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from Breakingviews:

Scots’ no to independence still leaves UK in limbo

By George Hay

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Scotland’s landmark decision to reject independence is not the end of British uncertainty. The 55:45 split, with almost all the votes counted early on Sept. 19, leaves the UK intact. But the terms of the unionist victory introduce tensions which could yet lead to a national division.

UK investors and companies will be relieved by the result. Almost a tenth of the UK’s population and its GDP will now stay put. The feared economic, financial and monetary disruptions of a split will not materialise. Scottish banks, including Royal Bank of Scotland, will probably stay in Edinburgh. They will continue to enjoy the support of the Bank of England, which will set its monetary policy with Scotland in mind.

The UK has also dodged a bullet politically. The continued presence of euro-friendly and Labour-voting Scots makes it less likely that Britain will leave the European Union, so-called Brexit. The odds of a defeat of the more euro-sceptic Conservative party in the 2015 election increase. Even if the party stays in power and holds its promised referendum, the with-Scotland UK is more likely to vote to stay in. And UK officials can devote more time to negotiating a better deal in Europe, rather than a Scottish divorce.

from Breakingviews:

Bayer’s plastic float sows seeds for one more sale

By Quentin Webb

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Bayer’s plastic float could sow the seeds for another sale. Investors added more than $5 billion to the German blue-chip’s $114 billion market capitalisation on Sept. 18, after it unveiled plans to float MaterialScience, its capital-intensive plastics and polymers business. Once again, investors are rewarding a company for adopting a sharper focus. A logical follow-up for Bayer Chief Executive Marijn Dekkers would be to quit agrochemicals and create a pure healthcare business.

from Breakingviews:

ECB’s trillion-euro race may start slowly

By Neil Unmack

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The latest parlour game in financial markets is guessing the size of the European Central Bank’s upcoming four-year targeted long-term liquidity operations (TLTROs): how many banks will tap the ECB, for how much?

from Hugo Dixon:

Capital markets union needs deregulation

By Hugo Dixon

Hugo Dixon is Editor-at-Large, Reuters News. The opinions expressed are his own.

One of the biggest projects for the next European Commission, which takes office in November, will be to create a “capital markets union.” President-elect Jean-Claude Juncker last week gave Britain’s Jonathan Hill the task of creating such a union “with a view to maximising the benefits of capital markets and non-bank financial institutions for the real economy.”

from Breakingviews:

Botin’s swashbuckling hid a conservative streak

By Peter Thal Larsen

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Emilio Botin transformed Santander from regional Spanish lender into global giant. He was a merger mastermind who usually got the upper hand. With slicked-back hair and red tie, he flew in a private jet, conferring with presidents and prime ministers as easily as bankers and chief executives. Yet unlike many of his peers during European banking’s boom years, Botin also had a cautious streak. It is that, rather than his swashbuckling style, which allowed him to keep his grip on Santander until his death at the age of 79.

from Global Investing:

Bleak investment outlook sours mood at Russia forum

By Alexander Winning

What are the chances that Western investors will rush back to Russia if a shaky ceasefire in Ukraine leads to a more lasting peace? Pretty slim, judging by a keynote speech at a recent Russia-focused investment conference in London.

Dmitri Trenin, director of the Carnegie Moscow Centre, told the conference organised by Sberbank CIB, the investment-banking arm of Russia's top state-controlled lender, there was little prospect of significant Western investment in Russia over the next 5 years:

from Hugo Dixon:

Gas and bank security have similarities

Europe is currently conducting two stress tests. One is on its energy suppliers, to see how badly they would fare if Russian gas was disrupted. The other is on euro zone banks, to ensure they are strong enough to finance economic recovery.

It is hard to know which of the two is the more important. But it is clear that an effective regime for energy security requires many of the same elements as financial stability.

from Breakingviews:

Euro has further to fall

By Swaha Pattanaik

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Euro zone inflation is too low, and economic activity sluggish. But at least one thing is going the European Central Bank’s way. Its hankering for a weaker currency will be fully gratified.

from Breakingviews:

LVMH, Hermes in five-year handbag peace

By Carol Ryan

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Bernard Arnault has conceded defeat. The LVMH chairman and controlling owner has agreed to distribute the stake he built up four years ago in rival Hermes to the shareholders of his luxury and drinks conglomerate. That’s an uncharacteristic retreat for the man dubbed “the wolf in cashmere.”

from Breakingviews:

Banks risk provoking EU with bonus get-arounds

By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Investment banks that are too successful in mitigating the impact of Europe’s new bonus curbs could be setting up another fight over pay. Most big banks are now paying so-called allowances to circumvent European Union rules, which bar firms from paying bonuses worth more than double base salary. If policymakers conclude that bankers are still wrongly paid, they could do something about it.

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