China’s shared bikes will merge into car lane 18 Dec 2017 A plague of two-wheeled startups has exhausted investor cash and municipal patience. After a cull, the biggest survivors, Mobike and Ofo, will resist calls to form a monopoly. Instead they will chain themselves to other shared-economy winners like taxi app Didi Chuxing.
Dual-class Hong Kong will double-cross Wall Street 15 Dec 2017 To compete with New York for tech IPOs, the Asian financial centre's exchange is set to host companies with super-voting stock. Investment bankers will be degraded as much as investors. They stand to be paid less for the same deals and can expect to share fees more widely.
U.S. online rules keep buffering despite FCC plan 14 Dec 2017 The watchdog will no longer require internet service providers to treat content equally. It’s a boost for the likes of Verizon and a setback for Netflix and others. But the decision will face lawsuits and many in Congress are opposed, which may leave regulations in flux.
M&A friction limits EU single-market opportunity 13 Dec 2017 Two Spanish ministries are interfering in a 16.5 bln euro Italian bid for local toll-road group Abertis. France and Italy similarly meddled in recent cross-border deals within the euro zone. Building scale isn’t proving as borderless as proponents of EU champions would like.
Exxon climate U-turn deserves wary investor cheers 12 Dec 2017 The $350 bln oil firm is finally planning to comply with shareholder demands – approved months ago - to disclose how global warming will affect its business. That’s welcome. But Exxon’s reputation for fobbing off such concerns means investors need to not just trust, but verify.
Cox: Popping gun bubble to bring financial casualties 12 Dec 2017 Five years since Sandy Hook, the firearms trade has never had a better friend in the White House than Donald Trump. Yet the industry is in terrible shape, having already fulfilled years of future demand. Storied Remington, maybe others, will face bankruptcy in 2018.
Bitcoin futures set scene for more gambling 11 Dec 2017 The 20 pct surge on new CBOE cash-settled contracts is sedate by crypto-currency standards. There’s still cause for concern. Rather than being a useful hedge, futures make it easier to trade bitcoin without actually owning it. For now they have little utility beyond speculation.
U.S. hands HSBC CEO perfect going-away gift 11 Dec 2017 The end of a five-year agreement over money-laundering lapses removes the threat of authorities yanking the bank’s U.S. licence. HSBC devoted 8 pct of its operating expenses to compliance last year. Though those costs will stay, departing boss Stuart Gulliver can leave on a high.
Steinhoff is priced for unvarnished truth 11 Dec 2017 An accounting scandal and debt downgrade has cast doubt over the furniture maker’s future. Retail assets and investments should comfortably cover net debt of 6.5 billion euros. With shares down 80 percent in less than a week, however, investors are anticipating more bad news.
Chinese bond fraud leaves unseemly paper trail 11 Dec 2017 Bank regulators imposed a record $109 mln fine on a Guangdong lender for faking letters of guarantee to a corporate issuer. Stiff penalties might encourage better controls. A system-wide tech upgrade also would help. Improving China’s credit culture, however, will be a long slog.
China’s new regulator could tighten bank squeeze 7 Dec 2017 The China Banking Regulatory Commission’s new vice chair is a confidant of former anti-corruption czar Wang Qishan. Watchdogs are already clamping down on the financial sector. As people from Wang’s no-nonsense camp join the fray, banks and their investors should brace for more.
Fed forecasts just enough sunshine for stress tests 7 Dec 2017 The central bank wants to provide more information about its models for loan losses and other inputs in the annual exams. That would suit lenders who complain the process is too opaque. But the Fed would retain some mystery, striking a balance that boosts the test’s credibility.
New bank rules are kind without being weak 7 Dec 2017 Big lenders will need a trifling 27.6 billion euros of fresh equity capital under new Basel regulation. Rules on the use of internal models are no worse than feared, and kick in slowly. This is hardly draconian – but that’s because banks have already done much of what was needed.
UK gender pay data needs rigorous audit 7 Dec 2017 Some British companies have suspiciously reported no gap between the pay of male and female employees, the Financial Times found. The government thought transparency would help close the divide. To be credible, though, the data must be audited – and offenders punished.
Trump and Warren make odd antitrust bedfellows 6 Dec 2017 The liberal senator says mega-deals like Aetna’s $77 bln sale to CVS kill competition. She backs the DOJ fighting AT&T-Time Warner and has concerns about past merger remedies. It puts her in the same camp as the president. Such an alliance of convenience puts pressure on big M&A.
Steinhoff meltdown shows market fallibility 6 Dec 2017 The furniture retailer shed more than half its market value after a probe was launched into accounting irregularities and its CEO stepped down. Investors who had ignored red flags such as a 2015 investigation and oddly low tax rates are paying the price of being too trusting.
Wanda’s asset shuffle buys brief Beijing reprieve 5 Dec 2017 The indebted Chinese conglomerate is shuffling assets around, including a $470 million cash injection from its founder, as officials pressure firms to deleverage. The cash will help pay down $1.7 bln in offshore loans, but it will take more to escape the government penalty box.
EU fight against tax havens has flaws 5 Dec 2017 The bloc has put 17 jurisdictions, including Panama and South Korea, on a blacklist for failing to fight tax abuses. European Union countries, however, are free to decide what steps to take against offenders. A laudable drive can be undermined if some choose a lenient approach.
Brexit deal hinges on enlightened obfuscation 5 Dec 2017 A plan for Northern Ireland to accept some EU rules has met with opposition in Belfast and demands for similar treatment elsewhere. Prime Minister Theresa May's best hope is to fudge tough decisions, and use the threat of a chaotic exit – or another election – to quash dissent.
Provident Financial probe complicates salvage job 5 Dec 2017 Shares in the embattled lender fell 13 pct after UK regulators investigated its car unit. Its card business is also under scrutiny and its home credit division is reeling from a botched revamp. Financial clouds will make it harder to find a new CEO or bolster its balance sheet.