Politics

Brexit transition deal offers Lloyd’s scant cover

15 Dec 2016

The London insurance market is pushing ahead with the launch of a subsidiary that could conduct EU business after Britain leaves the bloc. Lloyd’s of London is not waiting to see whether politicians can secure extended access to the single market. Banks may take a similar view.

New president may force hawkishness on 2017 Fed

14 Dec 2016

The central bank nudged interest rates up again after a year's pause. Janet Yellen and colleagues previously sounded cautious but that was before the Trump bump. If bond yields, inflation and stock prices continue to rise, the Fed will be under pressure to make quicker increases.

Brazil’s Temer puts country on knife’s edge

14 Dec 2016

The unpopular leader has won a key victory, securing constitutional reform to cap public spending for the next 20 years. That's necessary but insufficient if he is to fix Latin America's largest economy. Pension reform will be harder, though, and a corruption probe spells danger.

Small step for some is giant leap for Uzbekistan

14 Dec 2016

The landlocked central Asian country has poor human rights and low foreign investment. But new President Shavkat Mirziyoyev has made encouraging changes, like restoring air links with Tajikistan and scrapping visas for some foreigners. There is far to go, but it’s a start.

Tech needs to speak the president-elect’s code

13 Dec 2016

Most major Silicon Valley CEOs have heeded the call to Trump Tower. They may be expecting a browbeating, a deal for tax cuts – or both. Their real task, though, is to convince a hostile audience that they – and open societies – create wealth, jobs, security and power.

Brexit transition may ease not remove uncertainty

13 Dec 2016

UK Chancellor Philip Hammond sensibly wants banks to have continued access to Europe's single market after Britain's departure to protect financial stability. That would give them longer to make alternative plans - but also risks prolonging doubts about the final arrangements.

UniCredit’s bankers should avoid 2012-style panic

13 Dec 2016

The Italian bank's 13 bln euro cash call is almost double its capital raising five years ago, which nearly imploded. The current one also takes place in the teeth of domestic political upheaval. Yet today's UniCredit is healthier. Underwriters needn't end up holding the baby.

UniCredit detox is key moment in Italy bank reboot

13 Dec 2016

A cost cull, bad debt purge and mega-cash call mean the country's biggest bank merits a much higher valuation. The risk is that investors see smaller Italian peers as weak in comparison. Yet with the top two banks solid and MPS being sorted, cleaning them up is less daunting.

Italy’s next PM is a Five Star gift for populists

12 Dec 2016

Paolo Gentiloni has to fix the banks, sort out voting rules and steer the country to elections. A replacement for Matteo Renzi is better than a vacuum. But given the new leader is from the same party, doing too good a job might just hand power to the populist 5-Star Movement.

Beijing seeks applicants for Hong Kong’s worst job

12 Dec 2016

Special Administrative Region seeks competent and charismatic chief executive. Goals: reassure a rattled finance industry, tame crazed property prices and make peace with a protest movement. And somehow not look too much like Beijing's agent. Anyone?

Trump’s stock sales earn at best a “hold” rating

9 Dec 2016

He says he unloaded his portfolio to avoid conflicts of interest. The June decision also coincided with a cash crunch for his campaign, meaning it may have been a pair trade that paid off. Trump's commitment to ethics will be clearer if he divests his main business holdings.

Italy: stop dawdling, bail in Monte dei Paschi

9 Dec 2016

Rome is trying to keep a 5-bln-euro rescue of the stricken lender on the road. The best way to do so is to let retail investors take some of the losses. Protecting them from their just deserts will mess up future European bank rescues, and not just in Italy.

Breakdown: Park impeachment leaves Korea in limbo

9 Dec 2016

The National Assembly ousted President Park Geun-hye amid a corruption scandal. Though politicians swiftly made the historic move, clouds will still linger over the Korean economy and markets. A court can shoot down the bill after a lengthy review. Overseas risks also abound.

China will show Trump more carrot than stick

9 Dec 2016

The People's Republic likes to test out new U.S. presidents. Its response to the TV tycoon’s early tantrums, however, hints at a more measured approach. China will try to avoid provoking Trump on currency and military issues, but take a harder line on investment and trade.

Cox: Public company capitalism meets its match

8 Dec 2016

Donald Trump is challenging the ideals that have guided U.S. capital markets and corporate behavior for a generation. If it forces boards to reconsider the broader impact of their actions it may be a good thing. More likely, it will usher in an age of cronyism and quid pro quos.

China gets a good cop as Trump’s primary emissary

8 Dec 2016

The president-elect mollified Beijing with his ambassador pick. The selection of Iowa Governor Terry Branstad, who has personal connections with Xi Jinping, calms waters troubled by Trump's tough talk. As other hardliners are brought in, Branstad will need to pack a surfboard.

UniCredit Polish exit tinged by seller’s remorse

8 Dec 2016

The Italian lender will sell a third of Bank Pekao to two Polish state-controlled entities. UniCredit needs capital, may share the upside via a sale of equity-linked paper, and Warsaw's hatred of foreign capital is a spur. Still, at 1.4 times book it's cheap versus some peers.

Renzi has time for one last gamble

8 Dec 2016

Despite resigning as Italy’s prime minister after losing a referendum, there’s a way back for Matteo Renzi: a quick election. That could pit him against the 5-Star Movement, which wants a vote on the euro. Renzi may still have enough support to win, but would need to move fast.

Trump’s grain of truth makes biotechs vulnerable

7 Dec 2016

The U.S. president-elect said he dislikes what has happened to drug prices, and pharma stocks slumped. Hillary Clinton's views once carried similar weight. That's because the jabs are justified. Investors know there's too little innovation and too much reliance on raising prices.

MPS solution requires further bondholder sacrifice

7 Dec 2016

The Italian bank has secured a fifth of the 5 billion euros it needs in new equity by turning some bonds into shares. The priorities are to protect retail depositors and attract outside investment. Institutional investors, and Brussels, will both have to give a little.