The Latest

  • 08 Oct 2014 at 5:00 PM
  • Banks

Citi’s Bout Of Montezuma’s Revenge Not Entirely Unforeseeable

La Casa de Corbat may have had an inkling about the problems that led to its $400 million Mexican nightmare. Or it may not have read all of those long, boring missives that the New York Fed insisted on sending year after year. Read more »

We’re talking individualized monthly outlook letters. We’re talking autographed, limited-edition photos of Bill and Bob doing things together around the house. Read more »

Earlier this week, a judge approved Brookfield Property Partners’ $110 million bid to buy bankrupt Atlantic City casino Revel (AKA the biggest mistake Morgan Stanley ever made). One person with whom this outcome didn’t sit right? Glenn Straub, who had previously made a $90 million offer for the place. How’d he express his disappointment? Not well! Or very well, if you were holding out hope someone would once and for all drop the white collar niceties BS and settle their professional setbacks Jersey-style. Read more »

A British judge is none too pleased with Lloyd Blankfein, et. al., re: their none-too-serious request of her to junk the Libyan Investment Authority’s lawsuit against it. And for wasting her time and Libya’s money (or, if you believe the accusations that Goldman sold the sovereign wealth fund worthless crap, more of its money), the bank’s gonna have to pony up. Just not as much as Libya would like, because the very same judge isn’t sure that even Gary Cohn’s words warrant this level of textual analysis. Read more »

Ken Griffin Not Distracted By Matters Of The Heart/Wallet

The Citadel multi-tasking chief isn’t just waging war against his soon-to-be ex-wife. He’s also adding to his (and his clients’) fortune, one month at a time. Read more »

Former Galleon trader turned Wall Street memoirist Turney Duff, he of “in an effort to create an alibi for skipping work, he faked a mugging by rolling on the pavement and into a puddle until he was bleeding and bruised” and middled aged escorts who say things like “If only I’d invested some of my money…then I could pick my clients and only hang out with guys like you,” continues to share tales from the crypt. Read more »

Two independent directors on the board that oversees HSBC’s British business may leave the bank over stricter rules aimed at holding bankers more accountable for reckless actions that may lead to the failure of a lender, according to a person with direct knowledge of the matter. Alan Thomson, a member of the audit and risk committees at HSBC Bank, has tendered his resignation and will leave the bank later this month, said the person, who was not authorized to discuss the matter publicly. John Trueman, deputy chairman of the bank’s British business, is also considering whether to leave over the new rules. [Dealbook]

Opening Bell: 10.08.14

Valeant, Pershing Square to Boost Allergan Bid (WSJ)
Valeant Pharmaceuticals International Inc. and activist investor William Ackman plan to boost their offer for Allergan Inc. by $15 a share, people familiar with the matter said, trying to keep the Botox maker from striking a rival deal. The new bid could value Allergan at more than $56 billion, increasing the offer by $4.5 billion. That would make it the largest deal of the year if completed, surpassing AbbVie Inc. ABBV -2.01% ’s pending $54 billion acquisition of Shire PLC. A $15 bump would bring the bid from Valeant and Mr. Ackman’s Pershing Square Capital Management LP to about $191 a share, based on Valeant’s closing price Tuesday. That is 2.5% above the closing price of Allergan’s shares, which rose Tuesday to $186.20. The bidders are still ironing out timing and the mix of cash and stock, the people said.

Profit at Goldman Less Easy to Find (Dealbook)
…the company is facing questions about whether it will be able to maintain its place atop the financial industry in a new era of regulations that hit hardest the very businesses in which Goldman makes the most money. Among Wall Street analysts, the company has been losing its favored position. Only a quarter of the analysts that follow the company have a buy recommendation on the shares of Goldman Sachs — the lowest proportion in years — while roughly half are still positive on its fiercest rival, Morgan Stanley, and even more recommend buying JPMorgan Chase stock. Further signs will come next week, when Goldman and the other big banks report third-quarter results. Goldman is expected to report higher profit than it did a year ago, but much of the bank’s recent success has come from divisions that are expected to shrink as new regulations are phased in.

Florida Pension Fund Significantly Reducing Pimco Exposure (WSJ)
The Florida State Board of Administration plans to pull more than $2 billion from Pacific Investment Management Co. following the departure of co-founder Bill Gross in late September. The decision appears to represent the biggest movement of funds disclosed by a public agency since Mr. Gross unexpectedly resigned from Pimco on Sept. 26. to join rival Janus Capital Group Inc.

A thousand miles apart, Janus bond chief Smith embraces Gross (Reuters)
Before hiring star bond fund manager Bill Gross last month, Janus Capital Group Inc (JNS.N) Chief Executive Dick Weil took care to check with the bond chief he already had, Gibson Smith. Smith said he has embraced the idea, despite concerns in the industry that Gross may not be enough of a team player. Smith said on Tuesday he plans to stay at Janus, with his team intact, after Weil said continuity was important. Weil “wanted to maintain what we have built and not do anything disruptive,” Smith said. “This is good for the Janus fixed-income business and good for Janus as a whole,” Smith said of Gross’ move in a telephone interview. Smith said he expects to talk about markets with the one-time Pimco leader. But they will be about 1,000 miles apart. The two will operate two distinct business units, with Gross operating out of a Newport Beach, California office, which Smith called “Janus West.”

New Dating App Caters to Rich by Weeding Out the Poor (NBC)
A new dating app called Luxy matches wealthy singles…to wealthy singles. It describes itself as “Tinder, minus the poor people.” The app’s iTunes page claims members are CEOs, investors, millionaires, and fitness models. So far, there are 3,000 users, and the average male user’s income is $200,000, company spokesman Darren Shuster told Vice. Shuster also told CNN that Luxy’s rich clientele is self-regulating and the app does not (yet) enforce salary verification. “If you show up in a 20-year-old VW Bug, and request to meet at McDonald’s, you won’t last very long on LUXY,” Shuster said. “It doesn’t take long to weed out those who belong on a different kind of dating site.” The app is so controversial that the CEO’s identity is kept anonymous. “With the rise of high-speed digital dating, it’s about time somebody introduced a filter to weed out low-income prospects by neighborhood,” wrote the app’s nameless CEO in a release. Read more »