Mark Kleinman at Sky.com had news on Wednesday, that Lloyds Banking Group is auctioning off a portfolio holdings in scores of British companies, together worth something in the region of £400m. Read more
Let’s face it, snow in southern England is a bit of a rarity.
Consequently, it’s quite understandable that when the occasional dump occurs transport chaos, truancy and mindless sledging-related accidents are common place. Read more
Isn’t it great when City analysts think alike?
Take those who follow Shell. On Tuesday of several of them decided to cut their earnings forecasts — all at the same time. Read more
Harley Bassman, a veteran strategist on the US rates trading desk at BoA Merrill Lynch, is hanging up his boots after more than 25 years on Wall Street. Or at least his widely read RateLab strategy note is going on “indefinite hiatus.”
Here is his final dispatch: Read more
Tune in now…
“It is our hope that together we can rebuild the American people’s belief in a financial system that puts Americans to work, fulfills their dreams and provides the foundation for a new era of broadly shared prosperity.” Read more
Shares in Royal Dutch Shell took a bit of a walloping on Wednesday as reports circled the city the company was guiding analysts lower on fourth-quarter numbers:
Last week FT Alphaville wrote that an auction of £2.25bn worth of 2049-dated gilts was widely expected to be the real test of markets’ demand for UK government debt, having fewer of the supporting factors that helped lift sentiment for an earlier £4bn 2015 gilt-offering.
And on Wednesday, we get the results of the £2.25bn auction. Read more
Live markets commentary from FT.com
So began the presentation of Albert Edwards at SocGen’s ‘Alternative Strategy’ event at London’s Marriott Hotel Grosvenor Square on Tuesday.
In front of a packed Westminster Ballroom — we reckon around at least 400 people turned up — Edwards revealed, much to the surprise of no one, that ‘yes’ he was still bearish. Read more
That’s CDOs of RMBS to be specific.
And the erstwhile structured finance favorite (plus some revaluing of CDS) is behind the fourth-quarter profit warning issued by the French Bank on Wednesday morning. Read more
Comment, analysis and other offerings from Wednesday’s FT,
Robert Reich: Why Obama must take on Wall Street
It has been more than a year since all hell broke loose on Wall Street and, remarkably, almost nothing has been done to prevent all hell from breaking loose again, writes former US labor secretary, Reich. In fact, close your eyes and you could be back in the wilds of 2007. Bankers are still making wild bets, still devising new derivatives, still piling on debt. Read more
Asian stocks fell on Wednesday, reports Bloomberg, while copper and oil declined after China raised the amount banks have to hold in reserve. Hong Kong’s Hang Seng Index slumped the most in seven weeks.
Asian markets (Wed)
Nikkei 225 down -86.66 (-0.80%) at 10,792
Topix down 4.94 (-0.52%) at 949
Hang Seng down -501.18 (-2.24%) at 21,825 Read more
Bankers on both sides of the Atlantic struggled to quell anger over their bonus pay-outs on Tuesday as Congress prepared a new probe into executive compensation and US officials worked to claw back all bail-out costs. US bank stocks fell on investor concerns about the Obama administration’s plans to charge banks for the estimated $100bn in government losses on its main bail-out fund. Lenders with large deposit bases, which are likely to bear the brunt of the planned levy, were worst hit, with Bank of America and Citigroup dropping more than 3%.
Wall Street reacted with disbelief and resignation to the Obama administration’s plans to impose an industry levy to pay for the financial bail-out. With executives such as Goldman Sachs’s Lloyd Blankfein and JPMorgan’s Jamie Dimon due in Washington on Wednesday to testify before a congressal inquiry into the financial crisis, senior bankers said they felt under siege. In private, financial executives vented their anger at the levy plan but avoided public criticism – another sign of Wall Street’s fears of a public backlash.
Google has said it will end the controversial censorship of its search service in China and risk expulsion from the most populous internet market, following what it claimed were Chinese-based attempts to hack into its systems and those of other international companies, reports the FT. It also cited attempts to break into its Gmail system and efforts to trick “dozens” of human rights activists in order to access their email. Bloomberg adds that Google last week told US secretary of state Hillary Clinton of its China plans.
Banks are preparing to fight a proposal by global regulators to sharply increase capital requirements for institutions that bring in outside investors to fund subsidiaries, warning it will cripple their ability to expand in emerging markets. The banks fear the provision would hit the capital stocks of a wide range of UK, European and Japanese financial institutions, as they deal also with pressure to increase their regulatory capital. Analysts said the proposal was one of the most “draconian” parts of a reform package put forward in December by the Basel committee on banking regulation.
Stephen Hester, chief executive of Royal Bank of Scotland, has warned that the UK-backed lender has no choice but to pay large bonuses to top employees as it has become a “prisoner of the market”. He told a panel of MPs that RBS would pay the “minimum we can get away with” but that failure to pay market rates would limit its ability to keep and motivate talent. The heat on bonuses is also rising in Washington, where top US financial executives will testify on Tuesday before a bi-partisan inquiry into the causes of the financial crisis.
CIT Group is ramping up its search for a new chief executive to replace longtime chief Jeffrey Peek, who steps down this week, and former Merrill Lynch CEO John Thain is among the candidates under consideration, reports the WSJ. A person familiar with the situation said Thain had been approached for the job but cautioned that talks were “extremely preliminary”. CIT, a major lender to small businesses, exited from bankruptcy protection in December after eliminating more than $10bn of debt from its balance sheet.
Greece was condemned by the European Commission on Tuesday for falsifying data about its public finances and allowing political pressures to obstruct the collection of accurate statistics. In a damning report, the Commission said Greece’s figures were so unreliable that its budget deficit and public debt might be even higher than claimed last October. At the time, Greece estimated its 2009 deficit would be 12.5% of GDP, far above 3.7% predicted in April. See also FT Alphaville on a “Greek tragedy“.
XL Capital, the Bermudan insurance and reinsurance group, has become the latest in the industry to announce plans to move its legal domicile to Ireland, which is finding favour as a growing insurance market and as a stable, low-tax home. Mike McGavick, chief executive, acknowledged the risk of a clampdown on tax havens by US lawmakers, but said there was more to the proposed move of its legal domicile away from the Cayman Islands, where it is registered despite its Bermudan base.