Morgan Stanley Loss Smaller Than Estimated (Bloomberg)
The net loss was $250 million, or 15 cents a share, compared with profit of $836 million, or 41 cents, a year earlier, the New York-based company said today in a statement. The loss from continuing operations was 14 cents, compared with the 57-cent average estimate of 22 analysts surveyed by Bloomberg. Morgan Stanley posted the only increase in trading revenue excluding accounting gains among the five largest Wall Street banks in 2011, making progress toward Chairman and Chief Executive Officer James Gorman’s goal of boosting market share.
BofA Swings to Profit as Lender Rebuilds Capital (Bloomberg)
Net income of $1.99 billion, or 15 cents a diluted share, compared with a loss of $1.24 billion, or 16 cents, a year earlier, according to a statement today from the Charlotte, North Carolina-based firm. While results were boosted by one- time gains on asset sales and reserve releases, the stock advanced 5.6 percent in early trading as investors focused on the stronger balance sheet. Chief Executive Officer Brian T. Moynihan, 52, is cutting holdings, expenses and staff while raising capital to meet demands from regulators for a larger cushion against losses. So far, $50 billion in assets are gone, and Moynihan’s Project New BAC will eliminate at least 30,000 jobs as the firm seeks to save $5 billion annually. He’s also aiming to quell disputes over faulty mortgages that have cost the bank about $40 billion.
Greeks, Creditors Set To Resume Talks (WSJ)
“All the variables are being considered. After the temporary pause in the negotiations last week, the parties have reflected on the specifics,” a Greek government official said Wednesday.
Hedge Funds May Sue Greece If Loss Forced (NYT)
The novel approach would have the funds arguing in the European Court of Human Rights that Greece had violated bondholder rights, though that could be a multiyear project with no guarantee of a payoff. And it would not be likely to produce sympathy for these funds, which many blame for the lack of progress so far in the negotiations over restructuring Greece’s debts. The tactic has emerged in conversations with lawyers and hedge funds as it became clear that Greece was considering passing legislation to force all private bondholders to take losses, while exempting the European Central Bank, which is the largest institutional holder of Greek bonds with 50 billion euros or so.
Dimon, Blankfein Predict Markets To Rebound (Bloomberg)
Dimon and Blankfein have since sought to reassure investors that markets and earnings from securities units will rebound. “The world will snap back, and it will be a surprise, and it will be faster than people think,” Blankfein, 57, said at a Nov. 15 investor conference. Yesterday, Chief Financial Officer David Viniar echoed the remarks after the firm said trading revenue fell 25 percent from the third quarter to $3.06 billion. “We are clearly in a cyclical downturn,” rather than a secular decline, Viniar said. “There is less activity that is cyclical. That will come back. I have no idea when, but it will come back.” Dimon, 55, said investment banking is a volatile business in which volumes can swing by 50 percent daily.
Carlyle’s Rubenstein To Help Fix Washington Monument (WSJ)
With his bare hands! No, kidding. But he is helping: “Rubenstein, co-founder of private-equity firm Carlyle Group, has stepped forward to donate the final $7.5 million matching gift that’s needed to start repairing cracks near the top of the Washington Monument caused by last summer’s earthquake. The billionaire history buff said he was inspired to help fund the repairs to the 555-foot obelisk when it became clear how severely damaged it was by a 5.8-magnitude quake on Aug. 23. The monument received about 1 million visitors a year before the famous landmark was closed to the public after the quake.”
Fitch Sees Downgrade For Some Euro States (Reuters)
Fitch expects its ratings review of six euro zone states will result in downgrades of one to two notches in most of those countries, senior director Ed Parker said at a Fitch conference in Madrid on Thursday. Fitch put Belgium, Spain, Slovenia, Italy, Ireland and Cyprus on negative watch late last year on Dec 16.
BlackRock Profit Falls 16% (WSJ)
Assets under management fell to $3.513 trillion as of Dec. 31 versus $3.561 trillion a year earlier, although rose from $3.35 trillion in the third quarter. BlackRock reported a profit of $555 million, or $3.05 a share, down from $657 million, or $3.35 a share, a year earlier. The latest results included $32 million in restructuring charges. Excluding items, earnings fell to $3.06 a share from $3.42 a year earlier.
Romney’s Unorthodox IRA (WSJ)
Like many Americans, Mitt Romney has an individual retirement account. Unlike most Americans, Mr. Romney has between $20.7 million and $101.6 million in it, a big chunk of his fortune. Experts on estate planning said it is highly unusual to accumulate such a considerable sum in an IRA, an investment vehicle restricted by annual contribution limits. It appears that Mr. Romney’s grew so large mostly because it holds investments in Bain Capital.
Jay-Z ‘pops’ up at club gala (NYP)
Jay-Z last night made his first public appearance since his wife, Beyoncé, gave birth to their daughter, Blue Ivy Carter. The rap icon apparently left mom and baby at home as he celebrated the re-opening of his 40/40 Club on West 25th Street. Jay-Z darted past the press on the red carpet without saying a word. Beyoncé was nowhere to be seen, and was presumably home caring for their 11-day-old daughter. But some of Jay-Z’s pals made it out for the opening — including billionaire investing tycoon Warren Buffett.