Warburg Pincus Sell's Tech Driven Spanish Private Bank

Warburg Pincus has sold Singular Bank, a tech-driven private bank, created from Self Bank, which Warburg Pincus acquired in 2019.  

The sale was to an ING (specifically ING Spain)-led consortium.

Self Bank was rebranded during Warburg's ownership and transformed to pivot to private banking.

Javier Marin Romano, former CEO of Banco Santander, has led Singular since its inception and continues to do so post-acquisition.

UK Banks to be Briefed on Anthropic's Mythos Cyberthreat

The Bank of England, UK National Cyber Security Centre, HM Treasury and FCA will brief banks, insurers and exchanges in the UK on the cyber implications of Anthropic's new (non-publicly released) AI model, Mythos, which was revealed in April.  

The briefing will include CEOs of the UK's eight largest banks, two insurers and four financial infra providers. 

The model can exploit new-found vulnerabilities autonomously when instructed to do so. Bruce Schneier has observed this is "very much a PR play by Anthropic". It is curious that Anthropic seem to have not built in any guardrails against offensive security.

Agentic Commerce Gets Lift from Santander and MasterCard PoC

Santander and Mastercard have completed an agentic payment, billed as Europe's first agentic commerce transaction within a regulated banking environment. It was conducted using Mastercard Agent Pay.

Agentic commerce is an emerging ecommerce category.

The grand vision is to allow purchases to be conducted using Mastercard's payment rails within conversational interfaces.

SWIFT backs Blockchain Ledger

SWIFT is adding a blockchain ledger to its infrastructure stack. 

It is developing this ledger with 30 financial institutions from 16 countries, including Absa, Banco Santander, Bank of America, BBVA, Citi, Deutsche Bank, BNP Paribas, Emirates NBD, Societe Generale-FORGE, Wells Fargo and Royal Bank of Canada, taking part.

SWIFT CEO Javier Pérez-Tasso (CEO since 2019) remarked: "We...are moving at a rapid pace... to create the infrastructure stack of the future".

Swiss Capital Requirements Weigh Heavy on UBS

The Swiss government has proposed heavier capital requirements on UBS, as revealed by UBS Group CFO and Stern-school MBA grad Todd Tuckner (Todd joined UBS in 2004 and is thus a 21 year veteran, prior to which he was an international tax partner at KPMG). 

These capital requirements would up the bar on core capital (removing currently allowed items such as software and deferred tax assets from counting as capital). Software was counted as an intangible asset with some regulatory value, especially if it supported core banking operations. However, concerns that is less loss-absorbing and more volatile in valuation than current treatment requires have prompted its exclusion from core capital (CET1- Common Equity Tier 1 capital, basically the highest form of capital, acting as a high quality shock absorber in the event of losses).

UBS will need to decide what to do - either push back, and hope for the best, or relocate its HQ to be outside of Swiss regulation, or plan both in parallel.

The proposed rules are to avoid an incident such as the collapse of Credit Suisse in 2023 from happening again. UBS has criticised the proposal as being non-proportionate.

UBS shows strong profits and franchise strength in Q1 2025 with robust CET1

UBS has reported (30 April 2025) 2.1bn USD PBT (profit before tax) for Q1 2025 and a net profit of 1.7bn USD with RoCET1 of 9.6%.

Measures of franchise momentum have also been positive: this includes USD 32bn of net new assets into Global Wealth Management and USD 7bn of net new money into Asset Management.

UBS also calculates an underlying PBT and underlying RoCET1 which excludes P&L items which management consider not representative of underlying performance.  This gives a higher PBT number and higher RoCET1.

Capital position is strong with CET1 ratio of 14.3% and CET1 leverage ratio of 4.4% (banks have a requirement to keep their CET1 ratios above 4.5% to meet Basel standards with additional plus points if over 14%). UBS has stated this provides "a solid capital buffer to requirements during integration" (referring to Credit Suisse integration) and "given increased market volatility" (driven by US tariff policy changes).

The CET1 ratio is used to gauge a bank's solvency and capital strength.  

CET1 stands for Common Equity Tier 1 and measures the bank's "core capital" including common shares and retained earnings.  The BIS describes CET1 as the "highest quality of regulatory capital, as it absorbs losses immediately when they occur".

Tier 1 capital consists of CET1 and Additional Tier 1 (AT1) capital. Contingent convertibles (which can be converted into equity) and other kinds of hybrid securities qualify as AT1 capital. Typically these convertibles will have "triggers" to convert into common equity or be written off if CET1 ratios fall below a certain level.

Tier 2 capital consists of instruments other than common equity and is less discussed.

Growth including GenAI and cloud investments have included the roll-out of 50,000 Copilot licenses to employees (UBS has over 110,000 employees so this is under half of employees, including contractors), increased cloud usage to ~75% and an exclusive JV with 360 ONE on wealth management in India and international markets.

There are a few areas not covered by the broad results announcement - how well has Trading done, and how reliant is UBS on trading now relative to wealth and asset management.

HSBC Winding up Investment Banking in Europe

HSBC is winding down M&A and equities in the UK, Europe and Americas, accelerating a move to cut costs and a shift to Asia, led by CEO Georges Elhedery (appointed September 2024, and who holds a postgraduate qualification in Statistics and Economics from ENSAE). HSBC will keep debt capital markets and leveraged acquisition finance globally.