Brussels Edition: Deutsche Bank Explains

(Bloomberg) -- Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union.

The European Parliament’s special committee on financial crime will take the unusual step of devoting an entire session to a single bank’s legal troubles at a hearing with Deutsche Bank’s head of anti-money laundering today. The bank will be able to explain itself in Brussels after attracting the attention of the Federal Reserve, which is examining Deutsche’s involvement in the Danske money-laundering scandal. The lender, also under investigation by German prosecutors in a case tied to the Panama Papers, will be the center of attention days after results showed revenue shrank for an eighth straight quarter.

What’s Happening

British Visitors | Lawmakers from the U.K.’s Brexit Committee are coming to Brussels today to hold talks with top EU officials, including European Commission Secretary General Martin Selmayr and Guy Verhofstadt, the lawmaker in charge of European Parliament’s Brexit Steering Group. U.K. Prime Minister Theresa May said she is determined to leave the EU on time as she also prepares to head back to Brussels, even though EU diplomats warn that major concessions aren’t likely.

Tech Progress | The EU’s Justice chief, Vera Jourova, will give her fourth update on how well tech giants such as Facebook, Twitter and Google’s YouTube have been doing in removing online hate speech, three years after the companies committed to a code of conduct that forced them to remove hateful content within 24 hours of being notified. The latest review a year ago showed the companies removed on average 70 percent of the speech flagged.

Train Troubles | National regulators from across the EU refused to give their support to Siemens and Alstom’s rail merger, instead backing EU Competition Commissioner Margrethe Vestager’s plan to block the deal. The advisory vote means the EU could issue a formal decision blocking the merger as soon as this week, despite vocal government backing and cries that Europe’s competition policy fails to adequately account for Chinese rivals.

Italian Debt | From the trading floors of London to the gatherings of European leaders in Brussels, there’s one issue that can induce a shudder of financial fear like no other: Italian debt. Although Italy’s economy slipped into recession in the fourth quarter, markets are calm for now. But a budget standoff in the fall showed how swiftly sentiment can turn. Here are all the charts you need to see who stands to lose if that happens.

In Case You Missed It

Facebook Probes | Facebook faces seven separate data-protection probes in Ireland as the country’s privacy regulator looks to take advantage of new rules that allow it to impose hefty fines. The investigations are among 16 cases targeting big technology companies including Twitter, Apple, LinkedIn as well as Facebook’s WhatsApp and Instagram, Helen Dixon, Ireland’s data protection commissioner, told Bloomberg in an interview. 

Venezuela Draft | Spain, the U.K. and Germany are among nations pushing the European Union to recognize Juan Guaido “as president ad interim of Venezuela,” according to a draft communique, in the latest move by the west to isolate Nicolas Maduro. Foreign ministers from the EU’s 28 countries discussed the statement at an informal meeting in Bucharest last week, and only Italy objected to the wording, an EU diplomat told us. If efforts to reach consensus on the wording fail, the governments that agree may separately issue the statement.

SSM Vacancy | The European Central Bank’s financial watchdog may be left without its second-in-command this month as the incumbent, Sabine Lautenschlaeger, concludes her time in office before the Governing Council can gather to propose a successor. That raises the prospect that weeks before the scheduled Brexit deadline, the watchdog may be led solely by Andrea Enria, who has been in the job of chair of the Single Supervisory Mechanism for only a month.

Swedish Question | The longest political standoff in Sweden’s history may have ended but the battle for the country’s soul continues, Amanda Billner and Rodney Jefferson report. In reality, the deal for a new coalition government merely papers over the discontent that’s been eating away at Swedish liberalism since the beginning of the Syrian refugee crisis.

Chart of the Day

The European Commission last published forecasts for the euro-area economy in November, which means a big downgrade is on the cards when it updates the numbers on Thursday. While it’s mostly a case of playing catch-up -- consensus is now just 1.4 percent growth in 2019 versus the commission’s 1.9 percent -- it’s another reminder of how much the outlook has changed recently. The European Central Bank, which recently said risks have moved to the downside, will update its own projections in March.

Today’s Agenda

All times CET.

• 12 p.m. Statement by EU Commissioner Vera Jourova on the fourth monitoring of the Code of Conduct on countering illegal hate speech online
• 6:30 p.m. EU antitrust chief Vestager makes a speech in Cambridge, a rare visit by a EU politician to he U.K. to give yearly Mackenzie Stuart lecture on EU law
• 6:30 p.m. The European Parliament’s committee on financial crime holds a hearing on Deutsche Bank, with Stephan Wilken, the head of the lender's anti-money laundering unit
• The U.K.’s Committee on Exiting the European Union will visit Brussels to examine the progress of the UK’s negotiations on EU withdrawal
• EU-League of Arab States (LAS) ministerial meeting in Brussels brings together foreign ministers from both sides. Ministers will focus in particular on a number of regional issues, as well as on current global challenges that both Europe and the Arab world are facing, such as terrorism, climate change, migration, and human rights situations
• Eurostat to release reading about healthy life years at birth expectancy
• EU Commissioner for Economic Affairs Pierre Moscovici meets French President Emmanuel Macron in Paris

--With assistance from Nikos Chrysoloras, Stephanie Bodoni and Zoe Schneeweiss.

To contact the editor responsible for this story: Heather Harris at hharris5@bloomberg.net, Andrew Blackman

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