Investors can curb the rights issue middlemen 24 Mar 2010 UK investors are angry about the fees banks charge for underwriting equity issues. Even the competition watchdog sounds worried. But institutions could take the initiative and offer to underwrite cash calls themselves for a lower rate. They just need an honest broker.
Energy investors exit Russia as state power grows 24 Mar 2010 ConocoPhillips and TNKBP are cutting exposure to Russia's oil and gas sector. The circumstances of the two sales are different, but they both reflect growing state influence over the energy sector. Attracting new external investors which Russia claims to want will be hard.
Lack of flying hours is no handicap at easyJet 24 Mar 2010 The UK airline's next CEO comes from the newspaper trade. She joins a new chairman from accountants KPMG and an incoming CFO from music group EMI. Last year's acrimony with the founder is resolved, and the departing board has set the flight path at steady expansion. Just as well.
Loans watchdog may prove a drag for RBS and Lloyds 24 Mar 2010 The statedominated UK banks have been ordered to increase gross loans to British businesses by 18 percent this year. The targets look achievable. But the creation of a new body to review lending decisions is a reminder that RBS and Lloyds remain hamstrung compared to peers.
Starbucks admits growth starting to drip 24 Mar 2010 The java giant has announced its first dividend 18 years after it first went public. Returning capital to investors is a welcome sign of maturity. Yet Starbucks hasn t entirely shaken its addiction to expansion.
Daimler U.S. settlement won’t end lure of bribery 24 Mar 2010 The German carmaker is to pay $185 mln to halt longstanding U.S. bribery probes. Siemens, BAE Systems and AlcatelLucent have struck similar deals to buy mercy. But the penalties aren t terribly painful. Executives will have to go to jail to act as a real deterrent.
VW’s expected 4 bln euro capital hike is a shock 23 Mar 2010 Partial details of the German auto group's cash call have sent its stock tumbling even though the fundraising was trailed back in August. Investors were expecting something smaller. While VW's investor communication has been poor, investors also misread the tea leaves.
Amadeus float offers more buoyancy than Travelport 23 Mar 2010 The Spanish travel bookings firm plans to raise 910 mln euros through an IPO. Amadeus has less debt and a better growth record than rival Travelport, which recently pulled its offering. Its private equity owners are already sure of stellar returns. They should not be too greedy.
U.S. pay czar should make more use of bully pulpit 23 Mar 2010 Ken Feinberg s pay limits for the five firms all but one being car companies he oversees are a sideshow. Instead he ought to name and shame companies like American Express that seem to ignore his sound compensation principles. That could be Feinberg s most important function.
Lloyds still has some explaining to do 23 Mar 2010 The head of the UK bank's remuneration committee is right to step down after the furore over chief executive Eric Daniels' bonus. Lloyds' chair Win Bischoff now needs to battle to restore his board's credibility. Full disclosure in its annual report would be a good start.
Rio trial should give China investors pause 23 Mar 2010 Four employees of the miner have admitted taking bribes. Their treatment may seem harsh, and has a political flavour. But China has never claimed to follow the Western rule of law. Rapid economic growth may have blinded investors and companies to the risks that entails.
Reform of U.S. housing policy needs more than talk 23 Mar 2010 Fannie Mae and Freddie Mac are potentially the biggest drain on U.S. taxpayers of all. Yet Tuesday's hearing on their future in Congress seemed like a meeting to talk about the next meeting. Reining in the agencies is politically charged but it needs to start soon.
U.S. financial reform process takes risky turn 23 Mar 2010 The effort to reform the U.S. financial regulatory system was supposed to show the Senate working more or less as intended bipartisan up to a point, and largely nonconfrontational. But it s starting to follow the healthcare bill s more contentious path.
Deutsche Bank’s China head may swap cash for power 23 Mar 2010 The German bank's chairman in China is poised to defect to ICBC. He may be taking a big pay cut to join an investment banking minnow. But the move gives him a chance to run the world's biggest lender. If it doesn't work out, his contacts will still be attractive to Western banks.
Britain’s FSA hopes to have found its Galleon 23 Mar 2010 An insidertrading probe led by the UK regulator has led to six arrests, including a trader at hedge fund Moore Capital. The case may not be as big as Galleon, which was the target of a U.S. investigation last year. Nevertheless, it will set off alarm bells in the City of London.
Google saves face with half-way retreat 23 Mar 2010 In shutting its China portal, the search engine chose morals over profits. But it will keep a toehold, rerouting searches to Hong Kong and keeping on staff. Retaining an option on China looks sensible if Google can withstand bad press, brain drain, and loss of market share.
UK public sector pensions are a giant Ponzi scheme 23 Mar 2010 Past public sector pension promises are a trillionpound liability dwarfing the national debt. Worse still, they are rising fast, making Madoff look an amateur. At the very least, it's time to stop the burden on future taxpayers getting worse. There is a way.
Healthcare is still U.S. macroeconomic elephant 23 Mar 2010 Though officially projected to reduce U.S. deficits eventually, Obama s farreaching reforms increase government subsidies and overall spending on healthcare. That brings closer the day when medical expenses start doing major economic damage and something has to give.
U.S. banks pay lip service to second mortgages 23 Mar 2010 JPMorgan is the latest in a trickle of big U.S. banks willing to modify secondlien loans for some struggling borrowers. It s a baby step in the right direction, but it barely gets at the widerscale principal reductions required to solve America s foreclosure woes.
It’s BA 1, unions 0 22 Mar 2010 Willie Walsh is having a good war. He needs to. The UK airline's CEO must defeat striking crew for the airline to survive. That still leaves a crippling pension deficit and merger with Iberia to resolve. Walsh had to fight but his determination is impressive all the same.
EU summit Greek standoff could restart contagion 22 Mar 2010 Despite Germany's fierce rhetoric opposing a Greek bailout, there is still a chance of compromise at this week's EU summit. But if euro zone leaders can't clarify their position, the crisis could spread to other weak members such as Portugal and Spain.
Big pharma, the uninsured among healthcare winners 22 Mar 2010 President Barack Obama s reform plan is close to becoming law. For sure, Americans without health insurance will benefit, as will drug makers. Insurance companies are widely touted as likely to suffer. But there are myriad winners and losers from the sweeping bill.
Goldman should show the way with lower pay 22 Mar 2010 The bank's decision to accrue pay at 49 percent of revenue in the first half of 2009 set off a chain reaction that led to windfall taxes and a regulatory backlash. To stop 2010 also being poisoned by a row over bonuses, Goldman should accrue only modestly for the first quarter.
UK bank tax could raise up to 3.6 bln stg a year 22 Mar 2010 The exact sum would depend on which parts of the balance sheet are taxed and what rate is used. But one thing is clear: as a proportion of earnings, RBS and Lloyds would be hardest hit for the simple reason that their earnings power is lower than Barclays and HSBC.
Russian 4G tenders aid unwelcome state expansion 22 Mar 2010 All but one of 40 licences just awarded for 4G telephony in Russia have gone to Svyazinvest, the inefficient state telecoms dinosaur. Svyazinvest's expansion is part of a deliberate policy that bodes ill for a sector that had been benefiting from the injection of competition.
Soccer clubs must share spoils to fix finances 22 Mar 2010 European soccer authorities are debating capping players' wages and restricting borrowing to improve clubs' dire finances. But the measures won't level the playing field and could strengthen top clubs. Lively competition will depend on a more even distribution of the spoils.
Biotech offers welcome radical investment therapy 22 Mar 2010 Companies in the sector often resist liquidation, even if it s the wisest outcome. One small firm is adapting a biological process apoptosis, or preprogrammed death. Unhappy shareholders can withdraw their cash quota if things go wrong. It s a minor scientific breakthrough.
Sarkozy’s poll rout isn’t French left triumph 22 Mar 2010 The French president's conservatives have been trounced in regional elections. They pay the price of crisis anxiety and unkept reform promises. The opposition left has won a stunning victory. But considering its divisions, it won't easily translate into a national sweep in 2012.
Markets aren’t ready to blow LBO bubbles — yet 22 Mar 2010 Buyout buzz has gained momentum thanks to shrinking debtmarket risk premiums. HarleyDavidson, RadioShack and Supervalu all got the treatment recently. Sure, LBOs are back from the dead. But bigger examples will remain scarce for now. Loan markets, especially, just aren t ready.
UK shouldn’t go for unilateral bank tax 22 Mar 2010 All political parties want to tax the UK's largest lenders. But a levy only makes sense if it is coordinated with other large countries and specifically targets risky shortterm funding. A goitalone strategy could simply prompt British banks to move elsewhere.