Banks

Small cap companies are on a tear

10 Sep 2003

Small caps have outperformed the broader market by a huge margin this year. In the UK, the sector is up by 34%. The sector still suffers from its usual discount to the broader market. But this is shrinking every day. A bubble may be inflating.

Investors clamour for mezzanine funds

9 Sep 2003

Goldman closed a $2.7bn fund as investors hope returns from "private equity lite" can rival those from the riskier mainstream variety. But a flood of money into private equity diluted its returns. The same could happen with mezzanine funds.

Thou shalt not attend IPO pitches

8 Sep 2003

That, at least, is what the UK's FSA wants following Spitzer's lead in the US. The European Commission's approach is less clear. But whatever the regulators decide, the industry big boys are likely to implement a selfdenying ordinance on analysts attending pitches.

Employees gamble on DKW doing a Lehman

8 Sep 2003

By pledging support for two years, and keeping open the ownership question, Allianz has given the bank a chance to shape its own destiny. If management can turn it round, DKW could win autonomy just like Lehman did from Amex a decade ago.

State sell-offs may aid primary equity markets

5 Sep 2003

A rash of stake sales by deficithit countries would pick up the slack in ECM now that the wave of distressed activity is ebbing. But a for real pickup, companies would have to start doing M&A deals and IPOs again. And that sort of activity is still patchy.

Too soon to remove HVB from the critical list

4 Sep 2003

The German bank has made great strides in turning itself round. But it faces tough financial goals. And the rating agencies may pounce if it misses them.

Deutsche Bank prepares giant hybrid capital issue

3 Sep 2003

The bank s timing is very clever. After the boom in hybrids earlier this year, demand now outstrips supply. That suggests investors will lap up Deutsche s offering, and on favourable terms for the bank. Patience can be a very commercial virtue.

Next shake-up looms at Merrill

2 Sep 2003

Following the summer power struggle, the investment banking department is now being reorganised and its boss is moving to a new job. Investors will be hoping the musical chairs will lead to a more efficient structure and are not a reflection of more infighting.

Capitalia spins new protective web

29 Aug 2003

The controversial Italian bank is collecting a group of powerful investors. The risk is that these players have multiple relationships and that could allow Capitalia's chairman to resist pressures from the market.

Goldman eyes Chinese joint venture

27 Aug 2003

The investment bank would be the latest to jump onto the Chinese securities bandwagon. Morgan Stanley stole a march on rivals when it formed a Chinese venture in 1996. Others including Deutsche and BNP are playing catchup.

ECB holiday doesn’t stop euro sliding

21 Aug 2003

Everyone knows that Europe grinds to a halt in August. But the ECB has taken that to heart, and cancelled all its August meetings. Investors, though, are pummelling the euro in a backhanded way doing the ECB's job for it.

No harm in central bankers setting up hedge funds

20 Aug 2003

But often they ran hedge funds beforehand. And central banks should not stop hiring them just because they may return to the day job. When expolicymakers like Arminio Fraga and Sushil Wadhwani set up hedge funds, the fear is they will put their inside knowledge to ill use.

Deutsche fined over Hewlett-Packard conflict

20 Aug 2003

Its fund managers are cleared of allegations that they switched votes in the Compaq merger because of pressure from banking colleagues. But they have been rapped for the still serious offence of failing to disclose to their clients the fact that Deutsche was advising HP.

New hedge fund money slows in second quarter

19 Aug 2003

The market bounce has left pension funds far less interested in switching out of large equity positions and into hedge funds. That may be temporary. But rising equities wouldn t be dampening inflows if hedge funds had been able to show evidence of outperformance.

Private equity haggles with banks on failing deals

19 Aug 2003

Guy Hands and Investec both fought to retain an interest after their ventures Meridien and Welcome Break went wrong. While Hands fought hard, his attempt was seen to be fair. Investcorp, on the other hand, raised the hackles of the banks.

UBS posts highest quarterly profits since boom

13 Aug 2003

The Swiss bank's improved performance is broadly based, and benefited from a pickup in equities revenues not just fixed income dealing. But UBS has been more vocal than rivals in saying that equity business will not recover in time or enough to offset the bond boom's demise.

US banks say Basel 2 may hit capital markets

12 Aug 2003

They may be right in claiming the accord will unfairly penalise some aspects of their business. But it isn't all bad news for the industry.

Merrill probes mystery $43m energy contract

11 Aug 2003

Typically, whenever investment banks' controls seem to be lacking, the problems are in their most lucrative businesses. It is investigating whether a former employee in its then gogo energy unit bought insurance from a company he himself was connected to.

Barclays looks across Channel for mega-deal

11 Aug 2003

In a sense, this is no surprise. The bank s boss, Matt Barrett, is a deal junkie, and there is no big UK deal left for Barclays to do. But it is harder to deliver than to promise. Lloyds TSB has already tried and failed.

Barclays and ABN beat expectations

7 Aug 2003

While there are still pockets of concern, investors should take heart that both banks made good operating results across their businesses. The UK and Dutch banks have cut baddebt provisions and made upbeat noises about the future.