Review: Money, theft and death in Putin’s Russia

March 6, 2015

Bill Browder's grandfather was an American communist. The grandson ran a hedge fund which profited during the chaos under Boris Yeltsin. But Browder did not reckon with the hard men of the Putin regime. His book offers some sobering lessons for investors in emerging markets.

UK retreat from RBS is more important than value

March 6, 2015

Chancellor George Osborne now wants to return the bank rapidly to private hands after May’s election. Both strategy and governance have been flawed. Britain is wary of starting to reduce its 79 pct stake at a loss. But that’s a price worth paying to put RBS on a stable footing.

Carlos Slim buys Spanish real estate on the cheap

March 5, 2015

The Mexican tycoon bought a 25 pct stake in property firm Realia at a discount and is eyeing a takeover. He is also the biggest shareholder of builder FCC, which in turn owns major stakes in Realia and Cementos Portland. Slim effectively controls all three. Minorities beware.

Actavis sale dresses up barely investment grade

March 4, 2015

The acquisitive drugmaker attracted huge demand for $21 bln of bonds one notch above junk. They yield 1.75 percentage points over U.S. Treasuries, less than Verizon’s bigger, better-rated issue did in 2013. Buyers of top-tier debt can’t help but keep looking further downward.

Trust Citi to win from losing most profitable unit

March 3, 2015

The U.S. mega-bank has at last offloaded OneMain to rival Springleaf for $4.25 bln. The subprime unit’s 6.7 pct return on assets far exceeds anything else at Citi. And yet the deal provides a one-off income boost, frees up capital, accesses tax breaks and removes a distraction.

Barclays’ trading woes offset pay restraint

March 3, 2015

The UK bank has cut investment bank bonuses by a quarter, atoning for a PR gaffe last year when pay rose despite a drop in profit. But 2014 results show returns in the unit are also lower. To maintain its turnaround, Barclays may have to shrink the misfiring division further

StanChart board clearout is only the first step

February 26, 2015

Installing Bill Winters as CEO to replace Peter Sands ends the short-term uncertainty about the bank’s leadership. But the former JPMorgan executive will face an overflowing inbox when he takes charge in June. Capital, credit quality and returns will be the immediate priorities.

JPMorgan optimism reinforces industry mediocrity

February 25, 2015

Jamie Dimon and crew reckon growth, cost cuts and new fees can boost earnings 43 pct and help silence talk of a breakup. Trouble is, the bank’s 2017 target puts tangible ROE at just 15 pct. That’s not bad but underscores what an unimpressive investment big banking has become.

UK jail-a-banker rules will hike board pay

February 25, 2015

That’s the likely upshot of Britain’s new regime to hold financiers accountable for wrongdoing. Regulators have stopped short of applying the rules to all non-executives, but half of most boards still risk incarceration. As a result, they will probably demand more money.

London’s FTSE can extend its record-breaking run

February 24, 2015

At long last, Europe’s big name equity index has entered new territory. Yet while the FTSE 100 is higher than ever, and is hardly risk-free, it is also attractive. It is cheaper than the leading U.S. and pan-European benchmarks and has alluring diversity.