April, 2009
UK pension deficit hits £250bn
The aggregate deficit of corporate UK pension funds soared past £250bn in March, setting a record for a shortfall due mainly to the drop in gilt yields as the Bank of England’s quantitative easing commenced.
Leighton saves Macquarie in $3.5bn project
Leighton Holdings has rescued a A$4.8bn ($3.5bn) Australian road project and its underwriter Macquarie Group by striking a deal with a dissident shareholder trying to shut down the development, reports Bloomberg.
Bahrain to launch $1bn debt sale
Bahrain will add to efforts by the Arab Gulf states to create an active regional bond market by raising more than $1bn in a debt sale in local currency and US dollars, the central bank said Tuesday. Abu Dhabi and Qatar have already sold $6bn worth of bonds between them in the past month but are expected to issue more and at longer maturities,
UK moves on Madoff brother’s assets
UK officials on Tuesday moved to recover a vintage Aston Martin car and other assets belonging to the brother of Bernard Madoff, claiming they were bought with funds transferred from the disgraced broker’s UK-based business.
Overnight markets: Mixed
Asian stocks mostly fell on Wednesday after US retail sales unexpectedly declined and the stronger yen dimmed the earnings outlook for Japan’s electronics and auto companies. Futures on the S&P500 Index dropped 0.6% after the gauge slid 2% on Tuesday after figures showed that US retail sales fell a monthly 1.1% in March while producer prices dropped 1.2%.
Financial crisis, UK payment system edition
CHAPs. That would be the UK’s ‘Clearing House Automated Payment System’, which is used by account holders the nation over for the completion of large transactions, facilitating such things as house purchases and other large payments etc.
Shrinking financial services sector datapoint du jour
More evidence of the grim outlook for work in the City on Tuesday.
Figures from the Securities & Investment Institute (SII) seen by the Times show a 17 per cent drop in registrations for SII administered examinations – those that most City would be City-types need to pass in order to gain accrediation from the FSA.
The finance of flying fat
European discount carrier Ryanair has long been a big proponent of discretionary charges. Paying for things like check-in and excess baggage charges, added €132m to their third-quarter results, accounting for 22 per cent of total revenue.
March US PPI falls an unexpected 1.2 per cent
News just in for the deflation mongers out there: the US Producer Price Index fell an unexpected 1.2 per cent in March — the sharpest decline in three months. The market had been expecting a flat number.
CDS report: Banks good, industrials bad
Credit derivatives markets were buoyed by Goldman Sachs’ numbers, with traders hoping that they may be a sign of a fundamental improvement in the banking sector.
As the earnings season kicks off in earnest for non-financial companies,
Lunch Wrap
On FT Alphaville Tuesday morning,
- On Wells Fargo and banks’ well-being.
- Invoice: You owe us RMB.
- Forex trading booms in 2008.
- Roubini stresstifies.
- Tuesday pangloss: a $12 trillion perspective.
Invoice: You owe us RMB
News from China’s regional cities rarely makes our radar, but this is an exception.
BEIJING, April 8 (Reuters) – China took a step towards using the yuan to settle trade with Hong Kong and some other neighbouring trade partners on Wednesday,
Our friends in the North: A message to the peasantry from Lord Adair Turner, Baron of Ecchinswell
A lesson in superciliousness from the FSA today. The below landed in the FT Alphaville inbox moments ago.
Subject:
Real help for North West and North East through £12m Moneymadeclear service pathfinder.
Markets live transcript 14 Apr 2009
Markets live chat transcript for the chat ending at 12:11 on 14 Apr 2009. Participants in this chat were: Neil Hume, FT (NH) Bryce Elder (BE)
NH:
Hello
NH:
and welcome to Markets Live
‘We don’t hate you AIG’
A fourth-grade class in Houston, Texas, ‘imagined’ what it’s like to be an AIG employee as part of their daily economics lesson.
The verdict: Not nice. The class solution: Write sympathy cards to AIG workers.
Tuesday pangloss: a $12 trillion perspective
A generalised sense of cautious optimism seems to be on the table for this week. In the US, Goldman is refunding the taxpayer and Wells Fargo is making money. Over here, notwithstanding March’s FSA stress-test madrigal,
Stresstify
Roubini posits that the stress test scenarios are already more optimistic than reality.
Related link:
Stress testing the stress test scenarios – Nouriel Roubini on RGE Monitor
On Wells Fargo and banks’ well-being
The blogosphere – and analysts – are in varying states of agitation over Wells Fargo’s pre-announcement of its quarterly results on Thursday last week.
The bank said it would post $3bn in first-quarter profits when it releases Q1 results next month — more than double what analysts were expecting.
Further reading
Elsewhere on Tuesday,
- Let’s hurt the American financial services industry.
- Bank runs: Past, future and right now.
- Taxpayer-funded Goldman profits.
- The fake recovery.
- Soak the rich:
Pink picks
Comment, analysis and other offerings from Tuesday’s FT,
Put finance back in its box
Author and ex-investment banker Philip Augar writes: Financial models must change. Unless governments in the US and UK really open themselves up to new ideas,
Snap news
Breaking pre-market news on Tuesday,
- Britvic announces successful refinancing of debt – statement.
- MCB considers bid for RBS Pakistani business – statement. Also Jahangir Siddiqui Ltd – Reuters.
Goldman push to repay $10bn
Goldman Sachs signalled its determination to emerge quickly from the financial crisis, disclosing plans late Monday to raise $5bn to pay back public funds and reporting stronger-than-expected first-quarter earnings of $1.81bn.
Goldman results set high bar for rivals
Goldman Sachs on Monday kicked off the reporting season for US banks, with Q1 results that beat analysts’ forecasts. But its move to a calendar year-end – following its decision to become a bank holding company last year – revealed that it lost $1.3bn in December,
Buyout groups back Skype founders’ bid
Four private equity groups are jointly backing the founders of Skype, the internet telephony group, in a bid to buy back the business from eBay, reports DealJournal. KKR, Warburg Pincus, Providence and Elevation Partners are backing Niklas Zennstrom and Jannus Friis in a bid to repurchase the company they sold for $2.6bn in 2005.
India’s Tech Mahindra wins Satyam bid
Tech Mahindra – an Indian outsourcing group partly owned by BT of the UK – on Monday won the auction for a controlling stake in Satyam Computer Services, which is at the centre of India’s biggest corporate scandal.
US eyes GM loan-to-equity swap
The US government is considering taking an equity stake in a stripped-down General Motors in a swap for some of the $13.4bn the carmaker owes the Treasury, reports Bloomberg. The move comes ahead of a June 1 deadline for GM to submit a revised plan to become viable.
ICBC takes top slot for deposits
Industrial and Commercial Bank of China, the world’s largest lender by market cap, has now also become the biggest by deposits. The latest symbolic milestone underlines how Chinese banks have weathered the global crisis to become the world’s largest lenders.
SEC to review BofA’s bonus actions
The SEC is reviewing whether Bank of America broke the law by not telling shareholders about Merrill Lynch’s plan to pay out $3.6bn in bonuses before they voted for a merger of the two banks. Merrill paid the bonuses in December,