News > All

HSBC becomes HSBC UK in ‘radical’ rebranding
Lifestyle, 4:01
<p>After more than а month-long review on a potential name change, the UK’s largest lender has decided to keep ‘HSBC’ in its domestic banking division brand, Finbuzz reports. </p> <p>An internal staff email last week said of the change: “It soon became obvious that everyone preferred a name that maintains a strong connection to HSBC, and a clear commitment to the UK.”</p> <p>HSBC, also Europe’s largest bank, announced plans to rebrand earlier this summer. The announcement had the chatting classes speculating whether or not HSBC would revive its Midland Bank brand which it acquired in 1992.</p> <p>One legacy of Midland Bank that HSBC UK will adopt is location, as the 26,000 banking employees will be based in Birmingham, the former Midland Bank centre. The HSBC UK name comes into effect from 1 January 2018, and will be used at the bank’s 1000 UK branch locations.</p> <p>The name change comes ahead of the new banking rule that requires lenders to ‘ring-fence’, or separate, high-street and investment banking operations. “[Setting] up the UK ring-fenced bank in Birmingham is a key strategic action for the group,” Gulliver said.</p> <p>“Our ambition is to be the bank of choice in the UK and as a name, HSBC UK will build on the global connectivity and customer trust of the HSBC brand and differentiate us in a competitive market.”</p> <p>This article originally appeared on Finbuzz.<br /> Photo: Elliott Brown</p>
Don’t sweat the Fed
Asset Management
<p>This should be short. There are a lot of good reasons not to worry about the FOMC raising Fed funds or not. If they raise Fed funds:</p> <p> First, savers deserve a return. Economies work better when savers get rewarded.<br /> Second, investors do better on the whole when there is a risk free asset earning something to allocate money to, because otherwise investors take too much risk in an effort to generate income.<br /> Third, the FOMC should never have let Fed funds rates go below 1% anyway — the marginal stimulus is limited once the yield curve gets slope enough for the banks to lend. They don't really need more than that.<br /> Fourth, it's not as if monetary policy has been doing that much. Outside of the government and corporations, most entities have not shown a lot of desire to lever up after the financial crisis.<br /> Fifth, long Treasury yields will do what they want to do — they won't necessarily go up… it all depends on how strong the economy is.</p> <p>But if the the Fed doesn't raise Fed funds, no big deal. We wait a little longer. What's the difference between having zero interest rates for 6.5 years and 7.5 years? Either one would build up enough leverage if the economy had the oomph to absorb it.</p> <p>As it is, corporate borrowing has been the major place of debt expansion through both loans and bonds. Watch the debt of energy firms that are allergic to low crude oil prices. Honorable mention goes to auto, student, and agricultural lending. May as well mention that underwriting standards are slipping in some areas for consumers, but things aren't nuts yet.<br /> I've often said that the FOMC stops tightening rates when something big blows up. Can't see what it will be this time — the energy sector will be hurt, but it isn't big enough to impair financials as a group. Subprime lending is light at present outside of autos.<br /> Watch and see, but in my opinion, it is a sideshow. Watch how the long end behaves, and see if the market reflates. We need more confusion and less concern over what the next crisis is, before any significant crisis comes.</p> <p>This story originally appeared on ValueWalk.<br /> Photo: Maritime Haftek</p>
Oppenheimer analysts met with GoPro management; here's what happened
Capital Markets
<p> Shares of GoPro Inc (NASDAQ: GPRO) touched new all-time lows of $31.32 last week.</p> <p> Andrew Uerkwitz of Oppenheimer met with GoPro's management team and the overall tone was "upbeat."<br /> Uerkwitz maintained a Perform rating (no assigned price target) due to his "more conservative" view of the segment.</p> <p>Andrew Uerkwitz of Oppenheimer recently met with GoPro's Chief Financial Officer Jack Lazar and VP of Corporate Development Colin Born.</p> <p>According to Uerkwitz, the overall tone of the meeting was "upbeat," as management was "positive" on GoPro's market position and opportunity. Specifically, the Hero4 Session is expected to be the company's "most prominent" piece of new hardware for 2014 given its ...</p> <p>Read the full story available on</p> <p> Photo: Keegan Slattery<br /> &nbsp;</p>
IBM gets behind the blockchain
<p>&nbsp;</p> <p>&nbsp;</p> <p>&nbsp;</p> <p>While bitcoin and other cryptocurrencies have struggled to find mainstream appeal, blockchain, the ledger like technology that they run on, has been touted as one of the most important technological advancements of the past decade. The system has the ability to facilitate transactions in a way that many say will transform more than just the financial industry.</p> <p>That idea is now being put into practice by tech giant International Business Machines Corp. (NYSE: IBM), as ...</p> <p>Read the full story on<br /> Photo: Kansir</p>
Oil, China pulls Kynikos deep into the black
Hedge Funds
<p>The past few years have been nothing short of brutal for the short-only hedge fund space. QE3 was launched in September 2012, equities went through the roof, and the market has never looked back since. HFR data shows that from 2012 to 2014, short-only funds lost an average of 35%, a stark contrast to the S&amp;P’s over 75% gain in the same period.</p> <p>Thankfully however, 2015’s a little different – especially for Jim Chanos’ crew at 22 West 55th Street.</p> <p>After losing money since 2012, Jim Chanos’ Kynikos Associates is now firmly in the black according to the Wall Street Journal, and it didn’t just creep there either, no, it actually posted some respectable gains in August alone:<br /> The Ursus and Kriticos funds, which bet only against stocks, gained 6.2% and 8.2% in August, according to the document.<br /> The fund’s returns were mostly driven by bets against energy prices and – you guessed it – China, though the former did drive most of the gains, according to someone familiar with the matter.</p> <p>Still, the returns are tiny compared to Kynikos’ glory years. In 2008, when vaunted hedge funds such as Tudor and SAC chalked up their first ever losses, the firm’s Ursus fund surged 62%. And let’s not forget Chanos’ epic Enron short back in 2001.</p> <p>They still have more than enough reason to cheer up though. Recent Preqin analysis shows that hedge funds overall slipped 1.88% in August, exacerbating a 0.45% fall in July, and took the industry’s returns down to 1.96% year to date. And besides, as Chanos said two months ago regarding China, “The story has yet to play out…As long as China adds credit faster than its growth, the real story is months and years ahead.” I’m sure he’ll be there when that happens.<br /> Photo: Insider Monkey</p>
Full stack fintech: Will finance have its Uber moment?
<p>In the world of fintech startups there is an important distinction to be considered: Is a business full stack and partial stack?</p> <p>The distinction is important because the emergence of full-stack startups could be the biggest threat to industry incumbents. Unsurprisingly, banks are so far throwing most of their  support behind partial stack fintech startups.</p> <p>In his blog,  Andreessen Horowitz and general partner Chris Dixon predicts a full-stack movement in the fintech space, similar what has been seen  in other sectors. But so far fintech start-ups are predominantly partial stack: taking new technologies and then selling or licensing them to big banks.</p> <p>The new approach is to offer an end-to-end solution, cutting out existing players. This is full stack. Think about what Uber has done to taxis, Netflix to cable, or what Tesla is on the verge of doing to the motor industry.</p> <p> If a fintech start-up can pull off a full stack solution, it is hard to replace. That said, the barrier to entry is high and the startup would need to be good at many different things - from software and hardware, to marketing and logistics - to make it a success.</p> <p>If there is a movement in this direction though, the banks should be nervous.<br /> Photo: me and the sysop</p>
Liquid alts actually did pretty well last month
Asset Management
<p>Of the asset management industry’s many subsectors, none have been as reviled lately as the burgeoning liquid alts space.</p> <p>They’ve been called “watered down hedge funds” at a time when hedge funds themselves weren’t even doing well, and their promise of daily liquidity seems to stymie any effort to deliver out of the park returns. Even their managers seem to have taken flak as well, with critics asking why would they do it if they were successful hedge fund managers in the first place.</p> <p>Goldman Sachs however, would like to point out how awesome the space did this rocky August:<br /> As Exhibit 1 shows, three of five GSAM Liquid Alternative Investments Peer Groups lost less than 1% over the most volatile stretch of the month, as measured by the S&amp;P 500’s closing price high (Aug. 10) and low (Aug. 25). While the S&amp;P 500 fell a total 11% over this period, the GSAM LAI Relative Value Peer Group, Tactical Trading/Macro Peer Group, and Event Driven Peer Group, lost 0.6%, 0.6% and 1.0%, respectively.</p> <p>Given the steep losses in equity markets, it came as no surprise to us that equity long/short funds were down as well, since, historically, these strategies have been more closely correlated with equity markets than certain other strategies.1 Still, the Equity Long/Short Peer Group lost less than half the S&amp;P 500’s decline (5.2%) – and also beat almost every individual S&amp;P 500 Index sector. (See Exhibit 2). The GSAM LAI Multistrategy Peer Group, meanwhile, comprised of funds incorporating several different alternative investment approaches, fell by less than a quarter the S&amp;P 500’s loss (2.5%).<br /> All five peer groups meanwhile thrashed the traditional “balanced” portfolio’s performance in the same time frame, with the worst-performing group – Equity Long/Short – declining 5.2% in August compared to the 6.59% drop suffered by an “illustrative” 60-40 portfolio.</p> <p>Does this make the case for Liquid Alts then? Goldman seems to think so, especially as drivers in well-diversified investment portfolios. It would’ve been great to see which funds they tracked for the study though.<br /> Photo: Kristian Niemi</p>
BlackRock is setting up a social impact fund. But why Japan?
Asset Management
<p>US asset manager BlackRock is setting up a new social impact fund and has decided to base it in Japan. It will be first fund of its kind in the country.</p> <p>An appetite for social impact funds has been steadily on the rise since the global financial crisis. Investors are seeing the value in seeking long term returns in investments that are based on both social and monetary returns.</p> <p>Many also realize that adopting ESG (environmental, social and governance) standards does not only keep some investors happy, but can also drive value.  </p> <p>In Asia much of this investment activity has, rather unsurprisingly, been focused on emerging economies that stand to benefit the most from ethical investing. Think of microfinance in India, or in agriculture in Indonesia. So it is interesting that BlackRock has decided to set something up in Japan. </p> <p>The so-called Big Impact fund will be offered to retail investors from September 30, reports the Asian Nikkei Review, and BlackRock will use a range of criteria to select 200-800 issues from 3,700 companies in developed economies. </p> <p>When you look at two of the fund’s target industries, pharmaceuticals and energy, the rationale for Japan comes clearer. The country's ageing population, and its ongoing struggle with energy security - born out its unstable dependence on nuclear energy - means the country’s is driving innovation and growth in industries that hold several environmental and social benefits.</p> <p>But its not just that. Corporate Japan's progress on governance and social responsibility is also big factor for BlackRock. The new corporate governance code adopted by the Tokyo Stock Exchange in June aims to strengthen management through outside director appointments and  urges companies to be more pro-active towards ESG value.</p> <p>It's early days, but BlackRock is not alone. Private Equity firm KKR has also eyed ESG opportunities in Japan. This year is inducted its recent healthcare acquisition Panasonic Healthcare Holdings in its Green Portfolio Program (GPP), an operational improvement platform that uses ESG  benchmarks for KKR’s portfolio management activities.<br /> Photo: Mr Hicks46</p>
Daily Scan: Chinese equities return to earth; Japan holds gains
Capital Markets
<p>Updated throughout the day</p> <p>September 17</p> <p>Good evening everyone. After heading for the stratosphere throughout the day, mainland shares began experiencing problems in the last hour trading and eventually wiped out all its gains. The SHCOMP finished the day down 2.1% while the SZCOMP ended the session down 1.48%. Hong Kong’s Hang Seng Index unfortunately fell victim to the selloff as well, though the H-shares Index – surprisingly – managed to hold on to its gains:</p> <p> Hang Seng Index: -0.53%<br /> H-shares Index: +0.65%<br /> Nikkei 225: +1.43%<br /> Topix: +1.31%</p> <p>Over in Europe, stock indices are beginning to dip lower with T-minus nine hours remaining until the Fed decision. The U.K.’s FTSE 100 is down 0.2%, Germany’s DAX slipped 0.1%, while France’s CAC dipped 0.2%. Here’s what else you need to know:</p> <p>Japan upper house OKs defence bills amid chaos. A panel in Japan's upper house on Thursday approved legislation for a security policy shift that would allow troops to fight abroad for the first time since World War Two, a ruling party lawmaker said.Opposition lawmakers tried to physically prevent the vote in a chaotic scene carried live on national television. The legislation has sparked huge protests from ordinary voters. Channel News Asia</p> <p>Another “coup”in Burkina Faso. Presidential guard officers in Burkina Faso have announced the dissolution of the transitional government. A new "national democratic council" has taken control, an officer said on state television. Interim parliament speaker Cheriff Sy said the move was "clearly a coup". BBC</p> <p>Singapore’s non-oil exports tumble 8.4% year-on-year. The decline in NODX (non-oil domestic exports) is due to a contraction in the export of both electronic and non-electronic products.  Electronic and non-electronic domestic exports fell 2.7% and 10.6% in August, respectively. Channel News Asia</p> <p>Chile coast rocked by 8.3 magnitude quake. At least five people were killed and 1 million evacuated from affected areas, when a powerful 8.3-magnitude earthquake struck Chile Wednesday. CNN</p> <p>Desperate migrants clash with police in Hungary. Hungarian riot police responded to one of the worst bursts of violence that this tense refugee summer has seen. Agitated migrants at the border crossing were pelted with water cannons, head-cracking batons and both tear gas and pepper spray. New York Times (paywall)</p> <p>Japan debates its pacifist policy - with a round of fisticuffs. Scuffles broke out in Japan's upper house today ahead of a vote on a controversial move by the government to expand the role of the armed forces. The bills would amend Japan's pacifist constitution to allow it to defend its allies overseas even when it is not under attack. BBC</p> <p>U.S. CPI falls for first time since January. In a massive stumbling block for Yellen et cie, America’s consumer price index contracted 0.1% in August while on a year on year basis, August CPI climbed just 0.2%, essentially unched from July. </p>
Daily Scan: Stocks rally before Fed announcement
Capital Markets
<p>&nbsp;</p> <p>Updated throughout the day</p> <p>September 16</p> <p>Good evening,</p> <p>The Federal Reserve began its two-day policy meeting on interest rates Wednesday. Everyone is wondering whether the Fed will raise interest rates for the first time in nine years. Over at Quartz, Matt Phillips asks a more basic question: Does the central bank have the firepower to make it happen? The world of finance has changed dramatically since the 2008 crisis -- in part because of Fed moves. Many of its traditional tools are no longer likely pack the same wallop. What's a central bank to do? U.S. stock futures were muted ahead of the rate decision, to be announced Thursday. Stocks rose Wednesday, riding off gains from energy. The Dow was up 0.8%, the Nasdaq gained 0.6%, and the S&amp;P 500 rose 0.9%. Oil jumped more than 5%, closing above $47/barrel. </p> <p>&nbsp;</p> <p>Here is what else you need to know:</p> <p>Texas teen arrested for making a clock. Ahmed Mohamed, a 14-year-old high school student, found himself in handcuffs after bringing a digital clock that he'd made from a pencil case to school. The school and local police accused him of creating a hoax bomb. The police say Mohamed should have told them more than the fact that the item in question was just a clock. On the upside, the attention from the arrest got Mohamed an invitation to the White House from President Obama. CNN</p> <p>GM close to settlement with Justice Department over faulty ignition switch. The Justice Department is expected announce a criminal settlement with General Motors this week that will likely force GM to pay millions in fines. GM is in trouble for failing to recall millions of cars with a defective ignition and then covering it up. Wall Street Journal</p> <p>GOP debate, part deux. Carla Fiorina joins 10 male candidates who will hash out the key issue of the day: How in the world did Donald Trump become the No. 1 Republican candidate? Tune in at 8 p.m. ET</p> <p>FedEx earnings disappoint as freight demand drops. The global carrier got hit by a slowdown in trade. FedEx lowered the outlook for the year, to $10.40 to $10.90/share for the year ending next May, down from previous guidance of $10.60 to $11.10/share. Also hurting profits: Higher costs on its relatively new ground delivery business. MarketWatch</p> <p>Gold surges as consumer price index weakens. The metal is on pace for its biggest one-day gain in a month, up 1.5%. The consumer price index in August fell 0.1%, well short of the Fed's target of annualized inflation of 2%. The news good convince the FOMC members who are meeting Wednesday and Thursday to think twice before raising interest rates. MarketWatch</p> <p>No pay raises for middle income earners in 2014. The median household income was a smidgeon higher at$53,657 from 2013 when the number stood at $54,462, the U.S. Census Bureau reported. The number of Americans living at the poverty level was also unchanged at 14.8% at 46.7 million vs 46.3 million a yea</p>