Bank deals (surprisingly) pick up
In spite of the crisis in worldwide financial markets, the collapse of the US subprime mortgage market, and the liquidity crisis faced my many financial institutions, there are still major deals in banking going on, in terms of both global reach and vertical expansion
South Korea
UK-based HSBC Holding s announced it would buy a majority stake in South Korea's Korea Exchange Bank. The deal is for $6.3 billion. That bank is the #6 bank in South Korea in terms of assets.
For HSBC, which has a small presence in South Korea already, it comes after several failed attempts to buy other South Korea banks in the last five years. The move should extend HSBC's already strong Asian presence. In what will be the rule more than the exception right now, the takeover is being financed by HSBC directly.
Taiwan
General Electric Capital and SAC Private Capital Group jointly bought a majority share of Cosmos Bank Taiwan, one of the leading credit-card issuers in that country. The deal was for $800 million. The Taiwanese bank was in trouble due to defaults on consumer loans and was badly in need of a cash infusion.
Scandinavia
Sweden's Svenska Handelsbanken announced it would sell its life insurance and pension business to Norwegian insurer Storebrand. The deal is worth $2.6 billion. The acquisition will make Storebrand the #1 life insurance and pension company in Scandinavia. Svenska Handelbanken stated that the insurance business was no longer a core asset for them.
US
Every disaster offers an opportunity for some one. Ameriquest, the #2 private mortgage company in the US, is been liquidated by its parent, ACC Capital. It announced it has sold its wholesale mortgage-origination and servicing assets to Citigroup. Terms were not disclosed. Citigroup had an option to buy that division, base don earlier capital infusions it sent to prop up Ameriquest.
Netherlands
Meanwhile, the UK-based Barclays Bank's epic battle to acquire Netherlands-based ABN Amro may be over. Barclays battered by the subprime debacle, Barclays has had to borrow hundreds of millions of dollars from the Bank of England, and many suspect that is a sign of serious liquidity problems. Barclays is/was a major player in the mortgage derivates market. It is also a direct player in the market, since it earlier this year purchased US subprime lender Equifirst and servicer HomeEq. The result has been a drop of over 15% in the bank's high-flying stock, and a stock offer was a key part of the ABN Amro deal. The Royal Bank of Scotland, Barclays' big competitor for ABN Amro is in better shape, with a mostly cash offering. But even with RBS, it may be hard to gather all the cash given the tightness of the market.
10:58:39 AM 
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