Investment Banking

Capital Calls: UBS Russia risk

27 Sep 2023

Concise views on global finance: The Swiss bank’s value fell by $3 bln after Bloomberg reported that the US Department of Justice is investigating the recent acquisition of Credit Suisse over possible compliance failures.

Hong Kong bankers play an anxious waiting game

26 Sep 2023

Fewer IPOs in the city mean firms such as UBS and Bank of America are more willing to handle middling transactions like Tuhu’s $150 mln offer. But as big deals stir in New York and beyond, the downsizing increasingly will look like an awkward stopgap for Wall Street.

Nomura is merely first in line for new China risk

25 Sep 2023

Charles Wang Zhonghe, the firm’s Hong Kong-based chair of investment banking for the People’s Republic, is barred from leaving the mainland. Overseas banks committing to bulk up in the country may no longer be able to avoid the effects of President Xi Jinping’s crackdowns.

Ukraine war gives wings to India bond index debut

22 Sep 2023

JPMorgan will add the country’s sovereign debt to its emerging market index, easing concentration issues following Russia’s exclusion. It drags foreigners into a $1 trln market. New Delhi sees new gains from opening but it may have to bend on taxes and more to win wider backing.

Lazard’s new CEO dares to evoke Bruce Wasserstein

14 Sep 2023

Peter Orszag aims to double revenue to about $5 bln by 2030 while delivering at least a 10% annual shareholder return. The firm’s recent history suggests the plan is bold. But it’s as good a time as any to heed the advice its former boss famously gave clients: “Dare to be great.”

Capital Calls: British wages

12 Sep 2023

Concise views on global finance: UK pay rose by an annualised 8.5% in the three months to July – more than inflation. That’s good for retirees, whose pensions will rise by that amount. But such a hot labour market is likely to prompt the Bank of England to hike rates next week.

Asia’s richest banker makes a meal of succession

4 Sep 2023

Uday Kotak has quit early as CEO of his $43 bln lender. He seems to be pitching it as a way for Kotak Mahindra Bank to appoint a replacement free from his interference. But he’s on the board and the firm’s biggest shareholder. And his legacy is tied to whoever takes his spot.

UBS cost-cut gains are a double-edged sword

31 Aug 2023

Boss Sergio Ermotti will keep Credit Suisse’s domestic unit, and hopes to slash $10 bln through the merger. His higher savings target easily offsets the hit from vanishing revenue as clients flee the acquired bank. The risk is that Swiss politicians think UBS’s deal is too sweet.

With housing, Buffett chooses a great location

30 Aug 2023

The billionaire’s Berkshire Hathaway recently backed US homebuilders such as Lennar even as mortgage rates rose. Although Americans will pay more in interest, higher wages can make up the difference. Plus, existing home sales have ground to a halt. Builders are in prime position.

UBS inherits tricky wealth legacy in Asia

29 Aug 2023

By gobbling up Credit Suisse, Sergio Ermotti is expanding his bank’s clout in serving the Asian super-rich. Yet exposures to risk-taking entrepreneurial clients used to big leverage pose a challenge. Regaining the wealth ground lost by its Swiss rival will also not come cheap.

Beware the hedge fund deal that’s not about money

23 Aug 2023

Bill Ackman, Marc Lasry and Boaz Weinstein want to buy Sculptor, which manages $34 bln. Instead, Daniel Och’s former shop accepted a lower bid from real estate investor Rithm. Sculptor’s doubts about the moguls’ funding sounds fishy, as does the idea they couldn’t work it out.

Unused safety net gives UBS best of both worlds

11 Aug 2023

The Swiss bank scrapped $10 bln of government insurance against losses from rescuing Credit Suisse and repaid emergency central bank loans. Turning down the political heat gives CEO Sergio Ermotti more scope to cut costs. Yet the state remains on the hook for any future problems.

Capital Calls: Uber’s road trip to redemption

1 Aug 2023

Concise views on global finance: The $95 bln ride-sharing firm notched its first operating profit and more than doubled free cash flow, but its valuation is lagging.

Europe’s listless IPOs are red flag for big floats

31 Jul 2023

The region’s string of mostly mid-sized initial public offerings this year are now just 3% above their listing price on average. Such poor performance will make investors wary of backing new ones. That will give larger float candidates, like CVC and Galderma, pause for thought.

Barclays CEO fiddles while valuation droops

27 Jul 2023

Despite earning adequate returns, the $32 bln UK bank has long traded at a big discount to rivals. Boss C. S. Venkat’s plan so far boils down to more of the same. Without clearer targets to move capital out of investment banking, the shares risk remaining stuck in the doldrums.

Goldman is losing Wall Street’s popularity contest

19 Jul 2023

Own goals dragged the investment bank’s return on equity down to 4% in the second quarter, half of Morgan Stanley’s level. Though Goldman Sachs still rules markets, its relative valuation has sagged under CEO David Solomon. He lacks his rival’s bold plan to win over investors.

Morgan Stanley and MUFG’s next act is well-timed

19 Jul 2023

The duo will collaborate on equities and currencies as their 15-year alliance evolves. With global interest in Japan driving up stocks as Tokyo toughens its stance on governance and amid a welcome return of inflation, the partnership will become even more the envy of its peers.

BlackRock’s Aramco embrace makes sense in a vacuum

18 Jul 2023

The $109 bln asset manager added the state-owned Saudi oil giant’s CEO Amin Nasser to its board. BlackRock boss Larry Fink may invite a political firestorm at home, but he needs a competitive advantage. Diversity of opinion helps, as does the ability to unlock new investments.

Research U-turn is poor fix for vanishing stocks

18 Jul 2023

The UK and EU may let investors pay for equity analysis through trade commissions again. The hope is that this will lead to more research and help small firms list. Yet asset managers will fear higher costs, and the IPO market faces bigger headwinds than a writeup shortage.

Citi cheers into the valuation void

14 Jul 2023

Even amid shrinking revenue and weak markets, CEO Jane Fraser is thumping the pulpit on the bank’s turnaround, sticking by a target of an 11% return on tangible equity. One problem is that investors don’t seem to believe it; the other is that rivals are already getting far more.