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A sour mixture of manufacturing hiccups, Chinese Covid lockdowns and other issues have watered down Oatly’s once-heady growth rates. On that basis, the company could exhaust its $116 million cash pile early next year. Petersson has announced layoffs and other cost-cutting measures, which he hopes will save $50 million in annual terms. And even if he finds a manufacturing partner soon, it’s unlikely to stop the company burning cash. That leaves Petersson two options: sell the company, or raise cash.

☆ Stablecoins fall few cents short of respectability
▼ + stars: | 2022-11-23 | by ( John Foley | ) www.reuters.com time to read: +8 min

That will reignite the debate over how to regulate digital assets – especially when it comes to stablecoins, the most money-like part of the cryptoverse. Stablecoins are digital assets designed to have a steady value, usually by being pegged to a real-world currency like the U.S. dollar. For each dollar of stablecoin a user holds, there’s supposed to be a dollar, or something like a dollar, sitting in a metaphorical vault. And in the case of some so-called algorithmic stablecoins, what backs the stablecoin might be another digital token with no fundamental value. The total sum of major U.S. dollar stablecoins outstanding is just under $145 billion, according to CoinGecko.

☆ SocGen’s BNP envy carries a cost
▼ + stars: | 2022-11-22 | by ( Liam Proud | ) www.reuters.com time to read: +3 min

It mimics BNP Paribas’s (BNPP.PA) deal with European peer Exane, which the French group took over last year. SocGen research analysts cover around 500 mostly European stocks, according to JPMorgan, compared with AllianceBernstein’s more international coverage of roughly 800 companies. Second, the venture makes the French bank’s equities business less reliant on derivatives and structured products, which led to heavy losses in 2020. Trading cash equities and selling research typically chews up much less capital and leads to fewer blow-ups. And the wider equities trading business is increasingly dominated by larger players, especially U.S. banks.

☆ Rio swaps wild goose chase for white-knuckle ride
▼ + stars: | 2022-11-18 | by ( ) www.reuters.com time to read: +2 min

SHARM EL-SHEIKH, Egypt, Nov 18 (Reuters Breakingviews) - Rio Tinto’s (RIO.L) tortuous quest to buy out minorities in Turquoise Hill Resources (TRQ.TO) just got even worse. Now a side deal to remove Pentwater Capital Management and SailingStone Capital Partners from the deciding vote has fallen apart. Rio needs Turquoise Hill, which controls two-thirds of Mongolian mega-mine Oyu Tolgoi, to ensure a tighter grip on one of its key growth projects. But to win the vote it needs a simple majority of the minorities, and Pentwater and SailingStone have over 30% already. Hence the attempted side deal, which would have outsourced the valuation of the two minorities’ stakes to an arbitration process.

☆ Breakingviews: FTX affords a turning point in venture governance
▼ + stars: | 2022-11-17 | by ( Liam Proud | ) www.reuters.com time to read: +3 min

The new chief executive of the collapsed cryptocurrency exchange, insolvency veteran John Ray, uncovered giant financial gaps and signs of looting. Ray’s first in-depth account, submitted to the court on Thursday, reveals a brazen lack of controls and governance. Financial statements dated to Sept. 30, when founder Sam Bankman-Fried was in charge, contain no record of customer liabilities at either the U.S. subsidiary or the international division. Many of the FTX corporate entities never had board meetings. Ray also criticised his predecessor and FTX co-founder Sam Bankman-Fried for making “erratic and misleading public statements”.

☆ FTX affords a turning point in venture governance
▼ + stars: | 2022-11-17 | by ( Liam Proud | ) www.reuters.com time to read: +3 min

☆ Crypto watchdogs have a giant offshore problem
▼ + stars: | 2022-11-17 | by ( Liam Proud | ) www.reuters.com time to read: +4 min

The European Union’s mammoth crypto regulation would help. Known as MiCA and recently agreed by lawmakers, the rulebook forces custodians to segregate clients’ crypto holdings from the firm’s own assets. Security firm Chainalysis reckons almost three-quarters of stolen crypto in 2021 was taken from DeFi services. Take Binance, by the far largest crypto exchange. Reuters GraphicsFollow @liamwardproud on TwitterCONTEXT NEWSFTX suffered a “severe liquidity crisis” that led to its bankruptcy, according to court filings dated Nov. 14.

☆ Credit Suisse’s fuzzy Apollo deal better than none
▼ + stars: | 2022-11-15 | by ( Liam Proud | ) www.reuters.com time to read: +3 min

The U.S. buyer, which already has about $523 billion of client money, will also manage the remaining $20 billion of Credit Suisse’s packaged loans and mortgages, in return for a fee. The Apollo deal and other smaller transactions will only reduce Credit Suisse’s risk-weighted assets by roughly $10 billion by mid-2023, which is less than half of the $22 billion that Körner said was sitting in the unit at the end of September. Credit Suisse also said that the final sale price will depend on discount rates. Follow @liamwardproud on TwitterloadingCONTEXT NEWSCredit Suisse on Nov. 15 said it would sell the bulk of its securitised products business to Apollo Global Management. As a result of the deals, Credit Suisse’s risk-weighted assets will fall by about $10 billion.

☆ Sam Bankman-Fried did financial system a favour
▼ + stars: | 2022-11-15 | by ( Peter Thal Larsen | ) www.reuters.com time to read: +5 min

LONDON, Nov 14 (Reuters Breakingviews) - Sam Bankman-Fried has tipped the cryptocurrency industry into crisis. But the spectacular implosion of FTX, the exchange he founded, has done the broader financial system a big favour. Bankman-Fried, widely known as SBF, was eager for regulators in the United States and elsewhere to recognise crypto exchanges like FTX. In that sense, he’s done the financial system a favour. FTX founder Sam Bankman-Fried has previously told Reuters some of the transfers out of FTX were a result of “confusing internal labelling”.

☆ SoftBank buyout goes from impossible to improbable
▼ + stars: | 2022-11-11 | by ( ) www.reuters.com time to read: +2 min

The $74 billion Japanese investor logged earnings of $21 billion in the three months to end September after trimming its stake in Alibaba (9988.HK). It offsets some gloom as technology valuations plummet; writedowns of its punt on crypto exchange FTX will follow. Expectations that these repurchases are a prelude to a buyout have helped lift SoftBank’s shares by one quarter in the past month. But any further sales of Alibaba or other assets would give SoftBank the firepower to keep buying out minorities. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ Breakingviews: FTX crash is old lesson for financial newcomers
▼ + stars: | 2022-11-10 | by ( Liam Proud | ) www.reuters.com time to read: +4 min

LONDON, Nov 9 (Reuters Breakingviews) - FTX is a young company facing an ancient financial problem. While it may be of little consolation to Bankman-Fried, the industry could end up better off for FTX’s agonies. Any investors who used trades on FTX’s exchange to hedge positions held elsewhere may now have to liquidate those other holdings, creating a wave of selloffs. While crypto is a new industry, the de-facto run that FTX experienced is a phenomenon as old as finance. Follow @liamwardproud on TwitterloadingCONTEXT NEWSCryptocurrency exchange Binance on Nov. 9 scrapped its deal to buy rival FTX.

☆ Centrica gives ammo to UK windfall tax fans
▼ + stars: | 2022-11-10 | by ( ) www.reuters.com time to read: +2 min

The chief executive of 5 billion pound Centrica (CNA.L) on Thursday outlined plans for a 250 million pound share repurchase, following in the footsteps of chunky payouts by BP (BP.L) and Shell (SHEL.L). With the UK already windfall taxing North Sea oil profits, the risk for O’Shea is that it emboldens UK Prime Minister Rishi Sunak to hit power generators as well. Nearly half of Centrica’s 25 billion pounds of revenue this year, based on Refinitiv data, will come from British Gas, which sells power to Britons. But a strong performance from Centrica’s electricity and gas production, and from its trading arm, means O’Shea has cause to be generous. Generation provides a much larger chunk of 2.2 billion pound renewable energy group Drax’s (DRX.L) top line.

☆ UK energy IPOs get a vote of minimal confidence
▼ + stars: | 2022-11-09 | by ( ) www.reuters.com time to read: +2 min

LONDON, Nov 9 (Reuters Breakingviews) - In one sense, Ithaca Energy’s initial public offering on Wednesday was a success. But a 6% drop below its 250 pence listing price on its first day of trading suggests it’s not all good news read more . Ithaca, owned by Israel’s Delek Group (DLEKG.TA), has a newly minted equity value of roughly $2.9 billion, and $1.4 billion of net debt. And Ithaca might have to rethink key growth projects, like oilfield Cambo, if the UK elects a potentially more anti-fossil fuel Labour government in the coming years. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ Primark’s price freeze is risky inflation gambit
▼ + stars: | 2022-11-08 | by ( ) www.reuters.com time to read: +2 min

LONDON, Nov 8 (Reuters Breakingviews) - Primark is breaking with the pack to navigate soaring inflation. Its largest rival Inditex (ITX.MC), owner of Zara, is taking a different approach by hiking prices over the next year. AB Foods Chief Executive George Weston appears to be willing to sacrifice Primark’s near 10% operating margin to keep price-sensitive customers happy. Assume inflation shaves almost 3 percentage points off the retail unit’s operating margin next year, taking it down to 7%. The 4% bump in AB Foods’ share price on Tuesday suggests investors reckon the plan may work.

The respective chief executives of $139 billion Philip Morris International (PM.N) and $95 billion Rio Tinto (RIO.L) are attempting takeovers that are central to their strategies. Olczak, who needs 90% of shareholders to accept in order to automatically de-list the company, initially faced opposition to his $16 billion offer. The mining giant asked for the postponement at the request of Quebec’s financial regulator, Turquoise Hill said. Two key investors in Turquoise Hill have agreed to withhold their votes on the bid, with their final deal dependent on Canadian arbitration. Turquoise Hill shares closed at C$41.6 on Nov. 4.

☆ BNP defies French banks’ interest-rate malaise
▼ + stars: | 2022-11-03 | by ( Liam Proud | ) www.reuters.com time to read: +3 min

A regulated savings rate, with roots tracing back to the French Emperor’s wars of conquest, is one reason why Gallic retail lenders could miss out on an interest-rate windfall that is boosting banks elsewhere. Ironically, 60 billion euro BNP Paribas (BNPP.PA) looks set to escape the curse because of some international expansion of its own. One-third of Gallic lenders’ deposits sit in savings vehicles with regulated interest rates, Jefferies analysts reckon. Combined with other interest-rate regulations and the fact that many French mortgage borrowers are on fixed rates, the upshot is that Gallic retail lending margins don’t rise as quickly as they might in Spain or Britain. Chief Executive Jean-Laurent Bonnafé, who is approaching his 11-year anniversary in the role, deserves credit for helping BNP to defy the lending malaise at home.

NEW YORK/ LONDON, Nov 3 (Reuters Breakingviews) - First Boston is an old Wall Street name that’s re-emerging from Credit Suisse (CSGN.S) with some new features. Credit Suisse Chief Executive Ulrich Körner is reshaping the $11 billion group to put some bad years and big losses firmly in the past. Credit Suisse is setting up joint ventures between CS First Boston and the parent’s trading and wealth management businesses, according to a person familiar with the matter. An added complication is that CS First Boston bankers could be getting paid in their own division’s stock, rather than Credit Suisse shares. Michael Klein will step down from the Credit Suisse board of directors to help launch CS First Boston, the bank said.

☆ Saudi Credit Suisse deal is fair Buffett imitation
▼ + stars: | 2022-11-02 | by ( Liam Proud | ) www.reuters.com time to read: +3 min

Saudi National Bank (1180.SE) is continuing the tradition, ponying up about $1.4 billion for a 9.9% stake in troubled Credit Suisse (CSGN.S). By contrast, Saudi Arabia’s biggest bank is acquiring $1.2 billion of new Credit Suisse shares in a private placement and then participating in the bank’s imminent rights issue. Credit Suisse is targeting a 6% return on tangible equity in 2025, once Chief Executive Ulrich Körner has cut costs and shrank the investment bank. The Gulf bank has talked up the wider opportunities of partnering with Credit Suisse. That would cost SNB roughly 220 million Swiss francs, taking its total investment spend to around 1.4 billion Swiss francs.

☆ Ocado’s South Korean deal is valuation rocket fuel
▼ + stars: | 2022-11-01 | by ( ) www.reuters.com time to read: +2 min

Shares in the 5.4 billion pound ($6.2 billion) online grocer surged almost 40% on Tuesday after it inked a new deal with South Korea’s Lotte Shopping (023530.KS). The warehouses could bring in about 2.1 billion pounds of annual sales when operating at full capacity, Numis analysts reckon. That implies about 100 million pounds of annual revenue, equivalent to 4% of sales in the last financial year. Most significantly, it shows that Steiner’s strategy of building warehouses for supermarkets worldwide may have legs. Steiner’s South Korean deal offers his company some valuation rocket fuel.

☆ Michael Klein’s fourth act may be his toughest
▼ + stars: | 2022-10-28 | by ( Liam Proud | ) www.reuters.com time to read: +3 min

Yet his toughest task yet will be making a success of Credit Suisse’s (CSGN.S) carved-out advisory unit, CS First Boston. Credit Suisse will be reluctant to provide that, having already slashed exposures to $3.6 billion from $10.2 billion in early 2021. Credit Suisse has struggled for years to encourage the two divisions to team up on deals involving billionaire business owners. Klein’s fourth investment banking act will be his toughest. Klein, a former Citigroup banker who has been on the Credit Suisse board since 2018, will act as an adviser to Chief Executive Ulrich Körner.

☆ Credit Suisse begins perilous ride to right place
▼ + stars: | 2022-10-27 | by ( Liam Proud | ) www.reuters.com time to read: +4 min

LONDON, Oct 27 (Reuters Breakingviews) - After years of botched strategies, Credit Suisse (CSGN.S) has finally hit the nail on the head. He’s also in exclusive talks with Apollo Global Management (APO.N) and PIMCO about selling the securitisation business, which bundles and slices mortgages for credit investors. It could fall even further if Credit Suisse eventually hives off the carved-out dealmaking business it is rebranding as CS First Boston, under former Citigroup (C.N) rainmaker Michael Klein. Those moves solve the central problem that has plagued Credit Suisse for years, and which former CEOs Thomas Gottstein and Tidjane Thiam failed to answer. The deposit outflow saw Credit Suisse breach liquidity requirements set by regulators of its legal subsidiaries.

☆ European banks’ perfect moment will prove fleeting
▼ + stars: | 2022-10-26 | by ( Liam Proud | ) www.reuters.com time to read: +4 min

LONDON, Oct 26 (Reuters Breakingviews) - Europe’s big banks are enjoying a perfect moment. That dream scenario allowed Deutsche Bank (DBKGn.DE), Barclays (BARC.L) and Banco Santander (SAN.MC) to report chunky profits in third-quarter results released on Wednesday. Barclays’ revenue from trading fixed-income securities, currencies, and commodities in the first nine months of 2022 was 63% higher year-on-year. Deutsche, Barclays and Santander have slashed their group-wide stock of loan-loss provisions since 2020, and in the latter two cases they’re even below pre-pandemic levels. Deutsche Bank and Barclays were down 0.5% and 0.9% respectively.

☆ GE is hurting but Larry Culp’s legacy has hope yet
▼ + stars: | 2022-10-25 | by ( Lauren Silva Laughlin | ) www.reuters.com time to read: +3 min

NEW YORK, Oct 25 (Reuters Breakingviews) - For Larry Culp, it’s not the journey but the destination. If all goes perfectly, it could be enough to salvage Culp’s legacy. Orders plummeted 43% year-on-year and revenue declined 15% as demand in the power division, which focuses on more traditional sources, rose. In healthcare, both orders and revenue were up just slightly in the first nine months of the year. If it succeeded in juicing up Vernova’s revenue, it could be game-changing for Culp’s legacy too.

☆ HSBC ditches its cost-cut tsar before job is done
▼ + stars: | 2022-10-25 | by ( Liam Proud | ) www.reuters.com time to read: +3 min

LONDON, Oct 25 (Reuters Breakingviews) - HSBC (HSBA.L), (0005.HK) boss Noel Quinn is getting rid of a cost-cutting finance chief, Ewen Stevenson, while his skills are still in need. The former Royal Bank of Scotland chief financial officer and Credit Suisse (CSGN.S) banker only started as HSBC CFO in January 2019. HSBC has so far managed to axe about $4.9 billion of gross annual expenses under a programme launched in early 2020. To keep HSBC’s investors happy, Elhedery will have to do his best impersonation of the bank’s outgoing cost-cutting tsar. Reuters GraphicsFollow @liamwardproud on TwitterloadingCONTEXT NEWSHSBC on Oct. 25 appointed Georges Elhedery as chief financial officer.

☆ If Credit Suisse loves its bankers, set them free
▼ + stars: | 2022-10-21 | by ( Liam Proud | ) www.reuters.com time to read: +6 min

LONDON, Oct 21 (Reuters Breakingviews) - Credit Suisse (CSGN.S) is a weak bank with some strong bankers. SECOND COMINGImagine, then, that Credit Suisse spins out its advisory and capital-markets business. But Credit Suisse has never quantified the business it wins from intragroup referrals, which suggests it is low. In this case, it will be higher if those people are no longer at Credit Suisse. First Boston was a U.S. investment bank in which Credit Suisse first bought a stake in 1978.

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