Banks

In praise of American finance’s regulatory mess

9 Mar 2023

China’s plan to create a super watchdog leaves the US looking more like a global outlier. Its improvised tangle of agencies has drawbacks, as the 2008 crisis and crypto boom demonstrate. Even so, the rats-in-a-sack approach might be the least bad way to run a financial system.

Credit Suisse blunders undermine CEO’s repair job

9 Mar 2023

The bank’s shares fell 5% after a call from US regulators stopped it from publishing its 2022 annual report. The watchdog’s accounting questions seem minor and predate boss Ulrich Körner. But the constant bugs impede his quest to win back lost confidence and wealth assets.

M&A bankers trip over their cracked crystal balls

8 Mar 2023

Corporate consiglieri use an array of flawed methods to forecast deal activity, which tallied $3.6 trln last year. Luckily, they’re paid to complete mergers, not predict them. This blind spot makes staffing tougher, however, and in some ways undercuts the value of their counsel.

Capital Calls: TD Bank’s $13 bln cliffhanger

2 Mar 2023

Concise views on global finance: The Canadian bank’s acquisition of U.S. peer First Horizon will be delayed beyond its May 27 drop-dead date, but there are reasons to think it will still get done.

Banks’ state shareholders can afford slow selldown

2 Mar 2023

The Belgian and Dutch governments took advantage of a market rally to offload chunks of BNP and ABN. Valuations have risen but are still low relative to lenders’ returns. That means Britain and Germany would be wise to move gradually with their NatWest and Commerzbank holdings.

Revolut audit snag undermines $33 bln price tag

1 Mar 2023

The startup published 2021 results after a long delay. Growth soared but bean-counters raised questions over how its IT systems record revenue. That’s unlikely to help its quest for a British banking licence, which will in turn limit Revolut's ability to make sustainable profits.

Santander’s new plan is a make-or-breakup moment

28 Feb 2023

Chair Ana Botín wants to forge deeper links between the disparate bits of her 60-bln-euro bank, including by using common IT systems. If it works, and higher returns follow, the bank should trade at more than the sum of its parts. If not, it will be hard to resist selling assets.

Revisiting JPMorgan’s innovative Cazenove deal

24 Feb 2023

The American giant’s 2004 joint venture with the venerable UK stockbroker is often cited as a rare example of a successful investment banking takeover. A new memoir by former CEO Robert Pickering confirms Cazenove was right to sell. Less clear is whether JPMorgan needed to buy.

Capital Calls: Starbucks

21 Feb 2023

Concise views on global finance: The $123 billion coffee chain’s new patent filing speaks to popular TikTok campaigns for more bespoke beverages – and other labor challenges. 

HSBC turnaround party has muted morning after

21 Feb 2023

The $150 bln bank has hit the targets boss Noel Quinn set three years ago, and is enjoying a valuation close to pre-pandemic levels. But Quinn’s current ambitions seem modest compared with recent performance. His conservatism may mean the bank’s rate-rise jackpot has peaked.

Capital Calls: UK banks

17 Feb 2023

Concise views on global finance: NatWest CEO Alison Rose is expecting a 3.2% lending margin in 2023, which is the same as she managed in the three months ending December. It means giddy bank investors may have to calm down.

Missing China bank boss is the wrong big deal

17 Feb 2023

Bao Fan's disappearance wiped 30% off China Renaissance’s stock. But his boutique investment bank had already shrunk as work from clients like Didi vanished. The broader blow is to financiers waiting for new business to offset Beijing’s common-prosperity and anti-corruption push.

StanChart’s takeover defences are getting stronger

16 Feb 2023

For years the emerging markets lender’s shareholders would probably have welcomed a cash bid. But CEO Bill Winters is getting closer to a 10% return on tangible equity. Prospective suitors like First Abu Dhabi Bank would have to pay an extra chunky premium to clinch a deal.

Barclays CEO faces a long road to higher valuation

15 Feb 2023

The UK lender pays a share-price penalty because investors dislike its volatile investment bank. Shrinking it is off the table, so boss C. S. Venkat’s best bet is to boost steadier bits like transaction banking and securities lending. Over time, that may earn a higher multiple.

Capital Calls: Rothschilds in charge

14 Feb 2023

Concise views on global finance: The storied banking dynasty wants to buy out minority investors on the cheap, and they’ll probably get away with it.

China’s offshore-stock fears trade in paranoia

14 Feb 2023

As travel resumes and the yuan softens, mainland authorities may step up curbs on citizens buying foreign shares via Hong Kong. Yet such services are unlikely conduits for mass capital flight. And denying domestic investors overseas hedging options is a double-edged sword.

Bank of Japan’s new governor starts on back foot

14 Feb 2023

Academic Kazuo Ueda will replace Haruhiko Kuroda atop the central bank after the first choice demurred. He’s respected but lacks factional support and faces an unpopular prime minister pushing an expensive agenda. His appointment augurs a rocky transition at a delicate time.

Piyush Gupta shines his risk appetite with Adani

13 Feb 2023

The boss of $70 bln DBS, Singapore’s top lender, is one of the first major global bank bosses to speak out largely in favour of the troubled Indian industrialist. His typically candid comments put Gupta’s broader calculation of where Asia’s big opportunities lie into sharper focus.

Capital Calls: Alibaba’s Paytm exit

13 Feb 2023

Concise views on global finance: The e-commerce group has sold out of the Indian fintech company, though Paytm’s other Chinese backer may find it harder to follow suit.

Klein has safety net in First Boston high-wire act

9 Feb 2023

Credit Suisse is buying Michael Klein’s advisory shop for $175 mln, mostly in convertible debt. Both sides can make good money if they revive the old Wall Street firm. If it fails, the former Citi rainmaker gets stock in the Swiss parent, which should limit his downside.