Lauren's Feed
Oct 4, 2012

Analysis: Big funds seek to rein in pay at Wall Street banks

By Lauren Tara LaCapra and Dan Wilchins

(Reuters) – The days when Wall Street banks could blithely hand out half their revenue in compensation to their staff without a murmur from shareholders have come to an end.

In an era of leaner times and tighter regulation, big mutual funds and pensions are growing more vocal in pushing executives at investment banks to rein in pay and bonuses and consider more staff cuts. Investors worry that bank employees are getting too big a piece of a shrinking pie, leaving shareholders a much smaller slice.

Sep 19, 2012
via Unstructured Finance

The new Goldman way: Less cushy compensation?

By Lauren Tara LaCapra

On a conference call to discuss Goldman Sachs’ new chief financial officer yesterday, an analyst asked departing CFO David Viniar why he was leaving when the stock is at a historic low.

Viniar avoided the question by joking that his successor, Harvey Schwartz, would trump that performance. But some investors think they have a better way to fix Goldman’s stock slump: cut back further on comp.

Sep 19, 2012

Goldman names new CFO, heralding end of an era

By Lauren Tara LaCapra

(Reuters) – Goldman Sachs Group Inc (GS.N: Quote, Profile, Research, Stock Buzz) has named senior trading executive Harvey Schwartz to replace David Viniar as chief financial officer, the latest in a series of executive shuffles as the investment bank prepares for a change in top management.

Schwartz, 48, is among a small group of executives who are considered potential candidates to take over as chief executive when Lloyd Blankfein, eventually steps down.

Sep 18, 2012

Goldman names Schwartz to CFO role as Viniar retires

Sept 18 (Reuters) – Goldman Sachs Group Inc’s
longtime chief financial officer, David Viniar, will retire at
the end of January and be replaced by Harvey Schwartz, the
current global co-head of securities, the investment bank said
on Tuesday.

Schwartz, 48, joined Goldman in 1997 from Citibank and is
among a small group of executives who are considered candidates
for the chief executive position when current CEO Lloyd
Blankfein eventually steps down.

Sep 18, 2012

Morgan Stanley infrastructure fund hit by Volcker rule

By Lauren Tara LaCapra and Greg Roumeliotis

(Reuters) – A U.S. regulation that limits how much of its own capital a bank can put at risk is causing headaches for Morgan Stanley as it prepares to raise a new multi-billion-dollar global infrastructure fund, people familiar with the situation said.

The regulation, called the Volcker rule, puts a cap on the amount of capital that Morgan Stanley (MS.N: Quote, Profile, Research) can pledge to the new fund. That means senior executives at Morgan Stanley Infrastructure Partners will have to make do with a smaller share of the fund’s profits, the sources said.

Sep 18, 2012

Exclusive: Morgan Stanley infrastructure fund hit by Volcker rule

By Lauren Tara LaCapra and Greg Roumeliotis

(Reuters) – A U.S. regulation that limits how much of its own capital a bank can put at risk is causing headaches for Morgan Stanley as it prepares to raise a new multi-billion-dollar global infrastructure fund, people familiar with the situation said.

The regulation, called the Volcker rule, puts a cap on the amount of capital that Morgan Stanley can pledge to the new fund. That means senior executives at Morgan Stanley Infrastructure Partners will have to make do with a smaller share of the fund’s profits, the sources said.

Sep 12, 2012

Morgan Stanley, Citigroup settle brokerage dispute

Sept 11 (Reuters) – Morgan Stanley agreed to buy the
rest of a brokerage joint venture from Citigroup Inc at a
lower-than-expected price valuing the business at $13.5 billion,
a win for Morgan Stanley although it faces challenges to boost
the operation’s profits.

The brokerage business was meant to stabilize Morgan
Stanley’s revenue during economic cycles but has not been nearly
as profitable as the investment bank had hoped. Costs have run
over and technology problems have dogged the joint venture since
its inception.

Sep 11, 2012

Morgan Stanley, Citigroup value brokerage at $13.5 billion

By Lauren Tara LaCapra and David Henry

(Reuters) – Morgan Stanley (MS.N: Quote, Profile, Research, Stock Buzz) has agreed to buy the rest of its brokerage joint venture from Citigroup Inc (C.N: Quote, Profile, Research, Stock Buzz) over time at a price that values the business at $13.5 billion, a victory for Morgan Stanley and far lower than the $22 billion that Citigroup had originally sought.

Under terms of the agreement, Morgan Stanley will buy another 14 percent of Morgan Stanley Smith Barney now, and will buy Citigroup’s remaining 35 percent stake by June 1, 2015. The deal is subject to regulatory approval.

Sep 11, 2012

AIG shares price at $32.50, cutting U.S. stake to 19 percent

By Lauren Tara LaCapra and Olivia Oran

(Reuters) – The Treasury Department’s $18 billion offering of American International Group shares priced at $32.50, an underwriter said, lowering the government’s stake in the bailed-out insurer to 19 percent.

The underwriters also have the option to buy another $2.7 billion worth of AIG shares, which they can exercise in the coming days. If they do, it would make the Treasury Department’s sale the largest secondary offering in the history of the U.S. stock market.

Sep 7, 2012

Goldman sees 20 pct return-on-equity possible -analyst

Sept 7 (Reuters) – Goldman Sachs Group Inc management
believes the bank can produce a return-on-tangible-equity of 20
percent under better operating conditions, Sandler O’Neill
analyst Jeffery Harte said in a report on Friday after meeting
with three senior bank executives.

The figure is far above the single-digit
return-on-tangible-equity figures the investment bank has been
producing lately, and it signals that Goldman executives have
become more optimistic about future results.