Financial Services

Capping credit card rates is only half a solution

17 Dec 2024

Donald Trump pledged to limit interest on plastic at 10%, eliciting howls from banks of a crunch on consumers. Delinquencies are up as charges have soared. But a plan that doesn’t also target, say, 400% APR payday loans could push poorer borrowers into something worse.

Why private credit is shrinking as it booms

17 Dec 2024

Non-bank lenders, sitting atop $2 trln in assets, keep taking more of the market away from the traditional titans of Wall Street. Yet the industry is now rapidly consolidating. In this episode of The Big View podcast, Marc Lipschultz, co-CEO of Blue Owl Capital, explains why.

Brookfield’s simpler structure adds layer of rigor

4 Dec 2024

The $100 bln investment shop is nearly finished rearranging its sprawling standalone units, helping narrow a stubborn discount to asset value. Hedge fund manager Bill Ackman is a big believer. The new challenge for boss Bruce Flatt will be returns depending purely on performance.

BlackRock’s HPS deal seals Netflix-like strategy

3 Dec 2024

Boss Larry Fink intensified the race against Apollo and others to capitalize on booming private markets. For the index-fund titan, it means finding content-like assets to push through its pipes. Buying a credit shop managing $150 bln helps, but only up to a point. Just ask Apple.

Robey Warshaw’s $90 mln bonanza is taste of 2025

29 Nov 2024

The UK boutique’s four partners split a record bounty for the last financial year. That’s oddly high since it was a slow period for deals. Now, falling rates and laxer antitrust authorities will help buyouts and corporate mergers, lifting rival rainmakers too in the coming years.

Aviva can put its foot down with Direct Line

28 Nov 2024

The $16 bln UK insurer has had a $4 bln approach for its smaller rival rebuffed. Boss Amanda Blanc has scope to turbocharge the offer and still make an acceptable return. That makes it more likely that she goes over the heads of Direct Line’s management if they don’t engage.

Italian bank M&A circus risks sidelining investors

26 Nov 2024

Andrea Orcel’s UniCredit offered 10 bln euros for Banco BPM, irking Rome and potentially eliciting a rival swoop from the target’s 9.2% owner Crédit Agricole. Meanwhile BPM may launch its own bid for Monte dei Paschi. The risk is that shareholder interests get lost in the noise.

UniCredit boss’ 3D chess M&A game could backfire

25 Nov 2024

Andrea Orcel’s bank offered 10 bln euros for Italian rival Banco BPM months after a raid on Germany’s Commerzbank. Both deals make sense, and having options may boost his negotiating power. But hostile moves can harden opposition, and UniCredit risks looking desperate for a deal.

Hong Kong regains some lustre amid China’s gloom

22 Nov 2024

Top mainland officials made a rare appearance alongside CEOs like David Solomon at a conference in the city. It's a sign Beijing will lean on Hong Kong more to tap global capital and navigate looming US tariffs. Potential market reforms could benefit the finance hub, too.

Buyout barons salivate over uncertain wealth prize

20 Nov 2024

Blackstone says $80 trln is up for grabs from coaxing individual investors into private-market assets. KKR puts the figure at $200 trln. The range reflects the variety of people whose nest eggs the firms are targeting, and regulatory hurdles. Shareholders aren’t counting on it.

China developers’ survival fight gets litmus test

15 Nov 2024

Sunac has given investors four options for restructuring $2 bln of onshore bonds, including an 82% haircut and a debt-for-equity swap. How they vote will reveal their views on both the $3.1 bln firm’s chances of survival and Beijing’s attempts to end the property slump.

Shein margin wobble takes bite out of IPO value

14 Nov 2024

The e-commerce giant’s revenue growth slumped in the first half of 2024, and the net margin fell to 2% per The Information. Even if the business recovers, it creates uncertainty that’s compounded by a protectionist US government. Investors may struggle to see the upside.

Rubber meets road for divergent buyout-shop models

7 Nov 2024

Strong quarterly results and the US election lifted enthusiasm for Apollo, Blackstone, Carlyle and KKR. After pursuing different paths to gather nearly $3 trln of combined assets, however, their opportunities and risks vary. Those leveraged to insurance are under fresh pressure.

HSBC can stand strong in a fragmenting world

7 Nov 2024

The $170 bln bank is uniquely dependent on East-West linkages at a time when global tensions are rising. Yet it weathered the last US-China tit-for-tat fairly well. And supply-chain shifts could even boost the lender, if CEO Georges Elhedery can help it adapt to new trade flows.

Schroders can stop slide by getting grip on costs

5 Nov 2024

The $6.6 bln asset manager’s shares fell over 10% as it warned of clients withdrawing funds. Once first among UK equals, Schroders now suffers from a humdrum valuation, and a lack of scale. New Chief Executive Richard Oldfield can at least tackle its bloated expenses.

UBS can share more M&A savings with investors

30 Oct 2024

CEO Sergio Ermotti keeps upping the pace of cost cuts from buying Credit Suisse, with his 2024 target now $7.5 bln. Yet expenses elsewhere in the bank seem to be offsetting those gains. To please shareholders, UBS may have to let more of the bounty drop down to the bottom line.

Value push will mostly survive Japan election mess

29 Oct 2024

A decade-long effort to boost shareholder returns can continue to gain traction despite the LDP's disaster at the polls. It helps that Japan Exchange took charge of the party's initiative for structural reform. For now, as politicians vie for power, a weak yen will buoy stocks.

India’s microfinance trouble goes mainstream

28 Oct 2024

IndusInd Bank shares dropped 19%, wiping out $2 bln or over half the value of its loans to the poor. Investors are pricing in an asset quality meltdown far worse than the lender’s rising delinquencies imply, and a possible throwback to the 2010 crisis that blew up the industry.

Barclays’ investment bank slog gets welcome push

24 Oct 2024

The $46 bln UK lender’s dealmaking unit beat expectations in the third quarter, helped by booming debt underwriting. A depressed share price shows CEO C.S. Venkatakrishnan’s turnaround has a long way to go. But cutting costs is easier when the business is growing.

Fintechs’ IPO valuations can look beyond Nubank

24 Oct 2024

The $70 bln Brazilian lender is seen as a benchmark for unlisted rivals. But Nubank’s focus on interest income, and the idiosyncrasies of its home market, make it look rather different to the likes of Revolut. Bankers prepping neobank IPOs may gain from looking at other peers.