By Jane Merriman
LONDON, Aug 27 (Reuters) – Plans to make hybrid bond investors share the pain when banks run into trouble could polarise the financial sector into big firms that can afford to pay up for capital and smaller players that cannot.
Financial regulators want to ensure that taxpayers are not the only ones on the hook when banks fail by proposing that bonds that count towards a bank’s capital should be written down or converted to equity if it is close to collapse.
By Agnieszka Flak and Julie Crust
JOHANNESBURG/LONDON, Aug 24 (Reuters) – South Africa’s handling of two disputed mine right awards has damaged the resource-rich country’s reputation and raised investor concerns over transparency and governance.
Kumba Iron Ore, a unit of Anglo American, and Lonmin have said the government deprived them of mining rights when it awarded prospecting licences, some to people linked to high-ranking officials, over areas where the two mining giants operated.
NEW DELHI, Aug 23 (Reuters) – With India’s main opposition party continuing to object to bills on tax reform and opening up the $150 billion nuclear power market, several reforms proposed by the coalition government may be delayed.
The Congress Party-led coalition government has a slim majority in the lower house of parliament, but not in the upper house. The coalition is also composed of several small and fickle parties who are often suspicious of reforms, making the passage of bills in parliament subject to torturous negotiations.
If not passed, the bills can be taken up in the winter session, around November, but pending state elections from the end of the year could narrow the political window to push any controversial policies.
By Lisa Lambert and Joan Gralla
WASHINGTON/NEW YORK, Aug 19 (Reuters) – Municipal bond issuers are on high alert after the Securities and Exchange Commission charged the state of New Jersey with fraud for failing to disclose to bond buyers it had underfunded the state’s pensions.
The SEC move on Wednesday was groundbreaking for several reasons. It was the first time the SEC charged a state for violating federal securities laws. New Jersey agreed to settle the case.
It also highlighted the increasing attention the federal government is paying to those who sell municipal bonds, the tax-exempt debt that pay for roads, bridges, schools and hospitals.
By Dave Clarke
WASHINGTON, Aug 19 (Reuters) – The government’s $700 billion bailout of the financial system may still be politically toxic, but for those who voted for the program, there is some good news: the taxpayer bill continues to drop.
On Thursday, congressional scorekeepers projected the overall deficit impact of the Troubled Asset Relief Program — or TARP — will be about $66 billion.
By Al Yoon
NEW YORK, Aug 18 (Reuters) – In March of 2000, American homeowners got a scare.
Gary Gensler, a U.S. Treasury undersecretary, threw his support behind legislation whose impact could have jacked mortgage rates up to levels that would fly in the face of what lawmakers say is good for the nation: expanding homeownership.
He wanted Treasury to cut ties with Fannie Mae and Freddie Mac — companies whose federal charters make them the key vehicles for Washington’s housing policy and mortgage market intervention.
By Kevin Lim and Adrian Bathgate
SINGAPORE/WELLINGTON, Aug 17 (Reuters) – “Dark pools” and other alternative trading systems are not as big a threat to Asia’s bourses as they are for their western counterparts, given regulators’ reluctance to grant them a free reign and due to structural differences in markets.
Dark pools, so named because they represent large pools of “buy” and “sell” orders not visible to regular investors, operate relatively freely and match billions of dollars in stock transactions each day in the west.
By Emily Chasan
NEW YORK, Aug 15 (Reuters) – U.S. and international accounting rule makers are planning to propose an overhaul of lease accounting as soon as Tuesday, in a move expected to affect some $1.2 trillion in leased assets.
– Jeremy Boulton is an FX market analyst for Reuters. The opinions expressed are his own –
By Jeremy Boulton
LONDON, Aug 13 (Reuters) – The United States and China are again on collision course over the yuan, bringing the threat of protectionism and the potential to tip the world back into recession.
An export led recovery, or at least a recovery aided by a more competitive export sector, has been seen as an easier option than boosting demand for governments trying to shore up their economies.
By Steve Slater
LONDON, Aug 13 (Reuters) – Some of Europe’s banks are faced with the unusual problem of holding too much cash as they try to lift sluggish returns, and few will dare to eat into capital until well into 2011 amid an uncertain regulatory outlook.
A jump in profits may have prompted banks like HSBC and Barclays to talk about improving returns for investors, but the financial crisis is too fresh in the memory for regulators and bank bosses.
