Raphael Stevens

Italy’s UniCredit appears to have caught German authorities off guard with a potential multibillion euro merger of Frankfurt-based Commerzbank.
Market observers told CNBC on Tuesday that the swoop may have provoked a sense of national embarrassment among Germany’s government, while it’s been argued that the outcome of the takeover attempt could put the meaning of the European project at stake.
Milan-based UniCredit announced on Monday that it had increased its stake in Commerzbank to around 21% and submitted a request to boost that holding to up to 29.9%.

A protestor holds a placard with a slogan reading “Stop Merger Horror” during a union demonstration outside the Commerzbank AG headquarters in Frankfurt, Germany, on Tuesday, Sept. 24, 2024.
Bloomberg | Bloomberg | Getty Images

Italy’s UniCredit appears to have caught German authorities off guard with a potential multibillion-euro merger of Frankfurt-based Commerzbank, a move that has triggered a fiery response from Berlin.
Market observers told CNBC that the swoop may have provoked a sense of national embarrassment among Germany’s government, which firmly opposes the move, while it’s been argued that the outcome of the takeover attempt could even put the meaning of the European project at stake.

Milan-based UniCredit announced on Monday that it had increased its stake in Commerzbank to around 21% and submitted a request to boost that holding to up to 29.9%. It follows UniCredit’s move to take a 9% stake in Commerzbank earlier this month.
“If UniCredit can take Commerzbank and take it to their level of efficiency, there’s a tremendous upside in terms of increased profitability,” Octavio Marenzi, CEO of consulting firm Opimas, told CNBC’s “Squawk Box Europe” on Tuesday.
“But [German Chancellor] Olaf Scholz is not an investor. He’s a politician and he’s very concerned about the jobs side of things. And if you look at what UniCredit has done in terms of slimming down things in its Italian operations or particularly in its German operations, it’s been quite impressive,” Marenzi said.

Scholz on Monday criticized UniCredit’s decision to up the ante on Commerzbank, describing the move as an “unfriendly” and “hostile” attack, Reuters reported.
Commerzbank’s Deputy Chair Uwe Tschaege, meanwhile, reportedly voiced opposition to a potential takeover by UniCredit on Tuesday. Speaking outside of the lender’s headquarters in central Frankfurt, Tschaege said the message was simple and clear: “We don’t want this.”

“I feel like vomiting when I hear his promises of cost savings,” Tschaege reportedly added, referring to UniCredit ‘s CEO Andrea Orcel.
Separately, Stefan Wittman, a Commerzbank supervisory board member, told CNBC on Tuesday that as many as two-thirds of the jobs at the bank could disappear if UniCredit successfully carries out a hostile takeover.
The bank has yet to respond to a request for comment on Wittmann’s statement.

Hostile takeover bids are not common in the European banking sector, although Spanish bank BBVA shocked markets in May when it launched an all-share takeover offer for domestic rival Banco Sabadell. The latter Spanish lender rejected the bid.
Opimas’ Marenzi said the German government and trade unions “are basically looking at this and saying this means we could lose a bunch of jobs in the process — and it could be quite substantial job losses.”
“The other thing is there might be a bit of a national embarrassment that the Italians are coming in and showing them how to run their banks,” he added.
A spokesperson for Germany’s government was not immediately available when contacted by CNBC on Tuesday.
Germany’s Scholz has previously pushed for the completion of a European banking union. Designed in the wake of the 2008 global financial crisis, the European Union’s executive arm announced plans to create a banking union to improve the regulation and supervision of lenders across the region.

What’s at stake?

Craig Coben, former global head of equity capital markets at Bank of America, said the German government would need to find “very good” reasons to block UniCredit’s move on Commerzbank, warning that it would also have to be consistent with the principles around European integration.
“I think it is very difficult for UniCredit to take over or to reach an agreement on Commerzbank without the approval of the German government, just as a practical matter — but I think Germany needs to find a legitimate excuse if it wants to intervene [or] if it wants to block the approach from UniCredit,” Coben told CNBC’s “Squawk Box Europe” on Tuesday.

The Commerzbank AG headquarters, in the financial district of Frankfurt, Germany, on Thursday, Sept. 12, 2024.
Emanuele Cremaschi | Getty Images News | Getty Images

“Germany has signed up to the [EU’s] single market, it has signed up to the single currency, it has signed up to [the] banking union and so it would be inconsistent with those principles to block the merger on the grounds of national interest,” he continued.
“And I think that’s really what’s at stake here: what is the meaning of [the] banking union? And what is the meaning of the European project?”
Former European Central Bank chief Mario Draghi said in a report published earlier this month that the European Union needs hundreds of billions of euros in additional investment to meet its key competitiveness targets.
Draghi, who has previously served as Italian prime minister, also cited the “incomplete” banking union in the report as one factor that continues to hinder competitiveness for the region’s banks.
— CNBC’s April Roach contributed to this report. More

The U.S. Department of Justice on Tuesday sued Visa, the world’s biggest payments network, saying it propped up an illegal monopoly over debit payments.
The DOJ said Visa imposed “exclusionary” agreements on partners and smothered upstart firms.
Visa and its smaller rival Mastercard have surged over the past two decades, reaching a combined market cap of roughly $1 trillion.

Justin Sullivan | etty Images

The U.S. Justice Department on Tuesday sued Visa, the world’s biggest payments network, saying it propped up an illegal monopoly over debit payments by imposing “exclusionary” agreements on partners and smothering upstart firms.
Visa’s moves over the years have resulted in American consumers and merchants paying billions of dollars in additional fees, according to the DOJ, which filed a civil antitrust suit in New York for “monopolization” and other unlawful conduct.

“We allege that Visa has unlawfully amassed the power to extract fees that far exceed what it could charge in a competitive market,” Attorney General Merrick Garland said in a DOJ release.
“Merchants and banks pass along those costs to consumers, either by raising prices or reducing quality or service,” Garland said. “As a result, Visa’s unlawful conduct affects not just the price of one thing — but the price of nearly everything.”
Visa and its smaller rival Mastercard have surged over the past two decades, reaching a combined market cap of roughly $1 trillion, as consumers tapped credit and debit cards for store purchases and e-commerce instead of paper money. They are essentially toll collectors, shuffling payments between banks operating for the merchants and for cardholders.
Visa called the DOJ suit “meritless.”
“Anyone who has bought something online, or checked out at a store, knows there is an ever-expanding universe of companies offering new ways to pay for goods and services,” said Visa general counsel Julie Rottenberg.

“Today’s lawsuit ignores the reality that Visa is just one of many competitors in a debit space that is growing, with entrants who are thriving,” Rottenberg said. “We are proud of the payments network we have built, the innovation we advance, and the economic opportunity we enable.”
More than 60% of debit transactions in the U.S. run over Visa rails, helping it charge more than $7 billion annually in processing fees, according to the DOJ complaint.
The payment networks’ decades-old dominance has increasingly attracted attention from regulators and retailers.

Litany of woes

In 2020, the DOJ filed an antitrust suit to block Visa from acquiring fintech company Plaid. The companies initially said they would fight the action, but soon abandoned the $5.3 billion takeover.
In March, Visa and Mastercard agreed to limit their fees and let merchants charge customers for using credit cards, a deal retailers said was worth $30 billion in savings over a half decade. A federal judge later rejected the settlement, saying the networks could afford to pay for a “substantially greater” deal.
In its complaint, the DOJ said Visa threatens merchants and their banks with punitive rates if they route a “meaningful share” of debit transactions to competitors, helping maintain Visa’s network moat. The contracts help insulate three-quarters of Visa’s debit volume from fair competition, the DOJ said.
“Visa wields its dominance, enormous scale, and centrality to the debit ecosystem to impose a web of exclusionary agreements on merchants and banks,” the DOJ said in its release. “These agreements penalize Visa’s customers who route transactions to a different debit network or alternative payment system.”
Furthermore, when faced with threats, Visa “engaged in a deliberate and reinforcing course of conduct to cut off competition and prevent rivals from gaining the scale, share, and data necessary to compete,” the DOJ said.

Paying off competitors

The moves also tamped down innovation, according to the DOJ. Visa pays competitors hundreds of millions of dollars annually “to blunt the risk they develop innovative new technologies that could advance the industry but would otherwise threaten Visa’s monopoly profits,” according to the complaint.
Visa has agreements with tech players including Apple, PayPal and Square, turning them from potential rivals to partners in a way that hurts the public, the DOJ said.
For instance, Visa chose to sign an agreement with a predecessor to the Cash App product to ensure that the company, later rebranded Block, did not create a bigger threat to Visa’s debit rails.
A Visa manager was quoted as saying “we’ve got Square on a short leash and our deal structure was meant to protect against disintermediation,” according to the complaint.
Visa has an agreement with Apple in which the tech giant says it will not directly compete with the payment network “such as creating payment functionality that relies primarily on non-Visa payment processes,” the complaint alleged.
The DOJ asked for the courts to prevent Visa from a range of anticompetitive practices, including fee structures or service bundles that discourage new entrants.
The move comes in the waning months of President Joe Biden’s administration, in which regulators including the Federal Trade Commission and the Consumer Financial Protection Bureau have sued middlemen for drug prices and pushed back against so-called junk fees.
In February, credit card lender Capital One announced its acquisition of Discover Financial, a $35.3 billion deal predicated in part on Capital One’s ability to bolster Discover’s also-ran payments network, a distant No. 4 behind Visa, Mastercard and American Express.
Capital One said once the deal is closed, it will switch all its debit card volume and a growing share of credit card volume to Discover over time, making it a more viable competitor to Visa and Mastercard.

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Israel’s economy should have been trundling towards recovery. After all, many of the 300,000 workers who left their jobs to fight have now returned to offices, factories and farms. Instead, a difficult situation is becoming ever more acute. GDP growth came to just 0.7% between April and June, on an annualised basis, some 5.2 percentage points below economists’ expectations, according to Bloomberg, a news agency. On September 16th Bezalel Smotrich, Israel’s finance minister, was forced to ask legislators to approve an emergency deficit increase. It was the second time he had made such a request this year. More

Nvidia CEO Jensen Huang is done selling the chipmaker’s stock for the time being, cashing in more than $700 million under a prearranged plan.
The executive in mid-March adopted a trading plan for the sale of up to six million Nvidia shares by the end of the first quarter of 2025.
The chipmaker has been the biggest beneficiary of the artificial intelligence boom.

Nvidia CEO Jensen Huang talks onstage with Salesforce CEO Marc Benioff during Salesforce’s Dreamforce in San Francisco on Sept. 17, 2024.
Justin Sullivan | Getty Images News | Getty Images

Nvidia CEO Jensen Huang is done selling the chipmaker’s stock for the time being, cashing in more than $700 million under a prearranged plan.
The 61-year-old executive in mid-March adopted a trading plan for the sale of up to six million Nvidia shares by the end of the first quarter of 2025. Huang has hit that threshold months ahead of schedule after a flurry of transactions between June 13 and Sept. 12, according to a new regulatory filing.

Even though the sales were made under a 10b5-1 plan, which allows insiders to sell shares under a preplanned structure, Nvidia shares seemed to get a boost from the update Tuesday, trading more than 4% higher.

Stock chart icon

The chipmaker has been the biggest beneficiary of the artificial intelligence boom, with shares rallying more than 140% this year. Nvidia briefly topped a $3 trillion market cap earlier this year, and its dominance has grown so big that it tends to influence the broader market and investor sentiment.
Nvidia declined CNBC’s request for comment.
Barron’s first reported on the completion of Huang’s preplanned sales Tuesday.
After the sales, Huang now holds 75.4 million Nvidia shares and another 786 million shares through different trusts and a partnership, according to a separate filing. In the company’s latest proxy statement, Huang was listed as the company’s largest individual shareholder.
Nvidia sells processors that are powering the generative AI boom and services such as OpenAI’s ChatGPT. The company counts Microsoft, Meta, Alphabet, Amazon and Oracle as its main customers.

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The White House in June issued guidelines that defined standards for a “zero emissions” building.
Morgan Wojciechowski’s Williamsburg, Virginia, home is among the first to receive that label.
Residential and commercial buildings account for almost a third of U.S. greenhouse gas emissions.

Courtesy: Wojciechowski Family

Real estate is a key puzzle piece in achieving the U.S.’ climate goals, according to federal officials.
Residential and commercial buildings account for 31% of the nation’s greenhouse gas emissions, after accounting for “indirect” emissions like electricity use, according to the Environmental Protection Agency. That’s more than other economic sectors like transportation and agriculture.

The Biden administration has adopted various policies to cut residential emissions.
The Inflation Reduction Act, enacted in 2022, offers financial benefits including tax breaks and rebates to homeowners who make their homes more energy-efficient, for example. The White House also recently issued guidelines for buildings in order to be considered “zero emissions,” meaning they are “energy efficient, free of onsite emissions from energy use and powered solely from clean energy,” according to the Department of Energy.
More from Personal Finance:How EVs and gasoline cars compare on total costHere’s how to buy renewable energy from your electric utility8 easy — and cheap — ways to cut your carbon emissions
Morgan Wojciechowski, 33, is among the first homeowners to get that federal “zero emissions” label. (That assessment was bestowed by the third-party firm Pearl Certification.)
Wojciechowski, her husband Casey, and their three dogs — Dixie, Bo and Charlie — moved into the newly built residence in Williamsburg, Virginia, in August 2023.

Wojciechowski, who is also the president of Healthy Communities, a local real-estate developer focused on sustainable construction, spoke with CNBC about her new home, its financial benefits and how consumers can best upgrade their homes to be more efficient.
The conversation has been edited and condensed for clarity.

Morgan Wojciechowski and her husband Casey.
Courtesy: Wojciechowski Family

Greg Iacurci: What does it mean for your home to be considered ‘zero emissions’?
Morgan Wojciechowski: It’s a very, very, very highly efficient home that’s all-electric. Those are kind of the first two bullet points of the White House definition.
The third part is we are part of the green energy program with [our power provider] Dominion. Not only am I producing solar [energy] and any excess is going back onto the grid, but the power from the grid coming into my home is clean and sustainable. It’s about $10 extra a month for me to get that clean energy.
GI: How much did your house cost to build?
MW: Like $1.1 million.
GI: And how big is the house?
MW: 5,400 square feet.
It’s a large home. But mine is not what everybody’s doing. My home was my personal project because I believe in sustainability and wanted to do it in a home that would be my forever home. But one that’s more replicable would be like what [Healthy Communities] builds at Walnut Farm, which is like 1,500 square feet. We’re selling it for $433,000.
GI: Can you break down your home’s estimated savings?
MW: Our utility bills are projected to be about $917 a year with [solar] panels, or around $80 a month.
The annual savings are $7,226 [relative to an average U.S. home, according to rater TopBuild Home Services]. That’s just from the efficiency of the home with solar.
If you took the solar production away, I would be saving $5,431 annually. The solar offsets it.

Courtesy: Wojciechowski Family

Courtesy: Wojciechowski Family

Courtesy: Wojciechowski Family

Courtesy: Wojciechowski Family

Courtesy: Wojciechowski Family

GI: What do you mean solar offsets it?
MW: You create energy. Your home uses that energy and sends excess energy back to Dominion. Those credits are stored in an account, and then those credits offset your bill. It’s called net metering.
GI: So the power company is paying you that money?
MW: Those credits are applied to your next billing cycle. They offset your overall utility bill, and that’s where your savings come in.
Solar panels only make sense if you build an energy-efficient home that’s really all-electric.

Courtesy: Wojciechowski Family

GI: Why is that?
MW: You have to have a home that’s constructed energy-efficiently enough or retrofitted — by replacing your windows with higher-grade windows, adding insulation — so that you will need fewer panels on your rooftop, so you have a quicker return on your investment. Solar only makes sense if you’re going to have a return on your investment within a few years.
GI: That makes solar more attractive?
MW: If you don’t do energy-efficient upgrades to a pre-existing home or if you don’t build a home that’s energy-efficient enough, you have to add more panels to compensate for the lack of energy efficiency. And if that number gets too big it turns people upside down.
Solar has to make sense with the home that you’re putting it on, or else, don’t do it. Maybe just upgrade your windows, add insulation, condition your crawl space, upgrade your mechanical systems.

There are a lot of things consumers can do. You don’t have to do it all at one time. You don’t have to have a solar home to be zero emissions; you have to have an energy-efficient house that’s all-electric, and you have to buy renewable energy from your utility company.
That’s extremely approachable. Lots of people can do that. Everybody can join in at their level of sustainability.
GI: How do you recommend people get started?
MW: I would tell a consumer, why don’t you start with windows and doors. That’s a very easy one. Do that and see how you notice any [efficiency] changes.
In a lot of older homes windows are very old and they leak. Air is coming in and out. If you think about it, a house is like an envelope. You you want to seal the inside of your home the best that you can.  

I would hit insulation next.
A lot of older homes have HVAC systems, duct work inside of their attic. Insulate it so that it’s a conditioned space, so that those building systems don’t have to work in overdrive to keep up with really hot temperatures or really cold temperatures. That keeps it more energy efficient.
And there are tax incentives [available] for energy-efficient upgrades to your home. Consumers can get and write them off, so that’s attractive to people as well.
GI: If you’re a renter, there are certain things that are out of your control. I suppose you can ask your landlord.
MW: Depending upon what your rental situation is. I feel like that’s a little bit more daunting, to change someone else’s mind. Once you get to your own home, eventually, then you have more say of what you can do.
Until then, you could be mindful about the energy you use. Turn lights off. I mean, that’s a real thing. People don’t turn lights off. I mean, even though I have a really efficient home, I have timers on things because I don’t want to be wasting energy. That’s an easy one that anybody could do.
Correction: The house is 5,400 square feet. An earlier version misstated the figure. More

As China’s economy has descended into deflation, the central bank’s lack of urgency has been a source of frustration. Officials at the People’s Bank of China (PBoC) at first expressed confidence that deflation was, so to speak, transitory. When it persisted, they worried less about falling prices than about the side-effects of fighting them. They were reluctant to ease monetary policy decisively as China’s currency was too weak, banks’ profit margins too slim and bond yields too low. More

As China’s economy has descended into deflation, the central bank’s lack of urgency has been a source of frustration. Officials at the People’s Bank of China (PBoC) at first expressed confidence that deflation was, so to speak, transitory. When it persisted, they worried less about falling prices than about the side-effects of fighting them. They were reluctant to ease monetary policy decisively as China’s currency was too weak, banks’ profit margins too slim and bond yields too low. More

Fed Governor Michelle Bowman said Tuesday she thought her colleagues should have taken a more measured approach to last week’s half percentage point interest rate cut.
The jumbo cut “could be interpreted as a premature declaration of victory on our price-stability mandate,” she said in remarks to a bankers’ group in Kentucky.

US Federal Reserve Governor Michelle Bowman attends a “Fed Listens” event at the Federal Reserve headquarters in Washington, DC, on October 4, 2019. 
Eric Baradat | AFP | Getty Images

Federal Reserve Governor Michelle Bowman said Tuesday she thought her colleagues should have taken a more measured approach to last week’s half percentage point interest rate cut as she worries that inflation could reignite.
Bowman was the lone dissenter from the Federal Open Market Committee’s decision to lower benchmark interest rates for the first time in more than four years. No governor had dissented from an interest rate decision since 2005.

In explaining her rationale, Bowman said the half percentage point, or 50 basis point, reduction posed a number of risks to the Fed’s twin goals of achieving low inflation and full employment.
The jumbo cut “could be interpreted as a premature declaration of victory on our price-stability mandate. Accomplishing our mission of returning to low and stable inflation at our 2 percent goal is necessary to foster a strong labor market and an economy that works for everyone in the longer term,” she said in remarks to a bankers group in Kentucky.
Inflation by the Fed’s preferred metric is running at 2.5%, above the central bank’s 2% goal. Excluding food and energy, core inflation is at 2.6%.
Though Bowman favored a reduction, she preferred the Fed lower by a quarter percentage point, more in line with the traditional moves at the central bank. The FOMC last cut by half a point in the early days of the Covid pandemic in March 2020, and before that the global financial crisis in 2008.
Bowman cited several specific concerns: that the big move would indicate that Fed officials see “some fragility or greater downside risks to the economy”; that markets might expect a series of large cuts; that large amounts of sideline cash could be put to work as rates fall, stoking inflation; and her general feeling that rates won’t need to come down as much as her fellow policymakers have indicated.

“In light of these considerations, I believe that, by moving at a measured pace toward a more neutral policy stance, we will be better positioned to achieve further progress in bringing inflation down to our 2 percent target, while closely watching the evolution of labor market conditions,” she said.
In recent statements, Fed officials have cited easing inflation and a softening labor market as justification for the cut. At last week’s meeting, individual policymakers indicated they expect another half percentage point in cuts this year and another full point in 2025. Market pricing, however, is more aggressive, expecting 2 full percentage points in cuts through next year.
The Fed’s benchmark overnight borrowing rate is now targeted at 4.75%-5%.
Bowman said she respects the committee’s decision and emphasized that policy isn’t on a preset course and will depend on the data, which she said has indicated the labor market has softened a bit but is still strong
“I continue to see greater risks to price stability, especially while the labor market continues to be near estimates of full employment,” she said. More