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Deutsche Bank AG and Point72 Asset Management were among firms to report coronavirus infections as the financial industry takes steps to ensure business carries on during the escalating health crisis.
Japanese brokerages are among those introducing split operations, while the U.S. Securities and Exchange Commission is encouraging D.C. employees to stay at home following a possible infection there. Banks in the Asia-Pacific region can expect $100 billion in credit losses stemming from the outbreak, S&P Global Ratings said.
As new cases in China and South Korea abated, bank shares in Asia were among those to rise Tuesday after the previous day’s rout saw U.S. banks tumble the most since 2011.
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BBVA Employee in Madrid Tests Positive (3:26 p.m. HK)
An employee at BBVA’s headquarters in Madrid has tested positive for the coronavirus, according to internal email to staff seen by Bloomberg News. The case was confirmed March 10, according to the email. The bank has shut down the building where the employee worked and closed all pantries and cafeterias, as well as the gym and nursery at the HQ.
Japan Brokerages Split Operations (3:22 p.m. HK)
Japanese securities firms have joined their global peers in splitting teams to ensure business continuity in case of any coronavirus infections. SMBC Nikko Securities Inc. last month began separating each of its departments including mergers advisory and debt underwriting into two groups working in different locations, spokesman Wataru Kawarazaki said. Nomura Holdings Inc. and Daiwa Securities Group Inc. have also taken steps to allow departments in Tokyo to operate from different areas, spokesmen said.
SEC Workers Told to ‘Telework’ on Possible Case (10:52 a.m. HK)
The U.S. Securities and Exchange Commission is encouraging employees at its sprawling Washington headquarters to work remotely beginning Tuesday amid concern that one of the agency’s workers may have contracted the coronavirus.
In an email to staff on Monday evening that was obtained by Bloomberg News, the SEC said that “out of an abundance of caution” it was requiring all people on the floor where the person sat to “telework.” The regulator said it was also reaching out to people with whom the person had been in contact, and that the agency had asked its landlord to have the area “deep cleaned.”
Point72 Asset Management Employee Infected (10:36 a.m. HK)
An employee of Steve Cohen’s $16 billion hedge fund firm Point72 Asset Management contracted the coronavirus, according to a person with knowledge of the matter.
The employee works at the firm’s 55 Hudson Yards location in Manhattan, on the 14th floor, where back-office staff work. The staff member was self-quarantined at home and the rest of the employees on that floor have been asked to work from home for two weeks, the person said.
Asia Banks Face $100 Billion Bad-Loan Hit (10:35 a.m. HK)
The coronavirus outbreak will add $100 billion in credit losses to banks in the Asia-Pacific region this year with Chinese lenders bearing the brunt of the damage, according to S&P Global Inc.
“Some activity will be lost forever,” Shaun Roache, S&P’s Asia-Pacific chief economist, wrote in a note on Tuesday. “We estimate an income loss of about $211 billion, which will blow a hole in balance sheets across the region.”
Deutsche Bank, KKR Workers Get Virus in Europe (10:23 a.m. HK)
A Deutsche Bank AG employee in Frankfurt and another at KKR & Co. in London contracted the coronavirus, setting off swift measures to contain potential outbreaks.
Starting Tuesday, Deutsche Bank will divide sales and trading teams at its affected offices in a building across from its main towers in Frankfurt. It’s sending some personnel to a recovery site until March 27 as a precaution, and some employees may be asked to work from home.
KKR said it’s temporarily closing both of its London offices to have them sanitized and that staff there should work from home until further notice. It’s requiring personnel who had close contact with the employee who contracted the virus to quarantine themselves for 14 days.
Private Equity Firms With Energy Holdings Hit (10:15 a.m. HK)
Private equity firms were hit hard by Monday’s oil price collapse as a result of their entanglements in energy through buyouts, lending and owning stakes in companies that specialize in deal-making in the sector.
Shares of alternative asset managers with exposure to energy companies tumbled as U.S. stocks plunged broadly and oil had its biggest drop in a generation. A battle for market share between Saudi Arabia and Russia is threatening to boost crude supply just as the coronavirus is spurring the first decline in demand since 2009.
Wall Street Gets a Break on Work-at-Home Traders (6:21 p.m. NY)
Brokerages in the U.S. are getting a break from their main regulator as the coronavirus poses compliance headaches across Wall Street.
The Financial Industry Regulatory Authority said Monday that it would give firms more flexibility in supervising employees working remotely and in relocating personnel to temporary locations. The industry-backed regulator also said it would consider granting extensions for firms that need more time to respond to inquiries, filing deadlines or investigations.
— With assistance by Takashi Nakamichi, Alfred Liu, Macarena Munoz Montijano, Benjamin Bain, Andrew Ramonas, Hema Parmar, Steven Arons, Heather Perlberg, and Sabrina Willmer
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