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Sep 1, 2011

Breakingviews-Underwriters’ caution weakens Greek bank deal

By Margaret Doyle

LONDON, Sept 1 (Reuters Breakingviews) – Investment banks
are hesitating about underwriting Alpha and Eurobank’s 1.25 bln
euro capital hike. The share issue carries unusual risks given
the difficulties facing Greece and its lenders. But if the
experts are struggling to price the risk, other investors won’t
be inspired.

Full view will be published shortly.

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Aug 11, 2011
via Breakingviews

Investment bank cull won’t protect survivors’ pay

By Margaret Doyle
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Bankers who escape the summer cull won’t escape the pain. While they will get a bigger share of the bonus pie for this year, it seems clear that the pie itself, and their slice of it, will be much smaller.

Jul 25, 2011

Joe Ackermann shouldn’t be Deutsche Bank chairman

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

By Margaret Doyle

LONDON (Reuters Breakingviews) – Josef Ackermann looks like he is finding it hard to bid Deutsche Bank farewell. The chief executive postponed his departure once and is now being urged to chair the supervisory board. Ackermann would be wrong for the job. A chairman should support management. But Ackermann has already sought to undermine Anshu Jain, who currently looks like he will be one of two co-chief executives. And his interference over the succession suggests that he could be the worst sort of back-seat driver.

Jul 1, 2011
via Breakingviews

Lloyds chief banks on cuts to fund growth

By Margaret Doyle The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Antonio Horta-Osorio is applying the medicine he successfully administered at Santander UK to Lloyds. The lender’s new chief executive used his first strategy update to unveil plans to slash costs by 1.5 billion pounds by 2014. This, combined with the absence of further bad loan shocks, gave Lloyds shares a boost. But it’s less clear how the bank will generate future growth.

Jun 2, 2011
via Breakingviews

For Deutsche’s i-bank to succeed, rivals must fail

By Margaret Doyle
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

LONDON — Anshu Jain has an answer for investors worried about how investment banks generate decent returns while holding more capital. Deutsche Bank’s investment banking chief reckons the division can deliver a pre-tax return on equity of 20 percent to 25 percent even after tough new rules are introduced in 2013. But the plan depends on Deutsche winning market share in areas like equities and commodities. And its rivals have similar ambitions.

Feb 14, 2011
via Breakingviews

Swiss make life a bit more difficult for despots

By Margaret Doyle
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

LONDON — Switzerland has just made life a bit more difficult for despots. The country’s decision to freeze assets belonging to Hosni Mubarak after he was ousted smacks of hypocrisy: after all, the former Egyptian president and his family have long been suspected of enriching themselves at the country’s expense. But in the absence of a global deal to stop heads of state from exporting the spoils of office, Switzerland’s approach is better than nothing.

Jan 17, 2011
via The Great Debate UK

English divorce law is recipe for financial strife

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

It’s hard to feel sympathy when millionaires divorce. But after some mega-payouts in recent English court cases, a review of the law is welcome. While marriage isn’t a business transaction, the wealthy in particular could benefit from being able to agree legally enforceable pre-nuptial agreements.

Jan 14, 2010
via Breakingviews

Europe’s banks will suffer less from U.S. tax

– Margaret Doyle and George Hay are Reuters Breakingview columnists. The opinions expressed are their own. —

European banks should suffer less than their American counterparts from the Obama administration’s proposed bank tax. The president’s proposed levy on banks’ wholesale funding requirements will hit all banks with a big presence on Wall Street. But assuming that U.S. banks will be taxed on their worldwide operations, the levy will hurt them more. This could be a major bonus for European investment banks — as long as their own governments don’t follow suit.

Sep 25, 2009
via Breakingviews

HSBC goes back to its Hong Kong roots

HSBC’s decision to move chief executive Michael Geoghegan to Hong Kong is the latest sign the Anglo-Chinese bank is returning to its Asian roots. While chairman Stephen Green insists that there is “absolutely no question of HSBC pulling away from London”, the temptation to make itself more Chinese in the world’s most-exciting market cannot long be resisted.
The move may be largely symbolic for a jet-setting executive like Geoghegan, but it signifies that the bank sees its future in the East, where it started in 1865. HSBC became the first non-Chinese bank to issue a yuan-denominated bond earlier this year, and is hoping to become the first non-Chinese company to issue shares on the Shanghai bourse.
However, while HSBC is trying to present this as part of its ongoing long march back to its roots, the shift from its strategy of the past decade cannot be understated. For much of the 1990s, HSBC’s focus was on expanding in Europe and the United States. Indeed, it only moved its headquarters to London as a condition of its takeover of Midland Bank. That was followed by acquisitions in France and the U.S., culminating in the disastrous takeover of consumer finance group Household.
Under the current chairman, Stephen Green, HSBC has publicly abandoned its ambitions to be a global universal bank in favour of concentrating on its emerging market roots. Moving Geoghegan to Hong Kong underscores this intent.
In the short term, this will involve some nimble footwork with regulators. The Financial Services Authority, which tends to demand that key decision-makers of banks it regulates are based in London, has been kept sweet with the promise that Green and finance director Douglas Flint will continue to be based in the bank’s head offices. London-based Stuart Gulliver, who runs HSBC’s investment banking division, has also been given expanded responsibilities.
Nevertheless, this may prove difficult to sustain in the longer term — particularly if Green is eventually replaced by a non-executive chairman, as shareholders have demanded.
By taking over as chairman of HSBC’s business in Hong Kong, Geoghegan is also shunting aside Vincent Cheng, that bank’s first Chinese chairman. Cheng, along with Peter Wong, another Hong Kong native, will now spearhead HSBC’s push into the mainland. Nevertheless, HSBC will need more of a cultural revolution if it really wishes to be — and to be seen as — a true citizen of the Middle Kingdom.

Sep 8, 2009
via Breakingviews

$1,000 gold could soon lose its shine

The price of gold has broken through $1,000 an ounce for the first time since February’s brief intraday peak. The yellow metal is traditionally seen as a counterweight to dollar weakness and a safe haven in troubled times. Clearly not every investor believes the bullish narrative underlying the past six months’equity-market rally.

There have been a couple of triggers for gold’s current strength. After rallying strongly from December through early March, as equity markets went into meltdown, the dollar has fallen back sharply.

    • About Margaret

      "Margaret Doyle is a Reuters Breakingviews columnist, based in London. She writes about investment banking. She has been a journalist for over 14 years. She has written for The Daily Telegraph and The Economist and presented various radio programmes for the BBC. She began her career as a consultant at McKinsey & Co. She has an economics degree from Trinity College, Dublin and an MBA from Harvard Business School, which she attended as a Fulbright scholar. She is a Conservative Member of Westminster City Council."
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