Macquarie widens gap at home and abroad 2 Nov 2018 The $28 bln Aussie bank is set for a record year, thanks to a first-half lift from commodities. Return on equity stands apart and local lenders are under intense scrutiny. New boss Shemara Wikramanayake will need to keep up the impressive resilience in far choppier markets.
Henry Kravis joins gaming value “emote routine” 29 Oct 2018 The billionaire’s private-equity firm is investing in the company behind the Fortnite craze at a $15 bln valuation. Epic has shown free games can be lucrative. But the deal clocks in at what seems an over-enthusiastic price. It’s a bet Epic can stay ahead of teenage fads.
HSBC leans on rate rises to ease trade tensions 29 Oct 2018 The Asia-focused bank reported a 28 percent increase in quarterly pre-tax profit despite tariffs starting to squeeze some clients. Fortunately for boss John Flint, Fed policy is moving in HSBC’s favour. If it continues, his double-digit profitability target should be in reach.
Lazard could profit from some of its own advice 25 Oct 2018 A stalling asset-management arm dampened the $5 bln advisory firm’s earnings. The recent sale of Oppenheimer, which Lazard advised, suggests its stock is undervalued. Corporate finance tricks like buybacks aren’t helping. Boss Ken Jacobs’ bankers might have a better solution.
UBS stoops to conquer 25 Oct 2018 The Swiss bank is ditching a standard industry way of measuring earnings. Instead it's pegging performance to common equity Tier 1 capital, a lower number that automatically makes returns look higher. It may be simpler, but also smacks of trying to paper over a lack of growth.
Blackstone’s $1 trln goal needs some protection 18 Oct 2018 Steve Schwarzman’s outfit hopes insurers can help double its assets by 2026. Its credit funds offer the higher yields the industry is dying for, while steady fees might boost Blackstone’s valuation. The trick is to persuade risk-averse insurers that a buyout firm is a good home.
Wall Street offers no relief to European rivals 18 Oct 2018 On average, U.S. investment banks reported a 7 percent jump in equities revenue in the third quarter, while fixed income trading declined. If results from European peers follow the same trend, top-line growth will be minimal. That leaves more cost cutting to boost dreary returns.
Wall St seeks ambitious banker for lit new role 17 Oct 2018 Canada has legalized recreational marijuana, and other countries are likely to follow. That’s an investment-banking opportunity. Goldman Sachs and Bank of America have already dabbled in cannabis deals. It’s only a matter of time before a big firm hires its first “head of weed.”
Credit Suisse LBO defence is a hostage to fortune 3 Oct 2018 The Swiss bank’s asset management arm lauded the attractions of the leveraged loan market in a letter to clients last month, according to the FT. The pitch will do little to reassure those who are alarmed by the erosion of lenders’ rights and could backfire when the market sours.
Proxy plumbing is bigger problem than advisers 2 Oct 2018 The SEC has withdrawn its decade-old backing for the likes of ISS and Glass Lewis. Yet worries about the firms’ influence and potential conflicts are overblown. Modernizing proxy procedures would be a better way for the U.S. securities regulator to bolster shareholder democracy.
Orcel exit tests UBS’s Goldilocks investment bank 1 Oct 2018 Like the girl in the fairy tale, the Swiss lender wants a capital markets arm that is just the right size: not too big to weigh on its valuation, but not too small to compete. Departing chief Andrea Orcel managed the balancing act. His successors have to prove they can too.
Perella Weinberg IPO path already well trodden 28 Sep 2018 The M&A advisory boutique may be the next to list its shares. It has some differentiating factors, including a strong energy business. But boutiques come with lumpy revenue and people risk. Founder Joe Perella’s own journey shows how big a challenge the latter can be.
Silicon Valley puts tech gloss on house flipping 27 Sep 2018 Opendoor thinks algorithms are a better way to buy and sell homes. SoftBank’s $400 mln investment in the company suggests it agrees. Opendoor and its peers can speed up and streamline an inefficient process. They can’t wish away balance-sheet risk if the housing market slows.
Bolloré’s exit leaves Mediobanca exposed 27 Sep 2018 The French financier is ditching a shareholder pact that has long pulled the strings at Italy’s most influential investment bank. CEO Alberto Nagel, who has turned the bank around, gets a freer hand. But if the pact is not renewed, Mediobanca could more easily become a target.
Orcel may not need deals to keep Ana Botin happy 26 Sep 2018 The Santander chair wants her new CEO to double the bank’s share price. Andrea Orcel’s background implies he would try to do so via a blockbuster deal. But if he can increase the top line by 4.5 percent annually by 2023 and keep costs in check, he could get there organically.
Cull of bank traders is on the cards 26 Sep 2018 Global fixed income trading revenue has fallen faster than headcount over the past four years, according to Coalition. Pressure is growing on banks, especially in Europe, to cut costs. Technology will replace more humans on the dealing floors.
Santander puts relationships first with Orcel hire 25 Sep 2018 The Spanish financial giant has appointed UBS investment banking head Andrea Orcel as its new CEO. The Italian is a long-time adviser but has no experience of running a retail lender. That matters less than his rapport with Executive Chair Ana Botin, who remains firmly in charge.
Another big deal is last thing Invesco needs 24 Sep 2018 The Atlanta-based investment manager may buy the Oppenheimer mutual fund house for $5 billion. Yet Invesco’s revenue and operating profit have stalled despite several acquisitions, including Guggenheim’s ETF business. More scale won’t alleviate the downward pressure on fees.
Jefferies faces half-a-million-dollar question 21 Sep 2018 That’s what the average employee of the Wall Street firm earns – some 25 pct more than peers at Goldman Sachs. Jefferies hands staff a higher portion of its revenue, yet has paltry returns. After a restructuring of its listed parent the gap is more prominent, and unsustainable.
Merrill Lynch deal a qualified success for BofA 20 Sep 2018 The bank bought the Thundering Herd in a hurry in the depths of the 2008 crisis. Merrill’s retail brokerage has worked out well. But the M&A and equity franchises have faded under the BofA brand. The unit’s new boss, Matthew Koder, would need something special to change that.