George's Feed
Jul 31, 2013

Dividend cut would help Santander and BBVA

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

By George Hay

LONDON, July 31 (Reuters Breakingviews) – The Bank of Spain
is being cruel to be kind to Santander (SAN.MC: Quote, Profile, Research) and BBVA
(BBVA.MC: Quote, Profile, Research). The Spanish regulator, backed by the International
Monetary Fund, recently urged its two largest charges to limit
cash dividends to 25 percent of net income for 2013. Although
first-half results and economic data suggest Spain’s two biggest
banks may not need this kind of nannying, the regulator is in
the right.

Jul 30, 2013
via Breakingviews

Barclays’ rights issue is worth supporting – just

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By George Hay

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

Barclays’ 5.8 billion pound rights issue is just about worth supporting. Just six months after a strategic revamp, the UK bank’s investors are facing a cash call to help address an unexpected 12.8 billion pound capital hole. They should stick around.

Jul 29, 2013

Breakingviews- Barclays learns that capital delays don’t work

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

By George Hay

LONDON, July 29 (Reuters Breakingviews) – Barclays (BARC.L: Quote, Profile, Research)
is the latest big bank to discover that a go-slow approach to
boosting capital just doesn’t work. The UK lender is finalising
a capital increase including a possible 5 billion pound share
issue, Reuters reports. That is in spite of stating in February
that it would bolster solvency over time through profit
generation and other measures. Regulatory caprice over capital
requirements is probably to blame for Barclays’ u-turn – but so
too is management’s lackadaisical approach to balance sheet
strength.

Jul 24, 2013
via Breakingviews

UK bank tsar is inconsistent, not zealous

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By George Hay

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

The main problem with UK bank regulation is inconsistency, not zealotry. Business Secretary Vince Cable, long the scourge of UK lenders, is now claiming that the demands of “capital Taliban” at the Bank of England are stopping banks from lending. But the real issue is regulators who don’t practice what they preach.

Jul 17, 2013
via Breakingviews

Barclays’ $453 mln power-trade spat looks lose-lose

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By George Hay

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

Barclays’ energy-trading spat is shaping up to be a real no-win situation for the UK bank. The U.S. Federal Energy Regulatory Commission (FERC) decided on July 16 not to budge from its contention that Barclays and four of its traders should pay a combined $453 million in fines for manipulating energy prices. Barclays strongly denies the charges. But even if the bank wins its case in court, the victory will be Pyrrhic.

Jul 15, 2013

Co-op creditors’ plan B could hurt just as much

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

By George Hay

LONDON, July 15 (Reuters Breakingviews) – Co-op Bank’s
(CPBB_p.L: Quote, Profile, Research) bondholders can salvage more value in the lender’s
restructuring. But more value isn’t always a better deal.

Jul 15, 2013

Banks dodge a bullet with transatlantic swap deal

(The authors are Reuters Breakingviews columnists. The opinions
expressed are their own.)

By Dominic Elliott and George Hay

LONDON, July 15 (Reuters Breakingviews) – A deal between
American and European regulators on derivatives has helped banks
dodge a bullet. Before a compromise hatched on July 11, the
Commodity Futures Trading Commission (CFTC) intended to force
swaps involving United States’ counterparties to be cleared in
America. That would have frozen cross-border flows and hammered
volumes by creating separate regulatory jurisdictions.

Jul 5, 2013
via Breakingviews

How regulators can restore trust in bank capital

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By George Hay

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

The Basel Committee just dealt another blow to the self-assessment of banking risk. This powerful group of global supervisors published new evidence on July 5 unmasking shortcomings in the models that tell lenders how much capital they need. For fans of the status quo, it makes gory reading.

Jun 28, 2013

Breakingview- New EU bail-in a great tool for previous crisis

(The authors are Reuters Breakingviews columnists. The opinions
expressed are their own.)

By George Hay and Neil Unmack

LONDON, June 28 (Reuters Breakingviews) – Europe’s shiny new
bank bail-in regime looks like the perfect tool for previous
banking crises. The agreement reached this week by European
leaders would force shareholders and creditors to swallow losses
of 8 percent of their bank’s liabilities in a future banking
crash. That would have spared euro zone taxpayers from pumping
in their own resources to protect most of their biggest banks in
2008. But it doesn’t provide a guarantee that public money will
never be used to rescue banks in the future.

Jun 27, 2013
via Breakingviews

EU bail-in rules give taxpayer partial protection

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By George Hay

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

European taxpayers are gradually being insulated from the risks taken on by their banks. An agreement reached in the early hours of June 27 by European Union finance ministers means that future bailouts will be financed to a greater extent by bank shareholders and creditors, rather than via public money. That represents significant progress.

    • About George

      "George Hay coordinates European financial coverage and writes about macroeconomics, the euro zone and UK/European financial policy. He covered European banks for Breakingviews during the financial crisis, and has also worked as a correspondent for AFX News and at United Business Media. He attended Edinburgh University and his work has been recognised at the UK’s Business Journalist of the Year Awards. Follow George on Twitter @gfhay"
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