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Tuesday, 23 September 2014

Tesco’s off-balance sheet wheeze, courtesy of Goldman Sachs | FT Alphaville

Tesco’s off-balance sheet wheeze, courtesy of Goldman Sachs | FT Alphaville:



"This is not new, but bears revisiting, given recent events.



Between 2009 and 2013, as part of its sale and leaseback plan, Tesco used a series of six special purpose vehicles to issue close to £4bn worth of property bonds. Structured with the help of Goldman Sachs, the programme even won Tesco an award — Risk Magazine’s 2012 Corporate risk manager of the year.



But Nigel Stevenson, a former M&A banker at Kleinworts who now runs his own research shop, reckons the effect of this off-balance sheet financing has been to artificially reduce Tesco’s net debt by around £2bn."



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Mechel Sinks 30% as Russia Expects Bankruptcy - Bloomberg

Mechel Sinks 30% as Russia Expects Bankruptcy - Bloomberg:



"OAO Mechel (MTL) sank 30 percent to a record low as Russia’s economy minister said he saw no alternative but bankruptcy for the mining company after nine months of unsuccessful efforts to refinance its debt.



Mechel, Russia’s biggest producer of coking coal, tumbled to $1.02 in New York yesterday as trading volume surged to 8 times the average of the past three months. The stock has plunged 60 percent this year after falling prices for the steel-making ingredient led to a record loss in 2013. The company has about $8.7 billion of bonds and loans due in the next seven years, data compiled by Bloomberg show. Analysts estimate the company will lose $591 million in 2014. 




The stock tumbled after Economy Minister Alexei Ulyukayev, speaking to reporters at a banking forum on Sept. 20, said “if the company is bankrupt, we should legally acknowledge it” and that he sees “no other way out.” While Russian banks own most of Mechel’s debt, international sanctions linked to the Ukraine war have virtually blocked them from tapping U.S. and European markets for refinancing."



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Raiffeisen Predicts Loss as Ukraine Causes Bad-Debt Rise - Bloomberg

Raiffeisen Predicts Loss as Ukraine Causes Bad-Debt Rise - Bloomberg:



"Raiffeisen Bank International AG (RBI), the foreign bank with most at risk in Ukraine and Russia, predicted its first annual loss this year as the conflict in Ukraine causes bad-debt charges to rise faster than expected.



Raiffeisen’s loan loss provisions will rise to 1.5 billion euros to 1.7 billion euros ($2.2 billion) this year, compared with 1.15 billion euros in 2013, the Vienna-based bank said in a statement late yesterday. It’s the second time this year the bank has raised the provisioning forecast as the escalating conflict takes a bigger toll on Ukraine’s economy. Loan losses in Hungary will also be higher than expected, Raiffeisen said.



“As a consequence of the latest developments, a negative result for 2014 is to be expected,” Raiffeisen said in the statement. That’s “primarily due to higher expected risk costs in Ukraine in light of ongoing political tensions in the region"



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Arab Bank Found Liable for Hamas Terrorist Attacks - Bloomberg

Arab Bank Found Liable for Hamas Terrorist Attacks - Bloomberg:



"Arab Bank Plc, the biggest lender in Jordan, helped Hamas militants carry out a wave of violence in Israel that killed and wounded hundreds of Americans, a New York jury decided in the first trial of its kind in the U.S.



The Amman-based lender was found liable for doing business with more than 150 Hamas leaders and operatives in the early 2000s, helping finance about two dozen deadly suicide bombings, including attacks on crowded restaurants and buses in Tel Aviv and Jerusalem, jurors decided yesterday in federal court in Brooklyn, New York.



“The verdict is an incredible message that should be understood and heard by the entire financial community -- if you do business with terrorists, you can be held liable in the United States,” Michael Elsner, one of the plaintiffs lawyers, said in a phone interview."



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OPEC Output-Target Cut Not Agreed Yet, U.A.E. Oil Minister Says - Bloomberg

OPEC Output-Target Cut Not Agreed Yet, U.A.E. Oil Minister Says - Bloomberg:



"OPEC nations have yet to decide to cut their collective oil-production target, the United Arab Emirates’ energy minister said, days after the group’s chief suggested its 12 members may lower the ceiling in 2015.



“It’s not a one-man decision,” Suhail Al Mazrouei told reporters today in Abu Dhabi. “It’s a decision by all the ministers when we meet.”



The Organization of Petroleum Exporting Countries, supplier of about 40 percent of the world’s oil, will review its target of 30 million barrels a day when it meets next on Nov. 27 at its Vienna headquarters. The group may reduce its official daily limit by 500,000 barrels to 29.5 million next year, OPEC Secretary-General Abdalla El-Badri said Sept. 16."



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OPEC Output-Target Cut Not Agreed Yet, U.A.E. Oil Minister Says - Bloomberg

OPEC Output-Target Cut Not Agreed Yet, U.A.E. Oil Minister Says - Bloomberg:



"OPEC nations have yet to decide to cut their collective oil-production target, the United Arab Emirates’ energy minister said, days after the group’s chief suggested its 12 members may lower the ceiling in 2015.



“It’s not a one-man decision,” Suhail Al Mazrouei told reporters today in Abu Dhabi. “It’s a decision by all the ministers when we meet.”



The Organization of Petroleum Exporting Countries, supplier of about 40 percent of the world’s oil, will review its target of 30 million barrels a day when it meets next on Nov. 27 at its Vienna headquarters. The group may reduce its official daily limit by 500,000 barrels to 29.5 million next year, OPEC Secretary-General Abdalla El-Badri said Sept. 16."



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After Alibaba, what next for the market? - YouTube

After Alibaba, what next for the market? - YouTube: ""



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