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Cash Tap Stays Dry for EU Banks - (online.wsj.com) Executives at Italy's Banco Popolare SC BP.MI -0.66% were hoping this week to
highlight their strength, as well as the resilience of the European banking
system, by selling a batch of so-called senior unsecured bonds for the first
time in 18 months. Instead, Popolare, Italy's fifth-largest commercial bank by
market value, got a reminder of how fragile the Continent's financial system
remains, even after the European Central Bank's extraordinary series of rescue
efforts. Popolare on Monday had to yank its bond sale off the market at the
last minute after its bankers failed to drum up adequate demand from investors.
Another lender, UniCredit Bank Austria,UCG.MI -1.92% also had to pull a
planned bond sale Monday for similar reasons, according to bankers who worked
on both deals. A Popolare spokesman declined to comment. A UniCredit Bank
Austria spokesman said the bond sale "was postponed because the market
environment was not as favorable as expected." He added that the bank will
"intensify its work with investors and try to float the issue at a later
point in time."
CEO
emails employees: Defeat Obama or else - (www.money.cnn.com)
David Siegel, the resort CEO who is building the biggest private home in
the country, really, really doesn't like President Obama. And while
Siegel hasn't sent any money to Republican presidential candidate Mitt Romney, he has gone a
step farther to support him. On Monday he sent an e-mail to all 7,000 employees
of privately-held Westgate Resorts, many of them in the battleground state of
Florida, warning them their jobs are at risk if the president is re-elected. "The
economy doesn't currently pose a threat to your job. What does threaten your
job however, is another 4 years of the same Presidential administration,"
he said in the e-mail. "If any new taxes are levied on me, or my
company, as our current President plans, I will have no choice but to reduce
the size of this company," he says in the nearly 1,400-word e-mail.
"Rather than grow this company I will be forced to cut back. This means
fewer jobs, less benefits and certainly less opportunity for everyone."
IMF sounds alarm on Japanese banks - (www.ft.com) The huge and
rising government bond holdings of Japanese banks leave them vulnerable to a
spike in interest rates, the International Monetary Fund has warned.
Sounding an alarm over the stability of
Japan’s banking system, IMF officials said domestic bank holdings of government
bonds in the country could rise to a third of their total assets within five
years, from a quarter now. The officials, speaking at the IMF and World Bank
international meetings in Tokyo, added that could this magnify the potential
impact of turmoil caused by a loss of confidence in state finances. Peter
Dattels, assistant director, said fears over Europe could be replicated in
Japan, the only country with gross government debt more than twice the size of
the economy.
Facebook Fought SEC to Keep Mobile Risks Hidden Before IPO
Crash - (www.bloomberg.com) When Facebook Inc. (FB)
filed its proposal Feb. 1 to go public, it touted the
effectiveness of ads linked to customers’ friends, citing research from
Nielsen, the audience-counting company. Barbara Jacobs, an assistant director
for corporation finance at the U.S. Securities and Exchange Commission, was
skeptical, as she and her staff vetted the filing to ensure Facebook
had disclosed all material information to investors.
The claim appeared to be drawn from marketing materials, not a Nielsen study,
she wrote to Chief Financial Officer David
Ebersman, 42. She gave him an ultimatum: Produce the study and
provide Nielsen’s consent for use of the data -- or don’t use it, she wrote to
Ebersman on Feb. 28. Facebook dropped the reference after initial resistance.
IMF Sees European Banks Facing $4.5 Trillion Sell-Off - (www.bloomberg.com) The International Monetary Fund said European banks may need to sell as much as $4.5
trillion in assets through 2013 if policy makers fall short of pledges to stem
the fiscal crisis, up 18 percent from its April estimate. Failure to implement
fiscal tightening or set up a single supervisory system in the timing agreed
could force 58 European Union banks from UniCredit SpA (UCG) to Deutsche Bank AG (DBK) to shrink assets,
the IMF wrote in its Global Financial Stability Report released today. That
would hurt credit and crimp growth by 4 percentage points next year in Greece,
Cyprus, Ireland, Italy, Portugal and Spain, Europe’s periphery.
“There is definitely a need for deleveraging in Europe,” said Michael Seufert,
an analyst at Norddeutsche Landesbank in Hanover, Germany,
with a “negative” rating on the European banking sector. “The danger is that
this produced a downward spiral as the regulation gets stricter and stricter
and the global economy cools, potentially meaning more writedowns for banks.
States in the periphery are hit hardest.”
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