Insurance

FDIC on back foot thanks to imperfect disclosure

16 Feb 2010

A web video critical of the U.S. agency's sale of failed IndyMac Bank has elicited a defensive clarification. FDIC could have been clearer when the deal was done. As with the AIG bailout, authorities dabbling in the private sector court skepticism if they don't disclose enough.

AIG’s Alico sale may delay, confuse taxpayer exit

10 Feb 2010

The bailedout insurer may get MetLife stock as well as cash in the mooted $15 bln deal. The U.S. government was set to get $9 bln of its money back. It could now end up owning stock in yet another company bringing further delay and uncertainty about converting that into cash.

Geithner in tricky spot over disclosure

27 Jan 2010

The U.S. Treasury chief endured congressional questioning that ran the gamut from spoton to grandstanding. How AIG counterparties got paid remains controversial. But the New York Fed's apparent inclination to obscure the outcome may turn out to be Geithner's bigger problem.

AIG still needs charmed future to repay taxpayers

26 Jan 2010

Tim Geithner's role in the $180 bln bailout remains under scrutiny. Looking ahead, though, AIG still owes U.S. taxpayers some $124 bln. The company is making progress on some asset sales. But to repay its rescuers in full, everything has to go very well and for a long time.

AIG’s Arctic winter lit up by $15 bln Alico deal

19 Jan 2010

Boss Robert Benmosche was right to wait. And he's right to offload the unit now rather than hang on for an IPO, which would only sell part of Alico. MetLife is set to pay a decent price given AIG s need to sell. And taxpayers will get $9 bln back. But the dark days aren't over.

Swiss Life would be odd target for Allianz

12 Jan 2010

The Swiss life assurer's shares have jumped on rumours of a bid from the big German insurer. The European insurance sector does look ripe for consolidation. But a deal doesn't make obvious financial or strategic sense for Allianz, and could lead it to miss bigger fish.

Axa AP takes gamble with A$13 bln NAB bid

17 Dec 2009

Directors of the Asian wealth manager have snubbed a $12 billion minority buyout by French parent AXA, backing a higher counterbid from Australia's NAB. The new offer has an allcash option, so more certain value but less certainty of actually happening. It's a risky choice.

Gaidar’s legacy relevant for Russia today

16 Dec 2009

The shock therapy introduced in the early 1990s by Yegor Gaidar, who has just died, helped drag Russia from socialism into a market economy. Freeing up prices and privatising industries wasn't pretty. But the broad thrust was right. Russia could do with more Gaidar medicine.

ING should be worth more as a pure bank

11 Nov 2009

Investors panicked when the Dutch bancassurer agreed to sell its insurance arm. But it has four years to get a good price. Add in the repayment of state aid, and ING s current conglomerate discount could be erased. Brussels intervention may turn out to be a boon.

AIG pay standoff entirely predictable

11 Nov 2009

It s what happens if a government props up a private company, makes a show of keeping it running like one, and then interferes. CEO Benmosche s threat to quit may be a bluff. But the lesson is that if there s no clear turnaround plan firms should be wound down, not bailed out.

Axa can pay more for Asian minorities

10 Nov 2009

The independent directors of Axa Asia Pacific rejected the offer of a 31% premium to buy out minority holders. The market agreed, and it looks like the right call. Direct control of Asian assets promises good growth for Axa. And it is probably willing to pay up to get it.

Axa gets sugar to sweeten Asian deal

10 Nov 2009

In September, the French group said it didn't need to raise capital. But now Axa wants to take full control of the best assets in its majorityowned Asian operation. A E2bn rights issue will allow it to raise the alreadyrejected offer, and to expand in emerging markets.

Axa tries for cash-lite $10bn buyout

9 Nov 2009

The French financial group wants full control of the Asian businesses in its 53%owned unit. Its plan: rival AMP buys the whole company, and then Axa buys most of it back. Axa puts up only $1.7bn in cash, but minority holders are unhappy. They get mostly hardtovalue shares.

Primerica’s pseudo-sale emblematic of Citi mess

6 Nov 2009

The megabank is hiving off the insurer, one of Sandy Weill s first acquisitions. But it s not a clean break. Citi is keeping much of Primerica s earnings and will remain a major shareholder for now. It s a fittingly complex way to mark the dismantling of Citi s sprawling empire.

US pay tsar plays with fire

22 Oct 2009

Ken Feinberg will soon unveil his plan to limit pay at Tarpdependent firms. With the best intentions, there could be damaging unintended consequences, like skewed incentives and mass defections potentially creating a mess. Let's hope Feinberg has asked the right questions.

Wasserstein’s influence didn’t surpass Lazard’s

15 Oct 2009

The legendary dealmaker put an indelible mark on the firm in his seven years at the helm. Wasserstein s outsize persona helped unite the divided house and push it from private to public. But a firm that has lasted 161 years can sustain the loss of even the most standout banker.

Axa is latest case of France’s bendy governance

8 Oct 2009

The insurer s CEO will take on the chairman s job too, while abolishing its dualboard structure. It s the latest example of a big French company tailoring its management structure to suit one man. France SA must realise that governance principles shouldn t be so pliable to whim.

Financials shouldn’t rush to ape Munich Re buyback

1 Oct 2009

The German reinsurer is resuming purchases of its own shares a rare instance of a financial institution returning capital. But Munich Re is in an unusually strong position. For most financials insurers included capital preservation must still be the order of the day.

New UK bank insurance boss has tricky task

25 Sep 2009

Stephan Wilcke has lots of credit experience. He ll need that and more as head of the government s scheme. He has to cajole RBS and Lloyds to come in, and set up a firstclass operation. But the toughest job will be to ensure his agency can be wound down when markets recover.

Verisk’s $1.8bn IPO looks like risk worth taking

24 Sep 2009

The initial public offering of Verisk Analytics is the biggest US float this year. It s also one of the most attractive. Not only is it a solid, growing and defensible business but the insurance companies that own Verisk are eager sellers because they need the cash.