bank Zion Bancorp’s (NASDAQ:ZION) investor day, its shares surge. During that day it was announced to investors that it has enough capital and liquidity to repay its TARP obligations.

Earnings Report: Equity One Inc. Fourth Quarter Earnings Sneak Peek.

To contact the reporter on this story: Tanya Harding at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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