Barclays Said to Name Bommensath to Oversee ‘Bad Bank’ (Bloomberg)
Barclays is planning to move its commodities division into a so-called bad bank of unwanted assets and units to be overseen by Eric Bommensath, according to a person familiar with the plan. Tom King, 53, co-head of the corporate and investment bank with Bommensath, will become its sole leader, the person said yesterday, asking not to be identified because the change hasn’t been made public. Bommensath will oversee businesses that the London-based firm previously designated as part of its “exit quadrant,” according to the person.
McGee Exiting Barclays Shows Lehman Legacy Fading Away (Bloomberg, related)
When Barclays Plc announced yesterday that McGee is stepping down from that role at the end of the month, it meant the London-based firm will lose a banker seen by U.S. colleagues as their advocate for risk, pay and aggressiveness. His departure is another step away from a pre-crisis Lehman culture whose competitiveness was written into the firm’s code of ethics. Almost six years after Barclays bought parts of the company, which filed the biggest bankruptcy in history, and following its own scandals from interest-rate rigging to selling insurance customers didn’t need, the lender is cutting jobs, rebuilding relationships with regulators and facing shareholder pressure to curb bonuses. “Barclays has to have its own identity and has to do its own thing, and I think it’s evolving to that now,” said American International Group Inc. General Counsel Tom Russo, a former Lehman vice chairman. “I think it’s becoming extraordinarily cost-conscious. It’s shrinking a bit.” McGee, 54, said in an e-mailed statement that he’s leaving because the job has changed. “My focus has always been on clients, but given the need for Barclays leadership to focus on regulatory issues for the foreseeable future, I have decided that it is time for me to move on to new challenges,” he said.
Third Point Asks Judge To Delay Sotheby’s Annual Meeting (Law360)
Third Point LLC asked a Delaware Chancery judge Tuesday to postpone Sotheby’s upcoming shareholder meeting, saying the auction house is improperly using a poison pill to thwart activist investor Daniel Loeb’s proxy fight for three board seats.
Twitter’s Stock Sinks Despite Growth in Revenue, Users (WSJ)
While Twitter has proven to be a powerful communications tool for celebrities, activists, marketers and journalists, it hasn’t caught on with mainstream users. Facebook, meanwhile, has become a required place to share photos and life’s daily happenings. Twitter reported Tuesday it added 14 million monthly active users in the first quarter, up 5.8% to 255 million from the previous three months. That growth was better than in the fourth quarter but failed to impress some analysts. Today one in five Internet users in the U.S. log into to Twitter once a month, and its global user base is about one-fifth the size of Facebook’s.
‘Dark Wallet’ for Managing Bitcoin Arrives This Week (Digits)
Last year, the Journal told readers about Cody Wilson’s efforts to take the virtual currency off the grid through a project called Dark Wallet, the 26-year-old’s latest effort to use technology to sidestep the government. Mr. Wilson is most famous for creating the first working gun made by a 3-D printer. After months of programming, Wilson and his partner, British anarchist Amir Taaki, also 26, are releasing an early version of the software for free download. It will work as an add-on for Google’s Chrome browser….Among other things, Dark Wallet is designed to encrypt bitcoins as they’re spent, making it difficult to see who is buying what. Think of it as throwing a ball into a spinning lottery tumbler and picking out a different ball. If more people use Dark Wallet, the theory goes, more people put balls in the lottery tumbler and make it harder to determine which belongs to whom.
Cronut Chef Creates the Waffogato (Time)
Dominique Ansel, creator of the infamous cronut, is at it again. And this time, he’s taking on the waffle. Well, sort of. The New York-based chef has created a waffle made out of ice cream and topped with a maple syrup espresso, which will make its debut at a hunger relief fundraiser in New York City Monday night. Ansel’s waffogato, a breakfast-themed take on the Italian dessert of ice cream topped with espresso, will be available in his Soho bakery starting May 9. The vanilla ice cream “waffle” is laced with Belgium waffle bits and set in a cup where warm, maple syrup espresso is poured on top. “It’s a little like a milkshake at the end,” Ansel told the Wall Street Journal. If history tells us anything, it’ll likely spark flocks of New Yorkers and tourists to stand in line for hours for the latest Ansel concoction, much like the waffogato’s predecessor the cronut did. Not even a mouse infestation could dim the hype over the part-donut, part-croissant pastry. The waffogato could even spawn another underground pastry economy, though that could be tricky logistically—the chef told the Wall Street Journal that his latest creation is best eaten right away.
Standard & Poors downgrades 15 European banks, cites reforms (Reuters)
Ratings agency Standard & Poors said it has downgraded 15 European banks, including Barclays, Credit Suissem and Deutsche Bank, after European lawmakers agreed on a framework that prevents governments from having to bail out troubled banks. The European Parliament signed off this month on new laws to make it easier – and less costly for taxpayers – to wind down problem banks, after long wrangling over rules for an industry blamed for triggering the worst economic slump in a generation. S&P said extraordinary government support for these banks would likely diminish as regulators implement the reforms, downgrading them to ‘negative’ from ‘stable. The banks, many of which are systemically important, also included ABN AMRO, Bank Of Ireland and ING Bank.
Money Manager Admits to Operating $96 Million Ponzi Scheme (Bloomberg)
“Callahan used six offshore entities to perpetrate one of the largest investment frauds in Long Island history,” U.S. Attorney Loretta Lynch in Brooklyn, New York, said in the statement. “Through lies and deceit, he misled investors and stole investor funds, including investments from a local fire department, to support a lavish lifestyle.” Callahan, of Old Westbury, New York, raised more than $118 million from at least 40 investors, who were told their money would be placed in mutual funds, hedge funds and securities, according to the statement. Instead, he used most of the money to support his lifestyle and fund a beachfront resort he owned with his brother-in-law in Montauk, New York, according to the statement.
Matt Damon: I’d invest in the Clippers (CNBC)
“I unfortunately don’t have Donald Sterling money,” Damon told CNBC on Tuesday. “But if Magic wants to put people together, I’ll jump in as a super tiny minority investor.”
‘The big gains are behind us’: Pimco executive (CNBC)
The economic recoveries in Europe and America are actually working, and that means the enormous gains investors have seen in the bond and equity markets are behind us, said Scott Mather, deputy CIO at Pimco. This should not be read as a signal of decline, but as a return to “normal,”after years of abnormal returns puffed up by the dovish central bank policies in Europe and America. The whole goal of very accommodative monetary policy was to inflate financial assets, and it did it very well,” Mather said on “Closing Bell Europe.” “Going forward we are going to see much more volatile financial markets, both in bonds and in equities. The big tailwinds that have been at investor’s backs are likely to dissipate.” This means going forward Mather expects single-digit returns in high-quality bonds and returns “only percent or two” higher for equities.
Massachusetts teen uses cop car to make prom proposal (NYDN)
Chris Murphy…convinced Duxbury Police Sgt. Dennis Symmonds to help him by pulling over an unsuspecting Megan Zaverucha, a senior at Duxbury High School in the seaside town on Cape Cod Bay. In a squad car, they followed the girl last week and pulled her over for a traffic stop. “I decided I’d pull her over and scare her really bad,” Murphy told Fox25 News. Sgt. Symmonds crossed his fingers. “I was just hoping she’d say yes,” he said. After Zaverucha pulled to the side of the road, Symmonds asked for license and registration, then told her to step to the back of the vehicle. That’s when Murphy made his move. “I was a little nervous so I kind of just went out of my way and asked right away instead of playing the role of cop,” he said. Problem was, she didn’t hear him. So Symmonds stepped in again and asked if she would accompany the young man to the prom. She said yes. Symmonds said he hoped they not only win the contest, but that they get elected prom king and queen.