Tag Archives: Corporate Bank (TRBC level 5)

African miners and winemakers toast China’s dispute with Australia | Instant News


CAPE TOWN (Reuters) – For South African winemaker Vergenoegd Löw, the pandemic could be catastrophic, but a fierce trade war between China and Australia has cost the 325-year-old plantation its toll.

Bottles of South African wine on display include supermarkets in Beijing, China February 4, 2021. Image taken February 4, 2021. REUTERS / Florence Lo

Its red, white and rose bottles pile up as South Africa bans the sale of alcohol under tight lockdown and visitors who once flock to vineyards near Cape Town to sip wine and snap photos of the notorious Indian Runner duck disappear.

That changed when Beijing imposed tariffs of up to 212% on Australian wines in November after Canberra led a call for an investigation into the origins of the COVID-19 outbreak in Wuhan.

Not just wine. Beijing hit various Australian goods with customs, created a new layer of bureaucracy and outright banned some Australian imports, giving a boost to African suppliers of anything from coal to beef to copper.

“We can now get a much larger volume of sales,” said Shaun McVey, marketing manager at Vergenoegd Löw, which has signed the new deal in China. “Instead of shipping maybe three or four containers a year, we’ve increased that to 15 to 20 containers.”

Chinese drinkers bought nearly 40% of Australia’s wine exports before long-burning tensions between Beijing and Canberra peaked and brought trade to a sudden halt.

Over the past three months, South African wine exports to China have surged 50%, according to trading agency Wines of South Africa, and hopes are high for more sales after Australian stocks waned during the Chinese Lunar New Year holiday.

Martyn Davies, Deloitte’s managing director for emerging markets and Africa, said a protracted trade war would create a wide window of opportunity for miners and other sectors such as agribusiness, although exploiting that potential would require work.

The Chinese market presents a variety of constraints, from incomprehensible language and bureaucratic barriers to tailoring marketing to its unique social media ecosystem, analysts say.

“Many African companies are significantly behind the curve,” said Davies Deloitte. “Australian companies have engaged China for 35 years.”

BAUXITE IMPROVEMENT

The lack of a trade agreement between China and countries in sub-Saharan Africa also means exporters may face an uphill battle.

Despite its increasingly important role as an investor in the continent, China only signed its first free trade agreement with the African nation, the Indian Ocean island nation of Mauritius, in January.

Thus, while some African products may overtake Australian goods in the pecking order, they remain at a disadvantage when competing with exports from countries with preferential Chinese trade terms such as Chile, Peru or New Zealand.

In the mining sector, China has spent the last decade scaling up projects in Africa to maintain the flow of raw materials to the manufacturing giants.

The investment is now paying off and African producing countries are pocketing royalties as exports to the world’s second largest economy get a boost at the expense of Australia.

Last year, state-owned Aluminum Corp of China Ltd, known as Chalco, shipped the first cargo of bauxite from the Guinea project, and a prolonged trade war between China and Australia will only help the West African nation’s economy.

Australia’s shipments to China of the stone used to make aluminum fell 22% in the last quarter of 2020 while imports from Guinea jumped 70%, according to Chinese customs data.

That’s after Guinea tripled its bauxite production between 2015 and 2019 when mining projects began operating, with most of it shipped to China. During the same period, Guinea’s gross domestic product jumped 40%.

Graph – China turned to Guinean bauxite because it avoided Australia:

Meanwhile, Chinese copper concentrate imports from Australia plunged to zero in December 2020. At the same time, exports were up 17% from the Democratic Republic of Congo, another country where Chinese companies such as China Molybdenum have invested heavily to secure major mineral supplies.

The South African coal industry has also received a much needed boost. Sales of Australian thermal coal to China, which is mainly used in power generation, and metallurgical coal for steelmaking, slumped to zero in December.

South Africa’s first shipment of thermal coal to China in five years landed last month and exporters expect sales to pick up further in 2021.

Graph – China’s copper imports from the DRC soar:

‘INNOVATIVE AND BEAUTIFUL’

To address the lack of a trade agreement with China, Standard Bank South Africa, which is partly owned by the Industrial and Commercial Bank of China, has sought to equalize.

Africa’s biggest bank measured by assets uses online platforms and events to match its customers with Chinese buyers in a bid to boost exports.

However, those efforts now face unique challenges for the coronavirus pandemic, such as shipping pressure due to global trade distortions that have sparked a bidding war for container space and pushed prices to record highs.

“You get a lot of interest. And then when people look at the current logistics costs, they end up not completing the transaction, ”said Philip Myburgh, head of Standard Bank’s African-China banking.

However, wine is one of the African exports that Standard Bank considers a good bet. So was Edouard Duval, chief executive of East Meets West Fine Wines, one of China’s largest wine importers.

If South Africa could capture just 1% of Australia’s 38% share of the import market share quickly emptying out, that would double its exports to China, he said. “The potential is there … this is a very dynamic and fast-moving market.”

South Africa typically exports less than half of its wine and raised 9.1 billion rand ($ 616 million) in overseas sales last year, with Britain buying the most. Sales to China totaled only $ 19 million.

Although Chinese tariffs removed sales of Australian wine in November and December, its exports to China alone still totaled A $ 1.01 billion ($ 779 million) last year.

At the “Cheers” wine shop in Beijing, Lin Lulu doesn’t really care about the impact of the trade war with Australia.

“South African wines now have a big advantage over Australian wines because of the new fare situation,” he said, filling his shelves with South African red wines. South African wines are more innovative and beautiful.

($ 1 = 1.2962 Australian dollars)

($ 1 = 14.7621 rand)

Additional reporting by Mike Hutchings in Cape Town, Helen Reid in Johannesburg and Thomas Suen, Tom Daly and Muyu Xu in Beijing; Edited by David Clarke

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UPDATE 2-CBA Australia raised dividends, posted gains | Instant News


* Cash gain for 1H21 of A $ 3.89 billion vs estimated A $ 3.76 billion

* ‘Strongest ever’ balance sheet, $ 10 billion in excess capital

* Higher dividends and strength of capital to be well received – CS (Adds details on dividends, background, analyst comments)

SYDNEY, February 10 (Reuters) – Commonwealth Bank of Australia, the country’s biggest lender, on Wednesday announced a higher dividend than six months ago as it beat forecasts for first-half cash profit, driven by lower provisions and growth in home loans and business. .

The results show the country’s banking sector enters 2021 on a strong footing, as Australia’s A $ 2 trillion economy recovers after largely containing the coronavirus outbreak.

Australia’s largest lender declared an interim dividend of A $ 1.50 per share, up from a final dividend of A $ 0.98 announced in August, but lower than last year’s payment of A $ 2.00 per share.

At 67% of cash income, the bank’s dividend payout ratio remains below its self-set target of between 70% and 80% of profit.

Australian banks, like their global counterparts, have been hit hard in 2020 as interest rates approach zero and bad debt provisions due to the pandemic squeezing their margins.

However, the recent increase in loan repayments by customers following stronger job growth and a surge in new home demand due to low mortgage interest rates has helped improve the outlook for the banking sector.

“Despite the positive outlook, there are a number of health and economic risks that could hinder the pace of recovery,” Chief Executive Officer Matt Comyn said in a statement.

“The low interest rate environment will continue to weigh on our earnings.”

Comyn said the CBA’s balance sheet was “the strongest ever” with an additional A $ 10 billion in capital above the regulatory minimum, a sign shareholders may see some of that capital return in the near future.

The tier 1 equity ratio increased to 12.6% on December 31 from 11.8% on September 30, 2020.

Credit Suisse analyst Jarrod Martin said higher dividends “with expected returns to a long-term 70-80% payout ratio along with capital strength” were likely to be well received by investors.

Net cash after-tax profit from continuing operations fell to A $ 3.89 billion ($ 3.01 billion) for the six months to December 31, from A $ 4.36 billion a year earlier. This beat the A $ 3.76 billion median estimate of six analysts surveyed by Reuters.

The provision for doubtful accounts was A $ 882 million, 53% lower than recorded in the previous semester.

CBA Big Four Peers report earnings in May. ($ 1 = Australian dollar 1.2927) (Reported by Paulina Duran in Sydney and Shriya Ramakrishnan in Bengaluru; Editing by Ramakrishnan M. and Sam Holmes)

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The European Union must punish Putin for Navalny’s arrest by cutting off the flow of money: German Weber | Instant News


BERLIN (Reuters) – The European Union should punish Russian President Vladimir Putin for the arrest of Kremlin critic Alexei Navalny and thousands of his supporters with targeted financial sanctions, the leader of the bloc’s biggest political alliance said on Sunday.

People hold signs in support of jailed Russian opposition leader Alexei Navalny, amid the spread of the coronavirus disease (COVID-19) pandemic, in downtown Dublin, Ireland, January 23, 2021. REUTERS / Clodagh Kilcoyne

Police detained more than 3,000 people and used force to disperse rallies across Russia on Saturday in support of Navalny, who was arrested last weekend when he returned to Russia from Germany for the first time since he was poisoned with a nerve agent.

“It is unacceptable that the Russian leadership is trying to shorten the growing protests by arresting thousands of demonstrators,” Manfred Weber, a senior German conservative and head of the center-right EPP group in the European Union Parliament, told German newspaper group RND. .

“EU foreign ministers are not allowed to avoid this once again and stop at general pleas,” said Weber.

“The European Union has to hit where it hurts the Putin system – and that’s the money,” Weber said. Therefore, the EU must cut financial transactions from Putin’s inner circle, he added.

Moreover, the threat to stop the Nord Stream 2 pipeline, which is meant to double shipments of natural gas from Russia to Germany, must remain on the table, Weber added.

A German government spokesman declined to comment when asked if Berlin was willing to support new sanctions against Russia following Navalny’s arrest.

EU lawmakers passed a resolution on Thursday calling for the bloc to stop the completion of the Nord Stream 2 gas pipeline in response to Navalny’s arrest.

German Chancellor Angela Merkel, who continues to support the project despite criticism elsewhere in the EU, said on Thursday that her view of the project has not changed despite the Navalny case.

The United States, EU and Britain all condemned Russia’s handling of security forces against Saturday’s protests, and the French and Italian foreign ministers on Sunday both expressed support for sanctions.

Reporting by Michael Nienaber; Edited by Alex Richardson

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Italy’s Banca Ifis appointed a new CEO after the current leader said he would step down | Instant News


MILANO (Reuters) – Italy’s Banca Ifis appointed Frederik Geertman to take over as chief executive from April after current CEO Luciano Colombini announced his intention to step down, the bank said on Monday.

The Italian bank said the changes, agreed with the controlling shareholder of La Scogliera, were needed to accelerate the bank’s growth and digitization process following the COVID-19 outbreak.

Colombini was appointed chief executive of Banca Ifis in 2019.

Frederik Geertman is deputy general manager and commercial director of the Italian bank UBI Banca and he has previously worked for ten years at UniCredit, Banca Ifis said in a statement.

Reporting by Elisa Anzolin; editing by James Mackenzie

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The head of Italy’s Credit Agricole says the bid for Creval is ‘fair’ – paper | Instant News


FILE PHOTO: Credit Agricole logo seen outside a bank office in Vertou near Nantes, France, 11 February 2019. REUTERS / Stephane Mahe

MILAN (Reuters) – The cash takeover offer announced by Credit Agricole Italy’s branch for rival Creval is “fair” and there would be no reason to change it, the head of Credit Agricole Italy said in a newspaper interview Monday.

France’s Credit Agricole this month offered 10.50 euros ($ 12.57) per share to buy an Italian third-tier lender, for an overall investment of 737 million euros. Creval said the offer was “unexpected and previously not approved” and sources said it would fight for it to get a better price.

Giampiero Maioli told Il Corriere della Sera L’Economia that the Credit Agricole offer takes full account of Creval’s turnaround and offers one of the highest premiums in the industry.

“This is a fair offer, why should we change it ?,” he said when asked if there was still room to increase prices.

“This is the only cash offering in Italy for the last 20 years … We consider it friendly because it generates value for everyone: shareholders, customers and employees”, he added.

Reporting by Giulio Piovaccari; edited by Valentina Za

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