Stress tests fuel bank rally US financial stocks soared on Wednesday on investor relief that capital shortfalls identified by the government's "stress tests" of 19 large banks were not as big as some had feared. The bank rally took off as news of the test results leaked out ahead of their official release on Thursday. The tests reportedly found that Citi, Bank of America and Morgan Stanley must raise equity, while JPMorgan, Goldman Sachs and Amex are among those that will not need additional capital See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55570/us-banks-need-less-t
|
Citi, BofA have biggest shortfalls Citigroup and Bank of America emerged from the governments 'stress tests' as the banks with the biggest capital shortfalls, with Citi requiring more than $50bn in fresh equity and BofA requiring about $34bn. BofA's capital deficit is more pressing because Citi has already agreed to bolster its balance sheet by converting up to $6bn of preferred shares owned by the government and other investors and selling non-core businesses. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55569/citi-bofa-have-bigge
|
Lex: Zombie banking in America In the short term, many shareholders will be diluted as banks convert preferred shares into common equity to raise capital as required by US government stress tests, says Lex. But at the end of this process, many will be convinced the banks have been restored to health. Longer term, however, the $3,000bn-odd aggregate hole in US financial sector balance sheets is beyond the private sector's ability to fill. Mirroring Japan more than a decade ago, Thursday "may well mark less a revival of the sector than the beginning of zombie banking in America". See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55568/lex-zombie-banking-i
|
Porsche, VW agree merger Volkswagen and Porsche announced plans to merge on Wednesday, ending the 3½-year takeover saga surrounding Europe's largest carmaker. After a meeting of the Porsche family owners and VW and Porsche executives in Salzburg, the family clan agreed to create an "integrated car-manufacturing group" with 10 marques under one roof. The move in effect sets Porsche aside from the nine existing brands of the VW group, dashing its hopes of dominating the group. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55567/porsche-vw-agree-mer
|
Sony Ericsson may need rescue Japan's Sony and Sweden's Ericsson are preparing for the possibility of having to secure new financing at Sony Ericsson, their troubled joint venture that manufactures mobile phones. Sony and Ericsson are considering a capital injection, or acting as guarantors on a loan for Sony Ericsson, to strengthen the joint venture's balance sheet. Carl-Henric Svanberg, Ericsson's CEO, said a capital injection for Sony Ericsson was "not unlikely". See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55566/sony-ericsson-may-ne
|
KKR to buy AB Inbev Korea unit US buyout firm KKR is is buying Anheuser-Busch InBev's South Korean beer unit for $1.8bn, reports Bloomberg. AB InBev, formed in a $52bn merger last year, and KKR plan to announce the deal Thursday, according to people with knowledge of the matter. The Belgian brewer is seeking to sell $7bn of assets to help repay $45bn of borrowings taken on to fund last year's acquisition of Anheuser-Busch. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55571/kkr-to-buy-ab-inbev-
|
Chrysler rebels owed just $295m Dissident creditors trying to block the reorganisation of Chrysler are a small group of investors that are owed just $295m, court documents show. Some members of the group have tried to remain anonymous after being criticised by the Obama administration. US bankruptcy Judge Arthur Gonzalez on Wednesday ordered them to reveal their identities. The dissident lenders appear to have lost momentum since coming forward last week as the "non-Tarp lenders" and saying they included 20 institutions holding $1bn of the senior debt. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55565/chrysler-rebels-owed
|
Fortress narrows quarterly loss Fortress Investment Group, the publicly traded US hedge fund and private equity house, on Wednesday reported a narrower Q1 loss as it continued to feel the impact of client redemptions and lower revenues from fees. Fortress reported a quarterly net loss of $67m, down from $68.9m last year. Fortress also said it has agreed to take over management of $2bn of credit investment funds from DB Zwirn & Co. that are being unwound. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55564/fortress-narrows-qua
|
BNP sees strong Q1 profit Investment banking revenues at BNP Paribas reached a record high in the first quarter, leading to bigger profits than expected at France's biggest bank, despite rising bad loan provisions. BNP on Wednesday reported Q1 net profits of €1.56bn ($2.07bn), down 21% from a year ago but well above consensus expectations of €850m. Strong trading in fixed income in the investment banking business drove the outperformance. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55563/bnp-sees-strong-q1-p
|
Shareholders reject Provident bonuses UK shareholder anger over executive pay issues intensified on Wednesday as investors voted down plans by Provident Financial to pay a bonus and double-digit salary increases to top executives. More than 51% of votes on the sub-prime lender's remuneration report were cast against it at its annual meeting on Wednesday. Investors also attacked a new deferred bonus based on the total shareholder returns against other lenders. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55562/shareholders-reject-
|
Commerzbank to divest property unit Commerzbank is to divest its Eurohypo property finance subsidiary as part of a deal with European competition authorities to compensate for the €18.2bn ($24.2bn) of state aid given to Germany's second largest bank. The agreement, to be announced by the European Commission on Thursday, will see Commerzbank give up the core of its commercial property lending business as well as Eurohypo's role in public sector finance. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55561/commerzbank-to-dives
|
Deutsche Post: no bid for Royal Mail Deutsche Post on Wednesday confirmed it had not made an offer for the UK's Royal Mail and turned the spotlight on plans to overhaul its own mail delivery business. Frank Appel, chief executive, prepared the ground for a clash with German labour unions as the logistics company races to cut costs. Deutsche Post, which owns DHL as well as Germany's former monopoly postal service, reported a 42% drop in Q1 underlying earnings. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55560/deutsche-post-no-bid
|
Gold sales cost Europe $40bn Europe's central banks are $40bn poorer than they might have been after they followed a British move 10 years ago to shrink the Bank of England's gold reserves, according to an FT analysis. London's decision on May 7 1999 to sell must of its gold reserves in favour of assets such as government bonds marked the peak of so-called "anti-gold" sentiment among European central banks. At the time, gold was worth around $280 an ounce, less than a third of its current level of more than $900. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55559/gold-sales-cost-euro
|
SocGen picks Oudéa as chairman In Categories: People Posted at 04:56 by Gwen Robinson Frédéric Oudéa was promoted to executive chairman of Société Générale after the sudden resignation last week of Daniel Bouton. It is the second time that Oudéa has succeeded Bouton, having replaced him as chief executive last May after the Jérome Kerviel trading scandal in January 2008 forced Bouton to split his chairman and chief executive roles. The surprise decision followed speculation that directors were unable to agree on an alternative candidate. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55557/socgen-picks-oudea-a
|
Red-faced IMF fixes east Europe error The IMF has corrected an embarrassing error that led to exaggerated estimates of the external debt levels of crisis-hit eastern European states. In its latest Global Financial Stability Report, published in April, the IMF provided data on 38 emerging market countries, including their 2009 external debt refinancing needs as a ratio of forex reserves. But after the numbers were challenged by central bankers, analysts and journalists, the IMF revised the data and began publishing new figures. See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55556/red-faced-imf-fixes-
|
Overnight markets: Relief Asian stocks jumped on Thursday on better-than-expected US and Australian jobs reports and an assurance from US Treasury secretary Tim Geithner that none of the biggest US banks are insolvent. Japan's markets re-opened after a string of holidays. Futures on the S&P500 Index lost 0.2% after the gauge climbed 1.7% on Wednesday. Asian markets (Thurs)
03:00 BST
Nikkei up 401.65 (4.47%) at 9,379.02
Topix up 38.45 (4.54%) at 885.30
Hang Seng up 321.33 (1.91%) at 17,155.90 US markets (Wed)
S&P500 up 15.73 (1.74%) at 919.53
DJIA up 101.63 (1.21%) at 8,512.28
Nasdaq up 4.98 (0.28%) at 1,759.10 European markets (Wed)
FTSE100 up 59.55 (1.37%) at 4,396.49
Eurofirst 300 up 11.74 (1.39%) at 858.55 Currencies
03:10 BST
€/$ 1.3313 ( 1.3249)
$/¥ 98.68 (98.15)
£/$ 1.5147 (1.5008) Commodities
03:05 BST
Brent Crude (ICE) up $0.60 at $56.75
Light Crude (Nymex) up $0.02 at $56.36
100 Oz Gold (Comex) up $1.40 at $912.40
Copper (Comex) down $1.30 at $217.55 10-year government bond yields (%)
03:50 BST
US 3.19 (3.17)
UK 3.60 ( 3.55)
Germany 3.23 ( 3.21)
Japan 1.41 (1.40) Sources: FT, Bloomberg See this article online.
http://ftalphaville.ft.com/blog/2009/05/07/55552/overnight-markets-re
|
No comments:
Post a Comment