Anbang seizure flips script on Chinese takeovers 23 Feb 2018 Authorities have commandeered the acquisitive insurer and prosecuted its boss. It is the boldest step yet in Beijing’s battle against financial excess, and is meant to protect policyholders and avert systemic trouble. The move may also be a worrying omen for HNA and others.
Holding: Privacy computes for Supreme Court 3.0 22 Feb 2018 High-tech snooping is back at the U.S. tribunal next week with Microsoft’s fight to shield users’ email from Uncle Sam. As in smartphone and GPS-tracking cases, the justices will probably focus on personal rights. The nine of them are remarkably attuned to technology’s risks.
Whistleblowers lose a shield, but so do employers 22 Feb 2018 Those who suspect U.S. securities breaches must tell regulators or lose some protection from vengeful employers, the Supreme Court says. Major misconduct should still get reported. But small stuff might fall through the cracks – depriving companies of a chance to tackle it early.
Barclays throws money at its many problems 22 Feb 2018 The UK bank’s boss Jes Staley has pledged to double payouts this year to boost shares trading at 0.7 times book. Yet Barclays needs to reverse falling revenue to meet a 9 percent return on tangible equity target by 2019. Even then, regulatory risks linger in the background.
GKN is wrong target for Corbyn’s M&A meddling 21 Feb 2018 The UK opposition leader criticised Melrose’s $10 bln hostile offer for the British engineer and threatened to block more deals. There’s a case for giving targets more protection. But the fight between two UK-listed international groups shows the folly of trying to pick winners.
Hadas: Put stock markets in their modest place 21 Feb 2018 Share price movements garner headlines and excite politicians, but not for good reasons. Equity markets play a minor and easily replaceable role in funding investment, and the effect of current values on wealth is almost entirely psychological. They deserve less attention.
Thrift can steer Lloyds to profitable banality 21 Feb 2018 The UK lender wants to be simple and safe. Boss António Horta-Osório’s new plan needs conduct charges, which grew by a fifth last year, to abate, and the economy to behave. Still, even if revenues stay flat, earnings can roughly double by 2020 if he hits cost targets.
Latvia exposes euro zone’s money-laundering holes 20 Feb 2018 The U.S. has accused the country’s third-largest bank of busting North Korean sanctions. This triggered outflows and an ECB payment freeze. Euro members Malta and Cyprus have also faced criticism for poor oversight. The bloc needs to rethink the policing of its weakest links.
Lloyds CEO’s next move: do as little as possible 20 Feb 2018 The UK lender is poised to unveil a new three-year strategic plan this week. Boss António Horta-Osório should resist anything dramatic. As long as the UK economy doesn’t implode, Lloyds could more than double its 2016 earnings just by avoiding charges for bad behaviour.
Chicago bourse succumbs to China’s HNA syndrome 16 Feb 2018 American regulators nixed a sale of the city's exchange to a group led by China-based investors. Officials are worried about murky ownership, an issue that has also bedeviled conglomerate HNA. The question is reasonable though, and raises the bar for Chinese firms.
Broadcom’s next sweetener: a bigger breakup fee 14 Feb 2018 The chipmaker's increased $120 bln-plus offer for Qualcomm has finally persuaded its quarry to talk. But the $8 bln of insurance Broadcom is offering in case antitrust regulators in Beijing or Washington block the deal probably isn't enough. History may justify twice as much.
Fund float is rabbit in Deutsche Bank’s hat 13 Feb 2018 The German bank’s shares are down almost a fifth this year, valuing the lender at less than half its tangible book value. A successful IPO of its asset management business would help shore up credibility. If choppy markets permit, Deutsche should accelerate the offering.
Chinese gold mining IPO is a dubious prospect 13 Feb 2018 A Hong Kong listing will help pay off a $1 bln purchase in Argentina, enabling Shandong Gold to do more deals. But high-quality mines are costly and the sector’s M&A track record is poor. Buyers will need to believe the state-owned firm is unusually good at sifting for bargains.
India’s offshore trading assault might pay off 12 Feb 2018 Local exchanges will no longer share data with foreign rivals. This move, which is especially painful for Singapore, looks protectionist and will irritate some investors. The higher volumes for Indian exchanges, and a potential tax boost to New Delhi, could make it worthwhile.
Viewsroom: The Fed’s belated Wells Fargo beating 8 Feb 2018 Chair Janet Yellen forbids the $2 trln lender from growing bigger - on her last day in the job, and 17 months after Wells’ fake-accounts scandal hit. Meanwhile, fellow financial watchdog CFPB seems to be giving hacked Equifax a free pass. Plus: how Nintendo made a comeback.
Rocky 2017 leaves SocGen with a mountain to climb 8 Feb 2018 Tax reforms and other one-off costs dragged the French bank’s return on equity down to 4.9 percent last year. But even underlying expenses grew faster than core banking revenue. CEO Frédéric Oudéa needs revenue growth at home to have any hope of hitting ambitious 2020 targets.
Elliott’s fresh attack on BHP misses its target 7 Feb 2018 The activist fund has been nipping at the heels of the world's largest miner for months. Now it argues that unifying listings in London and Sydney could mean a $22 billion boost. It’s a lot of distraction and cost for an unproven gain. Simplicity is unlikely to be so lucrative.
U.S. watchdogs put crypto-currencies on long leash 6 Feb 2018 Regulators warned Congress that bitcoin and the like test the limit of current law. But for now they seem willing to let the volatile $370 bln market develop rapidly as long as they can keep a handle on fraud. A measured approach makes more sense than Asia’s heavy-handedness.
Fed crystallizes Wells Fargo’s Tim Sloan discount 5 Feb 2018 Investors wiped $26 bln off the U.S. lender’s value after Janet Yellen censured it on her last day. That worsens the weak stock-price record since Sloan became CEO. Wells’ top line is growing more slowly than rivals’, too. A new boss could be the cultural change the bank needs.
CFPB scores too low on Equifax transparency 5 Feb 2018 The consumer-finance watchdog is dialing back its probe of the $15 bln U.S. credit-scoring firm’s massive data breach last year. Trump’s CFPB head says the regulator has gone too far in the past. Perhaps – but if protecting vital data isn’t its remit, he needs to explain what is.