5 Jul, 2022
FTX US inks option to buy BlockFi; Toronto-Dominion Bank weighs acquiring Cowen
By Maricor Zapata
TOP NEWS IN BANKING & FINANCIAL SERVICES
* Cryptocurrency exchange FTX US, the U.S. arm of FTX Trading Ltd., will invest in BlockFi Inc. through a $400 million revolving credit facility, with an option to acquire the cryptocurrency lending platform at a variable price of up to $240 million, based on performance. The deal, signed June 30, is valued at up to $680 million, including other potential considerations, BlockFi Co-founder and CEO Zac Prince said in a message on the company's website.
* The Toronto-Dominion Bank is weighing acquiring brokerage Cowen Inc., Bloomberg News reported, citing people familiar with the matter. The Canadian bank is working with advisers to study a possible transaction for Cowen but could still opt not to pursue a deal, the people told the news outlet. A deal would extend the offerings of the bank's investment banking arm, TD Securities Inc., in equity, debt and research, the report said.
➤ Asia-Pacific financial institutions M&A interest tracker
Potential deal activity in the Asia-Pacific financials sector in June remained concentrated in South Asia and Australia, driven by the planned sale of a few banks and other nonbanking financial assets.
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CaixaBank had the best-performing bank stock among large European banks in the first half of 2022 amid a turbulent backdrop of market volatility and macroeconomic pressures.
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BANKING
* Pinnacle Bank, a subsidiary of Pinnacle Bancorp Inc., agreed to acquire San Antonio-based Crockett National Bank in a deal expected to close in the second half, the San Angelo (Texas) Standard-Times reported.
* Grandville, Mich.-based Rivertown Community FCU plans to merge with in-state peer Allegan CU, Rivertown announced on its website. The combined organization will have about $160 million in assets and about 14,000 members with five branches.
* The Financial Crimes Enforcement Network and the U.S. Department of Commerce's Bureau of Industry and Security issued a joint alert warning financial institutions to be alert to attempts to evade export controls related to Russia's further invasion of Ukraine, American Banker reported. The U.S. regulators are now requiring banks to decline or report suspected transactions.
* Investment banks, including The Goldman Sachs Group Inc. and Bank of America Corp., risk losing billions of dollars on leveraged buyouts they agreed to finance before the markets went south, The Wall Street Journal reported. Sales of newly issued buyout debt were averaging 94.8 cents on the dollar as of June 23, down from 99.2 cents at the end of January, the Journal reported, citing Leveraged Commentary & Data.
FINANCIAL SERVICES
* Canadian investment giant Brookfield Asset Management Inc. eyes opening new offices, raising capital, seeking to venture into the European market and buying in sectors from clean energy to technology, Bloomberg News reported, citing an interview in London with Anuj Ranjan, who runs business development at Brookfield and leads its private equity arm in Europe and Asia-Pacific.
* Asset manager Fidelity Investments plans to open up direct indexing — once limited to the rich — to the masses by launching a platform in the U.S., called Fidelity Solo FidFolios, that would allow investment of as little as $1 per stock, Financial Times reported.
* Voyager Digital Ltd. is pursuing strategic alternatives and is focusing on protecting assets and maximizing value for customers as quickly as possible, Bloomberg reported, citing a series of tweets from the company following its suspension of trading, deposits and withdrawals due to a plunging cryptocurrency market.
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