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Morning Briefing

Morning Briefing

Japan Post Group has set tentative prices for its IPO that could see it raise 1.44 trillion yen ($12 billion) in what would be the biggest debut share sale in Japan since 1998.

According to a regulatory filing today, the group has priced Japan Post Bank shares at 1,250 yen to 1,450 yen, Japan Post Holdings shares at 1,100 yen to 1,400 yen and shares in Japan Post Insurance at 1,900 yen to 2,200 yen.

Indicative prices released as a guide for investors a month ago were 1,400 yen for Japan Post Bank, 1,350 yen Japan Post Holdings and 2,150 yen for Japan Post Insurance. Prices for the bank and insurer will be decided on 19 October and for the holding company on 26 October with stocks to be listed on 4 November.

A survey of ATM fees in the US by Bankrate.com has found that consumers in Atlanta and New York City are charged the most with New York ATM users paying $5.03 on average for out-of-network ATM use.

The survey includes fees charged by the ATM operator and by the consumer's own financial institution and reflects increases in ATM fees by large banks to compensate for lost fee income in other areas as a result of federal banking legislation enacted in the wake of the financial crisis. The average out-of-network fee nationally is at a record high of $4.52 and has risen 21 percent in five years.

Also in the US, borrowers may soon have more rights to sue their banks and credit card companies as the Consumer Financial Protection Bureau (CFPB) is today proposing rules to curb mandatory arbitration in contracts for credit cards, bank accounts and loans.

The CFPB move is part of a wider debate in the US as to whether consumers are helped or hindered by arbitration agreements that block class-action lawsuits. The proposals would ban companies from including arbitration clauses in consumer contracts for financial products including credit cards, current and deposit accounts, prepaid cards, money transfer services, some vehicle loans, payday loans and private student loans.

Meanwhile, Hillary Clinton, the leading contender to lead the Democratic Party into the 2016 presidential election has said that she will unveil a plan next week to rein in abuses in the financial services sector. She said the plan would ensure that those found guilty of financial wrongdoing would go to jail.

The former Secretary of State said tackling issues in the sector requires more than simply reinstating the Glass Steagall act repealed by her husband, Bill Clinton, during his period as president. "If you only reinstate Glass Steagall, you don't go after all these other institutions in what is called the shadow banking system — hedge funds and other big financial entities that have too much power in our economy," she said.

As non-performing assets continue to plague India's banks, Indian Overseas Bank (IOB) has set up what it describes as a "war room" to tackle mounting bad assets after the Reserve Bank of India (RBI) instructed it to take "prompt corrective action", according to the Financial Express.

"RBI's only aim was to shore up the bottom line of the bank. Though we have been making steady progress in recoveries and maintaining decent operating profits, the ballooning NPAs have been eating into our profits," R Koteeswaran, managing director and CEO of IOB said.

Spanish bank Santander was forced to evacuate the main building at its Madrid headquarters yesterday after envelopes containing white powder were sent to senior executives.

Santander said it had called in the Guardia Civil as a precaution and was sending the envelopes to be analysed. The Guardia Civil later said that the incident appeared to be a hoax. However, 12 Santander employees who handled the envelopes were kept under medical observation.

In more typical Santander news, the bank's venture capital fund, InnoVentures, is investing $4 million in the cryptocurrency-based payments system Ripple. Santander will get a seat on Ripple's board.

Finally, the Financial Conduct Authority (FCA) in the UK has begun a review into the mortgage market. "We are seeking stakeholders' views on competition in the mortgage sector," Christopher Woolard, director of strategy and competition at the FCA, said. "These views, together with evidence from the FCA's wider programme of work on mortgages, will help inform any future FCA work on this key sector of the economy, including any future competition market study," Woolard said.

The FCA will publish a feedback statement in the first quarter of 2016 ahead of launching any fully fledged study of the sector.

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