Just kidding, he claims! Count Vikula spoke at a “fireside chat” at Harvard Business School yesterday, and courtesy of a Dealbreaker reader in attendance, we’ve got some highlights. When asked about his biggest mistakes, he first offered the crowd-pleasing, “Taking this job and then staying in it,” to much laughter. Then he remembered he wasn’t doing a set at Caroline’s and responded that he had no “moment of catharsis” when he first arrived at the Big C, and should have communicated the trouble the bank was in faster and done more in a shorter period of time. Pandito apparently blamed the crisis on “global imbalances” and poor regulation of CDS and CDOs, and said that rebalancing and getting to a “stable platform for growth” will take “a long time” (he did not offer a timetable for getting Citi back to $55/share). On the matter of renovating his office to the tune of $10 million the jolly elfin fella characterized the situation as a “shit storm.”
And speaking of human waste– for students looking to get jobs on Wall Street, Vikula proffered the advice that they’re shit outta luck. (The actual exchange was a question by HBS professor Tom DeLong, who asked if VP had “any advice for students looking to get jobs in finance” and then, realizing the absurdity of the question, considering the dearth of positions on the Street, added “…or something,” to which Vikram responded with the suggestion they “go with the ‘or something’.”)
Archive for April 2009
That probably goes without saying, and apparently discussions of this nature and speculations as to why he did it are “way over the line,” but we’re going to have them anyway. The Times reports that the Freddie Mac CFO was working nonstop, losing weight, felt someone was “always angry with him,” and finding it “impossible to appease everyone — regulators, lawmakers, investors and other executives — given their competing demands.”
And no matter how many hours everyone worked, it seemed as if the economy and homeowners were still slipping farther into the abyss.
Mr. Kellermann was also working in a poisonous political atmosphere. In addition to taking criticism over the bonuses, he was recently involved in tense conversations with the company’s federal regulator over its routine financial disclosures, according to people close to those discussions who also spoke on condition of anonymity. Freddie Mac executives wanted to emphasize to investors that they believed the company was being run to benefit the government, rather than shareholders. The company’s regulator, the Federal Housing Finance Authority, had pushed to play down that language. Freddie Mac reported to the Securities and Exchange Commission that changes it had made in practices to help the government “have increased our expenses or caused us to forgo revenue opportunities.”
“The pressure right now is relentless,” said a Freddie Mac executive who spoke on condition of anonymity because he was not authorized to speak. “Everyone in the financial sector, regardless of where you work, is constantly told both that this is our fault, and that we have to work as hard as possible, otherwise the nation will fall apart.”
Apparently there will be “massive” cuts, in the range of forty percent, beginning today and lasting through the week for legacy Wachovia employees in LevFin, M&A, DCM, IB, etc.
Credit Suisse Tops Analysts, Up In Swiss Trading (Bloomberg)
“Credit Suisse rose as much as 8.2 percent in Swiss trading after reporting net income of 2 billion Swiss francs ($1.7 billion), twice the median estimate of analysts surveyed by Bloomberg News. The Zurich-based bank rebounded from a 2.15 billion-franc loss in the year-earlier period.”
US Reconsiders Releasing Bank’s Needs After Tests (Bloomberg)
The government is considering revamping their stress test silence rules to include disclosure about which banks are going to need further capital injections (and to what degree) and which aren’t.
Reuters Survey Suggests Sales Of Existing Homes Down Slightly (Reuters)
“Economists surveyed by Reuters expect sales of existing homes to have declined slightly to a 4.7 million annual rate in March from 4.72 million units in February.”
SunTrust Banks Shows First Quarter Loss (Reuters)
The southern regional had a $714.8MM Goodwill charge due to real estate which significantly affected it’s earnings:
“The net loss applicable to common shareholders was $875.4 million, or $2.49 per share, compared with a profit of $281.6 million, or 81 cents a share, a year earlier. Excluding the goodwill charge, Atlanta-based SunTrust said the loss was $160.6 million, or 46 cents per share. Analysts on average forecast a loss of 46 cents per share, according to Reuters Estimates. Revenue on a taxable equivalent basis rose 1 percent to $2.24 billion. Analysts expected $2.09 billion.”
Madoff’s Trading Firm Draws Offers (DealBook)
“Irving H. Picard, the trustee liquidating Mr. Madoff’s assets, said Wednesday that he had received three additional competing offers for the business. Last month, Mr. Picard struck a tentative deal to sell the business to Castor Pollux Securities of Boston for $15 million.”
$$$ Bill Ackman’s plan to fix the financial crisis [Portfolio]
$$$ Roots of $3 Billion Fraud Case Lie in DVD Players, Not CDOs [WSJ]
$$$ S.E.C. Has Failed Madoff Victims [Dealbook]
From: Kaspar-Villiger, Chairman
Sent: Monday, April 20, 2009 4:54 AM
To: ‘All UBS staff globally’
Subject: Initial thoughts on UBS and on winning back the trust of our stakeholders / Erste Gedanken zu UBS und wie wir das Vertrauen unserer Anspruchsgruppen zurückgewinnen können
Additional language versions can be accessed on the intranet: (fra, ita)
Dear colleagues
Last Wednesday at UBS’s annual general meeting I was elected Chairman of the Board of Directors by our shareholders. In assuming this post I am well aware that I have taken on a great responsibility. I also know that UBS continues to find itself in a difficult situation. No one is certain how the markets will develop. Past mistakes have shaken the trust of investors, clients and public authorities, as well as Swiss citizens. The state aid the bank has received has exposed it to the competing interests of politics. We have not yet been able to return to profitability, and many of you feel insecure. But these are problems that can be conquered.
The Obama Portfolio (Since Inception): +19.01%
Earlier: The Obama Portfolio
GM is defaulting.
GM Plans to Skip $1 Billion Debt Payment [The Wall Street Journal]
Basically, nothing.
We suspected, and told you, dear reader, that there was very little that the government could, should or would do. Not only did they do very little, other than nearly incite a riot (including here in the comments sections), but *gasp* AIG employees in all the groups are still actually getting paid- and there are few if any restrictions on those payments going forward.
Steven Davidoff sums it up for us in “We Fought AIG and AIG Won,” which amuses us to no end because it implies that AIG and “The Law” are synonymous- though we doubt Davidoff caught the overt cheer for sanctity of contract implicit in his poorly chosen title.
Just in case you might have forgotten that DealBook is a New York Times venture, Davidoff salts his piece with thinly disguised indignant rage, but the key stuff is here:
The only thing in these agreements (accessible here, here and here) that the Treasury did to pursue these retention bonuses is to deduct the $165 million in total payments from the approximately $183.5 billion made available to A.I.G. In addition, the Treasury charged A.I.G. a commitment fee of $165 million to be paid from the operating cash flow of the company. Since money is fungible, and the government has now agreed to support the company anyway, the latter requirement is meaningless.
How’d you like to be one of the AIG people who bothered to return your bonus now?
We Fought A.I.G. and A.I.G. Won [Dealbook]
Do you ever get the urge to just knock the lights out of one of your colleagues because, I don’t know, he watches Two and a Half Men and insists on telling you about it, or he’s constantly on the phone during business hours with his significant other, who he calls “shmoopie,” or because you just straight up don’t like the look on his face? We feel you. But don’t do it, otherwise your name’s gonna get put in a file and flagged as “crazy” and/or “dangerous,” with a note to keep an eye on your ass lest you lose it again. Plus, you’ll probably be forced take a course with other “dysfunctional employees” on managing your emotions and that’ll be six hours you’ll never get back. And if you think getting laid off is a free pass to take out some rage on whoever fired you, or the random colleagues whose asses you’ve just been waiting to beat down (and figured that on your way out of the building for the last time would be the perfect moment) think again! Your employer will probably have you followed to make sure you don’t flip out on anyone again (probably out of fear they could be in some way implicated). On the off chance you’ve already gone down the path of workplace violence (big and small), share your story! You know we’re always into that shit.
Recession fuels worries of workplace violence [Reuters via Cityfile]
Some discussion yesterday (You’re Not So Tough After All Safecracker) caused us to wonder who exactly had put the provision that seems to forbid Tim “The Safecracker” Geithner from imposing conditions on the repayment of TARP funds.
A series of amendments to what was then H.R. 384, the “TARP Reform and Accountability Act of 2009″ were offered to the rules committee on January 14th. That bill was eventually consolidated into a large mass of amendments and voted into the final bill which was passed in the house on January 28th. The Senate bill was passed on February 10th. Obama signed the bill on February 17th.
The “No Impediment” section of the bill was in the amendment packaged offered on January 14th, amendment #43, to be specific, was offered by Frank, Barney (D-MA).
Suck it, Timmy.
