HSBC Profit Falls 40% as Bank Plans $2.5 Billion Share Buyback (WSJ)
HSBC Holdings PLC on Wednesday announced a surprise $2.5 billion share buyback as the global slowdown makes new lending and investments less appealing. The bank’s shares rose 3.5% in London on the plan to give shareholders back some of the cash from the sale of HSBC’s Brazil unit last month. But questions remained over the bank’s growth and ability to keep paying big dividends after second-quarter net profit plunged 40% to $2.61 billion. HSBC said Wednesday that it is no longer “achievable” to reach its target return on equity, a key profitability measure, of more than 10% by the end of 2017.
Bitcoin worth $72 million stolen from Bitfinex exchange in Hong Kong (Reuters)
Nearly 120,000 units of digital currency bitcoin worth about US$72 million was stolen from the exchange platform Bitfinex in Hong Kong, rattling the global bitcoin community in the second-biggest security breach ever of such an exchange. Bitfinex is the world's largest dollar-based exchange for bitcoin, and is known in the digital currency community for having deep liquidity in the U.S. dollar/bitcoin currency pair. Zane Tackett, Director of Community & Product Development for Bitfinex, told Reuters on Wednesday that 119,756 bitcoin had been stolen from users' accounts and that the exchange had not yet decided how to address customer losses.
Too soon to rule out rate hike at next Fed meeting: Lockhart (Reuters)
Atlanta Federal Reserve Bank President Dennis Lockhart said on Tuesday it was too soon to rule out an interest rate increase at the U.S. central bank's next meeting in September, with a lot of data set to come in on the health of the economy. "At this point, I don't rule out a rate increase at the next meeting or later in the year," Lockhart said on CNBC. "We just have to wait and see how the data come in."
Investors Muscle Into Big Loans Too Risky for Banks (WSJ)
Ares and its peers, so-called alternative asset managers, have long lent money to midsize businesses. But they are now also muscling into deals up to about $1 billion. The firms can make larger loans because they have received an influx of cash from clients looking for yield as low interest rates persist. For larger loans, they often keep a piece of the debt and flip the rest to other investors. Traditional investment firms such as AllianceBernstein LP and Neuberger Berman Group LLC also have built up direct-lending teams in recent years. The competition is putting additional pressure on banks, which have been held back from lending to riskier companies by regulations implemented after the financial crisis. Lenders such as Ares “fundamentally aren’t hamstrung by those issues,” Mr. Mock says. While banks still control most corporate lending, the ascendance of direct lenders reflects the power shift transforming Wall Street as investment firms increasingly take on roles previously occupied by banks.
Vanilla Ice loses cool at airport after missing flight (NYP)
The ’90s rapper, 48, was recorded by a bystander shouting at a Delta employee because he missed his flight from the Peach State to Nebraska, where he held a concert Monday night. The woman who recorded the incident called it a “temper tantrum” and claims Ice missed his flight due to his own actions. She says Ice, who was allegedly on his phone, arrived 10 minutes after the cutoff time for boarding — which set off the chain of events. She also claims Ice, whose real name is Robert Van Winkle, threw his ticket at the agent and began cursing. TMZ reports that Ice says he arrived an hour early, but somehow missed the call to board the plane. “No one has called me. No one said final call. Nothing,” he’s overheard ranting to the agent in the leaked video. “You didn’t board me! I’m sitting in the freaking line … You didn’t even say anything.” He flew off the handle when an onlooker told him, “You gotta watch the monitor, dude.” “I don’t need any information from you, man,” Ice barks at the man offering his advice. “Shut your f–king mouth … You don’t work here. Shut up!”
JPMorgan Pays Inmates for Fees on Get-Out-of-Jail Debit Card (Bloomberg)
The bank agreed to pay a total of $446,822 to thousands of ex-prisoners to settle a class-action suit claiming JPMorgan ripped them off with $10 fees to withdraw money from a teller window and $2 charges for using non-network ATMs, according to a filing on Monday in federal court in Philadelphia. JPMorgan’s contract with the Federal Bureau of Prisons was a scheme “to exploit one of the most vulnerable groups imaginable -- releasees from federal corrections facilities,” according to the complaint.
The New Thorn in the Sides of Big Banks (WSJ)
Mr. Liberson, a 52-year-old lawyer who has devoted much of his career to defending apartment dwellers from eviction, is suing on behalf of the city of Miami. In the lawsuits, Miami blames the banks for widespread declines in property values and tax revenue, and increased expenses for police, fire and other services, due to the burdens of mass foreclosures. The banks, which already shelled out tens of billions of dollars for mortgage-related settlements with federal and state governments since the financial crisis, have challenged whether the city has the right to sue. The Supreme Court in June agreed to take up the question and is likely to hear oral arguments in the fall and will decide by July 2017.
Pimco Total Return posts outflows of less than $200 million in July (Reuters)
Investors pulled less than $200 million in July from the Pimco Total Return Fund, one of the largest bond funds in the world, following about $800 million of cash withdrawals the previous month, Pimco said on its website Tuesday. The Pimco Income Fund, seen by many in the industry as Pimco's new flagship fund and overseen by group Chief Investment Officer Dan Ivascyn, posted inflows of $1.2 billion last month. The fund has attracted a total of $23.9 billion this year and in 2015, Pimco said.
Man Pleads Guilty To Hiding 7.2 Grams Of Cocaine In His Foreskin (HP)
Police in Swindon, UK, said they found 7.2 grams of cocaine stuffed into the 24-year-old’s foreskin, according to the Sunday World. It all began June 17 when Swindon police were called to a furniture store after getting calls of a man shouting and disturbing customers in the parking lot. When officers arrived, Hare was naked and put up a struggle before he was taken into custody and taken to a local hospital. While in custody, a baggie containing white powder began to “emerge” from his foreskin, according to the Salisbury Journal.