Neil's Feed
Jul 10, 2013
via Breakingviews

Higher volatility is the new normal in credit

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By Neil Unmack

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

Higher volatility is the new normal in credit. For investors, it means the return of real winners and losers.

Jul 2, 2013
via Breakingviews

Cyprus bond swap is good publicity, bad economics

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By Neil Unmack

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

The creditor banks of Cyprus “voluntarily” exchanged 1 billion euros worth of sovereign debt at cheap rates. That lowers the bailout bill for the euro zone, but the burden fell unevenly on the country’s banks. Exchanging all creditors’ debt would have been fairer – but messier.

Jul 2, 2013

Breakingviews- Cyprus bond swap is good publicity, bad economics

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

By Neil Unmack

LONDON, July 2 (Reuters Breakingviews) – The creditor banks
of Cyprus “voluntarily” exchanged 1 billion euros worth of
sovereign debt at cheap rates. That lowers the bailout bill for
the euro zone, but the burden fell unevenly on the country’s
banks. Exchanging all creditors’ debt would have been fairer -
but messier.

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 14, 2013
via Breakingviews

World’s oldest bank limps into 21st century

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By Neil Unmack

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

The world’s oldest bank is limping into the 21st century. Banca Monte dei Paschi di Siena’s stock jumped after the Italian bank proposed removing the voting rules favouring the foundation that is currently its majority owner. The move will help the stricken lender to attract new capital. All it needs now is a buyer.

Jun 13, 2013
via Breakingviews

Europe tries to skirt both chaos and complacency

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By Neil Unmack and Olaf Storbeck

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

The two engines of the euro zone bond rally are sputtering. Rising yields on risk-free debt are hitting one, and the German constitutional court hearing has thrown a little sand in the other. But a tougher ride for peripheral debt is not necessarily all bad.

Jun 5, 2013

Man Group needs to address stock volatility

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

By Neil Unmack

LONDON, June 5 (Reuters Breakingviews) – Man Group’s (EMG.L: Quote, Profile, Research)
shareholders thought the worst was over. AHL, the
computer-driven fund that is the hedge fund manager’s main
profit engine, had recovered almost to the point where it could
earn performance fees again. But recent volatility in the U.S.
Treasuries market has dragged AHL down 13 percent below this
so-called high watermark. The revelation pushed Man shares down
12 percent in one day.

May 29, 2013
via Breakingviews

Europe yields to reality on austerity

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By Neil Unmack

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

The battle between growth and austerity in the euro zone is over. Nobody won.

Austerity is certainly taking a backseat. The European Commission will use its annual economic recommendations on Wednesday to signal a slower pace of fiscal tightening across the euro zone. That will reinforce the two-year leeway Brussels has already signalled it will give the region’s biggest fiscal offenders, Spain and France, to bring deficits down to the target of 3 percent of GDP.

May 1, 2013

BBVA’s hybrid hit is bet on health of Spanish bull

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

By Neil Unmack

LONDON, May 1 (Reuters Breakingviews) – A bank from the euro
zone’s debt-challenged periphery has been the first to issue a
new breed of loss-absorbing bonds. It is proof that central
bank-whipped bondholders, shrugging off the euro crisis, are
desperate for yield. A 9 percent coupon looks juicy, but it pays
investors less than equity, with no upside.

Apr 18, 2013
via Breakingviews

Bank hierarchy of pain could become a hydra

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By Neil Unmack

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

Who should lose money when banks fail? Talk of making deposits senior to bondholders might reassure savers rattled by losses in the Cyprus bailout, and avoid bank runs. But it could lead to unhealthy arbitrage between loans and deposits. Vigilance is needed, and lots of “bail-in-able” capital.