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German funds look to emerging market debt – HSBC
April 29, 2010--German pension funds' appetite for fixed income exposure will push them towards investing in emerging market debt, according to HSBC.
“Given the funds’ risk budget, the bond share in portfolios will remain high, so in search for return we observe that pension funds will diversify into emerging market debt,” Bernd Franke, chairman of the board at HSBC Global Asset Management Germany, a subsidiary of HSBC Trinkaus & Burkhardt, told IPE.
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Source: IP&E
S&P warns of hit to property loans
April 29, 2010--Banks could be hit by more than €90bn ($119bn) of losses on commercial property loans in the UK, Ireland and Spain between 2009 and 2011, according to a new report from Standard & Poor’s, the rating agency.
Losses of that magnitude would account for about 10 per cent of total commercial property lending carried out in those countries over the two-year period.
S&P said that while there was some evidence of a rebound in property values, it did not expect this to trigger a big improvement in the level of bad loans
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Source: FT.com
First ETN Launched on EURO STOXX 50 Volatility Index on Xetra
April 28, 2010--Since Wednesday, a new Barclays Bank ETN bearing the product name iPath has been tradable in Deutsche Börse’s ETN segment.
ETN name: iPath VSTOXX Short-Term Futures Total Return ETN
Asset class: Volatility
ISIN: DE000BC2KTT9
Management fee: 0.89 percent
Benchmark: EURO STOXX 50 Volatility Index (VSTOXX)
The iPath VSTOXX Short-Term Futures Total Return ETN offers investors the opportunity to participate for the first time in the performance of the EURO STOXX 50 Volatility Short-Term Futures Index (VSTOXX Short-Term Futures Index). The VSTOXX Short-Term Futures Index tracks the implicit volatility of equities in the EURO STOXX 50® index based on a hypothetical portfolio. This portfolio reflects the returns on a rolling investment in two VSTOXX futures contracts which are traded on Eurex® and which have a residual maturity of one to two months.
Deutsche Börse’s ETN segment product range currently comprises 14 instruments on volatility, currency and equity indices. ETNs are exchange-traded debt securities. They track the performance of underlying reference indices outside the commodities sector and have been tradable on Xetra® since December 2009.
Source: Deutsche Börse
FSA takes tough action against poor complaint handling in banks
April 28, 2010--The Financial Services Authority (FSA) is taking tough action after finding weaknesses in five banks handling of customer complaints.
As a result of the review, five banks are undertaking major changes to the way they deal with complaints and two of the five banks have been referred to enforcement for further investigation.
The review looked at several banking groups responsible for over 70% of the complaints firms receive and report to the FSA and over 60% of those resolved by the Financial Ombudsman Service (FOS).
It found poor standards of complaint handling within most of the banks assessed, including:
* A lack of senior management engagement and accountability for the delivery of fair complaint handling;
* Poorly designed staff incentive schemes that made branch staff reluctant to pay redress to customers, even in situations where the bank was at fault;
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Source: FSA.uk.org
CESR publishes responses to consultation on extending major shareholding notifications
April 28, 2010--CESR published today the responses received to its consultation on extending major shareholding notifications to instruments of similar economic effect to holding shares and entitlements to acquire shares.
view consultations
Source: CESR
NASDAQ OMX to Close Its Pan-European Equity MTF NASDAQ OMX Europe
April 28, 2010--Confirms Commitment to Profitable Growth in Europe With Renewed Focus on Pan-European Strategy in Nordics
The NASDAQ OMX Group, Inc. (Nasdaq:NDAQ) reports today that it has decided to close its pan-European multilateral trading facility (MTF) operated by NASDAQ OMX Europe (NEURO). The announcement was made following an assessment of the financial prospects of the NEURO business.
NASDAQ OMX will continue to have a presence in London and remains committed to London as a financial centre. Forty percent of NASDAQ OMX Nordic trading comes from London based clients. Through its office and its existing data centers in London, NASDAQ OMX will continue to support its trading and market data operations, run the UK power exchange N2EX, and support its international listings business.
Eric Noll, Executive Vice President of NASDAQ OMX, said, "Despite our best efforts, the increasingly competitive nature of the MTF space in Europe has meant that the growth of the business hasn't reached levels necessary for us to realize our stated objectives."
The last day of trading on NEURO is expected to be May 21. Charlotte Crosswell will continue working with business development initiatives for NASDAQ OMX in London and across Europe. She will also oversee an orderly transition of NEURO customer relationships to NASDAQ OMX Nordics.
Hans-Ole Jochumsen, President of NASDAQ OMX Nordic, will assume responsibility for Pan-European Equity trading. With the successful roll-out of the INET trading system in all seven of its equities markets in the Nordics (Copenhagen, Helsinki, Iceland and Stockholm) and the Baltics (Riga, Tallinn and Vilnius), NASDAQ OMX can now leverage operating synergies on the core INET trading platform and build on profitable growth. Jochumsen stated, "Our approach will be very targeted, market-by-market. For example, NASDAQ OMX Nordic is currently the largest competitor to Oslo Bors, with nearly five percent market share."
The INET trading platform is currently operating NASDAQ OMX's options markets in the U.S. and is utilized in all NASDAQ OMX equities markets across the world. NASDAQ OMX's INET technology is the most efficient and scalable trading platform in the world, with microsecond speeds, and high reliability and capacity. The INET system is capable of handling one million messages per second at sub-250 microsecond average speeds, the fastest of any exchange or alternative trading system in the world. INET also serves as the backbone for Genium INET, NASDAQ OMX's commercial exchange technology offering.
Source: NASDAQ OMX
Fall in loan demand shows eurozone weakness
April 28, 2010--Demand by businesses and house buyers in the eurozone for bank loans fell unexpectedly in the first quarter of this year, according to a European Central Bank survey that cast fresh doubt on the strength of economic growth across the 16-country region.
The surprise weakness, revealed in the ECB’s latest bank lending survey, set back hopes that a pick-up in credit provision would oil the wheels of the economic recovery. Banks also tightened further credit standards on business loans and mortgages, the survey showed.
The results came as the ECB reported weak demand from banks in the first offer of three month liquidity conducted as a competitive auction since the intensification of the global economic crisis in late 2008
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Source: FT.com
Europe debt crisis deepens after Spain downgrade
April 28, 2010-- Europe's debt crisis deepened on Wednesday after Spain was slapped with a credit downgrade and pressure mounted for urgent approval of a giant bailout for Greece that could run to 120 billion euros.
The head of the IMF warned confidence in the entire 16-nation euro area was now at stake and Greek Prime Minister George Papandreou said the EU "must prevent a fire... from spreading to the entire European and world economy".
IMF managing director Dominique Strauss-Kahn and European Central Bank president Jean-Claude Trichet travelled to Berlin to drum up support for an EU-IMF aid plan for Greece in which Germany would have to pay the lion's share.
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Source: EU Business
Volcanic ash costs European tourism one billion euros
April 28, 2010--Losses to Europe's tourism sector caused by the ash cloud from Iceland could touch one billion euros, according to a preliminary estimate by the European Commission on Wednesday.
"I take note that the initial estimates of the loss to the sector touch the threshold of one billion euros (1.3 billion dollars)," said European Commissioner for Industry and Entrepreneurship Antonio Tajani in a statement.
He was speaking after a videoconference with European tourism ministers and officials.
The statement said it was too early to gauge the effcts of the crisis on hotels as well as tour operators.
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Source: EU Business
Bailouts in Europe: some precedents
April 28, 2010--Greece's appeal for a debt rescue from the European Union and International Monetary Fund is the latest in a number of bailouts in Europe over the last few decades.
But the IMF has been involved in western Europe in the last 45 years only in Britain in 1976 and in Iceland at the end of 2008.
Most of the Fund's other recent interventions in the European arena have involved central or eastern states, many of them former Soviet bloc members.
The world economic meltdown of the past two years has seen the Fund become more active in the region. Key events:
-- October 2008: The IMF, European Union and and the World Bank put together a joint 20-billion-euro (26-billion-dollar) aid package for HUNGARY.
< a href="http://www.eubusiness.com/news-eu/greece-finance-imf.4ck" TARGET="_top">read more
Source: EU Business
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