UK’s imperfect bank pay rules still pack a punch 23 Jun 2015 The Bank of England’s code for investment bank remuneration introduces a sliding scale of deferral and clawback periods that hinge on seniority. Keeping bankers from their winnings for 10 years may still not be enough. But it positions the UK as significantly tougher than peers.
Rob Cox: Don’t underestimate Exor’s John Elkann 23 Jun 2015 Fiat Chrysler CEO Sergio Marchionne is the one leading a coercive charm offensive for car industry consolidation, but it wouldn’t be happening without the Agnelli scion’s support. Exor’s hostile bid for PartnerRe signals a hard-nosed approach that GM and others shouldn’t dismiss.
Greece stumbles towards dissatisfying compromise 23 Jun 2015 Any deal would be good, but the agreement being cooked up by Greece and its creditors in the EU and IMF looks decidedly unappetising. Athens’ government may introduce growth-slowing tax rises. More substantial reforms remain far distant. The crisis is far from over.
Ladbrokes bets ranch on 3 bln stg Gala finish 23 Jun 2015 A transformative deal will help the UK-listed bookmaker move on from recent troubles. Private equity-owned Gala Coral – corporate home of ex-HBOS chief Andy Hornby – is strong online, and could be an ideal partner. Potential cost cuts improve the odds of a successful deal.
China and UK are worlds apart on public debt 23 Jun 2015 Britain hopes to school China in its contentious public-private finance model. The idea underlines how different the two are. British schemes favoured private investors; in China the state remains in charge. The country has little need for accounting tricks to fund public goods.
EU top brass take a sunny view of banking union 22 Jun 2015 The bloc’s five most senior leaders are calling for a common deposit guarantee scheme for euro zone banks. That would push EU harmonisation forward - a much needed tonic with Greece on the brink of an exit. Yet political suspicion over fiscal transfers may still muddy their rosy vision.
Richemont’s digital fears may be overstated 22 Jun 2015 Amazon has got the Cartier parent worried. But the online retail giant is badly dressed for success in luxury. Richemont’s hope to join Kering and LVMH in a digital fightback also risks underestimating threats posed by smaller, nimbler luxury rivals such as Burberry.
Euro is poor yardstick for euro existential stress 22 Jun 2015 The Greek crisis is compromising FX traders’ reputation for being the first and fastest to react to big news. Currency market signals are currently so muddied that stocks and bonds are better barometers of investors’ views on how close Athens is to default or euro exit.
Numericable’s $11.4 bln Bouygues bid risks overkill 22 Jun 2015 Patrick Drahi could scrunch big cost savings out of a deal with France’s third-largest mobile telco. But his Numericable-SFR will have to work hard for regulatory approval and the mooted 10 billion euro price tag for the Bouygues enterprise - 14.4 times 2014 EBITDA - is huge.
Hugo Dixon: The big fat Greek blame game 22 Jun 2015 If Greece collapses, the biggest chunk of the blame will go to whoever behaves most unreasonably in the final stages of the current game of chicken. So both sides have an incentive to accommodate each other’s reasonable positions. Hopefully, they realise this.
SocGen’s asset management exit could prove shrewd 22 Jun 2015 The French lender is to list the remaining 20 pct stake it holds in Amundi, valuing the asset gatherer at 7 bln euros or more. Most banks have bulked up in capital-efficient funds businesses. But bond market outflows and heightened liquidity risk make it a less obvious bet now.
Review: The misbehaviour of behavioural economics 19 Jun 2015 Richard Thaler’s “Misbehaving” is the story of a supposedly new approach to people’s economic decision-making. The great insight is that we’re often funny about money. Entertaining anecdotes have helped this specialized field gain attention. The science of nudge has little to offer.
Greek point of no return could come on July 20 19 Jun 2015 The slide into financial no man’s land begins whenever the ECB has no excuse for propping up Greek banks. The central bank can overlook a June 30 non-payment to the IMF, even if a deposit run leads to capital controls. But if Greece stiffs the ECB on July 20, it gets much harder.
Bollore steps into Telecom Italia power vacuum 19 Jun 2015 The French billionaire will make Vivendi, which he chairs, the largest shareholder of the debt-laden telco. Vincent Bollore could help TI find a coherent strategy, at home and in Brazil. But his opportunism is at odds with Vivendi’s focus on media. That may irk some shareholders.
Pope offers coherent challenge to amoral economics 18 Jun 2015 The leader of the Roman Catholic Church speaks of climate change and biodiversity. His science is less compelling than his commitment to cultural and ecological unity. That can only be created by reassessing the importance of GDP and recognising that many debts are non-financial.
Capital control grenade hovers over Greek impasse 18 Jun 2015 If the Tsipras government can’t agree on bailout terms, Europe will soon be able to justify freezing Greek deposits. Athens might then be scared into a deal, but might also quit the euro zone. EU politicians need to make the threat credible - but they don’t want to pull the pin.
Lloyds CEO ring-fences rivals with reform praise 18 Jun 2015 Antonio Horta-Osorio reckons rules forcing some UK banks to erect a firewall around retail deposits will cut their risk and capital needs. Easy for him to say: the rules won’t hit Lloyds much. But carving big lenders into bite-sized chunks will help tackle complexity discounts.
Hugo Dixon: Greek negotiations need extra time 17 Jun 2015 Despite the inflammatory rhetoric and lack of trust, Athens and its creditors might still be able to do a deal. But to get an agreement, a little more time may be needed. The creditors shouldn’t truncate the talks.
Edward Hadas: Bring on kitchen economics 17 Jun 2015 A distinguished professor accuses his academic opponents of “mathiness”. It is wrong to use fancy formulas to justify intellectual prejudice. The discipline is poisoned by models created with mathematical abstractions. Equations muddy almost all economic debates.
Remy shows Diageo how success is best M&A defence 17 Jun 2015 It helps that the French cognac maker has a big family shareholder. But a cheery 18 pct rise in net profit pushed Remy’s value to a premium that matches its top-end brands. Diageo is no slouch. But bid talk would die down if the UK company’s outlook was sweeter and smoother.