Governance

  • Argentina bondholders can expect more political pressure

    Argentina bondholders can expect more political pressure

    In recent weeks, Argentina’s PR agency has been cramming the inboxes of financial journalists as the government goes on the attack in an apparent attempt to guilt-trip dissenting creditors into accepting its restructuring offer.

    28 Jul 2020
  • Australian govvies hit by climate challenge

    Australian govvies hit by climate challenge

    In a world first this week, 23-year-old student and Australian retail government bond investor Katta O’Donnell filed a legal challenge against the sovereign on Wednesday, claiming that the government does not do enough to disclose the risks of climate change to investors. If successful, the case could change issuers’ obligations regarding climate risk disclosure.

    23 Jul 2020
  • The war on Huawei, robots and female pay, state aid’s real state of play

    The war on Huawei, robots and female pay, state aid’s real state of play

    Each week, Keeping Tabs brings you the very best of what we have found most useful, interesting and informative from around the web. This week: what’s next for the US after its war on Huawei, the impact that more robots would have on the gender pay gap, and a look on the bright side of Europe’s mishmash of state guarantee schemes.

    17 Jul 2020
  • China rolls out unified law on bond defaults

    China rolls out unified law on bond defaults

    China has introduced a primary legal framework to tackle bond defaults, bringing together separate guidelines that had been in place for each of its three debt markets. While the move simplifies things for bondholders, there are still a number of unanswered questions, said bankers.

    17 Jul 2020
  • Regulators need to think like short sellers

    Regulators need to think like short sellers

    The Wirecard scandal — like other recent debacles such as NMC Health — shows that financial reporting, oversight and governance, as they are currently practised, are woefully inadequate.

    16 Jul 2020
  • Reckoning begins for BaFin after it pursued Wirecard foes, not fraudsters

    Reckoning begins for BaFin after it pursued Wirecard foes, not fraudsters

    Short sellers who for years have complained that BaFin, the German financial markets regulator, ignored their criticisms of Wirecard, the collapsed payments company, and instead prosecuted the critics, have begun to be vindicated with the news that the European Securities and Markets Authority (ESMA) has opened a review into the organisation. By Silas Brown.

    16 Jul 2020
  • Market keeps guard up as Ukraine names new CB chief

    Market keeps guard up as Ukraine names new CB chief

    Krylyo Shevchenko, the chairman of state-run Ukrgasbank, has been selected as the new governor of the National Bank of Ukraine (NBU) after weeks of deliberation. The choice has elicited a mixed reaction from market spectators, some of whom hope that Ukraine can salvage its international debt market access and IMF funding. Mariam Meskin and Ross Lancaster report.

    16 Jul 2020
  • UK ECM needs structural change for retail to play bigger role

    UK ECM needs structural change for retail to play bigger role

    UK equity capital markets have undergone changes during the Covid-19 pandemic, including allowing retail investors to participate in accelerated recapitalisations of London-listed companies via PrimaryBid. The rise of the app represents a long overdue change but its impact is likely to be limited.

    14 Jul 2020
  • Luckin Coffee serves up new chairman

    Luckin Coffee serves up new chairman

    Troubled Chinese coffee chain Luckin Coffee has appointed a new chairman of the board after founder Lu Zhengyao was voted out of the position by shareholders.

    14 Jul 2020
  • Supreme Court to review FHFA leadership structure

    Supreme Court to review FHFA leadership structure

    The Supreme Court has taken up the case to decide on the constitutionality of the Federal Housing Finance Agency’s leadership structure, just a few weeks after tackling a similar case in which it ruled the Consumer Financial Protection Bureau’s structure unconstitutional.

    13 Jul 2020
  • AMS close to Osram refi with €200m add-on

    AMS close to Osram refi with €200m add-on

    Austrian sensor maker AMS has added €200m and $50m to its July 2025 notes, taking the total to €1.25bn. The debt raise is intended to refinance a €2.77bn bridge loan, of which €1.47bn is drawn, used to buy Munich-based lighting maker Osram.

    13 Jul 2020
  • Hempton: ‘Wirecard is my biggest loss, despite being right’

    Hempton: ‘Wirecard is my biggest loss, despite being right’

    The Australian short seller, John Hempton of Bronte Capital, told investors that the profits his hedge fund Bronte Capital made on Wirecard’s collapse will not make up losses incurred during his lengthy short of the German payments company. It was an illustration, he said, of the dangers of betting against frauds and highlights the importance of risk management.

    13 Jul 2020
  • Bulgaria and Croatia to join Europe’s Banking Union

    Bulgaria and Croatia to join Europe’s Banking Union

    The European Central Bank will begin supervising financial institutions in Bulgaria and Croatia from October 1, as the two countries prepare to join the euro. Firms entering the Banking Union for the first time will also fall under the Single Resolution Board’s remit for the minimum requirements for own funds and eligible liabilities (MREL).

    13 Jul 2020
  • CSRC hits GF Securities with sponsorship, bond ban

    CSRC hits GF Securities with sponsorship, bond ban

    China’s securities regulator has banned GF Securities from sponsoring IPOs for six months and underwriting bonds for a year, punishing the firm for its role on a series of fundraisings for Kangmei Pharmaceutical Co.

    13 Jul 2020
  • Investor group calls for better covenant transparency after TKE victory

    Investor group calls for better covenant transparency after TKE victory

    The European Leveraged Finance Association has called for better transparency in high yield covenant packages, arguing that clarity is crucial for pricing risk. The call comes shortly after one of the largest covenant climb-downs in recent market history, when lead banks on ThyssenKrupp Elevator stripped many of the most controversial terms from the €8bn financing.

    09 Jul 2020
  • EBA finally receives approval for exec director

    EBA finally receives approval for exec director

    François-Louis Michaud was approved as the next executive director of the European Banking Authority on Wednesday. The EBA’s previous choice was rejected by parliamentarians, and this nomination faced scrutiny too over gender balance.

    09 Jul 2020
  • Tension in Ukraine over new central bank governor

    Tension in Ukraine over new central bank governor

    Following the high drama in Ukraine last week when the sovereign pulled a long anticipated bond issue after the governor of the central bank resigned just after the deal was priced, investors are now casting a cautious eye on who will take over.

    06 Jul 2020
  • Wirecard's insolvency triggers default for convertible investors

    Wirecard's insolvency triggers default for convertible investors

    SoftBank’s repackaged €900m Argentum bonds exchangeable into Wirecard shares are to be liquidated immediately after the German payments company filed for insolvency in June, having disclosed €1.9bn of cash was missing from its balance sheet. This will offer investors a way out or a seat at the table for the looming bankruptcy proceedings.

    02 Jul 2020
  • China bankers fret amid investor disclosure move

    China bankers fret amid investor disclosure move

    Shanghai Clearing House’s plan to show issuers a full list of their investors is causing alarm among some syndicate bankers — who admit to using highly questionable bookbuilding practices to impress their clients. Rebecca Feng reports.

    02 Jul 2020
  • Ukraine crisis cash in jeopardy after CB chief quits

    Ukraine crisis cash in jeopardy after CB chief quits

    The shock resignation of the governor of Ukraine’s central bank on Wednesday night led the sovereign to pull its much-anticipated Eurobond, which had priced just moments before. As investors grow more unsettled, experts fear for the sovereign’s access to institutional funding and capital markets, writes Mariam Meskin.

    02 Jul 2020
  • AMS pays up after investigation news trips up takeout

    AMS pays up after investigation news trips up takeout

    AMS had to discount its bond by an extra point and pay a higher coupon in the face of lower demand as it looked to fund the takeover of light maker Osram, after news broke last Thursday of a potential investigation into the company’s executives. That forced bookrunners to reopen the deal and take another swing at the market this week.

    01 Jul 2020
  • Barnier signals post-Brexit capital markets rupture

    Barnier signals post-Brexit capital markets rupture

    In the latest sign that the UK’s capital markets will diverge from the EU’s next year, the head of the European Commission’s task force for relations with the UK, Michel Barnier, called the UK’s demands regarding financial services as “unacceptable”.

    01 Jul 2020
  • TKE underlines the toxicity of the covenant wars

    TKE underlines the toxicity of the covenant wars

    ThyssenKrupp Elevator (TKE) is a deal of superlatives: the largest European high yield debut, the largest European LBO in over a decade, the last LBO before coronavirus, the most levered debut industrial, and the worst-ever covenant package — or at least, it was at first. Three days after launching the bond leg of the deal, the sponsors and leads capitulated, erasing almost every controversial term in the docs — perhaps the largest ever retreat and the biggest investor victory in the long-running war over bond covenants. But it’s too soon for investors to celebrate, as the episode only highlights how damaging this conflict has become.

    29 Jun 2020
  • Covenant victory for bond buyers as TKE climbs down from ‘worst ever’ package

    Covenant victory for bond buyers as TKE climbs down from ‘worst ever’ package

    Lead banks on ThyssenKrupp Elevator’s landmark financing announced a sweeping set of amendments to a covenant package initially described as the "worst ever" seen in European high yield, rowing back in almost every sponsor-friendly area. The move is a major victory for bondholders that hoped the coronavirus crisis would reset the balance of power themselves and sponsors.

    29 Jun 2020
  • Keeping Tabs — office return, economists relearn, vol strats burn

    Keeping Tabs — office return, economists relearn, vol strats burn

    Each week, Keeping Tabs brings you the very best of what we in the GlobalCapital newsroom have found most useful, interesting and informative from around the web. This week: remote working challenges and opportunities, rethinking discrimination in economics, and how volatility strategies fell apart in the market crash.

    26 Jun 2020
  • Wirecard insolvency filing stuns lenders

    Wirecard insolvency filing stuns lenders

    Stricken German payments firm Wirecard has filed for insolvency, its management said on Thursday, a week after auditors refused to sign off its accounts. The move has surprised some of its lenders, who said talks to renew roughly €2bn worth of loans were proceeding until Wednesday night.

    25 Jun 2020
  • BLM protests push ethnic diversity up City agenda

    BLM protests push ethnic diversity up City agenda

    The Black Lives Matter protests have propelled discussions about ethnic diversity in the UK’s financial sector, and companies are likely to face more pressure from employees, investors and the government.

    25 Jun 2020
  • UK paves way for Brexit divergence

    UK paves way for Brexit divergence

    The UK government and regulators are looking at ditching some of the specifics of EU financial regulation — encompassing banks, insurers and capital markets — as the country looks ahead to its post-Brexit future.

    24 Jun 2020
  • Yandex gets oligarch backing for growth push

    Yandex gets oligarch backing for growth push

    Yandex, the Russian internet company, has raised $800m through a sale of new shares to US investors and a private placement to a consortium of Russian oligarchs and VTB Bank.

    24 Jun 2020
  • ‘What Wirecard put its critics through is heinous’: Fahmi Quadir, Safkhet Capital

    ‘What Wirecard put its critics through is heinous’: Fahmi Quadir, Safkhet Capital

    Fahmi Quadir, founder of short-only Safkhet Capital, tells GlobalCapital her hedge fund increased its short position in Wirecard as the crisis surrounding it unfolded. She said German regulator BaFin should have properly investigated the claims levelled at Wirecard years ago, and pointed to the problem of auditors developing long-term relationships with companies.

    24 Jun 2020
  • It should not have been left to journalists and short sellers to expose Wirecard

    It should not have been left to journalists and short sellers to expose Wirecard

    Healthy financial systems should not rely on short sellers and journalists to expose accounting scandals at large, publicly listed companies. Regulators and auditors should have been the heroes of the Wirecard story but their inability to see what others saw plainly paints them as the villains in this edition of German corporate noir.

    23 Jun 2020
  • Wirecard lenders scrabble for unanimity as Moody’s withdraws ratings

    Wirecard lenders scrabble for unanimity as Moody’s withdraws ratings

    Bank lenders are trying to reach an agreement with scandal-rocked Wirecard to renew as much as €2bn of loans, after the beleaguered German payments company breached its terms on Friday when it failed to produce audited financial results. According to several sources familiar with the situation every lender needs to sign off on the new deal, otherwise Wirecard may have to pay the entire loan back.

    22 Jun 2020

  • People moves in brief

    Deutsche gives Toomey position as head of new group — Gimpel leaves Citi, has fintech idea — Moelis hires Whelchel for private capital team

    18 Jun 2020
  • Crisis Talk – John Hempton, CIO of Bronte Capital: ‘good things happen to bad people’

    Crisis Talk – John Hempton, CIO of Bronte Capital: ‘good things happen to bad people’

    John Hempton, the Australian short seller and self-styled eccentric, believes fraudulent companies will soon become evident in the corporate rubble left by the coronavirus pandemic. Hempton, who has bet against 1,100 companies over the course of his career, explained how his hedge fund Bronte Capital goes about finding rotten eggs in business and finance.

    12 Jun 2020
  • HK activist investor Webb to take step back

    HK activist investor Webb to take step back

    Hong Kong’s renowned activist investor David Webb revealed this week that he has been diagnosed with cancer and will be taking a step back from his regular critiquing of governance and regulation in the city.

    10 Jun 2020
  • Esma fines Scope Ratings over inconsistency

    Esma fines Scope Ratings over inconsistency

    Rating agency Scope beat many European agencies to the punch in adopting new covered bond rating methodology in 2015, which is today considered a standard approach. But the European Securities and Markets Authority (Esma) is fining the agency on the grounds that it failed to apply it consistently and with the regulator’s permission.

    05 Jun 2020