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’ARS probe widens, Morgan Stanley offer rejected
Morgan Stanley said Monday it was willing to buy back about $4.5bn in auction rate securities in response to pressure from regulators, but Andrew Cuomo, New York’s attorney-general, rejected the offer as “too little,
Wachovia revises and increases Q2 loss
Wachovia on Monday increased its previously reported Q2 loss to $9.11bn to cover costs to settle a probe of auction-rate securities sales, and said it will cut more jobs as the housing market deteriorates,
Banks post losses, stocks rally
Five of the largest US financial institutions, led by Wachovia and Washington Mutual, reported combined quarterly losses of more than $11bn but their shares jumped an average of 14% on rising hopes that bank stocks have fallen about as low as they can go,
Convertible bonds tumble
Convertible bonds – especially for auto companies and financial firms – suffered sharp declines yesterday amid forced selling by hedge funds specialising in such securities, market participants said.
CDS Report: Indices back to the wides while financials struggle
The benchmark credit indices on both sides of the Atlantic hit their widest levels since mid-April on Friday, after a sharp and surprising jump in the US unemployment rate.
This week’s mixed bag of economic news had led some investors to dare hope that the “green shoots of recovery”
Wachovia, WaMu, move against CEOs
The fallout from the credit crisis spread to the US retail banking sector on Monday as Wachovia ousted its chief executive. The move came as the Seattle-based bank Washington Mutual stripped its chief executive of his additional role as chairman of the board.
Uncomfortable news for acquisitive bankers
CHARLOTTE, N.C. — Wachovia announced today that its current Chairman, Lanty Smith, has been appointed interim Chief Executive Officer, succeeding Ken Thompson, who is retiring at the request of the Board. Ben Jenkins,
Banks protest Citi’s hedge fund losses
Wachovia said Monday it suffered significant losses from a Citigroup hedge fund, joining Fifth Third Bancorp, which disclosed its loss in an April lawsuit, reports Reuters. Wachovia said a $315m write-down the bank disclosed earlier in May was related to investments in Citi’s Falcon Strategies hedge Fund.
The credit crunch in context: banking write-offs per employee
Incredible chart porn from Here Is the City (HT Felix), showing how much firms have either written down or lost per wholesale banking employee:
The breakdown (headcount estimates are Here Is the City’s own):
Wachovia splits two top jobs
Wachovia, the fourth largest US bank by assets, has stripped the chairmanship from Ken Thompson but left him as chief executive following big loan losses and regulatory problems. The move to install Lanty
Wachovia hit by policies revaluation
Wachovia, the fourth-largest US bank by assets, on Tuesday nearly doubled the size of its Q1 loss to $708m after adding $315m in writedowns on the value of life assurance policies it takes out on its own employees.
Wachovia confirms $7bn capital raising
Wachovia, the fourth-largest US bank by assets, warned Monday that the US economy was deteriorating more rapidly than expected as it revealed plans to raise $7bn in capital after a surprising first-quarter loss of $393m,
Deep value now deeper for Wachovia
The latest from Wachovia – a $7bn rights issue, in stock and convertibles, on the back of a $350m net loss for Q1.
And among a raft of “flexibility” measures, this:
[Wachovia] … updated its credit reserve modeling to reflect greater emphasis on forecasted changes in customer behavior assuming continued house price depreciation.
Wachovia set for cash infusion
Wachovia, the fifth largest US bank by market value, is expected to announce as soon as Monday that it will raise several billion dollars in new capital from outside investors to shore up its balance sheet amid mortgage losses.
Hedge fund sues Citi, Wachovia
In separate lawsuits filed in a New York federal court, a $58m hedge fund alleges that Citigroup and Wachovia, respectively, improperly required the fund to pay out more money from credit default swaps – insurance derivatives contracts – amid a steep decline in the value of mortgage-backed bonds,
BofA and Wachovia hit by writedowns
Earnings at Bank of America and Wachovia plunged in the fourth quarter as mortgage-related asset writedowns and higher provisions for consumer loan losses all but wiped out profits at both banks. BofA,
Citi may write down $12bn: analyst
Citigroup may need to write down $12bn of debt and boost reserves for bad loans by $1bn as the global credit crunch deepens, a Sanford C. Bernstein & Co analyst said, reports Reuters. Bank of America and JPMorgan Chase,
Enthusiasm wanes for SIV bail-out fund
After months of intense planning to create a fund designed to save banks and structured investment vehicles from big losses, the proposal appears to be losing momentum, reports the Wall Street Journal.
Meredith Whitney’s latest ‘Ring of Fire’
Despite some respite for the banks during trading on Monday, the latest note to clients from freshly-famous CIBC equity analyst Meredith Whitney is as bearish as ever.
Branching beyond her focused criticism of Citi last week,
Merrill’s chief said to have floated bid to merge
Facing billions of dollars in losses from the subprime mortgage crisis, Merrill Lynch boss Stan O’Neal floated the idea of a merger with a large bank, a foray that angered Merrill’s board and could cost him his job,
Super-fund struggles for support
The backers of the proposed M-LEC superfund met on Thursday night to agree a syndication process and bring other banks on-board. The M-LEC scheme, orchestrated by Citi, JPMorgan and Bank of America, involves establishing a $100bn “super-conduit”
Lina Saigol: Time for an investment banking merger
One thing the spectacular M&A boom of recent years has been lacking is investment banking deals.The last time a rash of such transactions occurred was directly after the Russian bond crisis of 1998, when many banks,
Banks queue at Fed’s discount window
Figures issued by the Federal Reserve on Thursday showed that banks made more extensive use of its direct lending facility over the past week than previously disclosed, with the average daily amount of “discount window” loans outstanding at $1.2bn,
ECB lifts markets, US banks borrow $2bn from Fed
Investor fears about the credit markets showed signs of easing on Wednesday after European central bankers injected more funds into the financial system and four big US banks lined up behind the Fed’s efforts to ease the liquidity crunch.
Goldman, JPMorgan stuck with debt they can’t sell
As concerns grow about waning investor appetite for buyout-related debt, Bloomberg reports on Tuesday that Goldman Sachs, JPMorgan and the rest of Wall Street are stuck with at least $11bn of loans and bonds they can’t readily sell.
Wachovia to hire 300 private bankers
Wachovia, the fourth-largest US bank, said on Thursday it would more than double the size of its private bank as it seeks to improve its position in the lucrative business of managing wealth for affluent investors.
Wachovia in $6.8bn deal for AG Edwards
Wachovia, the fourth largest US bank, on Thursday continued its push to become a dominant retail financial services provider by agreeing to pay $6.8bn for regional brokerage firm AG Edwards. The deal will give Wachovia nearly 15,000 financial advisers and $1,100bn in client assets,
Hedge Funds play legal arbitrage over distressed debt
In recent years, the benign nature of the credit cycle has made it hard for distressed debt funds to produce returns using classic routes, writes Gillian Tett in the FT on Friday. Consequently, one tactic which is increasingly fashionable is so-called “legal arbitrage”
Citigroup, Wachovia, surge on improved earnings
Citigroup received a rare round of applause from Wall Street on Monday after announcing better-than-expected Q1 earnings, boosted by improved cost control and strong capital markets profits. Group revenues rose 15 per cent,
Landsbanki signs Wachovia deal
Landsbanki, the Icelandic bank that bought Teather & Greenwood, the UK broker in 2005, has teamed up with Wachovia, the fourth biggest US bank, to provide financing for mid-market European private equity deals.