For at least a quarter-century, the financial sector has grown far more rapidly than the economy as a whole, both in developed and in most developing countries. The ratio of total financial assets (stocks, bonds, and bank deposits) to GDP in the UK was about 100 percent in 1980, while by 2006 it had risen to around 440 percent. In China, financial assets went from being virtually non-existent to well over 300 percent of GDP during this period. As the size of the financial industry grew, so, too, did its profitability. The share of total profits of companies in the US represented by financial firms rocketed from 10 percent in 1980 to 40 percen...
If banks provide the fuel for modern economies, then corporates are its engines. Without them, we would earn and consume nothing, trade would evaporate, savings would be wiped out, banks would fail and tax receipts would plunge. Care then is needed when drafting rules and protocols to ensure they do not drive corporates off the road. And in these most sensitive times for corporates, particular care should be taken. This makes it all the more surprising that the latest proposals from the US administration – to clear all standardised derivatives – rides roughshod over corporate interests. The corporate sector is rightly incensed. Nicholas S...
Banco Espírito Santo Angola is not only known for its financial performance, but also for its hard work in corporate citizenship. In economic sustainability, BESA was honoured by UNESCO and the International Committee for the Development of Planet Earth for promoting sustainability in Angola. It was crowned ‘BESA, the Bank for the Planet’, which means it will be able to mark a presence at all the International Year of Planet Earth activities. BESA, in this manner, has the chance to express its concern for the promotion of sustainable development. Since 2007, it has worked with the UN High Commissioner for Refugees in supporting the retur...
Caribbean As many attack so-called “tax havens”, Natalie Shaw speaks to Shawna Lake, whose firm SKIPA promote development in St Kitts & Nevis France Companies have been going wrong and being bailed out globally. Liam Vaughan suggests that France is offering less protection for creditors than, say, the UK or the US. Vaughan goes on to say that investors in ailing corporations have taken substantial write-downs in the restructuring process. Chile There are not many success stories to come out of the global financial crisis but Chile can feasibly hold its head high as being the only investment-grade country to be upgraded by Moody’s i...
China is worried about the long-term decline of the dollar, mainly because it holds somewhere north of $1,000bn in US government debt. As a Chinese economist notes in a masterly piece of understatement, “a trillion (in greenbacks) is a hot potato.” Several other Asian countries holding vast dollar amounts are worried for the very same reason, and are starting to shift in their seats. Then there’s Russia, which wants oil and other commodities quoted in another currency, if only because the rouble is in a hole. Finally, many commentators are beginning to think that this might be the right time to tame the forex jungle once and for all. If...
“Banks in Trinidad and Tobago are blessed,” says Sekou Mark. It may be an intriguing statement, given the current global economic crisis to which some of the biggest banks have fallen victim. More intriguing perhaps is that the man making the statement is a banker himself. He is the General Manager of Corporate Banking at First Citizens Bank, the highest rated indigenous financial institution in the English-speaking Caribbean (BBB+ Standard & Poor’s) and winner of the World Finance Award for Best Bank, Trinidad and Tobago this year. Brandishing a broad smile and exuding a youthful confidence that speaks to his younger-than-average ...
While the UK’s FSA’s rules on unbundling may not have radically reformed the trading landscape, they have subtly altered the terrain. Commission-sharing agreements have become the status quo and the remaining bulge-bracket sellside firms continue to capture the lion’s share of both execution and research business.A split between the two activities as envisioned in the original Myners report is unlikely to happen in the current environment as fund managers do not want to dig any deeper into their own pockets. Reinder van Dijk, managing consultant at Oxera, which was commissioned by the FSA to compile a progress report on unbundling, said...
Size, says Margrit Schmid, is not the only criterion for success. But it does help indicate just how well a company is doing in its chosen marketplace. “In terms of premium volume, we are the leading global employee benefits network,” she says. “While size is not everything, our size does reflect how many multinational companies entrust their employee benefit solutions to us.” Clients looking for answers to their employee benefit problems do not come to Swiss Life Network just because it is big, of course. Among the important pillars for Swiss Life Network’s success, Schmid says, are its totally customer-oriented and experienced mul...
When did your banker last recommend against an execution or transaction for which they are being remunerated?” This leading question awaits prospective clients browsing the website of Ondra Partners, one of a new breed of independent boutique offering “unbiased” advice to companies raising equity, debt or making acquisitions.Senior bankers at established underwriting banks get angry at any implication they do not always work in a client’s interest and in turn question whether firms offering advisory services have the experience and knowledge to be of help to companies. One senior banker at a London-based firm said: “These firms have...
Dark pools are not the “new black” anymore – they have been in Europe for more than a decade – but recently these esoteric trading systems emerged as the new battleground for European exchanges and their ambitious rivals.Multilateral trading facility Turquoise signed up six customers to a new service that aggregates the liquidity in their dark pools while a rival MTF, Bats Europe, detailed its plan to launch a dark pool. Separately, the LSE launched its dark pool Baikal, offering its members the ability to route orders to other trading platforms, and affirmed its commitment to support dark pool trading “later this year” though it ...