Tag Archives: fund

Morgan Stanley disclosed Archegos’ loss of $ 911 million as profits soared | Instant News


(Reuters) -Morgan Stanley lost nearly $ 1 billion from the collapse of the family offices of Archegos Capital Management, the bank said on Friday, clouding a 150% jump in first-quarter profit supported by a boom in trade and deal-making.

Morgan Stanley is one of several banks with exposure to Archegos, which failed to pay a margin call late last month and sparked a stock sale fire across Wall Street.

Morgan Stanley lost $ 644 million selling shares held in relation to the Archegos position, and another $ 267 million trying to “demean” them, Morgan Stanley Chief Executive James Gorman said by phone with analysts.

“I consider the decision necessary and money well spent,” he said.

The bank did not immediately disclose the loss because it was deemed immaterial in the context of the overall results, he added.

Morgan Stanley is not alone in dealing with losses as the main broker for Archegos. Switzerland’s Credit Suisse Group AG and Japan’s Nomura Holdings Inc. bore the brunt, having lost $ 4.7 billion and $ 2 billion, respectively.

Goldman Sachs Group Inc, Deutsche Bank and Wells Fargo & Co also handled the Archegos position but left without a loss, Reuters and other media outlets have reported.

Morgan Stanley was unaware that Archegos had similar positions and was concentrated in several banks on Wall Street, Chief Financial Officer Jonathan Pruzan told Reuters. As such, the collateral requirements imposed reflect only Archegos’ specific Morgan Stanley risks, not risks across a broader portfolio of mutual funds.

Morgan Stanley has reviewed its main brokerage business for similar issues but found none, Pruzan said. The bank is looking more broadly at its methods for stress testing, and will recalibrate positions with clients if needed.

“We are never happy when we have a loss,” he said. “But the show is over … and we will learn from that experience.”

Archegos’ story likely had regulatory implications, however, with multiple US watchdogs as well as the Senate Banking Committee all investigating the incident to better understand why multiple banks were so exposed to one client.

FILE PHOTOS: View of Morgan Stanley London headquarters at Canary Wharf in London, England 24 June 2016. REUTERS / Russell Boyce / File Photo

Gorman occasionally seems exasperated during phone calls when he faces repeated questions from analysts about Archegos, distracting from the bank’s otherwise reversed performance.

Morgan Stanley shares fell 1%.

“This is not a financial event in the grand scheme of things, but is likely to raise concerns,” Oppenheimer analyst Chris Kotowski wrote in a note to clients.

Although Archegos Morgan Stanley’s losses dominated discussions on Friday, first-quarter earnings beat expectations. The report closed a strong quarter for the biggest US banks, which benefited from the release of reserves and record capital market activity.

The surge in trading, driven in part by the trading frenzy sparked by Reddit in “meme” stocks such as GameStop Corp., boosted a 66% jump in revenue in Morgan Stanley’s institutional securities business.

Unlike rivals JPMorgan Chase & Co and Bank of America, Morgan Stanley and Goldman Sachs lacked large consumer lending units, which limited their exposure to lending problems during the pandemic and allowed them to focus on investment banking and trade.

Morgan Stanley earnings rose to $ 3.98 billion, or $ 2.19 per share, in the quarter ended March 31, from $ 1.59 billion, or $ 1.01 per share, a year ago.

Analysts are looking for a gain of $ 1.70 per share, according to IBES data from Refinitiv.

Net income jumped 61% to $ 15.72 billion.

Like its larger rival, Goldman Sachs, Morgan Stanley is benefiting from an unprecedented boom in deal-making through special-purpose acquisitions (SPAC) companies.

Global investment banking costs hit an all-time record of $ 39.4 billion during the March quarter, according to data from Refinitiv.

Morgan Stanley has also made good payouts from a series of mergers and by pledging many IPOs for well-known companies including Affirm Holdings and AppLovin Corp.

Its investment bank revenue more than doubled to $ 2.6 billion.

Reporting by Elizabeth Dilts in New York, Additional reporting by Ambar Warrick in Bengaluru and Matt Scuffham in New York Writing by Anirban Sen and Michelle PriceEditing by Saumyadeb Chakrabarty and Lauren Tara LaCapra

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After the initial capital, Infarm Germany hired Goldman to root out the source of the blank checks | Instant News


FRANKFURT, April 16 (Reuters) – German vertical farming start-up Infarm has hired Goldman Sachs to help talk about the possibility of going public through a merger with a so-called blank check firm as it seeks funds for expansion, people close to it. the problem said.

Berlin-based Infarm, which currently focuses on the production of indoor herbs and salad vegetables, uses cloud computing to manage the cultivation of products grown near consumers, minimizing its environmental impact.

The company has hired Goldman to help engage in talks with a special-purpose acquisition (SPAC) company about a potential merger that could grant unicorn status, meaning a valuation of more than $ 1 billion, the people said.

The individuals, who requested anonymity because the talks were private, said that Infarm may not agree to a merger with SPAC.

Infarm said it comments on rumors or market speculation. Goldman Sachs declined to comment.

SPAC raises funds in an initial public offering (IPO) with the aim of buying a private company, which then automatically gets a stock market listing.

Infarm last month raised $ 100 million, bringing total funding so far to $ 400 million. Supporters include LGT Lightstone, Hanaco, Bonnier, Haniel, Latitude, Atomico, TriplePoint Capital, Mons Capital, and Good Harvest.

It has reached supply deals with major food retailers including Aldi Germany, Marks and Spencer in the UK and Kroger in the United States.

Infarm said last year that it plans to expand its cultivated area to 5 million square feet (465,000 square meters) by 2025, up from the 500,000 square feet now running in 10 countries, and add mushrooms, tomatoes and strawberries to its salads and herbs. now he sells.

Its automated 25-square-meter modular planting center can produce crops that typically require up to 10,000 square meters of land-based agricultural land, uses 95% less water, 90% less transportation and zero chemical pesticides, Infarm said. ($ 1 = 0.8347 euros) (Additional reporting by Nadine Schimroszik; Editing by Alexander Smith)

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The City of London Brexit did worse than expected, the study said | Instant News


City of London financial district seen with office skyscrapers commonly known as ‘Cheesegrater’, ‘Gherkin’ and ‘Walkie Talkie’ seen in London, England, 25 January 2018. Image taken 25 January 2018. REUTERS / Toby Melville / File Photo

More than 400 financial firms in the UK have shifted the combined trillion pound ($ 1.4 trillion) activity, staff and assets to hubs in the European Union because of Brexit, with more difficulties to come, a study from the think tank New Financial said on Friday.

“We think that’s an understatement and we expect the numbers to increase over time: we are just at the start of Brexit,” said the study.

The EU has offered little direct market access for financial services to the UK, which are not included in the bloc’s trade deal with Britain starting in January.

“That access is unlikely to come, so it may be better for the industry to take the damage off Brexit on the chin and focus rather than recalibrate the framework in the UK so that it is more adapted to the unique nature of the UK financial services industry,” the study said.

About 7,400 jobs have been moved from the UK or created in new centers in the EU, the study said. Bankers told Reuters that some staff transfers had been delayed due to COVID-19 travel restrictions.

The total of 440 relocations was higher than anticipated and well above 269 in the 2019 New Financial survey. New Financial believes that the real number is more than 500.

WINNER OF DUBLIN

Dublin emerged as the largest beneficiary with 135 relocations, followed by Paris with 102, Luxembourg 95, Frankfurt 63 and Amsterdam 48.

“This redistribution of activity across the European Union has turned in about 20 years,” the study said.

Banks have moved or moved more than 900 billion pounds of assets from the UK to the EU, while insurance companies and asset managers have transferred more than 100 billion pounds in assets and funds, reducing the UK’s tax base.

“We hope that Frankfurt will be the ‘winner’ in terms of assets in the long term, and that Paris will ultimately be the biggest beneficiary in terms of jobs,” said the study.

Amsterdam overthrew London as Europe’s biggest stock trading center since January has been the most visible sign of Brexit on the financial front.

The study estimates that 300 to 500 smaller EU financial firms could open permanent offices in the UK, far less than the prevailing estimate of around 1,000.

The city of London will remain Europe’s dominant financial center for the foreseeable future, but its influence will be eroded, risking a decline in Britain’s 26 billion pound annual trade surplus in financial services with the EU, the study added.

($ 1 = 0.7262 pounds)

Our standard: Thomson Reuters Trust Principles.

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British PM acts on plea from Saudi Crown Prince over canceled Newcastle United deal – Daily Mail | Instant News


British Prime Minister Boris Johnson speaks during the weekly question-and-answer debate in Parliament, amid the coronavirus disease (COVID-19) pandemic, in London, England, April 14, 2021, in this screenshot captured from this video. Reuters TV via REUTERS

(Reuters) – British Prime Minister Boris Johnson is acting on a personal plea from Saudi Crown Prince Mohammed bin Salman for a £ 300 million ($ 413.34 million) deal to buy Premier League club Newcastle United, the Daily Mail newspaper reported on Wednesday.

The proposed takeover of Newcastle United by a Saudi Arabia-backed consortium collapsed last year after the group refused to accept the Premier League’s independent arbitration offer to decide who would own the club.

The group, which includes Saudi Arabia’s sovereign wealth fund PIF, PCP Capital Partners and Reuben Brothers, said last year they were ending their interest in the deal, which had been put on hold by tests of Premier League owners and directors.

The consortium blamed the lengthy evaluation for the decision to resign.

Mohammed Bin Salman has urged Johnson to “correct and reconsider” the “wrong” decision by the Premier League, which is accused of blocking the takeover of the club, the Daily Mail reported.

Johnson asked a senior assistant and Middle East expert, Lord Eddie Lister, to deal with the complaint, the report said. Lister was quoted in the Daily Mail report as saying he would investigate.

A British government spokesman could not immediately be reached for comment by Reuters. The Daily Mail quoted a government spokesman as saying: “While we welcome foreign investment, it is a commercial matter for the parties concerned and the Government is not involved in any way in the takeover talks at Newcastle United.”

Reporting by Kanishka Singh in Bengaluru; Edited by Grant McCool

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Virgin Australia brought back 10 chartered Boeings as domestic demand grew | Instant News


SYDNEY, April 15 (Reuters) – Virgin Australia, the country’s No. 2 carrier, said on Thursday that 10 chartered Boeing Co 737 planes would return to its fleet as part of a plan that would see it reach more than 80% pre-pandemic. domestic capacity by mid-June.

The airline, now owned by US private equity group Bain Capital, last year entered voluntary administration after the pandemic hit and sent many of its 737s back to lessors.

The outlook for Australia’s domestic market is now improving after teetering for months by the pandemic-related closure of state borders.

“More planes means more flights, and with travel restrictions easing, there are more opportunities to support domestic tourism and the country’s economic recovery from COVID-19,” Virgin Australia Chief Executive Jayne Hrdlicka said in a statement.

Bigger rival, Qantas Airways Ltd expects an average of around 80% of pre-pandemic capacity in the quarter ending June 30 due in part to strong demand for tourist travel in a country where local transmission of COVID-19 is nearly eliminated.

Virgin Australia said it had finalized a deal to reintroduce 10 Boeing 737-800s previously operated, with further additions being investigated.

The first three will join the airline’s fleet this month, with the rest due to enter service gradually in October, the airline said.

Virgin Australia has suspended sales of most New Zealand services until October 31 even though the two-way travel bubble opened on April 19 as it focuses on strengthening its position in the domestic market.

Rival Regional Express Holdings Ltd last month launched a Sydney-Melbourne flight using a chartered 737 previously operated by Virgin Australia as a challenge to the incumbent. (Reporting by Jamie Freed Editing by David Holmes)

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