April, 2009
Aon UK cuts pension payments
The British arm of one of the world’s biggest insurance brokers is cutting its contributions to its workers’ pensions by up to half, the FT reported. Aon said it believed it was the first large company in the UK to cut payments to its workers’ defined contribution schemes,
RBS to cut up to 9,000 jobs across globe
Royal Bank of Scotland is cutting up to 9,000 jobs worldwide – including 4,500 in the UK – in areas such as technology and call centres in what is the biggest single job cull at a bank this year, the FT reported.
Pernod set to unveil €1bn rights issue
Pernod Ricard, the French drinks group, is expected to announce a €1bn ($1.3bn) rights issue and a deal to sell its Wild Turkey bourbon brand, the FT reported. The deal to sell Wild Turkey – the most likely buyer of which is Campari – is expected to raise $575m for Pernod,
Pearl plans LSE flotation after restructuring
Hugh Osmond’s Pearl life assurance group is close to a restructuring that is expected to see it float on the London Stock Exchange later this year with a targeted market capitalisation of about £2bn. Mr Osmond is close to raising about £500m from new institutional investors to recapitalise the Pearl parent company,
PartyGaming in Landmark Legal Settlement
PartyGaming, the online gambling company that became a sought-after stock on the FTSE 100 index in the UK, on Tuesday admitted to bank fraud and contravening other US laws as it paid a forfeiture of $105m (€79m) in order to escape prosecution by US authorities,
Taylor Wimpey in 11th-hour rescue deal
Taylor Wimpey, the stricken UK housebuilder, has reached a refinancing agreement with its key creditors after more than nine months of negotiations, the FT reported. The company also revealed pre-tax losses of nearly £2bn and net debts of £1.57bn.The 11th-hour deal came on the eve of a deadline on Wednesday to seek approval from its creditors,
Ireland unveils emergency budget
Ireland’s finance minister warned on Tuesday that the nation faced “the challenge of [its] life”, as he slapped higher taxes on the middle classes in an emergency budget aimed at tackling the spiralling economic crisis.
Europe concerned over sterling slide
The pound’s slide against the euro has begun to trigger concerns on the continent that the UK is seeking to gain a competitive advantage over its European Union partners, the FT reported. Sterling has fallen by more than 25 per cent on a trade-weighted basis since the autumn of 2007,
CDS market’s Big Bang arrives
The financial industry will on Wednesday overhaul how it writes contracts in the credit derivatives world – an effort to rebuff criticism that the vast sector could pose a systemic threat, the FT reported.
Grube to step down as EADS chairman
Rüdiger Grube signalled that he would step down as chairman of EADS, the Franco-German defence group, when he takes over as chief executive of Deutsche Bahn, the German state railway, later this year,
Blankfein attacks US job rules
Lloyd Blankfein, Goldman Sachs’ chief executive, on Tuesday stepped into the heated political debate over Wall Street’s future, calling for an overhaul of bankers’ pay and attacking new laws preventing financial groups from hiring foreigners,
French state is BNP’s biggest investor
The French state has become the largest shareholder in BNP Paribas, the country’s biggest bank, with a 17 per cent stake, according to a disclosure yesterday by the regulator, the FT said. This follows BNP’s decision to take €5.1bn ($6.8bn) of state support in the form of preference shares to shore up its balance sheet.
Overnight markets: Sell
Asian markets moved sharply lower on Wednesday, falling for a second consecutive session as traders digested losses at Alcoa and Daiwa Securities. Alcoa, the world’s largest aluminum producer, posted a larger-than-expected quarterly loss of $497m while Daiwa warned it would report an annual loss after booking a Y17.4bn ($173m) decline in the value of its securities holdings.
On ambulance chasing and bottom picking
A curious little indicator as to whereabouts we are in the credit cycle this:
Bankruptcy-related M&A.
(Or in other words, shotgun mergers and acquisitions being made where one – or both – merging parties would otherwise go bankrupt.)
Note in the graph below,
G20 City protest, take deux
Well, it’s reportedly on a Saturday this time so will likely have little impact on City workers. More importantly it’s directed at ‘PIGS of the policing kind — not the capitalist ones.
From politics.co.uk
The activists behind last week’s G20 protests around the Bank of England plan to march again this Saturday.
Moody March
While March saw equity markets rallying – the experience of the corporate credit sector was somewhat different.
RBC Capital has a summary of Moody’s March default report, released late Monday.
Moody’s released its default report for March which saw a pick-up in the default rate from 5.2% in February to 7% in March.
CDS report: Wider across the board
European credit derivatives markets made a poor start to trading on Tuesday, with spreads on CDS for single names in the defense industry a particular weak spot.
The CDS on BAE Systems widened 9.3 per cent to 134.3bps,
Lunch Wrap
On FT Alphaville Tuesday morning,
- Stress tests and little white lies.
- No more Naked Shorts.
- Sibir: shaping up as worst scandal on record to hit AIM?
- Summers regression.
On FT.com,
Markets live transcript 7 Apr 2009
Markets live chat transcript for the chat ending at 12:05 on 7 Apr 2009. Participants in this chat were: Paul Murphy, FT (PM) Neil Hume, FT (NH) PM:Hi there – welcome to Markets Live
Summers regression
Casual observation du jour — but Lehman Brothers is a pretty big outlier.
Related links:
Obama adviser Summers earned millions… – Portfolio.com
No more Naked Shorts
A lot of guff is written about how the advent of blogging and digital reporting generally also marks the end of serious investigative journalism as traditional media outlets are forced to cut costs.
For many years,
Sibir goes to court…
Sibir Energy is fast shaping up as the worst scandal on record to hit Aim, London’s junior Aim market.
On Tuesday, the company revealed it was suing former directors Henry Cameron and Russian businessman Chalva Tchigirinski, in connection with “unauthorised payments”.
Word of the day: Notlüge
You can add this to other pieces of European languages that have gained utility in the fiscal crisis, like Anstalslast and Herannakoord.
The term ‘Notlüge’ equates to a ‘white lie’ in English, but its literal translation is ‘emergency lie’ — and there seem to be a lot of those nowadays.
Further reading
Elsewhere on Tuesday,
- A new way to bet on house prices.
- Inflation prospects in an emerging market, like the US.
- An interview with a teary Sir Allen Stanford.
- Begun, the Stanford receiver war has.
Pink picks
Comment, analysis and other offerings from Tuesday’s FT,
A chance for bankers to refocus their talents
The FT’s Gillian Tett writes: A few weeks ago, some science and engineering students at London University lobbed me a question.
Snap news
Breaking pre-market news on Tuesday,
- Sibir Energy starts High Court proceedings against two former directors — statement.
- JJB Sports updates on proposed CVA and financing agreements — statement.
Toxic debts could reach $4 trillion, IMF to warn
Toxic debts racked up by banks and insurers could spiral to $4,000bn (£2,700bn), the Times reported, citing new forecasts from the International Monetary Fund due to be published on April 21. The IMF said in January that it expected the deterioration in US-originated assets to reach $2,200bn by the end of next year,
ECB dismisses euro short cuts in east Europe
The European Central Bank yesterday dismissed proposals for European Union states in eastern Europe to scrap their currencies and introduce the euro, without formally joining the eurozone. The ECB was responding to the publication in the FT of plans by the International Monetary Fund for the area as part of a regional anti-crisis strategy.
Fed in foreign currency swap agreements
The Federal Reserve has lined up almost $300bn worth of euros, yen, pounds and Swiss francs to lend to US-based banks to meet foreign currency needs, the FT reported. The US central bank reached currency swap agreements with the ECB,
UK manufacturing data offer no respite
The manufacturing sector suffered an even worse first quarter than the sharp decline at the end of last year, data released on Tuesday suggest, in a reminder that signs of the recession easing remain tentative.