Financial News

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Articles from July 20, 2003

Attica AM Drops Pictet
Byline: Pirkko Juntunen Attica Asset Management, the multimanager, has dropped Swiss asset manager Pictet as its preferred manager for European equities and replaced it with TT International, the European equity and hedge fund specialist. At the...
Bankers Cold on IPO Revival
Byline: Shanny Basar Investment bankers are playing down the chances of recovery in the European initial public offering (IPO) market despite the successful Yell deal this month.The UK directories business may have carried off the largest European...
Bebear Criticises Short-Termism
Byline: Anuj Gangahar Claude Bebear, chairman of the supervisory board at Axa, the French insurer, and the godfather of French capitalism, has launched a scathing attack on short-termism in financial markets.Bebear claimed that the spread of short-term...
Caledonia Rises to Challenge
Byline: Mike Foster UK-listed Caledonia Investments is seeking to justify its continued existence by pointing out that it has outperformed the index by an annualised 3.7 percentage points over 10 years.Caledonia is 38% owned by members of the Cayzer...
CDC Focuses on Africa and India
Byline: Caroline Meehan CDC Capital Partners, the private equity firm funded by the UK government, is focusing on Africa and India with plans to increase its combined portfolio in the regions to $1bn ([euro]890m) over the next five years.The 60-year-old...
Cheap Borrowing Boosts Issuance
Byline: Vivek Ahuja The corporate bond markets have bounced back strongly this year, becoming one of the most active sectors as low interest rates and cheap borrowing costs have enticed companies to issue bonds.Supply has remained robust after a...
Chris Huhne: Prospectus Directive Takes Effect
Byline: Chris Huhne European Union finance ministers last week signed off the new Prospectus Directive. The text agreed by the European Parliament on July 2 is now on the statute book and should be an important foundation stone in the EU's single...
Comment: Banks Need to Own Up about Diversity
Byline: Mark Fisher Diversity is a favourite buzzword of investment banks. They employ legions of diversity officers, hold diversity weeks for their staff, enthusiastically proclaim diversity initiatives and earnestly follow diversity programmes....
CSFB Holds Steady with Yahoo Mandate
Byline: David Rothnie and Jeremy Adams in New York CSFB's technology team has survived internal turmoil and star banker Frank Quattrone's resignation by landing a sole advisory mandate for Yahoo, the US internet provider, on its $1.6bn ([euro]1.4bn)...
Deutsche Tops French Extel Poll as Local Banks Lose Out
Byline: Sophie Brodie French banks including BNP Paribas and SG Securities have lost out to pan-European groups, such as Deutsche Bank and UBS, in Thomson Extel's first analyst poll in France.Deutsche Bank was voted best equity research brokerage...
Emerging Market Bond Issuance Flourishes
Byline: Nigel Dudley The past six months have been one of those rare dream periods for the emerging market bond sector when borrowers and lenders have been equally enthusiastic to participate in new issues.Sovereign and corporate borrowers have...
EU Pushes for Changes in Accounting Proposals
Byline: Patrick Blum in Brussels The European Union wants more consultations over proposed international accounting standards to ensure they better reflect the needs of the financial industry. It particularly wants changes to two controversial...
Fair-Value Pricing Hits Arbitrageurs
Byline: Melanie Wold Arbitrageurs who take advantage of market movements will find it more difficult if investment funds use fair-value pricing when calculating their net asset value (NAV).Investment funds calculate NAV daily using local prices,...
Fallen Angels in Favour
Byline: Jeremy Adams in New York General Motors (GM) is not officially a junk credit. Its debt ratings from the main agencies are still in investment-grade territory. That did not stop underwriters in GM's recent record-breaking $17bn ([euro]15bn)...
Fixed-Income Job Market Remains Flat
Byline: Mark Fisher While fixed income remains the best-performing sector for investment banks, providing more than half their turnover in many cases, recruitment is patchy. Headhunters say hiring by bulge-bracket banks focuses on upgrades - replacing...
FN Profile: Hauser Finds Evolutionary Niche as the Godfather of Silicon Fen
Byline: Margareta Pagano Hermann Hauser's bedtime reading is Molecular Biology by Harvey Lodish. He is reading the book to catch up on the latest in cell research, a subject where he worries that "the balance has gone too far on The Guardian readers'...
Former Axa Team Launches Funds Firm
Byline: Caroline Meehan and Guy Paisner A fund of private equity funds team of four that left Axa's private equity arm in last year's reorganisation, has set up Keyhaven Capital, an independent fund of funds firm.Founder Sasha van de Water, who...
France's Administrative Elite Lured by Private Sector Riches
Byline: Guy Paisner As France's investment bankers begin their summer migration south, a fresh intake of 100 budding civil servants has just enrolled for a two-year programme at the Ecole Nationale d'Administration (ENA) in Strasbourg. When Charles...
Fraud Buster Urges Risk Review
Byline: Kit Bingham A forensic accountant, who has been responsible for exposing financial black holes and dodgy accounts, says companies need to devote more resources to manage the risk of fraud.Alex Plavsic, head of fraud and financial investigations...
Goldman Shows Strength in Defence
Byline: Janine Brewis and David Rothnie Goldman Sachs, Europe's leading M&A adviser in the first half of this year, has never fought shy of high-profile deals. Earlier this month, after Alcan, the Canadian aluminium group, launched its unsolicited...
Growing Interest in Longer Yield Curve Fuels Market Activity
Byline: Natasha de Teran The recent upsurge in longer-term corporate bond issuance and the greater legal certainty provided by new documentation are helping the development of the credit derivative market. The most commonly used instruments are...
GUS Keen to Dispel Anti-Banking Myth
Byline: Alice Hohler GUS has recently become the highest-profile example of "large UK corporates that prefer not to use investment banks". When the retail and consumer services group sold its home shopping business to the Barclay brothers for [pounds...
Insurance Firms among UK's Most Inefficient Fund Managers
Byline: Ben Wright and Alistair Graham Investment firms owned by insurance companies are among the most inefficient fund management houses in the UK, as calculated by the ratio of front-office staff to assets under management.Research conducted...
Investors Win Rights at US Companies
Byline: Kit Bingham The US Securities and Exchange Commission (SEC) plans to make it easier for big investors in US companies to nominate director candidates.The commission recommended in a report on proxies published last week that companies disclose...
Issuers and Investors Are Clinging to the Good Times
Byline: Piers Townsend The bond market had one of its best-ever quarters by any measure between April and June this year. Volume was high, demand for new issues was huge, trading was hectic and prices only went up.The excitement was at such a fever...
KfW Heralds Convertibles Upturn
Byline: Caroline Muspratt The convertible bond market may be set for a revival after the record [euro]5bn ($5.6bn) Kreditanstalt fur Wiederaufbau (KFW) exchangeable bond into Deutsche Telekom this month. The week ended July 11 saw the strongest...
Kleinwort Identifies Hurdles to Public-to-Private Activity
Byline: William Hutchings The failure of European public-to-private activity to match the predictions of advisers illustrates how few companies are suitable for private equity investment, according to Kleinwort Capital.Advisers predicted buy-out...
Management Buys out LogicScope
Byline: Melanie Wold LogicScope, a UK-based provider of messaging and connectivity technology, has carried out a buy-in management buy-out, taking a chunk of its company back from private equity investors. The firm has also appointed a new board,...
Mike Foster: TUC Move on Disclosure Is Timely
Byline: Mike Foster Whatever you might think about its sledgehammer approach, the UK trade union campaign to force fund managers to disclose how they vote at company meetings is likely to prove effective. After all, there is little point in companies...
Mobile Phone Firm's Shares Surge 15% on Profits News
Ericsson posted better-than-expected first-quarter figures, pointing to an end to its financial crisis and indicating its markets are stabilising. The results caused shares in the Swedish mobile phone network provider to surge 15.5% to SKr10.1 ([euro]1.1),...
Montagu Pays Top Price for Ferries
Byline: William Hutchings Montagu Private Equity raised eyebrows last week when its [pounds sterling]142m ([euro]203m) bid for the Isle of Man Steam Packet Company beat those of rivals boasting of synergies with the ferry group.The buy-out firm...
Mrs Moneypenny: Bravo for the Wealth Creators
The summer holidays are on us. Three children means that I have had to draw up a document reminiscent of a British Airways crew roster, with an equivalent amount of planning and annotation.Son number one has left prep school and brought home with him...
News in Brief: Julius Baer Takes Reuters 3000 Xtra
Reuters, a global information and technology provider, has sold 150 of its 3000 Xtra premium desktop information display products to Swiss private bank Julius Baer. The bank will use the 3000 Xtra's thin client option, where it views the service via...
Parachute Clauses Reward Failure
Byline: Kit Bingham UK executives have reduced their service contracts in line with investor expectations but have retained generous termination and change of control provisions that could provide lucrative "rewards for failure".Research from Manifest,...
Record-Breaking Run for Asset-Backed Securities
Byline: Francesca Murra The asset-backed securities (ABS) sector is still on a roll. After an extraordinarily busy second quarter - "an all-time record", according to Iain Barbour, head of structured finance research at Commerzbank Securities -...
Redraft of HIggs Report to Be Approved
Byline: Margareta Pagano The three most contentious proposals in the Higgs report on UK corporate governance are set to be approved this week when the Financial Reporting Council (FRC) signs off the final draft of the code.However, both critics...
Reforming Europe's Biggest Economy
Byline: Peter Wilson-Smith, Editor- in-chief Structural reform is finally under way in earnest in Europe's largest economy. That, at any rate, was the message that Hans Eichel, Germany's finance minister, was out to convey on a visit to London last...
Regulator Attacks Pollack Ruling
Byline: Jeremy Adams in New York Bill Galvin, secretary of state for Massachusetts and among the leading state regulators investigating corruption on Wall Street, has criticised Judge Milton Pollack's rulings against investors in recent lawsuits.Pollack,...
Research Consultants Move In
Byline: Sophie Brodie Independent research consultants are taking up their positions as the eyes and ears of the Securities and Exchange Commission (SEC), the US regulator, within the US banks involved in the $1.4bn ([euro]1.2bn) settlement over...
Richard Greensted: Brown Brothers Harriman Loses Superstar
Byline: Richard Greensted One of the defining characteristics of any successful securities business is how it handles the superstars. Every firm has them but not all are comfortable with the concept of high-performance, high-maintenance staff. Those...
Shacklock's [Pounds Sterling]26m Is Hard to Justify
Byline: Ian Kerr, Personal View You could almost hear the howls of indignation here in Sotogrande. At the beach club it was certainly the focus point of discussion at a lunch table which mainly comprised former Credit Suisse First Boston (CSFB)...
Short-Selling Is the Market's Responsibility
Byline: Claude Bebear Short-selling and its impact on capital markets has been the subject of vigorous debate over the past year as regulators and governments around the world attempt to come to terms with what remains a widely misunderstood practice.Short-selling...
Shrinking Portfolios Put Squeeze on Costs
Byline: Mike Foster Wealth managers need to cut costs and improve the services they offer following last year's $1.9 trillion ([euro]1.7 trillion) fall in the value of portfolios owned by their clients.Swiss private banks are under particular pressure...
Slow-Down in Bonds Set to Hit Banks' Profits
Byline: Piers Townsend and Jeremy Adams in New York Investment banks are increasingly vulnerable to a collapse in profits if the bond market boom runs out of steam before equity and corporate finance revenues recover, according to analysts.Low interest...
Sovereign Issuance Cheers Bankers
Byline: Natasha de Teran The slew of sovereign paper that hit the market this year may signal spiralling government deficits and increased borrowing to some, but to bankers and investors it was manna from heaven. Despite a sell-off in recent weeks,...
S&P Warns Investors of PPP Bubble
Byline: Vivek Ahuja Standard & Poor's, the credit rating agency, has warned bondholders and bank lenders to be wary of investing in public-private partnership (PPP) schemes in the transport sector. The caution could contribute to a derailment...
Takeover Panel in Rude Health
Byline: William Wright At a time when most investment banks have seen revenues plummet, the Takeover Panel is in rude financial health.The organisation, which oversees mergers and acquisitions in the UK, saw its revenues leap more than 80% in the...
Talking Point: Comply - or Face the Consequences
Byline: Piers Townsend Who is the most important person in an investment bank? The chairman? The chief executive? Neither; it's the head of compliance, who ensures that the bank falls into line with the myriad of international laws and regulations...
UK Asset Firms Are Heavily Overstaffed
Byline: Alistair Graham and Ben Wright The UK's largest investment firms are heavily overstaffed in relation to their asset bases, according to research by Financial News. Fund management companies have not cut overheads fast enough to keep pace...
VAT Laws Will Drive Firms Away
Byline: Anuj Gangahar Hedge fund managers will be driven away from the UK by a new law due to come into effect next month preventing them from recovering value added tax (VAT) on their costs.Lobbyists against the law are hopeful that it will be...