Citigroup looks like a bargain 20 Jan 2005 There are a few "ifs" to this conclusion. Interest rates must not spike, and the bank s regulatory woes must be a thing of the past. The group s portfolio is better balanced geographically and by product than its rivals, which trade at a premium.
JP Morgan falls short in Q4 19 Jan 2005 The US bank's merger with Bank One is not yet bearing much fruit. Revenues were flat while costs actually rose. Two quarters after the completion of the merger, the integration looks messier than expected.
Goldman sets high hurdle for bonus round 19 Jan 2005 Its payouts were apparently 1520% above the other banks that have announced bonuses so far. As first to announce, Goldman was firing in the dark. It also had to please juniors who lost out last year. Rivals may not be so generous.
ABN chief invites bid at a premium 18 Jan 2005 That s the clear message from comments in a newspaper interview that the Dutch bank s destiny may be as "junior partner" with a larger bank. This is not how the national champions of European banking normally talk.
Baer family and staff cede control for no premium 18 Jan 2005 But they re getting some compensation: in swapping their supervoting stock for listed shares, they ll find it easier to sell out. Still, they seem ambivalent about losing control. They may be confident Baer will keep its independence. But it will have to earn it.
Placings even M&A battles 16 Jan 2005 Cash buyers are supposed to have an edge in a bid situation over companies that have to raise equity. That s because their bids are certain. But placings, especially if they are underwritten, can even the battle. Look at Standard Chartered s bid for Korea First Bank last week.
Capital Group seeks cut in commissions – report 14 Jan 2005 The leading US fund manager can afford to dictate terms to Wall Street. It might be less easy for other firms to follow its lead. But it s clear that longonly funds are fed up with being forced to pay for research they don t need, or that is more suited to hedge funds.
Analysts’ pay halves since boom 11 Jan 2005 It s no surprise that average pay rates have fallen. After all, the investment bankers no longer subsidise research as they did preSpitzer. But not all analysts are as badly off. Investment banks are desperate to find the stars of the future and pay scales reflect that.
Allianz pays too much for Pimco stars 10 Jan 2005 Buying a leading US bond fund manager in 2000 ought to have created lots of value for the German insurer. But it hasn t. That s partly because Allianz overpaid in the first place. But it s also because it paid too much to retain the top talent.
Standard Chartered to raise £1bn for Korean deal 9 Jan 2005 The bank is raising the money partly to bolster its capital ratios and partly to give it a bigger war chest in future. But whether investors back future adventures depend on it making a success of Korea First. And that s a tall order.
China throws $30bn at biggest bank 4 Jan 2005 This may seem like a huge capital injection. But it probably fills only 10% of the country s financial black hole. The state is torn between doing too little, risking a financial panic, and giving out too much, allowing bad lending practices to continue.
Blackstone set for mammoth Celanese payout 4 Jan 2005 The private equity group is planning an IPO of the chemicals group one year after taking it private. If the shares are sold at the midpoint of the range, the buyout's investors stand to recoup $3.5bn from their $641m investment.
KBC in E21bn merger with parent 24 Dec 2004 The Belgian bank's merger with Almanij addresses the problem of KBC s previously measly freefloat. Controlling shareholders initially resisted the deal because they face dilution, but they were won over by the potential for value creation.
Merrill Lynch is cleared of sexism 23 Dec 2004 Investment banks have shelled out millions in settlement of sexual discrimination claims. Merrill's win over a former employee's £7.5m claim could mark the high water mark for such cases.
Morgan Stanley makes better balanced earnings 21 Dec 2004 The group's banking earnings rose faster than its trading income fell a graceful end to the year after last quarter's bondmarket burp. But to continue rebalancing its revenue mix, the US bank must revive momentum in underwriting and do better in M&A.
Goldman clinches record year for profits 16 Dec 2004 Proprietary trading is still the firm s primary engine, but the mix of businesses looks better every quarter. If the pickup in mergers is sustained, and equity markets remain stable in the coming year, that can only improve further.
ABN Amro steps up restructuring plans 16 Dec 2004 The Dutch bank is "streamlining" investment banking unit and outsourcing more. The result? Cost savings rise from E500m to E770m by 2007. ABN stresses these changes are all about maximising efficiency. But the reality is that it is struggling with weak growth.
Lehman turns in brilliant year 15 Dec 2004 The firm s Q4 results were the icing on the cake. Revenues rose faster than costs, profits beat estimates and its costtoincome ratio fell. But the worry is still that Lehman is far too dependent on trading. Though falling, it still accounted for 44% of quarterly revenue.
Citigroup learns about diseconomies of scale 15 Dec 2004 The world's biggest bank made E15m on its government bond market raid in August but it is still paying for the coup in hostile headlines. Maintaining corporate reputations can require sacrificing potential profits. The bigger the company, the greater the sacrifice.
HBOS to return £750m 14 Dec 2004 The buyback is a nice Christmas bonus given a slowing UK banking market. Yet it comes only three years after HBOS tapped investors for £1bn. HBOS s readiness to return cash shows it knows how to please investors nervous about surprise share issues from elsewhere in the sector.