Banks

Capital Calls: L’Oréal

9 Feb 2024

Concise views on global finance: The French cosmetics giant suffered from the same China pain as Shiseido and Estée Lauder, but it is coping better than its Japanese and US rivals.

NY bank’s slide exposes regulatory booby trap

7 Feb 2024

A credit-rating downgrade adds to the misery of investors in $3 bln New York Community Bancorp, whose shares have more than halved in a month. A plan to rebuild its balance sheet will take many months. Watchdogs, who can’t afford for fear to take root, face a different timeline.

Investors are yet to fully embrace UBS’s promise

6 Feb 2024

The $93 bln Swiss bank is restarting dividends and share buybacks after delivering 30% of total planned cost savings from the Credit Suisse merger in 2023. Yet investors don’t seem fully convinced it will hit its returns targets. Speeding up the integration this year would help.

China’s bad banks rejig can serve a bigger purpose

6 Feb 2024

Sovereign fund CIC may subsume three of the country’s big four bad-debt managers, per a now-deleted state news agency report. It may seem like more piecemeal policy. But similar moves between 1998 and 2003 to clean up toxic loans helped beat deflation and invigorate the economy.

Capital Calls: Beijing’s anti-corruption drive

6 Feb 2024

Concise views on global finance: President Xi Jinping’s crackdown on the country’s financial sector threatens to derail efforts to boost confidence in the world’s second largest economy.

Capital Calls: Estée Lauder, European banks

5 Feb 2024

Concise views on global finance: The cosmetics giant behind Le Labo is cutting jobs and redoubling restructuring efforts, but the changes only go skin-deep; Santander and Lloyds are under pressure after a report they banked entities controlled by a US-sanctioned Iranian company.

UniCredit has ways to keep defying gravity

5 Feb 2024

The 50 bln euro bank pledged to match record 2023 net profit this year, and to keep showering investors with cash. CEO Andrea Orcel can use lower costs to offset higher loan losses and costlier deposits. If he can do so, and avoid flashy deals, his valuation can rise further.

JPMorgan succession is a high-stakes soap opera

1 Feb 2024

The US’s largest bank shuffled its business leaders, sparking speculation as to who might eventually take over from boss Jamie Dimon. In this Viewsroom podcast, Breakingviews columnists explain why it matters, even if Dimon’s eventual successor is unlikely to fill his shoes.

Deutsche Bank and BNP try on each other’s clothes

1 Feb 2024

The $27 bln lender is less highly valued than its $72 bln French peer and its recent past is more troubled. But Deutsche just upped its outlook, while BNP’s got worse. Neither are investor stars, but the German bank’s ambitions for its investment bank look easier to realise.

Julius Baer pops myth of private bank prudence

1 Feb 2024

CEO Philipp Rickenbacher is leaving the $12 bln Swiss wealth manager after bad lending led to a $700 mln writedown. It’s a reminder that serving rich clients is not risk-free. Money managers will have to provide more clarity on loan books or give up lucrative but dicey practices.

Nomura offers tantalising glimpse at mediocrity

1 Feb 2024

Japan’s vibrant market helped the investment bank churn out quarterly earnings in line with its 2025 target. Boss Kentaro Okuda’s job now is not just to sustain the performance but to improve the ho-hum 6.2% return on equity that came with it. History is not on his side.

Santander progress yet to show up where it counts

31 Jan 2024

The $65 bln lender has already hit its 2025 profitability targets, yet still trades below tangible book value. Investors may fear risks like European rate cuts, or they might not buy Santander’s strategy. Until they award a higher valuation, boss Ana Botín’s job is incomplete.

Capital Calls: HSBC, Delivery Hero

30 Jan 2024

Concise views on global finance: The global bank will pay a 57 mln pound penalty for misreporting depositor protection data; the Frankfurt-listed meal delivery company has sold a 4.5% stake in rival Deliveroo, at a loss.

JPMorgan is a rare palace that warrants intrigue

26 Jan 2024

Most whispers about CEO succession amount to idle gossip, but Jamie Dimon’s management shake-ups could lead to a world-changing decision. His swagger has helped expand the $4 trln bank’s clout in the financial system and it’s increasingly doubtful his replacement will sustain it.

Commerzbank stake sale would risk M&A impasse

25 Jan 2024

Berlin may consider offloading its 15% stake in the German lender. Deutsche Bank and UniCredit are obvious potential buyers, but higher rates have made a full-blown bank merger less appealing. A market disposal would present prospective suitors with a dilemma.

Take China’s easing signal with a pinch of caution

25 Jan 2024

Beijing is releasing $140 bln of liquidity at banks, trimming some lending rates, and talking up measures to boost the appeal of stocks. It is also pressing on rebalancing the world’s second largest economy. In a grand overhaul, short-term pain can only be managed to a point.

Capital Calls: Microsoft’s Russian hacker

22 Jan 2024

Concise views on global finance: The $3 trln tech firm disclosed that a nation-state hack accessed leaders’ email, saying it showed the need for potentially “disruptive” measures. It’s a worrying acknowledgement of the still-vague costs of geopolitical tensions for tech giants.

Private credit gets the slice-and-dice treatment

19 Jan 2024

Managers like Blackstone and Blue Owl are selling ‘collateralised loan obligations’ backed by privately issued debt. Such alchemy, common in traditional lending, helps lenders raise cheap funds. It also adds complexity, and makes private credit more dependent on flighty markets.

BoE can counter banks’ unfriendly rate fire

12 Jan 2024

UK lenders like HSBC think lower borrowing costs are coming and have slashed five-year mortgage payments below 4%. That makes it harder for the Bank of England to slay inflation and, in fact, may delay any cuts. Governor Andrew Bailey could ask the City to reward savers as well.

Bitcoin ETFs only entrench one frivolous use case

10 Jan 2024

The SEC finally greenlit BlackRock, Grayscale and other funds to track the crypto price, with trading due to start this week. It’ll be easier to make – and lose – money in the volatile digital asset, but it’s no closer to being a currency, store of value or network for new apps.