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View the article online at http://citywire.co.uk/wealth-manager/article/a731446

Friday Papers: US seeks $2.1bn from BofA over mortgage fraud

by Himanshu Singh on Jan 31, 2014 at 03:09

Friday Papers: US seeks $2.1bn from BofA over mortgage fraud

Top stories

  • Financial Times: The US government has asked for $2.1 billion in penalties from Bank of America in a high-profile case where the bank was found liable for civil fraud over bad mortgages sold to Fannie Mae and Freddie Mac.
  • Financial Times: India‘s central bank governor has hit out at the US and other industrialised countries for running selfish economic policies as their recovery leads to turmoil in emerging markets.
  • Financial Times: Denmark’s coalition government was brought to the brink of break-up on Thursday following public outcry at a Goldman Sachs investment in a state-owned utility.
  • The Guardian: Libya's sovereign wealth fund is suing Goldman Sachs for more than $1 billion over allegations that the investment bank exploited a lack of financial expertise at Colonel Gaddafi's investment fund.
  • Financial Times: Royal Dutch Shell is to suspend its controversial drilling in Arctic waters off Alaska as part of a multibillion-dollar scaling back of spending on new projects under Ben van Beurden, chief executive.
  • Financial Times: Renault and Nissan will fully combine their manufacturing and research and development operations to save at least €4.3 billion a year by 2016, in the most significant step toward full integration since the alliance was founded.
  • The Independent: Fashion fans flocked back to LVMH-owned brands in the final quarter of last year and the luxury group reported a 2% rise in profit - hitting the €6 billion annual profit figure for the first time.
  • Financial Times: Microsoft’s directors could name a successor to Steve Ballmer as chief executive within days; Satya Nadella, the executive in charge of Microsoft’s cloud and enterprise division, is seen as the likely successor.

Business and economics

  • The Daily Telegraph: Bank of England data show net business lending fell by alomst £2 billion in December, as data highlight widening disparity between interest rates offered.
  • Financial Times: US purchases of European stocks swelled late last year to the highest since October 1996 relative to the size of European equity markets, according to figures compiled for the Financial Times.
  • Financial Times: Post-tax profits at ExxonMobil were $8.35 billion for the fourth quarter, down 16%, on revenues down 3% at $111 billion; the group’s earnings per share were $1.91, in line with analysts’ expectations.
  • The Daily Telegraph: Facebook’s market capitalisation has passed the $150 billion mark, putting the social network in a very exclusive club of companies to break through the watershed valuation before they turned 10 years old.
  • Financial Times: On Thursday, Amazon reported a net profit of $239 million - or 51 cents per share - for the three months to 31 December having made a loss in the previous two quarters.
  • Financial Times: Rising losses at the Motorola handset business, which Google agreed this week to sell to Lenovo for $2.9 billion, left the US internet company’s earnings below expectations in the final months of 2013; overall, Google’s earnings reached $12.01 per share on a pro-forma basis, short of the $12.21 that analysts had been expecting.
  • Financial Times: Blinkx, the online video search company spun out of Mike Lynch’s Autonomy, lost a third of its market value on Thursday after a Harvard academic published a blog alleging it used questionable tactics to boost advertising revenue.
  • The Guardian: Shares in HSBC jumped nearly 10% in a matter of minutes on Thursday in what traders said looked like a costly mistake.
  • Financial Times: Hundreds of millions of pounds were wiped off Serco’s market value on Thursday after a UK government decision allowing it to bid for public sector work was overshadowed by a warning that profits would be hit by troubled contracts in the UK and Australia.
  • Financial Times: Glencore Xstrata is looking to sell its stake in a Philippines copper project, according to the commodities group’s partner in the development.
  • Financial Times: Time Warner Cable outlined a three-year battle plan to revive its residential offerings and ramp up its business services group, as the second-largest US cable operator by subscribers spurns a $61 billion takeover bid from smaller rival Charter Communications.
  • Financial Times: Diageo, the world’s biggest producer of Scotch whisky, is lobbying the Scottish and UK governments ahead of September’s referendum on independence for Scotland to counter “anything that could add complexity and burden to the business”.
  • Daily Mail: H&M posted an 11% surge in annual profits to £682 million for the year to 30 November.
  • The Independent: John Lewis has decided against closing its final salary pension scheme, leaving it as one of the only retailers in the country that still offers new staff the gold-plated retirement payouts more commonly associated with politicians and civil servants.
  • Daily Mail: The listed private equity group 3i, which owns the lingerie brand, also took a £14 million writedown in its Hobbs clothing business after a disappointing Christmas.
  • Financial Times: Banco Santander, Spain’s biggest bank by assets, has said it made €4.37 billion in net profits in 2013, almost double the level of the previous year, helped by a sharp drop in bad loan provisions.
  • Financial Times: Blackstone’s assets under management rose 26% in 2013 to $265.8 billion, still a fraction of the $4.3 trillion under management at BlackRock, the world’s largest fund manager.
  • Financial Times: UPS chief executive Scott Davis has announced a $500 million in accelerated investments after the company reported fourth-quarter earnings per share of $1.25, in line with figures foreshadowed in a 17 January profit warning following its Christmas delivery problems across the US.
  • Financial Times: Germany’s cartel regulator announced an investigation into state-owned rail operator Deutsche Bahn on Thursday, prompted by complaints from competitors that it had used its dominant market position to restrict the sales of rivals’ tickets.
  • The Independent: Last year Carphone Warehouse hung up on its partnership with US retailer Best Buy, but on Thursday it picked up new partner Samsung and approving investors piled in.
  • Financial Times: Mitchells & Butlers posted like-for-like sales growth of 2% for the 17 weeks to 25 January, although this performance was flattered by poor weather in the corresponding period last year and still lags behind the rest of the sector.

Share tips, comment and bids

  • The Daily Telegraph (Questor share tip): More to BSkyB than BT battle; satellite broadcaster is well prepared to continue growing, says Questor.
  • The Daily Telegraph (Questor share tip): Johnson Matthey hits all-time high; profits fall at catalyst group Johnson Matthey, but the future looks bright. Questor says hold.
  • Financial Times: Zynga is to pay more than $500 million to buy NaturalMotion, the UK-based developer of mobile apps such as Clumsy Ninja and CSR Racing, in the social gaming company’s largest acquisition yet.
  • The Daily Telegraph: Santander UK’s much anticipated stock market float is being delayed by regulatory indecision over capital and leverage ratios.
  • Financial Times (Comment): Investors should avoid casting their net too wide in emerging markets pool.
  • The Guardian (Comment): To stop our cites turning into ghettos for the rich, we need to rein in rogue landlords.
  • The Daily Telegraph (Comment): While politicians argue, the Big Six are harming the UK's energy future.
  • Financial Times (Lex): Amazon: Newfound capital efficiency suggests it cares more about the bottom line than has seemed the case
  • Financial Times (Lex): Blackstone: How much worse will the asset manager be hurt when the next downturn hits?
  • Financial Times (Lex): Diageo: Cost structure changes are a threat to the spirits maker
  • Financial Times (Lex): Santander: Falling provisions can only boost profits at the Spanish bank for so long

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