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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.
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Markets 8th October 2014

ECB will push for DTA to be replaced by core capital

MADRID | The Corner | The ECB doesn’t like the idea of allowing banks to use Deferred Tax Assets (DTA) to boost their capital buffers, a practice that was meant to be phased out under new European Union rules. The central lender fears that losses would be imposed on taxpayers should entities run into trouble in the coming years, as the WSJ reported. Even if the ECB doesn’t have the power to change that, and is not likely to make any move before the upcoming stress tests, it might push for DTA to be replaced by core capital. 

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Markets 8th October 2014

FSB: tougher loss-absorbency homework for too-big-to-fail banks

MADRID | The Corner | The Financial stability board (FSB) is advocating an increase in regulatory demands of systemic banks: the so-called “too big to fail”. The details will be presented at tomorrow’s G20 meeting, but will effectively mean that more capital and liabilities can automatically be written off in a crisis. The basic requirement will be set at 15-20% of risk-weighted assets by 2019, although the final number will be higher (even more than 25% in certain cases) since lenders have to meet “other regulatory capital buffers,” according to the document, dated Sept. 21, quoted by Bloomberg.

PEDIDOS MANUFACTURAS

In Europe 8th October 2014

A weak euro doesn’t necessarily mean stronger Q3, Q4 earnings

MADRID | The Corner| Shouldn’t a weak euro boost Q3 and Q4 earnings? As Barclay’s Alberto Vigil commented on Wednesday, up to this point there is no doubt that exports have benefitted from it, but “it is not that clear whether this positive effect will manage to boost domestic and emerging markets which are the destination of many exports.”

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In Europe 7th October 2014

Greece: ‘We’re dying to pay our taxes’

ATHENS | By Damian Mac Con Uladh at The Agora | Like thousands of citizens, Nikolas Elliniadis had left it to deadline day to go to his bank, in Thessaloniki, Greece’s second city, to pay the first of six instalments of Greece’s new property tax, the latest levy to hit a population beleaguered after five years of austerity.

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Spanish economy 7th October 2014

It’s IPO fiesta time in Spain!

MADRID | The Corner | In 2014, the Spanish stock market could register the largest number of IPOs since 1989 with a total of 17 operations, according to the Spanish Stock Exchange (BME). Up to present, eleven firms have won approval for initial public offerings with capital flows amounting to €4.8 billion.

 

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World economy 6th October 2014

A Nobel Prize for discovering our inner GPS

MADRID | The Corner | Right now, you are sitting on your desk and plan to grab a sandwich from the vending machine, then consider investing on a stock. Your plans are clear. But do you know why you know that? Neuroscientists John O’Keefe, May-Britt Moser and Edvard Mos are the discoverers of that mechanism, our brain’s GPS, or cells that form a positioning system in it. They were awarded with the Nobel Prize of Medicine on Monday in Stockholm. Their research could mean advances in the Alzheimer research. 

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In Europe 6th October 2014

Capital markets union and Lord Hill’s answers to next hearing

MADRID | The Corner | Newly appointed Commissioner for Financial Stability, Financial Services and Capital Markets Union, Jonathan Hill, received a “written exam” from the Parliament’s ECON Committee, whose members felt he had failed to sufficiently answer their questions at his first hearing. Lord Hill replied with his answers in writing on Sunday (see link below). Unfortunately, while Hill appears happy to offer his take on financial regulation, he was rather less forthcoming when it came to revealing his ties with The City of London.

 

 

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Markets 6th October 2014

Markets stall as fractious ECB fails to convince

MADRID | The Corner | Expect the market to stagnate in the days ahead, as markets continue to slump in the wake of the ECB’s disappointing announcement last Thursday and growing differences between the central bank’s counselors, who have failed to  agree on how to back ABS purchases. Whether it’s due to technical or fundamental reasons, the reality is that France (Mr Noyer) is against granting such state guarantees, in addition to Germany (Mr Weidmann) and Austria (Mr Nowotny).

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In Europe 6th October 2014

European Investment Banks: Q314 – It’s all about September

ZURICH | The Corner | UBS analysts explain that in September, volatility started rising in almost all major markets and asset classes. Higher Rates and FX volatility, driven by diverging monetary policies in the US and Europe, typically suggest higher activity and more favourable operating conditions for FICC. Although UBS analyts are still cautious about FICC for structural reasons, some cyclical improvement and potential upgrades in FICC consensus estimates for Q3 2014 are now more likely (UBS tweaks his CS and DBK 2014E EPS forecasts 2% and 3% upwards, respectively). For global IBs, they forecast FICC revenues up 9%, Equities up 3% and IBD up 12% y/y. In the European IB space, they prefer Barclays and SocGen for stock specific reasons.