Felda joins list of Malaysia’s money headaches 7 Jun 2017 The palm oil giant has suspended its chief after auditors raised a red flag. There are echoes of the 1MDB scandal: Felda is state-backed and investors have been burnt in a listing pushed by Prime Minister Najib Razak. It adds to the noise as Malaysia heads towards a key election.
French banks’ foreign strength cuts both ways 4 May 2017 Strong first-quarter growth in BNP Paribas and SocGen’s foreign markets offset weaker showings at home. Still, SocGen’s 963 mln euro Libyan settlement shows how overseas adventures can go awry. And if Sunday’s election delivers a surprise, French banks face redenomination risk.
Soccer attack weirdly converges risk factors 21 Apr 2017 A bombing of Borussia Dortmund's team bus was carried out by a man using leveraged options to bet against the club’s stock, prosecutors say. A similar unsuccessful plot recently involved U.S. retailer Target. The mix of financial weapons and real ones is a disturbing new trend.
Brazil’s Temer steers white-knuckle reform route 17 Apr 2017 The "Car Wash" corruption probe is increasingly denting the president's government as he tries to drive crucial changes to an unsustainable pension system through Congress. The nation's economic recovery may hinge on his ability to ease off the gas just enough to ensure passage.
South Africa’s slow burn cuts chances of quick fix 6 Apr 2017 President Jacob Zuma seems to be doing his best to get foreign investors to dump domestic assets. That may not lead to a sudden stop: only a small minority face being forced sellers. The bad news is that this could slow the process to replace him with a more responsible leader.
Credit Suisse raid jabs at private bank model 3 Apr 2017 The Swiss bank has stressed zero tolerance for tax evasion after authorities swooped on three offices. Credit Suisse may be scrupulous, but managing money for the wealthy brings certain recurring risks – not least because of Swiss private banks' historic pledge of utter secrecy.
Tesco has three issues, but only one matters 28 Mar 2017 Some investors think the UK grocer's merger with wholesaler Booker is distracting and expensive. Regulators are punishing it for an old accounting scandal. And customers just want ever-lower prices. This last challenge is the only one with the potential to knock Tesco off course.
Renault’s main risk is Ghosn exit – not emissions 16 Mar 2017 The carmaker’s shares lurched on reports of French authorities’ allegations of emissions cheating. Unless Renault’s protestations of innocence are bogus, the concerns look overblown. A far bigger problem for the group would come if boss Carlos Ghosn were to be shunted aside.
Review: Libor revealed dark underbelly of trading 3 Mar 2017 Two new books show how the benchmark interest rate underpinning many of the world's financial products was rigged. Jailed trader Tom Hayes leads a cast of deceitful or inept bankers, brokers and regulators. Yet both tomes might have said more about how to stop future malfeasance.
Old crisis quick fix could be real Samsung reform 28 Feb 2017 The group said it dismantled its secretive strategy office as its heir was indicted for bribery. Samsung has dissolved its "control tower" before, only to rebuild it. But this time pressure to reform is far stronger. The move could be a step toward lasting change.
Rodrigo Rato jailing is weak crisis coda 23 Feb 2017 The ex-IMF chief has been sentenced to over four years in prison for fiddling expenses while head of Spain's Bankia. It's a rare instance of severe banker punishment. For investors globally, though, this case will offer little satisfaction and even less deterrent value.
EU veto could do LSE and Deutsche Boerse a favour 23 Feb 2017 It's a year since the two exchanges proposed joining forces. The European Commission will soon decide if the tie-up is anti-competitive. A thumbs-down would spare both sides the need to navigate post-Brexit political waters, and force them to do the sensible thing: wait.
Korea fraud electrifies case for ABB spinoff 22 Feb 2017 The Swiss group suspects its South Korean treasurer helped steal $100 million. Fraud equivalent to a fifth of 2015 local sales was only uncovered after the executive absconded. This plays into the hands of activist investors who wanted ABB to become less complex.
Deutsche Boerse board makes a rod for its own back 2 Feb 2017 A bespoke pay package has led to insider trading allegations against the exchange’s CEO. Deutsche Boerse’s board didn’t have to incentivise Carsten Kengeter to buy shares worth 4.5 mln euros in 2015. It could have avoided the mess by structuring the award differently.
Deutsche’s capital balm fails to ease profit sores 2 Feb 2017 The German lender's 1.9 bln euro fourth-quarter loss featured weak revenue and souring loans. A big jump in Deutsche Bank's key balance sheet metric may forestall a cash call. But there is scant proof of a viable business emerging from the debris of restructuring and litigation.
Deutsche Bank’s UK fine has spurious specificity 31 Jan 2017 The German bank must pay less than 10 pct what it theoretically could have for making suspect Russian trades. In 2014, the regulator handed RBS a hit five times the base case. Regulatory fines lose their effect if they're too random or, as here, too lenient.
Deutsche capital joy fails to offset Russian shame 31 Jan 2017 The German lender will pay only $630 mln to U.S. and UK regulators for failing to stop suspect Russian trades. Being deemed merely negligent means Deutsche Bank's weak solvency gets a leg up. But its litany of catastrophic systems errors will only cement a tarnished reputation.
RBS takes baby step on road to U.S. redemption 26 Jan 2017 The UK bank's latest $3.8 billion charge almost doubles provisions relating to alleged mis-sellling of U.S. mortgage securities. The final cost could be far higher, since RBS is probably a year away from a settlement. Still, the extra bit of balance sheet clarity is welcome.
BT’s Italy scandal is more than a wrong number 24 Jan 2017 The UK telecom found alarming levels of collusion, incompetence and fraud at an Italian business that had been closely vetted by itself and external auditor PwC. The collapse in BT’s shares – far more than the actual losses – shows a pressing crisis of trust, not just accounting.
VW saved by its own failures in the U.S. 11 Jan 2017 The $4.3 bln settlement of criminal charges lifts the carmaker's Dieselgate costs to above $24 bln. VW can cope, but only thanks to its chronic underperformance in the U.S. Had the group met its U.S. targets up to 2015, it would be facing a crushing bill three times that size.