Investment Banking

Viewsroom: UBS gets lost in translation

20 Jun 2019

A star economist at the Swiss bank sparked outrage on Chinese social media after his remarks about the country’s pigs were misconstrued. UBS’s decision to put him on leave seems overdone. And: Those weighing the benefit of a Facebook cryptocurrency must ask if “In Zuck we trust.”

Debt debacle throws Natixis’ strategy off course

20 Jun 2019

The French lender’s shares fell 12% after Morningstar dropped ratings on one of its funds due to hard-to-trade bonds. That overstates the likely loss of earnings. The risk is that client withdrawals hurt CEO François Riahi’s plan to grow in areas other than traditional banking.

CEO protest vote would create a new Nomura problem

20 Jun 2019

Adviser ISS wants shareholders to punish Koji Nagai at an upcoming annual meeting. He has presided over the bank’s first full-year loss in a decade and an embarrassing leak, and has not fixed bigger strategic issues. The trouble will be finding a replacement better able to do so.

CLSA exodus leaves owner Citic with an empty shell

20 Jun 2019

The brokerage's star analysts are being poached by rivals like Credit Suisse and Jefferies. They take with them much of the brand value China's Citic Securities paid $1.3 bln for in 2013. Such mergers are always tough. But the state-owned group missed opportunities to do better.

Nordic banks’ soft regulators invite U.S. wrath

19 Jun 2019

Shares in Danske and Swedbank have fallen sharply due to concerns about American probes into money laundering. A $900 million fine by Dutch regulators helped ING escape U.S. ire for similar breaches. Laws limiting penalties in Scandinavia mean banks there may not be so lucky.

Now is the time to buy Deutsche Bank

17 Jun 2019

The German lender’s market value has shrunk to 13 bln euros, or about 20% of tangible book value. The retail lending and fund management units alone justify a higher price. If boss Christian Sewing can shrink the investment bank without major stumbles, the shares will rebound.

UBS sets a troubling precedent in China

17 Jun 2019

The Swiss bank put economist Paul Donovan on leave after misconstrued comments triggered outrage in the mainland. Local rivals fed the unwarranted flare-up. The episode hints at new pressures for outsiders in the country; excessive subservience, however, creates bigger headaches.

China audit crackdown is a Wall Street nightmare

13 Jun 2019

U.S. Senator Marco Rubio wants to force mainland companies listed on American exchanges to submit to local oversight - or leave. The problem is real. But torching shares with a market value of roughly $1.8 trln and millions in fees is a heavy price to pay for transparency.

Cox: Bruno Le Maire’s an awesome investment banker

6 Jun 2019

That’s one explanation for France’s finance minister torpedoing the $35 bln Fiat-Renault merger, if he now revives it with Paris at the wheel. More likely he’s mimicking President de Gaulle - who roughly expropriated the carmaker after the war - and doing France no favours.

Wells Fargo CEO hunt is chicken-and-egg dilemma

6 Jun 2019

The scandal-racked U.S. lender may make its interim chief permanent, a suggestion it can’t find an outsider to take the job. Wells Fargo needs a strong boss to mend regulatory fences – but with so much hostility, it may be hard and expensive to get someone who fits the bill.

Hedge funds see honey in Japan’s value traps

31 May 2019

The Land of the Rising Sun dominated Hong Kong’s Sohn gathering. Many see signs of unjustified panic in slumping equities this year, creating opportunities to buy low. But even optimists highlight the cash hoarding and slack governance that have long scared investors away.

Goldman beats path to new Wall St hunting ground

13 May 2019

The firm is courting an investment adviser in what would be its largest deal since the financial crisis. United Capital’s $23 bln in assets are a drop in the bucket for Goldman Sachs, but bring the kind of predictable earnings that boss David Solomon wants. He’s not the only one.

Bank of America brings high M&A hopes to oil patch

8 May 2019

Its bankers are so keen for client Occidental to prevail with its $38 bln offer for rival Anadarko that chief Brian Moynihan personally called Warren Buffett for help. After losing ground for a decade, BofA’s dealmakers and their new boss Matthew Koder could use the boost.

Macquarie can keep its edge over Wall Street

3 May 2019

The first full-year results under Shemara Wikramanayake included an impressive 18 pct return on equity. Macquarie cautions things may cool off, but commodities and infrastructure are hot, and play to its strengths. Trading at some 2.5 times book value means expectations are high.

BNP requires more than one-off trading boost

2 May 2019

The French lender enjoyed a 3 percent jump in investment banking revenue in the first quarter, implying CEO Jean-Laurent Bonnafé gained market share from peers. But he will only convince sceptical investors that he will hit his 2020 return target if he can maintain such growth.

Deutsche feels chill wind of conscious uncoupling

26 Apr 2019

A day after the German bank ended Commerzbank merger talks it reported a 1.3 pct first-quarter return. Cost cuts at least broadly kept pace with falling revenue. Yet poor performance and zero deal synergies mean even a lowball 4 pct return target is not in Deutsche Bank’s gift.

Barclays bolsters devil-you-know retort to Bramson

25 Apr 2019

The UK bank’s traders made a 9 pct return in the first quarter. They’re still not earning their keep, but the result shows the merits of a broad investment bank. That, and a pledge to prune bonuses, may help investors resist the upheaval touted by activist Edward Bramson.

Nomura’s star rainmakers face a drier spell

25 Apr 2019

The $13 bln bank’s Japanese advisory arm had a blowout year, a bright spot in otherwise dismal earnings, thanks to mandates for SoftBank and Takeda. Yet cost cuts abroad, uncertainty around deals like Toshiba Memory's IPO and an apparent snub by Japan Post could tarnish 2019.

Credit Suisse’s Thiam needs more than self-help

24 Apr 2019

The Swiss bank’s profit rose in the first quarter, helped by falling costs. But a 4 pct revenue decline makes it harder for CEO Tidjane Thiam to hit his 10 pct return-on-equity target unless the top line recovers. That requires calm markets, and a more profitable investment bank.

JPMorgan’s CEO parlour game is far from over

18 Apr 2019

Putting finance director Marianne Lake in charge of consumer lending is an unsubtle hint about who might one day replace Jamie Dimon. She makes for a solid succession candidate. A lot can happen at a mega-bank in four years, though. Hot-seats have a way of becoming jump-seats.