It’s either missing-missing or there but just in hiding as a result of “sloppy internal controls.” Continue reading »
Archive for October 2011
Regulators Interested To Find Out Where A Few Hundred Million In MF Global Customer Funds Went
By Bess Levin$$$ JC Flowers Fund Is Said to Have $47.8 Million Loss on Its MF Global Stake [Bloomberg]
$$$ MF Bankruptcy Sends Clients Fleeing [Bloomberg]
$$$ Pennies From Heaven [PIMCO]
$$$ “Donning a black hat and cape to compliment a tacked-on tail and ears, Meredith Whitney came to her annual office Halloween costume competition on Monday dressed as Puss in Boots.” [Dealbook]
$$$ Topless protest against DSK in Paris [EuroNews] Continue reading »
The convicted insider trader, who was previously scheduled to report to prison for an 11 year sentence at the end of the month, was granted a few extra days of freedom. He’ll now have ’til December 5 to dance like nobody’s watching. [WSJ]
Will Domino’s Largest Shareholders Increase Their Stakes After Hearing Of Two Managers Who Set Fire To The Competition?
By Bess Levin
If I’m a PM at Scout Capital, Trian, Cedar Rock, MSD, Calamos, BlackRock, RenTec or Two Sigma, all of which own a significant number of shares in the pizza purveyor, my takeaways are: 1. Passion 2. Teamwork 3. Initiative 4. Ingenuity 5. Ability by middle management to read between the lines and infer that corporate’s edict to “torch the competition” was meant literally. Alternatively, if I’m a certain someone who walked away, dumping all but a couple shares retained simply for the free slices, I’m thinking I made the biggest mistake of my life underestimating these two. Continue reading »
Does It Seem Strange To Anyone Else That CNBC Is MF Global’s Seventh Largest Creditor?
By Matt Levine
If as a generally informed person who had not yet seen MF Global’s bankruptcy petition, you were to guess who’s going to be knocking on MF’s door most forcefully, you might come up with a list something like this:
1. The banks that were repo’ing its $6.3 billion in Eurozone exposure
2. The lenders on its $1.3 billion in credit facilities that it drew last week (oops!)
3. Bondholders on its four series of public debt totaling ~$1bn
4-99. Other repo, derivatives, securities lending, etc. etc. counterparties and clearinghouses, including maybe the Fed
.
.
.
100. John Corzine, for his $12mm severance
101. CNBC, for advertising and/or Dick Bové’s strategic advice
102-…. Law firms, accountants, PR firms, Bloomberg, and other trade creditors.
If you then went and checked your work against the actual petition, you might be a bit surprised. At the top of the list are JPMorgan as admin agent for the credit facility (misleadingly listed as trustee for public bonds) and the indenture trustees for the bonds. Those top five total about $2.2 billion. The rest is trade creditors, maybe $10mm or so. CNBC is there, as are Bloomberg and a bevy of law firms and consultants. (Not nearly as many as there will be!)
But there’s not a repo counterparty in sight, and the total of about $2.3 billion in listed claims seems pretty light compared to the total liabilities of $39.7 billion. (Corzine’s not there either, though to be fair that severance is not crystallized quite yet.) If all you had was this petition, you might think that MF Global was in the business of raising money just to buy exposure on CNBC.
So where’d the other $37 billion or so go? Continue reading »
The (other) Swiss bank will be cutting people and assets, so don’t take it personally. Continue reading »
Technically, they owe CNBC the 845 but Corzine is probably more worried about invoking the ire of some anchors more than others, like Jim Cramer, who “is fine” with being an unsecured creditor. Continue reading »
According to Reuters, earlier talks with Interactive Brokers fell apart. Continue reading »
Corzine Races To Save MF Global (WSJ)
MF Global was nearing a deal late Sunday night to file for Chapter 11 bankruptcy protection as soon as Monday and sell assets to Interactive Brokers Group, said a person familiar with the matter. The tentative agreement, reached after a marathon weekend of negotiations, could end the short tenure for Mr. Corzine at MF Global…Under the tentative plan, MF Global’s holding company would file for bankruptcy protection, the person familiar with the matter said. Interactive Brokers would then likely make an initial bid of about $1 billion during a court-supervised auction, the person said, though the deal was described as complicated and that number could change. The sale would need to be approved by a bankruptcy judge. While the boards of both companies approved the tentative deal on Sunday, there are still other snags that could slow it down, according to participants in the deal. None of MF Global’s regulated entities would seek bankruptcy protection, the person said. “There is a handshake, but it [isn't] done yet,” the person said. The odds are high the plan gets executed, but it is “very far from a done deal,” the person said.
MF Global Faces Pivotal Days As Firm Mulls Sale (Bloomberg)
“While the pieces are attractive, figuring out potential buyers is a lot harder,” Robert Rutschow, an analyst with CLSA Credit Agricole Securities in New York, said in an Oct. 28 note to clients. “In the current environment, banks can’t even go to the bathroom without permission from their regulator, let alone buy a brokerage firm that was looking to grow proprietary trading and expand risk-taking activities.”
Barclays Third-Quarter Profit Climbs (BW)
Barclays said third-quarter profit increased by 5 percent, beating estimates, even as the sovereign debt crisis hurt investment banking revenue. Pretax profit before debt valuation adjustments in the three months to Sept. 30 increased to 1.3 billion pounds ($2.1 billion) from 1.27 billion pounds a year earlier, the London- based company said in a statement today. That beat the 1.24 billion-pound median estimate of 10 analysts surveyed by Bloomberg. Revenue at the Barclays Capital investment banking unit fell 15 percent to 2.25 billion pounds in the period.
Japan Intervenes To Tame Yen Ahead Of G20 (Reuters)
“We started currency intervention this morning in order to take every measure against speculative and disorderly moves and to prevent risks to the Japanese economy from materializing,” Prime Minister Yoshihiko Noda told parliament. The intervention came after the dollar touched a record low of 75.31 yen and pushed the world’s main reserve currency up past 79 yen.
Berlusconi Defiant as EU’s Focus Shifts to Italy (Bloomberg)
Berlusconi ruled out early elections and said the current legislature in Rome will last until 2013, according to an interview published yesterday in Corriere della Sera. He said the European Central Bank’s support will only be maintained if his administration follows through on the pledged measures. “Only I and my government can achieve this reform program for 18 months, which is why there is no way for me to stand aside,” the Italian leader told the newspaper.
Kris Humphries among victims of $1.7 million hedge fund fraud (NYP)
Andrey C. Hicks, a 27-year-old hedge fund manager who was invited to the celebrity couple’s August wedding, was charged with wire fraud following his arrest Friday in Canada, during a reported attempt to flee to Switzerland. He is accused of misleading investors, which included NBA player and Kim Kardashian husband Humphries, with a fictitious Harvard degree and investment banking job, while diverting cash to his personal bank account. Continue reading »
$$$ The Next Worry for Markets: No Deal Yet on US Debt [CNBC]
$$$ Jim Chanos Says China Property Is Slowing, Still Shorting Banks [BusinessWeek]
$$$ Pressure mounts on MF Global to strike a deal [Reuters]
$$$ DOJ Muffins Didn’t Really Cost $16, U.S. Says [Bloomberg] Continue reading »
