News Archive


Wal-Mart in talks to buy stake in India’s Flipkart: sources


HONG KONG/MUMBAI Wal-Mart Stores Inc is in talks to buy a minority stake in India’s largest e-commerce firm Flipkart, two sources familiar with the matter said, as the world’s biggest retailer aims to get a slice of a fast-growing online retail market.

One of the sources said the U.S. retailer was looking to invest between $750 million and $1 billion in Flipkart, but the final value and size of the stake would depend on the outcome of talks about the Indian company’s overall valuation.

He added Wal-Mart and Flipkart were also contemplating a collaboration that would see them leverage each other’s expertise in retail and supply chains in India.

Both sources declined to be identified because the talks are preliminary and have not been made public. Wal-Mart in India and Flipkart declined to comment.

A deal would pit Wal-Mart against U.S. rival Amazon, which has been expanding rapidly in the South Asian country’s retail market and is now Flipkart’s biggest competitor. Wal-Mart only operates wholesale stores in India.

“With Amazon slowly taking a lead over the Indian players, all these unicorns including Flipkart and Snapdeal are out there in the market to raise funds,” the source said.

“Companies like Wal-Mart would be more long-term investors, but there aren’t too many like them to write such big cheques.”

Flipkart has been valued at about $11.5 billion, local media reported last month, citing a U.S. regulatory filing from investor Valic, a division of American International Group Inc.

The company was valued at as much as $15 billion earlier this year, but cut-throat competition, reduced private funding, and elusive profitability is putting pressure on e-commerce players in India.

Launched in 2007 by two former Amazon employees, Flipkart sells everything from cellphones to suitcases and cosmetics. Current investors include Tiger Global Management and Accel Partners.

Flipkart and smaller rival Snapdeal have been looking to raise fresh capital to compete with deep-pocketed Amazon in an industry that relies on steep discounts on products and heavy spending on marketing, technology and delivery networks to lure customers.

India’s Economic Times newspaper, which first reported the talks on Tuesday, said a meeting between the two sides was scheduled for this week.

Wal-Mart agreed in June to take a 5 percent stake in China’s JD.com, giving the U.S. firm a ringside seat in JD.com’s bitter rivalry with Chinese e-commerce leader Alibaba Group Holding Ltd.

(Reporting by Sumeet Chatterjee in HONG KONG and Devidutta Tripathy and Promit Mukherjee in MUMBAI; Editing by Rafael Nam and Mark Potter)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/Ti6djKqZJqU/us-flipkart-walmart-stake-idUSKCN11Y1JO

Deutsche helps lift European stocks before Yellen, Draghi


LONDON A recovery in Deutsche Bank shares helped push European stocks higher on Wednesday, easing concerns over Germany’s financial sector that had hit equities in Asia and drove investors into safe-haven government bonds and the dollar.

Beyond banking sector worries, markets were looking ahead to separate appearances by U.S. Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi as well as a meeting of oil producers in Algiers.

Reflecting investor caution, Wall Street looked set to open around flat. SP 500 e-mini futures ESc1 were flat while equivalents on the Dow Jones 1YMc1 were up less than 0.1 percent.

However, after a torrid couple of days, there was some good news for holders of shares in Deutsche Bank (DBKGn.DE).

Germany’s biggest lender said it sold its British insurance business Abbey Life to Phoenix Group (PHNX.L) for 935 billion pounds ($1.2 billion).

And Deutsche Chief Executive John Cryan told German daily Bild he had not sought state aid after a report the lender had asked for help to deal with a $14 billion demand from the U.S. Department of Justice over claims it mis-sold mortgage-backed securities.

Deutsche shares were last up 2.7 percent, having hit a record low on Tuesday and lost about half their value this year.

This helped push the pan-European STOXX 600 index up 0.9 percent, with an index of banks up 1.3 percent .SX7P.

For Reuters new Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets

German two-year government bonds DE2YT=TWEB, however, held near Tuesday’s record low of minus 0.711 percent and last traded just above minus 0.7 percent. Germany sold a tranche of the bonds at a record low yield at auction of minus 0.7 percent.

Asian shares spent much of the trading session in negative territory, on investor concern about the state of the European banking sector and lower oil prices.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS moved in and out of negative territory and last stood less than 0.1 percent higher on the day.

Japanese shares fell, with the Nikkei 225 index .N225 falling 1.3 percent by the close.

Oil prices were slightly higher, partially reversing Tuesday’s fall of some 3 percent on diminished expectations that oil producers meeting in Algiers this week would reach an agreement to ease a global glut of crude.

Members of the Organization of the Petroleum Exporting Countries (OPEC) are due to meet at 1400 GMT. Some in the market say the Algiers talks could lay the groundwork for an agreement at OPEC’s formal policy meeting in Vienna on Nov. 30, said Vyanne Lai, oil analyst at National Australia Bank in Melbourne.

“I think OPEC producers realise they can’t continue to expand production indefinitely – OPEC producers are close to maximum capacity – so there could be room for a deal (in November),” Lai said.

Brent crude LCOc1, the international benchmark, last traded at $46.51 a barrel, up 54 cents on the day on data showing a surprise drawdown in U.S. inventories.

YELLEN SPEAKS

The dollar DXY was up 0.1 percent against a basket of currencies. Fed chief Yellen testifies before the House Financial Services Committee on regulation but may face questions on the interest rate outlook and the economy.

The Fed left rates on hold last week but strongly signaled they could rise in December.

ECB head Draghi speaks in Berlin.

The euro was flat at $1.1210 EUR=.

“While we admit that near-term downside risks to the euro have increased due to financial stability concerns we think that any setback into the $1.11 handle offers a buying opportunity,” Hans Redeker, head of currency strategy at Morgan Stanley said.

The yen JPY= weakened 0.2 percent to 100.65 per dollar and sterling GBP= dipped 0.1 percent to $1.3014.

(Additional reporting by Shinichi Saoshiro in Tokyo, Keith Wallis in Singapore, Anirban Nag in London; Editing by Hugh Lawson)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/yJUQZ4-6aTY/us-global-markets-idUSKCN11Y01V

SABMiller shareholders comfortably back AB InBev takeover offer


LONDON SABMiller (SAB.L) shareholders backed the brewer’s $100-billion-plus takeover by rival Anheuser-Busch InBev (ABI.BR) by a large majority on Wednesday, paving the way for one of the biggest corporate mergers in history.

The 79 billion pound deal was comfortably passed by the SAB shareholders who voted. It had required approval from a majority in number of shareholders and by at least 75 percent in share value. For the latter, it secured 95.5 percent support.

SABMiller’s two largest shareholders, cigarette maker Altria Group (MO.N) and the Santo Domingo family of Colombia, who together control about 40 percent of the shares, had already pledged their support for the deal.

The approval of SAB shareholders was widely expected, but not a given. Criticism of the takeover offer grew over the summer, after a steep fall in sterling following Britain’s vote to leave the European Union made AB InBev’s cash offer less appealing.

Activist shareholders pressured SAB to seek a higher offer, prompting AB InBev to sweeten its bid in July. SAB backed the higher offer, though some prominent shareholders, including Aberdeen Asset Management, continued to oppose it.

The takeover is expected to be completed on Oct. 10, nearly a year after AB InBev first approached SABMiller about the acquisition, which required a succession of sweetened bids to win over SAB and asset disposals to satisfy regulators around the world.

The shares of the new company will begin trading on Oct. 11 in Brussels, with secondary listings in Johannesburg and Mexico City and American Depositary Shares in New York.

Soon after, the company is expected to kick off a sale process for SAB’s central and eastern European brands, estimated to be worth up to 7 billion euros.

Earlier, AB InBev Chief Executive Carlos Brito, who will head the combined company, outlined the rationale for the deal – including the creation of the first global brewer with new fast-growing African and Latin American markets – before announcing that the name Anheuser-Busch InBev would remain.

After selling off SAB’s joint venture stakes in China and the United States and its businesses across Europe, the combined company will have a 27 percent share of the global beer market, according to Euromonitor International, with large positions in markets of Africa and Latin America.

Still, competition in individual markets will remain relatively unchanged, since the two companies have very little geographic overlap.

Anheuser-Busch InBev, the world’s largest brewer, had offered SABMiller a $3 billion break-up fee, payable if regulators or its own shareholders failed to approve the takeover.

(Reporting by Martinne Geller in London, Philip Blenkinsop in Brussels; Editing by Alexandra Hudson)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/VirDGKIPsxM/us-sabmiller-m-a-a-b-i-idUSKCN11Y0QY

China’s COSCO Shipping may consider buying Hanjin Shipping’s port assets: Caixin


High coking coal prices could stay: Teck Resources executive

Steelmaking coal prices, which have more than doubled this year, could stay high for several quarters as supply from mines that have restarted take time to reach the market, an executive at Teck Resources Ltd, the world’s second-largest exporter, said on Tuesday.

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/6hrf3eclu6Y/us-hanjin-shipping-m-a-cosco-shipping-idUSKCN11Y1H3

Saudis soften oil stance on Iran but OPEC deal still elusive


ALGIERS OPEC might still agree an oil output-limiting deal later this year as the economic problems of its de-facto leader Saudi Arabia force Riyadh to cede more ground to arch-rival Iran.

Saudi Energy Minister Khalid al-Falih said on Tuesday Iran, Nigeria and Libya would be allowed to produce “at maximum levels that make sense” as part of any output limits which could be set as early as the next OPEC meeting in November.

That represents a strategy shift for Riyadh, which has previously said it would reduce output only if every other OPEC and non-OPEC producer followed suit. Iran has argued it should be exempt from such limits as its production recovers after the lifting of EU sanctions earlier this year.

The Saudi and Iranian economies depend heavily on oil but in a post-sanctions environment, Iran is suffering less pressure from the halving in crude prices since 2014 and its economy could expand by almost 4 percent this year, according to the International Monetary Fund.

Riyadh, on the other hand, faces a second year of budget deficits after a record gap of $98 billion last year, a stagnating economy and is being forced to cut the salaries of government employees.

“Does the salary cut indicate the Saudis are ready for a fight or does it indicate that they are ready for a deal,” said an OPEC source from a Middle Eastern producer, when asked about the Saudi shift.

Iranian Oil Minister Bijan Zanganeh said on Wednesday talks about a deal to cap output were ongoing. OPEC will hold an informal meeting at 1400 GMT, following by a formal, regular gathering on Nov. 30.

Oil prices were up around 1.5 percent, with Brent crude LCOc1 nearing $47 per barrel by 1125 GMT.

Saudi Arabia is by far the largest OPEC producer with output of more than 10.7 million barrels per day (bpd), on par with Russia and the United States. Together, the three largest global producers extract a third of the world’s oil.

Iran’s production has been stagnant at 3.6 million bpd in the past three months, close to pre-sanctions levels although Tehran says it wants to ramp up output to more than 4 million bpd when foreign investments in its fields kick in.

“Iran is not losing as much as Saudi. They are in a stronger position,” an OPEC source traveling to Algeria this week said when asked about the shifting dynamic within OPEC.

Saudi oil revenue has halved over the past two years, forcing Riyadh to liquidate billions of dollars of overseas assets every month to pay bills and cut domestic fuel and utility subsidies last year.

“The Iranians have lived with a very tough macro backdrop for many years, and are not used to the government’s benevolence – whether subsidies, employment or spending contracts – in the manner the Saudis are,” said Raza Agha, chief Middle East economist at investment bank VTB Capital.

“So a sustained drop in oil prices has a more difficult social impact on Saudi.”

However, with unemployment in double digits, Tehran is also facing calls to maximize oil revenues and President Hassan Rouhani is under pressure from conservative opponents to deliver a faster economic recovery.

“The nation is still grappling with the sanctions overhang and an inability to create the jobs it needs, on top of longer-term structural issues,” said Emad Mostaque, strategist at London-based consultancy Ecstrat.

UNREALISTIC DEAL

Iran’s Zanganeh said on Tuesday OPEC would try to reach a deal by November, ruling out a compromise this week to address the glut.

At $45 per barrel, oil prices are well below the budget requirements of most OPEC nations. But attempts to reach an output deal have also been complicated by political rivalry between Iran and Saudi Arabia, which are fighting several proxy-wars in the Middle East, including in Syria and Yemen.

OPEC sources have said Saudi Arabia offered to reduce its output from summer peaks of 10.7 million bpd to around 10.2 million if Iran agreed to freeze production at around current levels of 3.6-3.7 million bpd.

For Gary Ross, a veteran OPEC watcher and founder of U.S.-based think tank PIRA, the offer was clearly unacceptable for Iran given that the Saudis have raised production steeply in recent years to compete for market share with U.S. shale production while Iran’s output was limited by sanctions.

“Given the anti-Iranian sentiment in the kingdom, it is very difficult for Saudi Arabia to do anything in OPEC which looks too beneficial to Iran,” Ross said.

“The salary cut highlights the urgency of the national transformation plan. If the Saudis did something aggressive to oil prices at this time, it would go against this urgency.”

Falih said on Tuesday he saw no need for significant output cuts as the market was rebalancing itself. He added that Saudi Arabia was investing in additional spare capacity and could withstand the current trend in oil prices.

(Additional reporting by Vladimir Soldatkin, Patrick Markey and Lamine Chikhi in Algiers, Andrew Torchia in Dubai; Writing by Dmitry Zhdannikov; Editing by Dale Hudson)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/7ZEgtndhI2U/us-opec-meeting-idUSKCN11Y18K

Germany denies preparing Deutsche Bank rescue plan


FRANKFURT The German government denied it was working on a rescue of Deutsche Bank (DBKGn.DE) as Germany’s biggest lender boosted its balance sheet by selling its British insurance business on Wednesday.

Deutsche is facing a $14 billion fine from the U.S. Department of Justice and concerns over its funding pushed its shares to a record low on Tuesday and heightened concerns about the health of the financial sector in Europe’s largest economy.

The finance ministry dismissed a newspaper report that a rescue plan was being prepared in case Deutsche was unable to raise capital to pay for costly litigation.

Weekly Die Zeit had reported that the German government and financial authorities were working on possible steps to enable Deutsche to sell assets to other lenders at prices that would ease the strain on the lender.

The German government would even offer to take a direct stake of 25 percent in an extreme emergency, the paper said without saying where it got its information.

The government was still hoping Deutsche would not need state support and only scenarios for a potential rescue were being discussed so far, Die Zeit added.

“This report is wrong. The German government is not preparing any rescue plan, there is no reason to speculate on such plans,” the finance ministry said in a statement.

Two sources close to the matter also said that German financial regulator Bafin was not working on an emergency plan.

Deutsche Bank shares, which have lost around half their value this year, were up 1.9 percent by 1045 GMT.

A Deutsche Bank spokesman referred to an interview Chief Executive John Cryan gave German daily Bild on Wednesday and denied the report.

“At no point did I ask the chancellor for support. Neither did I suggest anything like that,” the Briton told Bild in response to a report that said he had asked Angela Merkel for her backing with a $14 billion U.S. demand to settle claims it missold mortgage-backed securities.

BANKS SUFFER

Squeezed by the European Central Bank’s low interest rates, German banks have been seeking ways to boost revenue by passing on costs to corporate customers and increasing fees for retail depositors, but profit margins remain thin in one of Europe’s most competitive banking markets.

Banks such as Deutsche are also counting the cost of litigation dating back to their expansion before the financial crisis in 2007-2009.

Since the financial crisis, banks are required to have plans showing how they could recover from a major market shock. Regulators also draw up plans for each lender on how it would be smoothly closed down in the event of impending failure.

Deutsche Bank is in the midst of a deep overhaul that includes slashing jobs from a workforce of around 100,000, revamping information technology and shrinking non-core assets.

Commerzbank, Germany’s second largest lender and in which the government holds a stake of more than 15 percent, is expected to cut around 9,000 jobs in coming years.

In contrast to some European peers, Deutsche is sticking with its strategic focus on investment banking, where its global reach has earned it the International Monetary Fund’s label of being the riskiest of all banks.

Bank of England Deputy Governor Minouche Shafik dismissed comparisons with the collapse of Lehman Brothers at the height of the financial crisis in 2008.

“Many banks are struggling with reforming and transforming their business models,” she said in London. “I think the area that is less profitable right now is the investment banking side.”

BRITISH SALE

Deutsche Bank said it had sold its British insurance business Abbey Life to Phoenix (PHNX.L) in a $1.2 billion deal. The deal comes after the divestment of other non-core units such as its stake in Chinese lender Huaxia (600015.SS).

Although the sale will result in a pre-tax loss of 800 million euros ($895 mln), mainly from writedowns for Deutsche Bank, it will lift the German lender’s capital ratio by 10 basis points.

The lender’s litany of legal troubles have spurred worries it may need to raise capital to staunch the damage.

Analysts at Goldman Sachs on Wednesday estimated that the U.S. mortgages case will cost Deutsche Bank $2.8-8.1 billion. Other analysts have said that any price tag above $5 billion will likely necessitate a capital increase.

Its overall legal provisions stood at 5.5 billion euros at the end of June. However, three other large legal headaches also remain, alleged manipulation of foreign exchange rates, an investigation into suspicious equities trades in Russia and allegations of money laundering.

On Tuesday, Andreas Dombret, the Bundesbank board member in charge of supervision said that support for Europe’s oversized banking sector must stop, comparing banks to dinosaurs facing a threat of extinction.

“Political support for the banking sector must finally come to an end – something that unfortunately I’ve only seen to a limited extent,” he had said.

(Additional reporting by Matthias Sobolewski, Jonathan Gould, Noor Zainab Hussain and Anjuli Davies~; Editing by Keith Weir)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/wUT8Ll068CI/us-germany-banks-idUSKCN11Y1FH

Takata in talks with DoJ to resolve criminal allegations: WSJ


Japan’s Takata Corp (7312.T) is in talks with the U.S. Department of Justice to resolve allegations of criminal wrongdoing related to its faulty air bags, the Wall Street Journal reported on Wednesday.

Federal prosecutors have found evidence of unlawful conduct in Takata’s handling of rupture-prone air bags and are waiting for the company’s proposal on how to resolve an anticipated criminal case, the Journal reported, citing people familiar with the matter. (on.wsj.com/2cKtmjv)

The prosecutors are examining a charge of criminal wire fraud after determining the company likely made misleading statements and concealed information about air bags. They could pursue other kinds of criminal violations in the case, WSJ reported.

The DoJ investigators have held preliminary discussions with Takata that picked up steam in August and the company is expected to face a financial penalty as part of any settlement, according to the report.

Takata’s air bag inflators, which contain ammonium nitrate, have been linked to at least 14 deaths and more than 150 injuries and resulted in the largest vehicle recall in history.

The air bags can explode with excessive force in hot, humid conditions. About 100 million Takata air bag inflators have been declared defective worldwide.

Takata and the DoJ were not immediately available for comment.

(Reporting by Arunima Banerjee in Bengaluru; Editing by Don Sebastian)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/tmb3ONmDcAo/us-autos-takata-idUSKCN11Y1AF

Exclusive: U.S. seeks accused Manila banker’s help to crack Bangladesh heist


MANILA The FBI is negotiating with a former branch manager of a Philippines bank for information relating to $81 million that she handled after it was stolen from the Bangladesh central bank’s account at the New York Federal Reserve, her lawyer said.

Federal Bureau of Investigation officials have presented a “proffer”, or proposal, to the branch manager, Maia Deguito, to tell them all she knows about who received the money, the attorney, Ferdinand Topacio, told Reuters.

He showed Reuters a copy of an unsigned proffer agreement.

According to Topacio, U.S. investigators are trying to get Deguito, who has been fired by the Rizal Commercial Banking Corp (RCB.PS) (RCBC) for her role in the case, to share details about long-time bank client Kim Wong, who is a casino owner and agent.

Under the proposed agreement, any evidence Deguito gives will not be used to prosecute her, but she will be liable if she lies or hides any relevant information. She is currently on bail in a perjury case related to the heist.

In several face-to-face meetings in Manila, starting in May, the two sides also discussed relocating Deguito and her family – her husband and three children – to the United States, Topacio said. The United States has a visa program for foreigners who assist law enforcement agencies but it is limited to 200 people a year.

Spokesmen for the FBI and the U.S. Department of Justice declined comment. Deguito also declined comment.

Nearly eight months after the cyber heist, one of the biggest ever, investigations appear to have run up against a brick wall. From the New York Fed, the $81 million was sent by hackers to four accounts held in fake names at an RCBC branch in Manila where Deguito worked. The funds then changed hands several times and most of it vanished into the Philippines casino industry. About $18 million have been recovered in all.

No arrests have been made despite investigations by the FBI, Interpol, Bangladesh police and authorities in the Philippines.

Two sources in Bangladesh with knowledge of the FBI’s investigations confirmed that the American agency was trying to talk to “persons of interest” in the Philippines.

Topacio said negotiations with the U.S. officials on the offer were continuing because the immunity offered to his client was only limited to her evidence.

“I thought that was dangerous. We want total immunity,” he told Reuters. “It’s not a finished… transaction.”

The proposed agreement mentions Deguito and her lawyer and has the names of Manhattan U.S. Attorney Preet Bharara and Lamont Siller, the FBI’s legal attache at the U.S. embassy in Manila, at the bottom of the form.

CASINO BOSS Wong has admitted in hearings during a Philippines Senate inquiry that he received millions of dollars of the funds from two Chinese gamblers but did not know they were stolen.

Wong has returned $15 million of around $35 million he said he received and that the rest was spent in buying gambling chips for clients. He has denied involvement in the heist.

Wong was not available for comment on this story and his lawyer did not respond to requests for comment.

Deguito has told the Philippines Senate that Wong was a client of hers in a previous job at East West Banking Corp (EW.PS) and he followed her when she moved to RCBC. Deguito had “snippets of information” that may be useful to the American investigators, Topacio said. “We told the FBI ‘we will tell you everything we know and you connect the dots’,” Topacio said. Deguito told the Senate inquiry she helped set up five fake accounts, including the four that received the heist money, and facilitated the withdrawal of some of the funds. Wong was one of the recipients. She has said she was only following orders from her superiors and denies wrongdoing.

Lorenzo Tan, who was president of RCBC at the time of the heist, filed the perjury case against Deguito, accusing her of libel and false testimony. She was arrested and released on bail.

(Additional reporting by Neil Jerome Morales in MANILA and Nathan Layne in CHICAGO; Editing by Raju Gopalakrishnan)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/n-P8X-Jr4jk/us-cyber-heist-philippines-idUSKCN11Y17P

Wells Fargo CEO forfeits millions as board orders review


Wells Fargo Co said on Tuesday that Chief Executive Officer John Stumpf will forfeit unvested equity awards worth about $41 million and will not get a salary while the company’s board investigates the bank’s sales practices.

Carrie Tolstedt, the former head of the retail division at the center of a burgeoning sales scandal, has left the company ahead of her planned Dec. 31 retirement date, will get no severance and has forfeited unvested equity awards worth about $19 million, the bank said. Stumpf and Tolstedt will also not receive bonuses for 2016.

The penalties represent one of the biggest financial sanctions ever levied against a major bank boss and mark a sharp change from a few years ago when despite scandals at large banks, no CEO had to give back a bonus.

Wells Fargo, the United States’ third-largest bank by assets, is under pressure to show it is holding its top brass accountable after government investigations revealed that some of its employees opened as many as 2 million accounts without customers’ knowledge in order to meet sales targets.

The company’s failure to claw back executive bonuses was a big feature of Stumpf’s appearance before a Senate Bank Committee meeting last week into the bank’s sales tactics. Some lawmakers also called on him to resign.

Stumpf will appear before the House Financial Services Committee on Thursday.

The San Francisco-based bank agreed to pay $190 million earlier this month to settle regulatory charges over the account scandal and has fired about 5,300 employees, most of them low-ranking staff, in connection with it.

A special committee of the bank’s independent directors will lead an investigation into the retail bank’s sales practices, helped by the board’s human resources committee and the law firm Shearman Sterling LLP, according to the statement.

The investigation may lead to further compensation changes or employment actions, the company said.

“We are deeply concerned by these matters, and we are committed to ensuring that all aspects of the Company’s business are conducted with integrity, transparency, and oversight,” Stephen Sanger, the board’s lead independent director, said in a statement.

“We will conduct this investigation with the diligence it deserves.”

Stumpf, a member of the board, has recused himself from the investigation, the bank said.

Wall Street banks have introduced clawback provisions in the wake of the financial crisis when tens of billions of dollars in penalties for mortgage fraud and other illegal activities were paid out but no executive had to give back their bonus.

Since then, and before Stumpf’s forfeiture, the closest a bank CEO has come close to a clawback was when Jamie Dimon, JPMorgan Chase’s chief executive, had his 2012 bonus cut in half after the bank’s board decided he should shoulder blame for $6.2 billion of “London Whale” trading losses.

Wells Fargo has previously said it would eliminate sales goals in its retail banking on Jan. 1, 2017.

However, the Wall Street Journal reported earlier on Tuesday that the firm was planning to eliminate the goals on Oct. 1, citing Stumpf’s prepared remarks for delivery at the hearing. (on.wsj.com/2dqsuDd)

Up to Tuesday’s close, shares of the company have fallen nearly 10 percent since Sept. 8 when it reached a settlement with regulators, wiping off about $24 billion of market capitalization.

(Reporting by Narottam Medhora in Bengaluru; Editing by Sandra Maler, Lisa Shumaker and Bernard Orr)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/418CIAqoPL8/us-wells-fargo-accounts-idUSKCN11X2NW