Financial Times Update

Thu 30 Oct 2008

HBOS
HBOS became the second UK lender to sell public bonds under the government's bail-out scheme. The country's largest mortgage bank, which is expected to be taken over by rival Lloyds TSB, raised almost £3bn in two deals. The bank sold 3 billion euros in two-year bonds and later in the day added £600m in three-year bonds after enquiries from investors.
Barclays
After dividing the carcass of collapsed investment bank, Lehman Brothers, Barclays Capital and Nomura International are racing each other around the globe to sign up key Lehman people and clients before they slip away. Barclays bought Lehman's 10,000 person US business but did not bid for the operations elsewhere, saying it has them sufficiently covered. Nomura picked up the 3,000 persona Asian business and 2,500 people in the European and Middle-East investment banking and equities division. The companies are rushing to integrate their purchases, eliminate overlap and secure top employees with guaranteed compensation schemes.
Standard Life
Standard Life has become the latest insurer to slap hefty penalties on customers leaving its life fund early, and is also making an immediate cut to pay-outs. The former mutual, which reports its third-quarter sales figures today, said it had increased the market value reductions imposed on customers leaving its with-profit fund to as much as 30%, and has extended the penalties to more with-profit policies.
Kaupthing
The UK capital markets arm of collapsed Icelandic bank Kaupthing has risen from the ashes thanks to a management-led buy-out. The renames Singer Capital Markets will be an independent corporate broker focussing on the UK small and mid-cap market. It has about 70 employees and makes markets in 500 stocks and issues research in a dozen sectors.
Coutts
Coutts, the private bank for wealthy customers, is opening two more regional offices in Cheltenham and Exeter. The bank, which is owned by RBS, has increased the number of private bankers working from its offices significantly in the last few years. It has boosted the number of private bankers working outside of London by almost 80% over the past four years.
Societe Generale
The head of SocGen said he was "extremely confident and relaxed" about providing more loans to households and businesses after the bank's shares suffered another day of volatile trading. Shares in SocGen, the second-biggest French bank, have fallen 20% since the beginning of the week, and have lost 44% of their value since the start of the month.
Goldman Sachs
The big question for the 94 new Goldman Sachs bankers welcomed by the investment bank's chief Lloyd Blanfein into the partnership pool is just how special will the "special bonus pool" that they dip into actually be. Mr Blankfein was among the nine Wall Street chiefs who received a letter from Henry Waxman, chairman of the Congress oversight committee, questioning the "appropriateness of depleting the capital that taxpayers just injected into the banks through the payments of billions of dollars in bonuses, especially after one of the financial industry's worst years on record. "
MF Global
The chief executive of MF Global, one of the world’s biggest financial derivatives brokerages, on Wednesday bowed to investor demands to resign, capping a disastrous year for the company during which it has lost more than 90 per cent of its value. Kevin Davis, who had led the brokerage for a decade, leaves a company much weakened following its spin-off last year from Man Group, the London-listed hedge-fund manager. MF Global’s share price, which was trading at more than $30 in January, closed at $2.25 on Tuesday.
Mitsui Sumitomo
Mitsui SumitomoJapan’s third largest banking group, on Wednesday slashed its full year net profit forecast by 63 per cent, due to mounting bad loan costs and a sharp drop in the value of its share holdings. SMFG kept its revenue forecast at Y1,850bn but said group net profits would be Y180bn ($1.9bn) rather than a previously forecast Y480bn.
BBVA
Underlying net profit at the Spanish bank, BBVA whose conservative strategy has so far been vindicated by the damage to its rivals from the global financial crisis, rose 4 per cent in the third quarter to €1.39bn from €1.34bn a year earlier. The BBVA figures announced on Wednesday showed that net profit in the three months to September was the lowest for four quarters.

Continue