Summit Notebook

Exclusive outtakes from industry leaders

from Funds Hub:

The morgue after Christmas

Around this Christmastide banks will begin to take a strict approach to companies running out of money, according to Simon Davies, managing director of The Blackstone Group.  

 

 

He said at the Reuters Restructuring Summit in London that by the end of the year banks will issue "in patient", "out patient" or "morgue" judgements as they go about the business to decide who gets much needed loans and who does not.

Christmas Carol singers

Christmas Carol singers

They will do it with the same inexorable cool as the Spirit of Christmas Yet To Come in "A Christmas Carol." And it looks like this character will be the only one borrowed from Dickens' tale of hope.

If Davies is right, the only Charles that will shape corporate events this winter will be Darwin rather than Dickens. Leverage per se will not be seen as a morgue attribute though -- it will be working capital flows that make or break a company.

Nomura: Lehman taking shape

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Nomura’s takeover of Lehman Brothers’ European and Asia businesses is yielding results, and concerns the Japanese bank will struggle to marry cultures is misplaced, according to the man who drove the deal.

“It’s a very successful start and we’ve been happy with what we’ve got,” Takumi Shibata, chief operating officer for Nomura, told the Reuters Japan Investment Summit in Tokyo.

Japan eyes UK takeover rules

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Japan’s takeover rules are destined to be shaken up — but probably not for some time.

The government wants to adopt Britain’s takeover rules rather than base policy on the U.S. model.

Bair: Resolution. Authority. Now.

    Congress needs to get off the dime and create a resolution authority that would break down failed institutions in an orderly manner, since the lack of such an authority is driving policy decisions,  according to Sheila Bair, head of the Federal Deposit Insurance Corp.
    Speaking at the Reuters Global Financial Regulation Summit in Washington,  Bair said that gap has fed into the too-big-to fail presumption and created a dilution in market discipline for those who invest and extend credit to very large institutions.
    “We think Congress should give a very high priority to providing a resolution mechanism for very large organizations, Bair said. “The lack of this mechanism is driving policy choices right now.”

Central Europeans frown at state bank ownership

Talk in western Europe of possibly nationalising private banks to save them from the credit crisis is sending shivers down the spine of policymakers in ex-communist central Europe.

They remember how their government controlled financial systems completely collapsed in the 1990s and threatened to take the countries’ economies along with them due to pouring money into firms with little prospect of returning it.

Survival, yes, but what about the money?

Veteran Wall Street banking analyst Richard Bove sees Lehman Brothers surviving – but he doesn’t think they’ll be making a lot of money.
   There’s just not a lot of business there at the moment for brokers like Lehman, he told the Reuters Investment Outlook Summit in New York.
    To listen to a clip of what Bove had to say, please click here

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