Americas

IMF’s $500 bln funding request looks ambitious

18 Jan 2012

The Washington lender had no trouble in trebling its funding from anxious member nations after the 2008 crisis. But pulling in another half trillion dollars now may not be so easy. Extra funding from the U.S. will be a tough political sell and the likes of China remain cautious.

Moelis and Sumitomo strike unusually balanced deal

18 Jan 2012

Foreign investments into Wall Street often go badly. But Sumitomo is getting an easy, low-risk entrée to global dealmaking. The boutique, meanwhile, gets more access to Japan. Even better, the $1.9 bln valuation should give antsy Moelis bankers with equity renewed optimism.

Yang’s goodbye finally frees Yahoo

17 Jan 2012

The Internet firm’s co-founder has quit its board and those of valuable Asian properties. That gives Scott Thompson, the new CEO, fresh flexibility. Yang once got in the way of a high-priced sale to Microsoft; disposal or dismemberment of Yahoo is now that much more likely.

Wells Fargo stakes claim to top CEO pay for 2011

17 Jan 2012

Boss John Stumpf already earns more than most of his big bank rivals. He’s on course to best them all for last year. U.S.-focused Wells cranked out better asset, equity and stock returns than its more global peers - but not so great as to warrant gifting Stumpf a bumper payout.

TPG can be forgiven its mile-high club fetish

17 Jan 2012

A successful contrarian bet on bankrupt Continental in 1993 was the buyout firm’s seminal deal. Since then, David Bonderman has chased airlines across the globe, including now American, and scored with a few like Ryanair. Even bad romances like Midwest can’t dampen the thrill.

BankUnited sends ominous sign with its white flag

17 Jan 2012

The Florida lender rescued from the dustbin by private equity was supposed to forge an exemplary path by rolling up small banks, finding efficiencies and creating more competition. But crummy business, picky regulators and rivals too delusional to sell have left it up for grabs.

Citi punts shareholder hopes further downfield

17 Jan 2012

CEO Vikram Pandit has built a solid balance sheet and will have a surfeit of cash to return to shareholders in time. But he’ll need consistently decent earnings. Even allowing for last year’s slowdown, though, Citi’s Q4 performance remains anemic. Investors will have to wait.

New US chairman-CEO focus may bring welcome split

17 Jan 2012

JPMorgan’s Jamie Dimon is among those a U.S. union is targeting for serving in both top jobs. Some business grandees are also ramping up efforts against corporate autocracy. Like “say on pay,” a UK-style division of the two roles could have its long overdue day stateside.

Ex-American Idol boss readies own tech audition

17 Jan 2012

Robert Sillerman, the onetime concert promoter and TV talent show mogul, is back with a new idea. A little cash, a listed shell and the buzzy concept of socially networked TV is now a big stake in a $1 bln company. But the venture so far only has an X factor in clever finance.

Softly way on Indian governance may pay for T. Rowe

17 Jan 2012

T. Rowe Price of the U.S. has 26 pct of UTI, the Indian fund manager. But it can’t seem to agree with co-owners about who should run the business. New Delhi may want its say too. There’s talk of sticky rifts but the best way forward might be to embrace firm-but-quiet compromise.

JPMorgan deserves a little more investor love

13 Jan 2012

Though Q4 results weren’t great, the House of Dimon is lending more, cutting losses and banker pay and beating its cost of capital. It should also be able to lift its dividend. And yet JPMorgan stock languishes below book value. It’s time for shareholders to overcome their fear.

At least Obama knows which agencies he’s cutting

13 Jan 2012

The president is making good on promises to shrink the bureaucracy by merging six federal agencies and cutting up to 2,000 jobs. Though politically clever, it’s a bitty fix. Repairing America’s fiscal imbalances will require deeper cuts and more creative measures than this.

Antitrust watchdog rivalry may spell M&A trouble

12 Jan 2012

The U.S. Justice Department surpassed the Federal Trade Commission in antitrust enforcement last year. But signs that the FTC will block pharmacy provider Omnicare’s bid for PharMerica suggest a new hard line. Competing cops on the beat could gum up Wall Street’s deal machine.

Corporate America finds Doppelganger in Romney

12 Jan 2012

The U.S. Chamber of Commerce outlined plans to cut red tape, lower tax rates, boost energy production and expand trade, replicating nearly digit-for-digit the anatomy of the GOP front-runner’s campaign. It makes Romney look like a useful technocrat - or an agent of Big Business.

Current policies increase deleveraging pain

12 Jan 2012

A UBS report predicts that unwinding the developed world’s debt extravaganza will produce 10 years of slow growth. Some of that is unavoidable, but current monetary and fiscal policies make everything worse. Tighter money and more public thrift would work better in the long run.

U.S. broker fire-sale thwarts shrinking banks

12 Jan 2012

Regions Financial fetched just $930 mln - two-thirds of initial estimates - for decent performer Morgan Keegan. But the U.S. lender needs the cash. With European banks alone trying to offload some $2 trln of assets, the Keegan deal underscores it’s a serious buyer’s market.

US gas driller stock still too hot for cold prices

12 Jan 2012

Natural gas prices in the U.S. are near decade lows and sliding. Yet despite Wednesday’s declines, gas drillers like Cabot - the biggest S&P 500 gainer last year - continue to trade on richer multiples than extractors of dearer oil. The current valuations can’t be justified.

Predictions 2012: Upside down and inside out

12 Jan 2012

Planet finance has a propensity to turn itself upside down and inside out. It’s up to its old tricks again. A new collection of commentaries from Breakingviews sets the financial agenda for the next 12 months.

Fed profit shows it’s in the market but not of it

11 Jan 2012

The U.S. central bank is handing the Treasury $77 bln of its 2011 profit, a hair under the 2010 record. That’s three-quarters of what all the nation’s commercial banks collectively make in a year. It’s a reminder that the Fed plays big these days - but by different rules.

Carlyle’s big payday does private equity no favors

11 Jan 2012

David Rubenstein and two partners pocketed $400 mln of profits last year. The 99 pct - pensioners investing in Carlyle funds - did well alongside them. But the lower tax rate paid by the buyout barons cost Uncle Sam some $80 mln. The timing of Carlyle’s disclosure is impeccable.