Breakingviews

Euro is poor yardstick for euro existential stress

June 22, 2015

The Greek crisis is compromising FX traders’ reputation for being the first and fastest to react to big news. Currency market signals are currently so muddied that stocks and bonds are better barometers of investors’ views on how close Athens is to default or euro exit.

Subject financial fiefs to modern Magna Carta

June 15, 2015

Companies in the 21st century can learn from 13th century England. Overmighty, overpaid CEOs are the new King Johns. They are held to account, sort of, by the barons of fund management. What’s needed is more respect for finance’s neglected yeomanry: ordinary savers.

HSBC in 2020: An imagined letter to shareholders

May 15, 2015

Moving its head office to Shanghai marks a new era for the bank, writes chairman Hank Paulson in a make-believe memo. However, despite escaping hostile regulators in the aftermath of Britain’s divorce from the European Union, HSBC faces many challenges, both familiar and new.

ECB’s bank board-crashing makes sense – to a point

May 7, 2015

The euro zone’s financial stability gnomes will observe board meetings. Handled right, the ECB should glean extra insight – after all, corporate culture starts at the top. But regular sessions with board committees may reveal more about how Frankfurt’s 123 charges really operate.

HSBC revival overshadowed by existential questions

May 5, 2015

Better investment banking revenue and fewer bad loans boosted the $194 bln bank’s quarterly results. That’s a welcome respite from the Swiss tax furore. Still, long-term fortunes rest on decisions about its shape, head office location and UK business. None will be resolved soon.

Review: Hank Paulson’s kiss-and-don’t-tell China guide

May 1, 2015

The former U.S. Treasury secretary paints a world where noble Chinese officials beg straight-talking American bankers to help get their finances in order. Some things have changed. What hasn’t is that contacts are everything, and that killer details are always left unspoken.

M&A predators stalk Michael Milken’s ball

April 29, 2015

The financial elite prowling Beverly Hills at the behest of the former Drexel Burnham boss worried about everything from China to cybersecurity to stock valuations. Three former Treasury chiefs lamented a lame Washington. When it came to deals, however, animal spirits ran wild.

Deutsche Bank revamp puts capital ahead of returns

April 27, 2015

Exiting Postbank, and cutting 200 bln euros of investment bank assets and 3.5 bln euros of costs, is what the German lender needs. A 5 pct leverage ratio goal is also higher than expected, raising the bar for European rivals. But it means investors face a wait for decent returns.

Europe’s credit boom locks in mediocre returns

April 16, 2015

Investors are throwing money at European companies. Carrefour and Danone paid little over 1 pct a year to borrow for a decade; Novartis got 20-year funds at similar levels. A Breakingviews calculator shows how bond buyers’ generosity could backfire.

Silicon Valley trials start as sexism lawsuit ends

March 29, 2015

Venture capital firm Kleiner Perkins beat gender discrimination allegations, but the likes of Facebook and Twitter face similar lawsuits. The court of public opinion also has yet to deliver its verdict. Scrutiny of how the tech world treats women is just getting under way.