The Federal Home Loan Banks, which fund private-sector banks’ housing lending, now rely on short-term borrowing for over half their debt. That may boost the profitability of their nearly $1 trln of assets. But as the 2008 crisis taught regular banks, it also increases risk.
Hedge fund Barington wants two board seats and costs slashed at struggling Chico’s. It owns just a 1.4 pct stake at the $1.5 bln seller of women’s clothing. The company also is already shaking things up with its own new qualified directors. This investor aggression is overdone.
The streaming service increased revenue by 80 pct last year to $2.1 bln. More than 80 cents of each dollar pay for songs, however. Even assuming generous growth and operating leverage, Spotify will need to do still more to merit a higher valuation than its latest of $8.5 bln.
Prices sneaked above a psychologically important marker. But given temporary geopolitical and climate drivers explain why, oil bulls can’t declare victory yet. Only a major reduction in global oversupply - the preserve of OPEC - can send oil markets much higher.
Danish renewable energy utility DONG priced its initial public offering at up to $16 bln, suggesting a forward EBITDA multiple in line with stricken carbon-heavy peers. If it sounds dull, that’s the point. European IPOs are still a buyer’s market, but maybe now a rational one.
Amazon is the worst thing that could happen to stodgy old department stores. Yet that’s where Britain’s Debenhams found new boss Sergio Bucher. That makes it one of a handful of UK high-street names headed up by a digital ace. The hire sounds odd, but could be inspired.
The People’s Republic may create a more powerful financial watchdog with the teeth to prevent a repeat of last summer’s policy missteps. The new body would boost policy coordination. But the power of top party leaders and provincial officials means it will still lack real bite.
An executive at the tech giant reportedly proposed a bid for Time Warner. That seems contrary to founder Steve Jobs’ recipe for success: reject “1,000 ideas” and focus only on the few good ones. But an aging iPhone, a tepid stock price and a cash pile risk making the mediocre tempting.
The Bank of England has introduced a new capital requirement for lenders deemed systemically risky in a domestic context. Big banks basically have enough equity to meet it already. But Royal Bank of Scotland’s weighting to the UK means it has most to gain from getting smaller.
Traders are braced for big sterling swings around the EU referendum and then expect volatility to subside. But true calm may prove elusive whatever happens. Even if Britain votes to stay, there will be enough economic and political uncertainty around to ensure trading is lively.
The Spanish bank’s 2.5 bln euro rights issue better protects it against real estate losses, but is still a surprise for shareholders. Pain is also not being shared with equity-like CoCo holders. Dealing with the uncertainty would be easier if returns were more compelling.
The Chinese e-commerce giant’s accounting is under investigation. Depending on the outcome, Alibaba may have to consolidate its loss-making logistics business. If the scrutiny helps shed light on some of the group’s many blind spots, investors will be better off.
The Japanese auto-parts maker wants financial help to ride out its air-bag recall crisis. A few turnaround investors and industry peers will probably look. But huge unanswered questions about liabilities, prospects, and relations with big carmakers make clinching a deal tricky.