Credit Suisse Said Near U.S. Tax Deal for Over $1 Billion (Bloomberg)
Credit Suisse Group AG (CSGN), facing a U.S. criminal probe of whether it helped Americans evade taxes, is close to resolving the case with an agreement that may include a penalty of more than $1 billion and a guilty plea, according to a person familiar with the matter. The person, who asked not to be named because the negotiations are confidential, didn’t specify whether the plea would be entered by the entire firm or a subsidiary. Credit Suisse, the largest of 14 Swiss banks facing criminal tax probes by the U.S., was told in 2011 that it was a target of prosecutors.
UBS First-Quarter Profit Up (WSJ)
Swiss bank UBS AG said Tuesday that first-quarter net profit was 1.1 billion Swiss francs ($1.25 billion) compared with 988 million francs reported a year earlier and against analyst forecasts of 838 million francs.
Einhorn Plays Athenahealth for Laughs and Decimates Its Shares (BusinessWeek)
As he dismantled the bull case for Athenahealth and then mounted a lengthy bear case, Einhorn repeatedly turned for help to none other than Athenahealth Chief Executive Jonathan Bush when he played embarrassing video clips of the high-strung CEO. Bush was shown spouting techo-verbiage at various interviewers and acknowledging that his company was not worth its valuation. The snappily cut footage, complete with freeze frames of Bush looking foolish with his mouth open, lent the presentation a Daily Show-esque vibe. It’s a new way for Einhorn and his $10 billion Greenlight Capital hedge fund to publicize short sales.
Three Bankers Bolster Blankfein as Goldman Trading Sinks (Bloomberg)
Led by David M. Solomon, Richard J. Gnodde and John S. Weinberg, the investment-banking division last year generated the second-highest revenue and profit since the firm went public in 1999, trailing only 2007, when the volume of global mergers was almost twice as high. The unit boosted revenue and market share in each of its three businesses: underwriting equity, advising on mergers and acquisitions and underwriting debt. Its share of fees from debt underwriting was the greatest since 1999, and it made about $2 billion from advisory work, 50 percent more than its closest competitor, JPMorgan Chase & Co. — a $660 million gap, according to data compiled by Bloomberg. The dominance was even more pronounced in the first quarter of 2014, when Goldman Sachs almost doubled the advisory revenue of every other bank and led in total investment-banking fees for the first time since the financial crisis.
Calstrs to Vote Against BofA Directors in Proxy Campaign (WSJ)
The California State Teachers’ Retirement System pension fund voted against four members of Bank of America Corp.’s board in response to the bank’s announcement last week that it had miscalculated capital levels. The move is largely symbolic, because many big shareholders have expressed support for Bank of America’s management and are expected to vote for the current board.
Grilled cheese set to parachute into New York City (USAT)
The Australian pop-up restaurant Jafflechutes has announced plans to bring its parachute-delivered grilled cheese sandwiches to New York City. The Melbourne group raised funds to bring its whimsical sandwich delivery system to North America — possibly this month, according to a Facebook post — but they say they aren’t in it for the money. “We do this purely for fun,” Adam Grant, one of Jafflechutes’ founders, told Fast Company in April. If you’d like to catch an airborne jaffle (that’s an Australian word for grilled cheese), Jafflechutes says they will announce the next drop one day in advance on Twitter and Facebook. Interested parties can then order via Paypal, $5 for cheese and tomato and $6 for cheese and ham. At a predetermined time the following day, stand on an “x” marked on the street at a secret location and look to the sky. Jafflechutes will drop the sandwich, complete with its own tiny parachute, into waiting hands below.
AIG’s income from premiums fall, shares down (Reuters)
American International Group Inc (AIG.N) posted a 27 percent fall in quarterly income, hurt by a drop in earnings from premiums and higher disaster losses in its core property and casualty insurance business. The company’s shares fell as much as 3 percent in extended trading on Monday. The U.S. insurer is in the middle of a turnaround after almost collapsing under the weight of soured derivative bets during the 2008 financial crisis. It has since repaid the $180 billion in bailout funds it received in 2008 and has focused on its core insurance business.
Target CEO Steinhafel to Step Down Following Data Breach (Bloomberg)
After last year’s hacker attack compromised the personal data of millions of shoppers and added to the retail chain’s woes, the board replaced Steinhafel as chairman and CEO today, saying the time was right for new leadership. John Mulligan, Target’s chief financial officer, will serve as interim CEO while the company seeks a permanent chief, according to a statement. Board member Roxanne Austin, a former DirecTV executive, will be interim chairwoman.
Saying Farewell to the Lehman Ethos (WSJ)
For many people, Lehman Brothers Holdings Inc. died in the early hours of Monday, Sept. 15, 2008, when the Wall Street firm filed for bankruptcy. Others date its demise to the day after, when Barclays PLC bought Lehman’s U.S. operations. With the flick of a switch, the giant screens on the firm’s Times Square headquarters went from Lehman’s white and green to Barclays’s blue. To the victors, the spoils and the pixels. Yet, parts of Lehman’s tough-as-nails culture managed to survive inside Barclays, largely because many of its key people stayed on. Then, last week, three former Lehman executives— Skip McGee, Barclays’s Americas chief; Ros Stephenson, chairman of global investment banking; and Paul Parker, the head of the mergers-and-acquisitions department—left unexpectedly. This week, Barclays Chief Executive Antony Jenkins is expected to deal another blow to former Lehman troops by unveiling a plan to shrink the group’s securities businesses and create a “bad bank” to house unwanted assets. Few will shed any tears for Lehman. But the fate of the firm shines a light on the safer, gentler and less profitable path Wall Street has been forced to take by tougher rules and changing markets.
Barclays’ senior U.S. tech banker to leave for Evercore: FT (Reuters)
British bank Barclays Plc’s senior technology banker in the United States will become the fifth top investment banker to leave the bank ahead of a strategic overhaul due this week, the Financial Times reported, citing people familiar with the matter. Stuart Francis, head of technology banking business and a vice chairman at Barclays, will leave the lender and is planning to join investment bank Evercore Partners Inc (EVR.N), the newspaper quoted the people as saying.
One Direction might sue ‘One Erect!on’ condoms (NYP)
British boyband One Direction’s management team is upset that an American condom brand is for riffing off the band’s name with their “One Erect!on” line. “Stay ‘UP ALL NIGHT’ with these FDA approved ONE ERECT!ON condoms. There is only one direction to go with these babies and that is UP! Great ice breaker at parties and bars,” reads the promotional blurb reported by the Daily Star. The packaging is a rip-off the band’s first album cover, “Up All Night,” by using the same font and placement, as well as five cartoon drawings of condoms to represent each band member…the band’s management team wasn’t amused. “They are considering bringing in lawyers to stop them shamefully exploiting the band to sell condoms,” the insider also claims. They don’t want anyone “cashing in on their sex-symbol status.” The rubbers are being sold on Ripnroll.com. If you want just one, they cost $2.95, but in case you need more they’re selling 1,000 of them for $300.