Banks

Capital Calls: British wages

12 Sep 2023

Concise views on global finance: UK pay rose by an annualised 8.5% in the three months to July – more than inflation. That’s good for retirees, whose pensions will rise by that amount. But such a hot labour market is likely to prompt the Bank of England to hike rates next week.

Asia’s richest banker makes a meal of succession

4 Sep 2023

Uday Kotak has quit early as CEO of his $43 bln lender. He seems to be pitching it as a way for Kotak Mahindra Bank to appoint a replacement free from his interference. But he’s on the board and the firm’s biggest shareholder. And his legacy is tied to whoever takes his spot.

UBS cost-cut gains are a double-edged sword

31 Aug 2023

Boss Sergio Ermotti will keep Credit Suisse’s domestic unit, and hopes to slash $10 bln through the merger. His higher savings target easily offsets the hit from vanishing revenue as clients flee the acquired bank. The risk is that Swiss politicians think UBS’s deal is too sweet.

China’s Big Four banks are bracing for impact

30 Aug 2023

The group, worth a combined $680 bln, will bear the brunt of the country’s property mess: state lenders are to cut mortgage interest rates and AgBank is warning on margins. Investors are attuned to banks’ policy role but even at less than half book value they’re far from cheap.

UBS inherits tricky wealth legacy in Asia

29 Aug 2023

By gobbling up Credit Suisse, Sergio Ermotti is expanding his bank’s clout in serving the Asian super-rich. Yet exposures to risk-taking entrepreneurial clients used to big leverage pose a challenge. Regaining the wealth ground lost by its Swiss rival will also not come cheap.

Private funds’ regulatory dream meets logical end

23 Aug 2023

Securities watchdogs are proposing safeguards for private equity and hedge fund investors. The now-$25 trln industry owes its growth partly to lighter regulation than at the banks it is displacing. Tighter rules will irk some, but growing up should bring new responsibilities.

Leaving the office for dead may haunt investors

23 Aug 2023

Landlords’ valuations are half pre-pandemic levels due to the boom in hybrid work. Yet looser labour markets are giving bosses more power and companies like Google want staff to spend more time in their buildings. Fund managers betting on a trend reversal may be on to a winner.

Unused safety net gives UBS best of both worlds

11 Aug 2023

The Swiss bank scrapped $10 bln of government insurance against losses from rescuing Credit Suisse and repaid emergency central bank loans. Turning down the political heat gives CEO Sergio Ermotti more scope to cut costs. Yet the state remains on the hook for any future problems.

Stingy UK bank saving rates may become a non-issue

10 Aug 2023

Regulators dislike the fact that lenders are passing on rate hikes more quickly to borrowers than to savers. But unlike in Spain, British banks like NatWest are no longer swimming in spare deposits. That suggests they’ll have to pay up for funds, solving the problem before long.

Capital Calls: Italian bank levy flip-flop

9 Aug 2023

Concise views on global finance: Rome has only partially soothed investors panicking over its windfall tax on lenders.

Uday Kotak is wanting for the market’s support

9 Aug 2023

Asia’s richest banker wants to stay on his $44 bln lender’s board when he steps down as CEO. India’s regulator will weigh that up as it decides if an insider also can be the new boss. A cosy arrangement may be tolerable but Kotak Mahindra’s stock is starting to work against him.

Capital Calls: Dish and EchoStar

8 Aug 2023

Concise views on global finance: Billionaire Charlie Ergen is reuniting the two satellite businesses he controls, beefing up the $4.5 billion Dish Network’s strained balance sheet as it tries to expand its wireless strategy.

Capital Calls: PIF, Siemens Energy

7 Aug 2023

Concise views on global finance: Saudi Arabia’s big sovereign wealth fund is getting bigger; the $13 bln German company unveiled a $2.4 bln charge due to persistent wind turbine problems.

Aussie trustbuster rebuff does ANZ a favour

4 Aug 2023

The watchdog nixed the lender’s $3.2 bln deal for Suncorp’s bank arguing it’d reduce competition. That’s debatable. But the tie-up was full of promises on jobs and loans that would push benefits for the buyer out years. ANZ is appealing the ruling; accepting it would be smarter.

DBS shareholders show little interest in interest

3 Aug 2023

Rising rates powered most of the $65 bln Singapore bank’s bumper profit jump in another record quarter. Yet the stock is up less than 10% in 12 months. Whether it’s fears about the economy or interest income sustainability, CEO Piyush Gupta isn’t getting the benefit of the doubt.

HSBC invites shy investors to turnaround party

1 Aug 2023

Boss Noel Quinn is upping targets at the $160 bln bank after first-half pre-tax profit more than doubled. It’s good timing: pushy shareholder Ping An and its breakup hopes may have been effectively silenced, but other owners need convincing that Quinn’s overhaul has legs.

Capital Calls: Uber’s road trip to redemption

1 Aug 2023

Concise views on global finance: The $95 bln ride-sharing firm notched its first operating profit and more than doubled free cash flow, but its valuation is lagging.

Capital Calls: Bank of Japan, StanChart

28 Jul 2023

Concise views on global finance: Governor Kazuo Ueda shook markets by introducing a more flexible approach to controlling government bond yields, but he can easily retreat if inflation drops. Meanwhile, Bill Winters’ lender is improving but the heavy lifting is far from over.

New bank rules cage a tiger, feed a dragon

27 Jul 2023

Big U.S. lenders’ profitability is under fire from new Basel-related capital requirements – so expect them to fight it tooth and nail. The risk is that it pushes activity into the shadows, by accident rather than design. It’s a good way to set the scene for a future crisis.

Barclays CEO fiddles while valuation droops

27 Jul 2023

Despite earning adequate returns, the $32 bln UK bank has long traded at a big discount to rivals. Boss C. S. Venkat’s plan so far boils down to more of the same. Without clearer targets to move capital out of investment banking, the shares risk remaining stuck in the doldrums.