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’UBS rogue trader alert
RTRS-UBS SAYS A TRADER OF INVESTMENT BANK HAS CAUSED LOSS ESTIMATED AT $2 BLN
RTRS-UBS SAYS POSSIBLE THAT BANK WILL THEREFORE POST Q3 LOSS
RTRS-UBS SAYS LOSS DOES NOT INVOLVE CLIENT POSITION
RTRS-UBS SHARES 8.5 PCT LOWER AFTER SAYS COULD POST Q3 LOSS AFTER UNAUTHORISED TRADING BY A TRADER
Further details as we get them.
Fannie and Freddie’s revenge — the details [updated]
– By John McDermott and Cardiff Garcia
The details of the US government’s attempted bank raid are coming in on Friday afternoon.
The Federal Housing Finance Agency has filed 17 lawsuits against banks operating in the US.
Snap news
Breaking pre-market news on Tuesday,
- UBS to cut 3,500 jobs, to take SFr450m restructuring charge in second half — statement.
- G4S group turnover up 5 per cent, says it has “strong pipeline of M&A opportunities”
Swiss bank avalanche
This might be a deferred sell-off following Monday’s holiday in Switzerland. In the words of one analyst though, they’re ‘stuck between a soft dollar and a hard franc…’
(That’s because the wealth management arms of both banks have mainly US dollar revenues and Swiss franc costs).
Back to the drawing board at UBS
New capital and regulatory requirements, combined with a weakening economic outlook, are likely to weigh on future returns, constraining growth prospects for the industry. While we believe we will deliver higher profitability,
Snap news
Breaking pre-market news on Tuesday,
- UBS to cut costs by Sfr1.5bn-2bn; 2012 profit target abandoned — statement.
- Q2 results from Deutsche Bank miss forecasts — statement.
- BP reports weaker than expected Q2 underlying profit of $5.6bn;
[Paul Donovan] Guest editing for the day
Mark your calendars.
On Tuesday July 26, FT Alphaville will be taken over — again.
Paul Donovan, global economist at UBS, will be seizing the reins.
Donovan is not one to shy away from the harder topics in his field so expect some intriguing posts from him come Tuesday,
Snap news
Breaking pre-market news on Thursday,
- UBS to axe 5,000 jobs – report.
- Yell announces new strategy (to provide a broad range of digital services to SMEs) — statement.
- Premier Foods appoints Kraft executive as new CEO — statement.
Ackerman’s week to forget
It’s not been a good week for Deutsche Bank chairman and CEO Josef Ackermann.
First, he was forced to roll over his Greek debt for the greater good of the eurozone.
From the FT:
Mr Ackermann, speaking at a conference in the German parliament in Berlin on Wednesday,
Snap news
Breaking pre-market news,
- Former Bundesbank president Alex Weber nominated to UBS board; to become chairman in 2013 — statement.
- Northumbrian Water receives indicative proposal from Cheung Kong Infrastructure – statement.
Snap news
Breaking pre-market news on Thursday,
- UBS planning to separate its investment bank and incorporate outside of Switzerland — report.
- Jupiter Properties makes conditional 120.5p a share cash offer for Minerva — statement.
Snap news
Breaking pre-market news on Tuesday,
- UBS sees inflows of $11.5bn to wealth management business in Q1 — statement.
- Heritage Oil launches $100m share buyback because shares trading a significant discount to intrinsic value — statement.
Who’s exposed to Japan?
So it begins.
The first research we’ve seen quantifying European bank exposure is out to Japan following last Friday’s terrible earthquake and subsequent nuclear problems is out.
It comes from BNP Paribas and it uses the dreaded BIS statistics (So FT Alphaville’s standard disclaimer about the numbers applies) to come up with aggregate figures.
Libor fixings! UBS subpoenaed for interbank rate
Libor — the interbank rate set by, erm, the banks and curated by the British Bankers’ Association (BBA) — has not been without its critics in recent years.
And the creation of the rate has been also not been without scrutiny.
Swiss banks all stirred up
Two Swiss bank fallers at Tuesday morning pixel time:
Why the sharp-ish move?
The FT reports that Credit Suisse banker, Christos Bagios, has been arrested in connection with the US’s long-running investigation into tax evasion and Swiss banking secrecy.
Credit Suisse’s $6.2bn Swiss finish
Credit Suisse says it just gave the latent CoCo market a $6.2bn shot in the arm.
On Monday morning the Swiss bank announced it would issue Chf 6bn ($6.2bn) of Contingent Convertible securities — or debt that will convert into equity once a certain trigger is reached.
Snap news
Breaking pre-market news on Tuesday,
- HM Treasury raises bank levy target to £2.5bn — statement.
- UBS Q4 results disappoint — statement.
- BG Group reports forecast beating Q4 figures; provides strategy update — statement and statement.
The Puerto Rico pensions debacle
And you thought that Illinois pensions were enough to keep the SEC busy.
From Bloomberg on Friday:
UBS AG may be sued by the U.S. Securities and Exchange Commission over the sale of mutual funds that bought $1.5 billion in bonds Switzerland’s largest bank had underwritten in Puerto Rico.
Harbinger exits Inmarsat
Proving once again that lock-up arrangements with big investment banks aren’t worth the paper they’re written on, news reaches the FT Alphaville desk that Philip Falcone’s Harbinger Capital Partners is placing its remaining 14 per cent stake in Inmarsat.
Lloyds gets the red pen treatment
First the good news. House broker UBS remains extremely on bullish Lloyds Banking Group.
We remain convinced that the group can, by 2013, deliver a mid- to high-teens RoE on a capital base and net asset value considerably higher than the current level.
Snap news
Breaking pre-market news on Friday,
- Flybe prices IPO at 295p per share — statement and statement.
- City Link managing director resigns; Rentokil Initial warns full year performance unlikely to improve — statement.
Deutsche Bank, the European flowmonster
Some more on Wednesday’s third-quarter figures from Deutsche Bank — in particular, the unexpectedly strong performance of its investment banking operations.
Huw van Steenis of Morgan Stanley says the figures showed the advantage of a being a flowmonster,
Compare and contrast – UBS vs Deutsche Bank edition
The more one looks at Tuesday’s third quarter results from UBS the uglier they seem — and not just because its top bankers want the $1m cap on cash bonuses lifted so they can pay the mortgage and the kids school fees.
An investment banking horror, from UBS
“Pretty horrific.”
That’s the reaction of one City analyst to Tuesday’s third-quarter results from UBS.
And it’s hard to disagree.
We all know the third quarter has been a tough one for investment banks but this set of figures really does put things in perspective.
Snap news
Breaking pre-market news on Tuesday,
- UBS says investment banking arm recorded a loss of SFr406m in Q3 — statement.
- ArcelorMittal warns of tough Q4 — statement.
- Brit Insurance recommends £10.45 a share cash offer from Apollo Management and CVC Capital Partners — statement.
‘Something exceptional’ is happening in volatility, correlation
Whilst much has been written about the rise in correlation recently — what’s been less frequently observed is the strange disconnection that’s occurring between correlation and volatility.
The two traditionally move together.
UBSoiled all over again
Because the first 50-page report into shareholders’ subprime losses, released in April 2008, was not enough. UBS have now published a 76-page “Transparency report to the shareholders of UBS.”
This Swiss bank is a sucker for subprime pain.