Breakingviews on Twitter
Search League Tables

Saturday, 01 November 2014

Stocks and Funds

HSBC, Royal Bank of Scotland, Lloyds and Barclays

BoE leverage rule is complex, kind and incomplete

31 October 2014

UK bank shares rallied after the regulator published requirements for equity-to-assets of up to 4.95 pct, but not until 2019. The BoE’s move to peg gross leverage to risk-weighted thresholds should prevent arbitrage, but fails the simplicity test. It is also a work in progress.

Empty bottles of beer sit at the entrance of Anheuser-Busch InBev plant.

AB InBev miss pushes dividends to the fore

31 October 2014

Latest earnings suggest the once-fizzy beer company is becoming ordinary. AB InBev’s valuation reflects its history of M&A-fuelled growth. More big deals may come. But even if future revenue growth is flatter, its dividend ambitions will support the share price. 

The logo of BNP Paribas is seen on top of the bank's building in Fontenay-sous-Bois, eastern Paris, May 30, 2014.

BNP's U.S. demons repelled but not quite banished

31 October 2014

France’s largest listed bank rebounded from a U.S. mega-fine with an 11 pct rise in Q3 profit. A big drop in volatility helped everything but trading. Now, though, volatility is up and the upcoming temporary dollar-clearing ban for U.S. sanctions breaches may cause more pain.

An aerial view shows planes parked on the tarmac.

Spain’s $10 bln airports IPO is just shambolic

31 October 2014

Auditor-related technicalities have grounded one of the largest European share issues this year. The Aena airports sale will probably go ahead in early 2015. But the IPO process will be easier to re-rail if the government makes its commitment unequivocal.

Bids and Buyouts

Cinema-goers wearing 3D glasses watch a movie at a PVR Multiplex in Mumbai.

Regal movie chain could follow competitor's script

30 October 2014

The largest U.S. theater group is considering a sale. Rival AMC is flush after being acquired by China’s Wanda in September 2012 and relisting in late 2013. For Regal, keeping up may cost more than 47 pct owner Philip Anschutz is willing to spend. It needs its own AMC sequel.

Miguel Cotto (R) lands a punch to Sergio Martinez in the 9th round of their WBC middleweight title bout at Madison Square Garden in New York.

Madison Square Garden features new fight card

28 October 2014

Uppity investors have rattled once unthinkable cages, including $100 bln companies. Now, the family-controlled owner of the New York Knicks and Rangers may carve itself up following shareholder pressure. If such fiefdoms are vulnerable, boards will have fewer places to hide.

A Ferrari 458 Speciale car is covered before its presentation during a media preview day at the Frankfurt Motor Show (IAA) September 10, 2013.

Ferrari spinoff looks great but lacks oomph

29 October 2014

The hottest name in sports cars is joining the spinoff bandwagon. Fiat Chrysler will sell 10 pct of Ferrari and hand the rest to investors. Fiat shares zoomed up. Yet the split is largely symbolic. Ferrari needs to stay linked to Fiat, and the cash proceeds will be limited.

Customers use cash machines at a branch of Malaysia's CIMB Bank in Kuala Lumpur February 7, 2013.

Malaysia's 3-way bank deal may need creative fix

28 October 2014

A sweetener looks needed to seal a $25 bln merger of CIMB with two smaller rivals. Yet a slump in CIMB’s shares limits its ability to improve the terms. Cutting a side deal with a state pension fund or a difficult Gulf investor increasingly looks like a plausible workaround.

Money and Markets

A worker passes a sign for Bank Street in the Canary Wharf financial district in London October 21, 2010.

Bank synchrony hints at right kind of collusion

31 October 2014

In recent days, Barclays, Citi, Credit Suisse, Deutsche and RBS have socked away big sums for legal expenses, much of it related to forex rate manipulation. That suggests many U.S. and UK regulators are working together on a rare single settlement. It’d be good for all concerned.

Kate Duguid

Review: No bets on Berkshire after Warren Buffett

31 October 2014

Lawrence Cunningham’s “Berkshire Beyond Buffett” argues the Oracle of Omaha has built a corporate culture that will ensure success after his departure. The book does a good job of cataloging Buffett’s portfolio. But it doesn’t make a strong enough case for investors to follow.

A view of the Exxon Mobil refinery in Baytown, Texas

Unfazed oil kings could make crude bulls bolt

31 October 2014

Exxon, Chevron and Conoco reported solid earnings and remained optimistic despite falling prices. Shale drilling, for example, is profitable at current rates. But investment cuts won’t hit other projects for a few years, making price rises unlikely. Investors may get antsy.

European Central Bank (ECB) President Mario Draghi reacts at the monthly ECB news conference in Frankfurt March 6, 2014.

Draghi can only dream of moving like BOJ's Kuroda

31 October 2014

The ECB chief might fantasise about taking big decisions with a one-vote margin, as the Bank of Japan leader just did. But realpolitik requires a goodly majority. The euro zone’s inevitable compromises complicate Draghi’s fight against stubbornly low inflation.