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FILE PHOTO: A worker stands on the scaffolding at a construction site against a backdrop of residential buildings in Huaian, Jiangsu province, China October 18, 2018. REUTERS/Stringer/File Photo
April 19, 2019
BEIJING (Reuters) – China will maintain policy support for the economy, which still faces “downward pressure” and difficulties after better-than-expected first quarter growth, the Communist Party’s top decision-making body said on Friday.
The statement from the politburo came two days after China reported had steady 6.4 percent annual growth in January-March, defying expectations for a further slowdown, as industrial production jumped sharply and consumer demand showed signs of improvement.
“While fully affirming the achievements, we should clearly see that there are still many difficulties and problems in economic operations,” the official Xinhua news agency reported, citing a politburo meeting chaired by President Xi Jinping.
“The external economic environment is generally tightening and the domestic economy is under downward pressure.”
China will implement counter-cyclical adjustments “in a timely and appropriate manner”, while the pro-active fiscal policy will become more forceful and effective, and the prudent monetary policy will be neither too tight nor too loose, it said.
For this year, the government has unveiled tax and fee cuts amounting to 2 trillion yuan ($298.35 billion) to ease burdens on firms, while the central bank has cut banks’ reserve requirement ratios (RRR) five times since early 2018 to spur lending.
Further policy easing is widely expected.
On Friday, the politburo reiterated that the government will effectively support the private economy and the development of small- and medium-sized firms.Authorities will strike a balance between stabilizing economic growth, promoting reforms, controlling risks and improving people’s livelihoods, the politburo said.
China will push forward structural deleveraging and prevent speculation in the property market, it said.
“We should adhere to the orientation that houses are used for living, not for speculation,” the politburo said, reaffirming a city-based approach in controlling the property sector.
China’s economic growth is expected to slow to a near 30-year low of 6.2 percent this year, a Reuters poll showed last week, as sluggish demand at home and abroad weigh on activity despite a flurry of policy support measures.
(Reporting by Beijing Monitoring Desk and Kevin Yao; Editing by Richard Borsuk)
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Environmental activists block the entrance of the French bank Societe Generale headquarters during a “civil disobedience action” to urge world leaders to act against climate change, in La Defense near Paris, France, April 19, 2019. REUTERS/Benoit Tessier
April 19, 2019
PARIS (Reuters) – Climate activists blocked hundreds of employees from entering the headquarters of French bank Societe Generale, state-run utility EDF and oil giant Total on Friday, environmental group Greenpeace said.
Greenpeace said it was protesting against the companies links to the oil and gas industry, which the group says is a driving force in global warming.
They plastered giant posters of President Emmanuel Macron carrying the slogan “Macron, President of Polluters” and a banner reading “Scene of Climate Crime” on the glass facade of Societe Generale, Reuters TV images showed.
Police pepper-sprayed one group blocking the bank’s main entrance in a sit-down protest.
Some protesters taped themselves together while others cuffed themselves with plastic ties to metal poles to make it harder for police to dislodge them.
Employees in business suits milled around outside their offices. “I just want to get inside and on with my work,” one frustrated bank employee said.
A Societe Generale spokesman declined to comment. An EDF spokeswoman did not respond to requests for comment.
The protest came as Total chief executive Patrick Pouyanne, chief executive of Angola’s state oil company Sonangol, and the chairman of the Libya National Oil Corporation were due to attend an annual oil summit in Paris.
Greenpeace and action group Les Amis de la Terre (Friends of the Earth) have previously criticized Societe Generale for their financial role in oil and gas projects, in particular the Rio Grande LNG gas project in the United States.
Friday’s protest echoed a series by the Extinction Rebellion group of climate-change campaigners in London this week that have caused transport snarl-ups in the British capital.
Teenage protesters staged an emotional protest, weeping and singing, at political inaction on climate change near London’s Heathrow Airport on Friday.
(Reporting by Antony Paone and Inti Landauro; Writing by Richard Lough; Editing by Mark Heinrich)
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FILE PHOTO: A worker cycles near a factory at the Keihin industrial zone in Kawasaki, Japan February 28, 2017. REUTERS/Issei Kato
April 19, 2019
TOKYO (Reuters) – Japan’s March factory output is forecast to have slipped for the first time in two months, a Reuters poll showed on Friday, though the central bank is expected to stand pat on policy as it bets on a gradual economic recovery despite rising risks to growth.
The poll of 17 economists predicted the Bank of Japan will retain its massive stimulus as well as the short-term interest rate target at minus 0.1 percent, while also maintaining its pledge to guide 10-year government bond yields around zero percent at its April 24-25 meeting.
The BOJ is facing a daunting task in its years-long efforts to help push up inflation toward its 2 percent goal, with a slowdown in global growth and trade making its task even more difficult.
Factories have been under strain in the past few months, and the poll forecast industrial production to have slipped 0.1 percent in March from the previous month after it rose 0.7 percent in February.
“Exports are weakening due to the global economic slowdown, which appears to have impacted on factory output,” said Yoshiki Shinke, chief economist at Dai-Ichi Life Research Institute.
“The economy is either at a temporarily lull or worsening slightly. But it requires more data to assess whether the economy contracted in the first quarter.”
The trade ministry will publish the factory output at 8:50 a.m. April 26, Japan time (2350 GMT April 25).
Data on the nation’s retail sector, due at the same time with the factory output numbers, is projected to show sales rising 0.8 percent last month from a year earlier, the poll found, accelerating from a 0.4 percent increase in February.
Recent gains in oil prices appear to have supported fuel retailers and demand from inbound tourists likely also boosted the overall retail sales, analysts said.
Yet the positive retail impulse would need to be sustained for some months to help boost inflation and overall consumption.
Indeed, the BOJ is expected to forecast next week that inflation will remain below its 2 percent target through the fiscal year that ends in March 2022, sources say.
The central bank is also seen sticking to its view that Japan’s economy will emerge from a soft patch and resume a moderate expansion in the second half of 2019.
“We forecast the BOJ won’t largely change its economic view, so the central bank will likely keep its current pace of stimulus policy,” said Shuji Tonouchi, senior market economist at Mitsubishi UFJ Morgan Stanley Securities.
The poll also found Tokyo’s core consumer prices (CPI) index, which includes oil products but excludes fresh food prices, rose 1.1 percent in April from a year earlier, the same pace as in March.
Price gains in oil related products probably contributed to Tokyo’s core CPI, while falls in costs of electricity and city gas weighed on the index, analysts said.
The poll showed the jobless rate pushed up to 2.4 percent in March from 2.3 percent in February, and the jobs-to-applicants ratio improved to 1.64, which would be an over 40-year high, from 1.63 in February.
The government will publish Tokyo’s core CPI and jobs data at 8:30 a.m. on April 26 (2330 GMT on April 25).
(Reporting by Kaori Kaneko; Editing by Shri Navaratnam)
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FILE PHOTO: Investors stand in front of a screen showing the logo of Nomura Holdings in Tokyo, Japan, in this December 1, 2015. EUTERS/Toru Hanai
April 19, 2019
By Takashi Umekawa and Taro Fuse
TOKYO (Reuters) – Japan’s Nomura Holdings has no plan to follow the lead of Wall Street rivals and seek a tie-up with a commercial lender, its chief executive told Reuters, pledging to stay independent even as the investment bank faces its first annual loss in a decade.
Nomura in January reported a net loss of more than 101 billion yen ($903 million) in the first three quarters of the year to end-March. It has since announced an overhaul plan to cut $1 billion in cost from its wholesale business and close more than 30 of its 156 retail branches.
But it will not seek to join forces with a commercial bank, Koji Nagai said, eschewing a model that has reshaped Wall Street since the financial crisis and has seen Morgan Stanley tie up with Japan’s biggest bank, Mitsubishi UFJ Financial Group.
“We can do a deal with any partner if we make the effort. We don’t belong to any banking group and that is our strength,” Nagai told Reuters in an interview this week embargoed for release on Friday.
Even without capital ties to any of Japan’s three megabanks – Mitsubishi UFJ, Mizuho Financial Group and Sumitomo Mitsui Financial Group – Nomura has been able to retain its formidable presence in Japanese investment banking, particularly deals.
It is advising Nippon Paint Holdings on a $2.7 billion bid for Australia’s DuluxGroup, announced this week.
But it doesn’t have the lending firepower of a rival such as Morgan Stanley, which thanks to its tie-up with Mitsubishi UFJ, has been able to leverage the Japanese bank’s massive balance sheet to offer financing alongside of advisory services.
ENVY & INDEPENDENCE
Nagai said that while he felt “envy” toward competitors with lending power, a capital alliance with one of the megabanks would sacrifice Nomura’s independence – likely closing it off from clients allied to one of the other megabanks, given the Japanese corporate practice of sticking to a “main bank” and doing business with that lender’s affiliates.
“We won’t give up our independence by joining a capital alliance,” he said.
As part of the cost-cutting overhaul Nomura also plans to axe about 100 jobs in London, the center for its European banking business, Reuters has previously reported.
The wholesale business has been squeezed by lower trading revenue in fixed income.
Credit-ratings firm Moody’s has said that Nomura’s overhaul plans, if successful, would help it refocus its business and reduce earnings volatility.
Nagai said Nomura is also focused on driving its mass-affluent customers – often defined as those with less than $1 million in investable assets – to its digital platform. The bank is looking to hire people from online brokerages to help drive that strategy, he said.
($1 = 111.9100 yen)
(Reporting by Takashi Umekawa and Taro Fuse; Editing by David Dolan and Christopher Cushing)
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FILE PHOTO: U.S. Special Representative for Afghanistan & Pakistan Richard Holbrooke (L), co-chairs a session with Pakistan’s Finance Minister Abdul Hafeez Shaikh during the Pakistan Development Forum in Islamabad November 14, 2010. REUTERS/Adrees Latif
April 19, 2019
By Asif Shahzad and Drazen Jorgic
ISLAMABAD (Reuters) – Pakistani Prime Minister Imran Khan made a sweeping cabinet reshuffle on Thursday after only seven months in power and appointed Abdul Hafeez Shaikh as de facto finance minister to steer the country through worsening economic turmoil.
Pakistan is on the brink of signing up for it 13th International Monetary Fund (IMF) bailout since the late 1980s in a bid to stave off a balance of payments crisis and ease ballooning current account and fiscal deficits.
Khan’s government inherited a wobbly economy but the former cricketer has come under intense criticism for failing to fulfill his promises that he would steady the ship and bring prosperity to Pakistan.
Khan late on Thursday announced 10 ministerial appointments in a shakeup that included the departure of Finance Minister Asad Umar, who has been a close ally to Khan for many years.
Shaikh, who already served as finance minister from 2010-2013 under the opposition Pakistan Peoples Party when it was in power, has been appointed as “Adviser on Finance” but will be heading the finance ministry once again.
In Pakistan it is common for financial experts to be given the title of “adviser”, rather than federal minister, to head the finance ministry when they are not a sitting member of parliament.
Earlier in the day Umar, announcing that he would step down, said Pakistan would still go into an IMF program but warned his successor that he faces a tough job ahead.
“No one should expect from the new finance minister that things could be better in three months’ time,” Umar told reporters in capital Islamabad on Thursday afternoon.
“The next budget will be a difficult one,” he added, referring to annual spending plans for the financial year ending June 2020 due to announced in May.
Umar, who had been asked to quit on Wednesday night, said he still strongly believed Khan was the best hope for the country.
Influential Information Minister Fawad Chaudhry has been moved to the science and technology ministry, while retired Brigadier Ijaz Ahmed Shah has been appointed as Interior Minister. Energy expert Nadeem Babar has been appointed to lead the petroleum ministry.
GLOOMY PICTURE
Khan was widely expected to turn to a steady hand to replace businessman Umar, who was the former chief executive of Engro, Pakistan’s biggest private conglomerate.
Shaikh, a U.S-educated economist who worked at Harvard University, also spent many years working for the World Bank and had also been the privatization minister during the government of former military dictator General Pervez Musharraf.
Speculation that Umar would be replaced had been rife for months, with some business groups and investors unhappy with Umar’s strategy of seeking short-term loans from allies such as China and Saudi Arabia instead of finalizing an IMF rescue package after Khan assumed power in August.
Khan’s government has got temporary relief from allies, including China and Saudi Arabia, who offered short-term loans worth more than $10 billion to buffer foreign currency reserves and ease pressure on the current account.
But it was not enough.
Umar has been leading negotiations with the IMF but has faced criticism over a worsening economic outlook on his watch, with inflation at a five-year high and the local rupee currency down about 35 percent since Dec 2017.
The central bank last month cut growth estimates, forecasting the economy to expand 3.5 to 4 percent in the 12 months to the end of June, well short of a government target of 6.2 percent. The IMF paints a gloomier picture, predicting growth of 2.9 percent in 2019 and 2.8 percent next year.
(Additional reporting by Saad Sayeed; Writing by Drazen Jorgic; Editing by Robert Birsel, Clarence Fernandez and Andrew Heavens)
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Japanese Finance Minister Taro Aso holds a news conference after the G-20 Finance Ministers and Central Bank Governors’ meeting at the IMF and World Bank’s 2019 Annual Spring Meetings, in Washington, April 12, 2019. REUTERS/James Lawler Duggan
April 19, 2019
TOKYO (Reuters) – Japanese Finance Minister Taro Aso said on Friday there was no change in the government’s stance that it would go ahead with a planned sales tax hike in October, barring a big economic shock on the scale of the collapse of Lehman Brothers.
Aso made the comment a day after a close aide of Prime Minister Shinzo Abe told a TV program that the planned tax increase may be postponed depending on the results of the central bank’s next tankan business survey due out in July.
The tax hike to 10 percent from the current 8 percent would secure stable financial resources to pay for the bulging cost of social security for all generations, Aso told reporters after a cabinet meeting.
(Reporting by Tetsushi Kajimoto; Editing by Chris Gallagher)
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FILE PHOTO: Apr 8, 2019; Minneapolis, MN, USA; Texas Tech Red Raiders guard Jarrett Culver (23) speaks during a press conference after the championship game of the 2019 men’s Final Four at US Bank Stadium. Mandatory Credit: Caylor Arnold-USA TODAY Sports
April 19, 2019
Texas Tech standout Jarrett Culver, the Big 12 Player of the Year, announced Thursday he will forgo his last two seasons in Lubbock and declare for the 2019 NBA Draft.
The 6-foot-5, 195-pound guard made the announcement during a press conference in Lubbock, Texas.
Culver helped lead the Red Raiders to a share of the Big 12 regular-season title and was effective in this year’s NCAA Tournament, where Texas Tech fell to Virginia 85-77 in overtime in the national championship game.
On the season, Culver averaged 18.5 points, 6.4 rebounds and 3.7 assists per game while the Red Raiders set a school record with 31 wins.
–Also announcing his plans to declare for the draft was 18-year-old Russian Nikita Mikhailovskii, according to a report by ESPN.
The 6-foot-8, 180-pound wing is trying to become the first Russian player drafted since 2013 when Sergey Karasev was chosen with the 19th pick by the Cleveland Cavaliers.
Mikhailovskii spent the past season playing in the mostly Russian VTB United League and FIBA Europe Cup, averaging 7.8 points in 16.8 minutes while shooting 43.9 percent from 3-point range in 45 games.
–The Memphis Grizzlies hired two former general managers to their front office, adding Rich Cho as vice president of strategy and Glen Grunwald as senior adviser.
Cho is a former GM of the Charlotte Hornets and Portland Trail Blazers, and Grunwald was GM of the New York Knicks and Toronto Raptors.
The Grizzlies demoted former GM Chris Wallace to a scouting role in a flurry of moves last week, including the firing of head coach J.B. Bickerstaff and the promotion of Zach Kleiman to executive vice president of basketball operations.
–Los Angeles Clippers assistant general manager Trent Redden reportedly is close to interviewing for a senior front-office role with the New Orleans Pelicans.
The Clippers gave the Pelicans permission to discuss the position with Redden, ESPN reported, citing league sources.
David Griffin, the Pelicans’ new executive vice president of basketball operations, worked closely with Redden when they with the Cleveland Cavaliers during their 2016 NBA championship season. ESPN’s Adrian Wojnarowski noted that Griffin is expected to be “aggressive” in pursuing Redden.
–Field Level Media
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FILE PHOTO: U.S. President Donald Trump walks to board Air Force One as they travel to Florida for Easter weekend, at Joint Base Andrews in Maryland, U.S., April 18, 2019. REUTERS/Al Drago
April 18, 2019
By Nathan Layne and Mark Hosenball
WASHINGTON (Reuters) – Special Counsel Robert Mueller may not have found evidence of a criminal conspiracy between Donald Trump’s 2016 campaign and Russia, but his report details extensive contacts between the campaign and Russian operatives who sought to influence the election.
Mueller said in his report released on Thursday that he found “numerous links” and that the Trump campaign “expected it would benefit” from Russia’s effort to tilt the ballot in Trump’s favor.
Ultimately, Mueller determined the various contacts either didn’t amount to criminal behavior or would be difficult to prove in court, even if people in Trump’s orbit sometimes displayed a willingness to accept Russian help, the report showed.
Trump and his allies, who derided the Mueller probe as a political “witch hunt”, portrayed the report as vindication. “No collusion. No obstruction. For all the haters and the radical left Democrats, game over,” Trump tweeted on Thursday.
“The bottom line is the president is exonerated and the campaign is exonerated of collusion,” said Michael Caputo, a former adviser to Trump’s campaign.
Some legal experts and political strategists were more circumspect, saying the report confirmed the Russian government was attempting to help Trump with the election.
“I think that’s a pretty extraordinary finding of historical significance, whether or not there’s a crime,” said Matthew Jacobs, a former federal prosecutor who is now a San Francisco-based lawyer.
Many of the contacts in the report were already known. They included former national security adviser Michael Flynn’s conversations in late 2016 with Sergei Kislyak, Russia ambassador at the time, and former Trump campaign chairman Paul Manafort’s interactions with Konstantin Kilimnik, a political consultant who the FBI has determined has ties to Russian intelligence.
But the report contained fresh details on the range of official and unofficial dealings Trump campaign advisers and supporters had with Russians before and after the 2016 election.
For example, the report says that Manafort, shortly after he joined the campaign in the spring of 2016, directed his deputy to share internal polling data with Kilimnik with the understanding it would be passed on to Oleg Deripaska, a Russian oligarch known to have close ties to the Kremlin.
Lawyers for Manafort did not immediately respond to a request for comment. Kilimnik did not reply to an email seeking comment.
A Washington-based attorney for Deripsaka said he could not comment. In a statement to Reuters in January, representatives for Deripaska said he has never had any communication with Kilimnik.
The report also says that Manafort told Kilimnik in August 2017 about the campaign’s efforts to win the battleground states of Michigan, Pennsylvania, Wisconsin and Minnesota. Trump ended up winning three of those states in the November election.
Mueller’s investigation did not find a connection between Manafort’s sharing of polling data and Russia’s meddling in the U.S. election or that he otherwise coordinated with Russia.
Frank Montoya, a former senior FBI official, said he was nonetheless bothered by the interactions between Manafort and Kilimnik, especially their talking about battleground states.
“As a longtime counterintelligence investigator it makes the hair stand on the back of my neck,” Montoya said.
The report detailed a meeting in December 2016 between Trump’s son-in-law Jared Kushner and Sergei Gorkov, the head of a Russian state-owned bank under U.S. sanctions. Gorkov gave Kushner a painting and a bag of soil from the town in Belarus where Kushner’s family is from, the report says.
Mueller’s team said it could not resolve a conflict in the accounts of Kushner, who said the meeting was diplomatic in nature, and Gorkov, who said it was business related.
Kushner has said neither sanctions nor his business activities were discussed at the meeting. Kushner’s lawyer did not respond to a request for comment on Mueller’s report.
The report also provided new details about a meeting that campaign advisers Donald Trump Jr., the president’s oldest son, Kushner and Manafort held with a Russian lawyer at New York’s Trump Tower in June 2016. The meeting was set up after the advisers were promised “dirt” on Hillary Clinton, Trump’s Democratic challenger for president.
Mueller’s team considered whether the advisers violated laws barring election contributions from foreigners. But, the report says, they ultimately decided there was not enough evidence to show they “wilfully” broke the law and they might have had problems proving the information offered on Clinton was really valuable.
When news of the Trump Tower meeting broke in July 2017, Trump Jr. issued a statement saying the meeting was set up to discuss adoption policy, not politics, before later admitting he had been expecting intelligence on Clinton.
Such interactions have broadly been referred to by Democratic congressional investigators as examples of possible “collusion”. But because collusion is not a legal term, Mueller’s team examined the Trump Tower meeting and other contacts through the lens of federal conspiracy law.
Mueller said his investigation was unable to establish that such contacts with Russians met the bar of criminality which required that the contacts “amounted to an agreement to commit any substantive violation” of U.S. laws, including those governing campaign finance and foreign agent registration.
Therefore, Mueller said his office “did not charge any individual associated with the Trump Campaign with conspiracy to commit a federal offense arising from Russia contacts.”
(Reporting by Mark Hosenball, Nathan Layne, Sarah N. Lynch, Karen Freifeld and Andy Sullivan in Washington; Editing by Ross Colvin and Paul Thomasch)
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FILE PHOTO: Workers emerge from Bank underground station with the Bank of England (L) and Royal Exchange building (R) in the City of London financial district, London, Britain, January 25, 2018. REUTERS/Toby Melville/File Photo
April 18, 2019
By Sinead Cruise, Josephine Mason and Huw Jones
LONDON (Reuters) – The weeks before Easter are usually some of the busiest of the year for bankers, lawyers and consultants in the City of London, as clients rush to get deals done before a run of public holidays.
But this year comparatively little has been happening.
City workers had been hoping the torpor of the first quarter would be lifted if Britain left the European Union on March 29, or indeed, April 12.
But with Brexit on ice until as late as October 31 and the terms of the exit still to be agreed, fears are building that this could be one of the leanest years for the City since the aftermath of the 2008 financial crisis.
The London Stock Exchange has had only one corporate listing in excess of 75 million pounds ($97.61 million) so far this year. Trading turnover on the London Stock Exchange in February and March was down a third from a year ago, and the lowest since August 2016.
Average daily turnover on London’s blue chip FTSE 100 stock index fell harder in those two months than all the main bourses in Europe except the DAX 30, according to a Reuters analysis of Refinitiv data.
European investment banking fees – the biggest chunk of which are earned in London – were down 25 percent in the first quarter, according to Refinitiv. And there were just 11 new UK-based hedge funds launched in the first quarter, compared to 35 in the same quarter in 2018, data from Prequin shows.
“There is going to be a long hiatus. Investors will need to see something far more positive in politics to be persuaded to move again,” Alastair Winter, economic adviser to Global Alliance Partners told Reuters.
“I can’t see how Labour and Conservatives can agree a deal. They are playing games to avoid blame. And until they figure it out, the City will be left to just twist in the wind.”
Recruitment firm Morgan McKinley’s latest London Employment Monitor, which tracks financial services hiring trends from January to March, showed vacancies and job seekers dropping 9 percent and 15 percent respectively year-on-year. The number of job vacancies and job seekers in the first quarter were half the level they were in 2017.
Hakan Enver, Morgan McKinley Managing Director, said the figures showed confidence among City employers was flatlining.
“Even with all the uncertainty of the last few years, there was always an assumption that come March 29, we would have some answers. Yet here we are, still waiting,” Enver said.
Neil Robson, regulatory and compliance partner at law firm Katten Muchin Rosenman, said in the six weeks leading up to the end of March the “chargeable” work he had done was what he would usually do in a week-and-a-half.
“People are not setting up new funds, are not hiring, firing, they’re not doing new deals because they’re just waiting for what’s happening with Brexit,” he told Reuters.
Unlike the 2008 financial crisis, there is no sense of panic, just a pause pending greater clarity around Brexit, as well as other global issues like the U.S.-China trade dispute.
“We haven’t seen any panic-selling. There is resilience, and people have decided they need to just watch this play out,” one senior private banker said.
Robson said he had seen a small pick-up in activity since the Brexit extension was agreed, but it was still not at full capacity.
(Graphic: LSE turnover – https://tmsnrt.rs/2IrwrGg)
GETTING CREATIVE
The slowdown has forced firms to be more creative about how to make money.
Several large investment banks, including JPMorgan and Goldman Sachs, have ramped up fundraising for private companies to fill an income void left by shallow capital markets activity. JPMorgan recently helped British banking start-up Starling raise 75 million pounds to fund expansion.
Banks are also spending more time taking companies off the stock market.
“I’m probably spending more of my time talking about take-private opportunities than I was a year ago. You will see more of that from now on. There are going to be more take privates if valuations continue to be depressed,” Indy Bhattacharyya, director at broker Peel Hunt, said.
The slowdown is not isolated to London – U.S. banks this week reported slides in their trading businesses globally.
But with Brexit uncertainty confounding the issue, UK-based finance houses in particular are finding it tough going.
“The bigger players will survive this, with some cuts here and there. Where there will be carnage is among the small-cap brokers, the boutique operators,” said Winter.
Canada’s Canaccord Genuity Group last month blamed Brexit and regulatory pressure for unacceptable returns in its UK capital markets business and the launch of a restructuring program expected to lead to significant job cuts.
As part of that plan, the company has put 48 jobs in London, more than a quarter of its City workforce, at risk of redundancy, according to an internal document seen by Reuters. It also plans to ax its mining and investment trust businesses, two sources familiar with the situation said.
Canaccord said in a statement that it was going through a consultation process and could not confirm details about the affected employees.
“This process, while difficult, is in connection with our previously stated strategy of better focusing our operations in the areas where we can be most relevant to our clients, while limiting our exposure in areas that are more sensitive to an unpredictable market backdrop,” the firm said.
With the threat of potential cuts, bankers say they are holding off booking extended holidays and doubling down on meeting clients and pitching ideas instead. But until there’s more Brexit clarity, few expect that to lead to much new business.
“There’s every chance this year that you’ll see more bankers doing the school run,” Peel Hunt’s Bhattacharyya said.
($1 = 0.7684 pounds)
(Additional reporting by Helen Reid, Maiya Keidan and Virginia Furness. Editing by Jane Merriman and Rachel Armstrong)
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The flag of Puerto Rico flies outside the Capitol building in San Juan, Puerto Rico May 4, 2017. REUTERS/ Alvin Baez
April 18, 2019
SAN JUAN (Reuters) – A judge on Thursday ordered banks to comply with a request from Puerto Rico’s federally created financial oversight board to disclose customer information related to certain debt issued by the bankrupt U.S. commonwealth.
The ruling boosts a potential effort by the board to recover billions of dollars in payments made to bondholders should a federal court hearing Puerto Rico’s bankruptcy cases choose to invalidate disputed debt issued by the government and its agencies.
U.S. Magistrate Judge Judith Gail Dein’s order said “good cause exists” to grant the board’s motion, which seeks to compel banks to submit bondholder names and addresses along with Puerto Rico debt payments the bondholders received between 2013 and 2017.
The Bank of New York Mellon, Bank of America Corp, JP Morgan Chase Bank, and U.S. Bank objected to the board’s request last week, citing concerns over disclosing confidential customer information, as well as the cost and ability to produce a large amount of information by the April 19 deadline set by the board.
The judge ordered the banks and the board to submit a proposed confidentiality agreement by April 23 and set rolling deadlines of April 25, April 30 and May 8 for the banks to submit bondholder information. She rejected requests by the banks to be reimbursed for their costs and for indemnity for claims that could result from compliance with the order.
It was unclear whether the banks will appeal. Attorneys for the banks either declined to comment or could not immediately be reached.
The quest for bondholder information is related to an attempt by the board and some creditor groups in the bankruptcy to have the federal court void more than $6 billion of defaulted general obligation (GO) bonds sold in 2012 and 2014, as well as debt issued by Puerto Rico’s Public Buildings Authority and bonds sold for the island’s Employees Retirement System.
The board filed bankruptcy for the island in May 2017 to restructure about $120 billion of debt and pension obligations. But it did not seek to void the GO bonds on the basis they were issued in violation of debt limits in the Puerto Rico Constitution until January 2019, just months before the statute of limitations on bringing such actions runs out in early May.
U.S. District Court Judge Laura Taylor Swain is scheduled to take up the board’s motion to extend that deadline at an April 24 hearing.
(Reporting By Luis Valentin Ortiz in San Juan and Karen Pierog in Chicago; Editing by Matthew Lewis)
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