Banks

Equity cult’s demise spells shake-up for prime brokers

23 May 2003

The hedge fund boom has been a bonus for prime brokerages, but there are signs that certain strategies are at full capacity. Prime brokers will find it hard to adapt if hedge funds accelerate the shift to asset classes other than equities.

WestLB banker’s potential conflicts deepen

23 May 2003

Robin Saunders, the bank's assetfinance chief, was juggling a host of personal equity investments in the bank s borrowers. At the very least, WestLB looks pretty dumb to have got into a situation where it lost millions while Saunders apparently made a killing.

Not all analysts were patsies

20 May 2003

The failure of Japan s Resona bank is a case in point. One ING analyst saw it coming two years ago. But when he said so, Japan s FSA jumped on ING. The bank published a grovelling apology. Soon after, the analyst left.

CSFB tries to create superbankers

20 May 2003

This is an interesting experiment to drive efficiency in a harsh environment. But it relies heavily on the superbanker knowing his onions. The investment bank wants its financial services bankers to cover debt, equities, derivatives and corporate finance.

WestLB banker’s BHS ties deserve scrutiny

20 May 2003

As German regulators examine WestLB's controls, they should examine how Robin Saunders came to own 0.5% of top client BHS. The investment potentially eroded the natural tension that ought to exist between a lender and a borrower.

Court overrules bank regulator on Lyonnais

19 May 2003

This is bad for consumers and rivals. It also drives a coach and horses through European competition rules. The effect of its ruling is to wave Credit Agricole's bid for Credit Lyonnais through without any competition scrutiny.

SEC investigates tying of loans to deals

16 May 2003

This is a hot issue, but it is not clear why the regulator is pushing its nose into it. If tying is an issue for regulators at all, it is one for banking supervisors, not the SEC.

Italian banks turn in mixed results

15 May 2003

Firstquarter earnings were better than expected. But strip out trading gains and the picture is less pretty. Even so, the sector continues to rise. Investors in some of the riskier banks may be riding a fools' rally.

HealthSouth scandal engulfs UBS bankers

14 May 2003

According to the WSJ, they played a large role in shaping the inner operations of the scandalridden US firm. This sounds all too familiar. UBS s richlypaid health care bankers were a "special team" a bit like CSFB s Quattrone.

Spinning settlement misses its target

14 May 2003

The former chairman of Qwest is to donate his profits from hot IPOs to charities and "securities arbitration clinics" for retail investors. But it's Qwest shareholders, not New York law schools and museums, that really deserve compensation.

UBS hums along in first quarter

13 May 2003

The Swiss bank s profits beat forecasts, there was a fixed income bonanza and the private bank continued to suck in funds. UBS even thinks it can see the end of the downturn. But there are a few blotches on the picture.

Barclays takes E1.1bn Spanish plunge

8 May 2003

Spain may be Europe s best banking market. But Barclays is paying a peak price for Banco Zaragozano over three times book. Although Barclays can easily afford this, the surplus capital splurged in Spain may jeopardise its share buyback programme.

Commerzbank returns to profit in Q1

7 May 2003

The German bank has made progress on cutting costs, and it is racking up fewer bad debts. But this is its seasonally strongest quarter. There s still plenty of scope for disappointment.

Rhodia plans E700m junk bond issue

5 May 2003

First Vivendi Universal launches a junk bond, now this. The market seems to be opening up to fallen angels. Vivendi made big strategic changes before it sold its bond. Rhodia hasn't. Its deal smacks of opportunism.

Deutsche Bank is a one-trick pony

30 Apr 2003

Almost all of the German bank s earnings come from volatile investment banking. But to be fair, Deutsche does seem to be trying to mitigate the risks that flow from that.

Local Spanish retail banks outgun SCH, BBVA

30 Apr 2003

Spain is Europe s most attractive banking market and that s been reflected in the glowing Q1 results of its local retail banks. SCH and BBVA swear they ll catchup with domestic rivals soon. Judging from their valuations, investors believe they already have.

Rhodia boss should still go

29 Apr 2003

Tirouflet has clung onto power for now. If not a magic solution, his departure might help restore confidence from its equity, and more importantly, debt investors.

ABN Amro surfs US remortgaging boom

28 Apr 2003

With US rates so low, this can t go on forever. No wonder ABN is wary of giving an outlook statement. The Dutch bank got about 60% of its operating profits from the US in Q1 a huge chunk from mortgage originations.

Credit Suisse returns to profits in Q1

25 Apr 2003

But unlike the other banks that have reported, investment banking wasn't really the star. That's because CSFB is shrinking.

Deutsche Bank spring cleans its balance sheet

24 Apr 2003

The German bank is using the windfall it got from trading revenues in the first quarter to writeoff dud investments. This is a sensible approach. But has it cleaned things out thoroughly?