PRESS DIGEST – Financial Times – July 23

The Financial Times ECB CHIEF CALLS FOR GLOBAL TIGHTENING European Central Bank chief Jean-Claude Trichet said industrialised countries should cut public spending and raise tax to consolidate present recovery here

BLACKSTONE FUND HITS $13.5BN

Investment firm Blackstone (BX.N) has raised $13.5 billion for its new buy-out fund, making it the biggest since the financial markets crisis began. here

DESMOND READY TO BUY FIVE

Newspaper magnate Richard Desmond has made a £104 million pound bid to buy Five, making him the first individual to control a UK public service broadcaster if successful. here

MINISTER WARNS OIL SHOCK “LIKELY” WITHIN DECADE

Energy Minister Chris Huhne said Britain was “very likely” to face an energy crisis within the next decade that could trigger economic volatility. here

BT SOUGHT AUDITOR CHANGES AFTER 1.6 BLN POUND WRITEDOWN

British telecommunications provider BT (BT.L) asked its auditor to change members of its credit team after optimistic profit assumptions led to a 1.6 billion pound writedown. here

GM BUYS AMERICREDIT IN $3.5BLN DEAL

General Motors [GM.UL] agreed to buy Texas-based AmeriCredit for $3.5 billion in cash in order to boost its sales to non-prime car and truck buyers. here

(Summary compiled by Reuters)

Spanish stocks – Factors to watch on Thursday

July 22 (Reuters) – The following Spanish stocks may be affected by newspaper reports and other factors on Thursday. Reuters has not verified the newspaper reports, and cannot vouch for their accuracy:

SABADELL (SABE.MC), BANKINTER (BKT.MC)

Spain’s fourth and fifth largest banks posted declines as expected in first-half net profit versus a year ago, although investor focus is on capital ratios ahead of the publication of Europe-wide stress tests on Friday.

For Sabadell results, click on [ID:nLDE66L03W].

For Bankinter results, click on [ID:nLDE66K1IR].

SANTANDER (SAN.MC)

Santander is preparing to list its UK operations on the London market as early as this autumn, the Financial Times said, in a deal that could raise an estimated 3 billion pounds ($4.55 billion) to fund growth by the bank.

For more, please click on [ID:nLDE66L007]

MAPFRE (MAP.MC)

The Spanish insurer publishes first-half results.

SAVINGS BANKS

Spain’s savings banks will all pass so-called stress tests due for publication on Friday because the tests include the injection of 10.2 billion euros in capital from the State’s Fund for Orderly Bank Restructuring (FROB), newspaper El Economista reported, which will be included as capital.

For today’s European market outlook double click on [.EU].

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For IBEX constituent stocks highlight .IBEX in the command box and press the F3 button on your keyboard

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Market Chatter — Corporate finance press digest

July 22 (Reuters) – The following corporate finance-related stories were reported by media on Friday:

* Spain’s Santander (SAN.MC) is preparing to list its UK operations on the London market as early as this autumn, the Financial Times said, in a deal that could raise an estimated 3 billion pounds ($4.55 billion) to fund growth by the bank. [ID:nLDE66L007]

* Paulson & Co, the hedge fund linked to civil fraud charges against Goldman Sachs (GS.N), will launch a new fund open to retail investors, the Financial Times said. [ID:nLDE66L00M] (Compiled by Tresa Sherin Morera)

Can Brazil Save the Amazon?

On Sunday I woke up in a hotel in Manaus, Brazil, had breakfast overlooking the Negro River, then went for a run along the river’s beaches. It was an enjoyable way to begin my first visit to Brazil, a six-day, government-backed, jam-packed tour with a focus on the environmental issues facing the Amazon.

Environmentalists have labored for decades to protect the impossibly vast rainforests of the Amazon, which make up more than half of the world’s tropical forests. But until recently they had little to show for their efforts. (Ben & Jerry’s Rainforest Crunch doesn’t count.) Since the 1970s, about 230,000 square miles of the Amazon have been lost to development, mostly cattle ranches, soy plantations and illegal logging.

Only lately has the rate of deforestation began to slow, thanks to more progressive government policies and corporate campaigns by NGOS, notably Greenpeace. Just last week, there was encouraging news from a British think tank called Chatham House, which published a major report on illegal logging around the world. Fiona Harvey wrote in the Financial Times:

Illegal logging has fallen by 22 percent worldwide in the past decade according to a report published on Thursday …

The assessment found that that in certain key countries the decline was even more dramatic, showing a fall of between 50 and 75 percent in the Brazilian Amazon, 75 percent in Indonesia and by about half in Cameroon.

The New York Times said:

In Brazil in particular, an overhaul of logging laws and a new zeal in enforcement have led to a significant drop not only in illegal logging but also in overall deforestation rates in the Amazon, according to satellite data from Brazil’s National Institute for Space Research.

Why should you care?

The big reason is that deforestation is a major cause of greenhouse gas emissions, accounting for as much as 20 percent of global emissions, scientists say. Preventing deforestation of the Amazon is incredibly complicated: It requires good government policy, effective local law enforcement, satellite monitoring and global cooperation because soy, beef and logs are shipped from Brazil to the U.S., Japan and Europe. Rich countries, NGOs and even some corporations have been trying for years to find way to create market mechanisms or outright grants that would get money to places like the Amazon, so that trees are worth more standing than cut down.

Even oil and coal companies like this idea because preserving trees is low-cost way to generate carbon offsets and one of the very cheapest ways to fight climate change — much less expensive, say, than building solar or wind power.

!–pagebreak– Tropical forests are also storehouses of biodiversity that are the source of medicines, food and chemicals used worldwide.

Manaus has been the gateway to the Amazon since the 19th century. You can get here by plane or boat but no roads connect the city, which is home to about two million people, to the rest of Brazil. (In that regard, it’s a little like Juneau, Alaska, but hotter.) A half dozen or so reporters are taking this trip; this afternoon we took a brief tour of Manaus, which has its charms but has seen better days.

Much better days, it turns out: The city boomed in the 1890s after Charles Goodyear invented vulcanized rubber and the John Dunlop figured out how to make it into inflatable tires, creating enormous demand for the sap from Brazilian rubber trees. A relic of that period is the Teatro Amazonas, an opulent opera house, made with Italian marble and glass and Scottish cast iron imported from Europe. A very kind guard let us in (the place was closed) and we heard musicians practicing for a concert.

Our tour also took us to an unfinished bridge that will soon span the Negro River, connecting Manaus to towns to the south. Right now the only way to cross the river is by ferry. Roads remain a contentious issue in the Amazon region, we were told. Lots of local people want them, to get better access to markets, education and health care, but more roads means more development, opportunity for logging and deforestation. (We’re interviewing Brazil’s environment minister later this week, and I’ll ask her about this.) Here’s a look at the bridge, with the ferries at left:

On Monday, July 19, we took a 90-minute flight into the Amazon to see an an oil and gas plant operated by Petrobas, one of the sponsors of this trip; we’re told they’ve taken steps to preserve habitat. On Tuesday, we’ll fly to Santarem, a city on the Amazon River, for meetings with the Brazilian Institute of Biodiversity and then to see a sustainable development project in the Tapajos National Forest. My week will conclude with visits to Brasilia and Sao Paulo. By Saturday, I will have taken 11 flights in eight days. I hate to think about my carbon footprint this week.

Market Chatter — Corporate finance press digest

July 20 (Reuters) – The following corporate finance-related stories were reported by media on Tuesday:

* Hoare Govett, the Royal Bank of Scotland’s (RBS.L) corporate brokering business, has won its first FTSE100 client since it was bought by RBS from ABN Amro three years ago, the Financial Times said on Tuesday. [ID:nLDE66J00H]

* AIA, the Asian life insurance unit of American International Group (AIG.N), is seeking backing from potential investors to cut ties with its U.S. parent by listing more than half its equity in the Hong Kong market, the Financial Times said. [ID:nLDE66J00D]

* Kumba Iron Ore (KIOJ.J) may look for other domestic buyers to take extra ore if ArcelorMittal’s South African unit (ISPA.AS) shuts down one of its plants, Business Report newspaper said. [ID:nLDE66I0NM]

* India’s Tata Steel (TISC.BO) has started talks with lenders including Citigroup (C.N) to refinance as much as 3.5 billion pounds ($5.4 billion ) in loans for its British unit, Bloomberg reported, citing six sources with knowledge of the matter. [ID:nSGE66I0LK] (Compiled by Tresa Sherin Morera)

IMF aims to boost lending resources by $250 billion: report

(Reuters) – The International Monetary Fund (IMF) wants to boost its lending resources to $1 trillion from $750 billion in order to prevent future financial crises, the Financial Times said on Monday.

The paper, without citing sources, said the IMF wants to agree financing deals in advance that will be specially tailored to individual countries, rather than respond to crises with conditional loan packages.

“Even when not in a time of crisis, a big fund, likely to intervene massively, is something that can help prevent crises,” IMF Managing Director Dominique Strauss-Kahn told the FT.

“Just because the financing role decreases, doesn’t mean we don’t need to have huge firepower… a $1,000 billion fund is a correct forecast,” he said.

The FT said South Korea, which currently chairs the Group of 20 leading economies, is hoping to convince the G20 countries to back the plan at the next summit in Seoul in November.

(Reporting by Karolina Tagaris; Editing by Michael Urquhart)

Jefferies Enhances Global Equity Research Management Team

Richard Taylor Joins as Head of International Equity Research and Robert Fagin
as Co-Director of US Equity Research
NEW YORK & LONDON–(Business Wire)–
Jefferies announced today the hiring of Richard Taylor as Head of International
Equity Research in London and Robert Fagin as Co-Director of US Equity Research
in New York. Mr. Taylor will lead Jefferies` equity securities research effort
in Europe and Mr. Fagin will partner with Susan Gilbertson, Co-Director of US
Equity Research, in leading the firm`s US equity research.

“We are very pleased to welcome Richard and Robert to Jefferies,” commented
Steven R. Black, Global Head of Equity Research at Jefferies. “Their significant
experience and outstanding reputations make them key additions to our
established equity research effort. These additions demonstrate Jefferies`
commitment to providing our institutional clients with high-quality, independent
equity research on a global basis.”

Jason Griffith, Global Head of Equities at Jefferies, said, “These appointments
enhance the leadership of our equity research offering and are further
confirmation of our commitment to delivering high-quality equity research
globally. Steve, Susan, Robert and Richard, together with our team of 64 senior
equity research analysts worldwide covering nearly 1,000 companies, will
continue to enable Jefferies to provide our institutional clients with valuable
insight and perspective.”

Jefferies` research analysts consistently rank among the top industry
professionals, capturing 31 analyst awards year-to-date in 2010, including
honors from The Wall Street Journal “Best on the Street” Analyst Survey,
Institutional Investor, Forbes.com / Zacks Investment Research and Financial
Times / StarMine. Jefferies and its affiliates have more than 180 equity and
leveraged finance research professionals globally covering over 1,300 companies
in the areas of aerospace & defense, clean technology, consumer, energy,
financial services, gaming & leisure, healthcare, industrials, maritime, media &
entertainment, real estate, technology, telecommunications and utilities.

Mr. Taylor brings to Jefferies more than 25 years of industry experience,
including the most recent 13 years at Citigroup, where he was most recently
Managing Director and Head of European Equity Research. Previously, Mr. Taylor
was a Deputy Managing Director at Natwest Markets and Head of European Equity
Research. He received a BA from the University of Oxford in Philosophy, Politics
& Economics.

Mr. Fagin was most recently Associate Director of Equity Research at Banc of
America Securities, where he worked for five years. Prior to that, he was a
Managing Director and Senior Research Analyst covering the Telecommunications
sector at Bear Stearns, and a Director and Senior Analyst at CIBC Oppenheimer
covering the Software sector.

Jefferies, a global securities and investment banking firm, has served companies
and their investors for more than 48 years. Jefferies & Company, Inc. is the
principal US operating subsidiary of Jefferies Group, Inc. (NYSE: JEF:
www.jefferies.com), and Jefferies International Limited is the principal UK
operating subsidiary. Jefferies International Limited, a UK-incorporated
company, is authorised and regulated by the UK Financial Services Authority.

Jefferies
Tom Tarrant, +1 203 708 5989
ttarrant@jefferies.com
or
Desiree Maghoo, 44 20 7029 8085
dmaghoo@jefferies.com
or
CJP Communications
Josh Passman, +1 212 279 3115, x203
jpassman@cjpcom.com

Copyright Business Wire 2010

Indian shares turn positive on earnings optimism

July 19 (Reuters) – Indian shares recovered from early lows on Monday morning, on optimism over quarterly earnings and a newspaper report Etisalat was close to buying a stake in Reliance Communications (RLCM.BO), the no. 2 mobile operator.

At 10:20 a.m. (0450 GMT), the 30-share BSE index .BSESN was up 0.03 percent at 17,961.03 points, with 16 components advancing. It had declined as much as 0.6 percent early.

The 50-share NSE index was barely changed at 5,394.10.

Reliance Communications was up 2.2 percent at 191.30 rupees after a Financial Times report Emirates Telecommunications (ETEL.AD) (Etisalat) was close to buying 26 percent stake in the Indian firm. [ID:nSGE66I05B] (Reporting by Ami Shah)

Etisalat close to buying 26 pct in Reliance Comm: report

(Reuters) – Emirates Telecommunications ETEL.AD (Etisalat) is close to buying 26 percent in Indian telecoms Reliance Communications (RLCM.BO), the Financial Times said on Monday, sending Reliance shares up nearly 4 percent.

Citing people familiar with the negotiations, the newspaper said the deal was estimated to be worth $3 billion.

The two groups are also considering merging Reliance Comm, India’s No. 2 mobile operator, with Swan Telecom, the Indian company in which Etisalat holds a 45 percent stake, it said.

Reliance Comm and Etisalat could not be immediately reached for comment.

Shares in Reliance Comm, valued by the market at $8.3 billion, jumped as much as 3.9 percent on the report in a subdued Mumbai market.

An alliance between the two groups could be completed as soon as mid-August, the Financial Times reported, citing a person close to the matter. Another person told the paper it could take up to the end of the year. Reliance Comm and Etisalat declined to comment on any specific negotiations, the paper said.

A successful outcome hinges on how fast Etisalat can free itself of the stake in Swan Telecom, a joint venture it acquired in 2008, as Indian regulations do not allow one company to own more than 10 per cent in two telecom groups, the paper said.

Several potential suitors cited in media reports based on unnamed sources have denied being in talks with Reliance Comm, controlled by billionaire Anil Ambani.

So far, only Abu Dhabi-based Etisalat has acknowledged that it is considering a deal with Reliance Comm, the only major local cellular carrier without a foreign strategic investor in the world’s fastest-growing mobile market.

Anil Ambani has been in dealmaking mode since ending a pact in May with his long-estranged brother, Mukesh Ambani, that forbade the two from competing on the other’s turf, freeing Anil to bring new investors into his debt-laden company.

That pact had enabled Mukesh Ambani, the world’s fourth-richest man, to assert a right of first refusal two years ago that blocked a deal between Reliance Comm and South Africa’s MTN (MTNJ.J).

Last month, Reliance Comm agreed to merge its telecoms communication towers business with that of GTL Infrastructure Ltd (GTLI.BO) in a deal that a source said would cut its debt by $3.9 billion.

By 0443 GMT, shares in Reliance Comm were up 2.3 percent at 191.40 rupees, while the main BSE index .BSESN was flat.

(Reporting by Pratish Narayanan and Tony Munroe in Mumbai; Stanley Carvalho in Abu Dhabi; Editing by Ranjit Gangadharan)

UPDATE 1-Etisalat close to buying 26 pct in Reliance Comm-FT

MUMBAI, July 19 (Reuters) – Emirates Telecommunications ETEL.AD (Etisalat) is close to buying 26 percent in Indian telecoms Reliance Communications (RLCM.BO), the Financial Times said on Monday, sending Reliance shares up nearly 4 percent.

Citing people familiar with the negotiations, the newspaper said the deal was estimated to be worth $3 billion.

The two groups are also considering merging Reliance Comm, India’s No. 2 mobile operator, with Swan Telecom, the Indian company in which Etisalat holds a 45 percent stake, it said.

Reliance Comm and Etisalat could not be immediately reached for comment.

Shares in Reliance Comm, valued by the market at $8.3 billion, jumped as much as 3.9 percent on the report in a subdued Mumbai market.

An alliance between the two groups could be completed as soon as mid-August, the Financial Times reported, citing a person close to the matter. Another person told the paper it could take up to the end of the year. Reliance Comm and Etisalat declined to comment on any specific negotiations, the paper said.

A successful outcome hinges on how fast Etisalat can free itself of the stake in Swan Telecom, a joint venture it acquired in 2008, as Indian regulations do not allow one company to own more than 10 per cent in two telecom groups, the paper said.

Several potential suitors cited in media reports based on unnamed sources have denied being in talks with Reliance Comm, controlled by billionaire Anil Ambani.

So far, only Abu Dhabi-based Etisalat has acknowledged that it is considering a deal with Reliance Comm, the only major local cellular carrier without a foreign strategic investor in the world’s fastest-growing mobile market.

Anil Ambani has been in dealmaking mode since ending a pact in May with his long-estranged brother, Mukesh Ambani, that forbade the two from competing on the other’s turf, freeing Anil to bring new investors into his debt-laden company.

That pact had enabled Mukesh Ambani, the world’s fourth-richest man, to assert a right of first refusal two years ago that blocked a deal between Reliance Comm and South Africa’s MTN (MTNJ.J).

Last month, Reliance Comm agreed to merge its telecoms communication towers business with that of GTL Infrastructure Ltd (GTLI.BO) in a deal that a source said would cut its debt by $3.9 billion.

By 0443 GMT, shares in Reliance Comm were up 2.3 percent at 191.40 rupees, while the main BSE index .BSESN was flat. (Reporting by Pratish Narayanan and Tony Munroe in Mumbai; Stanley Carvalho in Abu Dhabi; Editing by Ranjit Gangadharan)

AIG CEO threatened to quit if chairman stays: report

(Reuters) – American International Group Inc Chief Executive Robert Benmosche said last week he would quit unless Chairman Harvey Golub leaves the company, Bloomberg reported on Wednesday.

Benmosche told the board during a meeting on June 25 that he wanted more control over the divestment of AIG’s Asian life insurance unit, including making management changes, Bloomberg reported, citing unnamed sources.

The board of the insurer, which is nearly 80 percent owned by the U.S. government after a $182.3 billion rescue, did not make a decision during the meeting, the report said.

AIG declined to comment.

The development is the latest sign of tensions within the AIG boardroom after a deal to sell American International Assurance (AIA) to Britain’s Prudential Plc for $35.5 billion fell apart.

Prudential wanted to cut the price of the deal and Benmosche backed doing so, but the AIG board voted against doing that, overruling its hard-charging CEO, sources have said.

AIG was counting on the AIA sale as a big step forward in its efforts to repay taxpayers.

Benmosche favored accepting new terms for a deal because, even at a lower price, it offered more liquidity and sooner. In the process, though, Benmosche left some AIG directors unhappy with his handling of the transaction, a source told Reuters earlier this month.

But Benmosche, the fourth person to hold the top AIG job since June 2008, was seen as safe in his role, with the board wanting him to stay CEO, the source said at the time.

An important concern for the board was the difficulty of finding another person to take on the job of running AIG, according to the source at the time.

Last week, the Financial Times reported that the botched sale had led to increased tensions between Benmosche and Golub, triggering concerns that one of the two men might leave less than a year after their appointment.

(Reporting by Paritosh Bansal; Editing by Gary Hill)

UPDATE 2-Market Chatter — Corporate finance press digest

June 25 (Reuters) – The following corporate finance-related stories were reported by media on Friday:

* Dutch bancassurer ING Group (ING.AS) is considering retaining its Belgian insurance activities rather than divesting the business as part of its European Union-mandated restructuring, Belgium’s De Tijd said. [ID:nLDE65O05J]

* American International Group’s (AIG.N) failed sale of its Asian life insurance unit AIA has led to increased tensions between Chief Executive Robert Benmosche and Chairman Harvey Golub, the Financial Times said, citing people close to the situation. [ID:nSGE65O03G]

* Lions Gate (LGF.N) Entertainment Corp has restarted talks with Metro-Goldwyn-Mayer [MGMYR.UL] about a possible merger, the Financial Times reported. [ID:nLDE65O00I]

* Dubai International Capital denied speculation it plans to offload its European assets, saying it will hold on to its investments for at least two more years, the Financial Times reported. [ID:nLDE65O003]

* China Strategic Holdings (0235.HK) and Primus Financial Holdings have lost their Taiwanese partner Chinatrust Financial Holding (2891.TW) in their $2.2 billion bid for AIG’s (AIG.N) Taiwan Nan Shan Life unit, a newspaper said. [ID:nTOE65O01G]

* A-shares of China’s Agricultural Bank of China [ABC.UL] were 16 times oversubscribed upon the completion of domestic pre-marketing for its IPO, with a price-to-book value of nearly 1.6 times, the Securities Times said. [ID:nTOE65N089]

For the deals of the day, please double click on [ID:nSGE65O06B]

(Compiled by Anirban Sen in Bangalore; Editing by Valerie Lee and David Holmes)

AIG CEO, Chairman at odds over failed AIA deal – FT

(Reuters) – American International Group’s (AIG.N) failed sale of its Asian life insurance unit AIA has led to increased tensions between Chief Executive Robert Benmosche and Chairman Harvey Golub, the Financial Times said, citing people close to the situation.

Stocks | Mergers & Acquisitions | IPOs | Global Markets | Financials

AIG is weighing its options for its Asian life insurance unit after a $35.5 billion deal to sell the business to Prudential fell apart.

Benmosche had supported Prudential PLC (PRU.L) deal and argued for accepting a reduction of about $5 billion to help the British company win support from its shareholders, the people told the paper.

However, AIG’s board led by Golub rejected the idea by an overwhelming margin, forcing AIG to go back to its original plan for a public listing of AIA, the FT said.

The divestment of AIA, which could include an IPO, is seen as a key step in AIG’s efforts to repay the government for its $182.3 billion bailout. [ID:nN14222874]

The rift between AIG’s two top executives has triggered concerns within the board and among officials in the U.S. government, who fear one of the two men might leave less than a year after their appointment, the paper said.

However, the relationship between Benmosche and Golub has not yet completely broken down, the people told the paper.

AIG could not immediately be reached by Reuters for comment outside regular U.S. business hours. (Reporting by Sakthi Prasad in Bangalore; Editing by Lincoln Feast)

UPDATE 1-Market Chatter — Corporate finance press digest

June 22 (Reuters) – The following corporate finance-related stories were reported by media on Tuesday:

* Indian group Reliance Industries (RELI.BO) was close to announcing a deal to pay $1.35 billion for a stake in a Texas shale gas field controlled by Pioneer Natural Resources (PXD.N), the Financial Times reported, citing people familiar with the matter. [ID:nSGE65L079]

* Reliance Industries, which has agreed to buy Infotel Broadband, is in initial talks with MTNL (MTNL.BO) to market the state-run firm’s 3G services as a franchisee, the Financial Express reported without citing any source on Tuesday. [ID:nSGE65L03K]

* U.S. film studio Spyglass Entertainment has emerged as the leading contender to run debt-ridden Metro-Goldwyn-Mayer Inc, the Wall Street Journal reported, citing people familiar with the matter. [ID:nSGE65L066]

* Spanish bank Banco Santander (SAN.MC) is trying to revive talks to merge its U.S. operations with M&T Bank Corp (MTB.N) after initial discussions fell apart last month over an issue of control, Bloomberg said on Monday. [ID:nN21259474]

(Compiled by Aditi Samajpati in Bangalore; Editing by Dan Lalor)

Reliance to pay $1.35 bln for Pioneer field stake-FT

June 22 (Reuters) – India’s Reliance Industries (RELI.BO) was close to announcing a deal to pay $1.35 billion for a stake in a Texas shale gas field controlled by Pioneer Natural Resources (PXD.N), the Financial Times reported, citing people familiar with the matter.

Stocks | Mergers & Acquisitions | Global Markets

Reliance, India’s largest listed company, will buy a 45 percent stake in the Eagle Ford shale gas field in south Texas, the people said, according to the newspaper.

A Reliance official declined to comment when reached by Reuters. (Reporting by Indulal P.M.)

Germany wants to release bank stress test results -report

June 17 (Reuters) – The German government wants to release the results of stress tests conducted on its banks, and is coordinating the action at a European level, a newspaper reported on Thursday.

Regulatory News | Global Markets

Citing unidentified government sources, Financial Times Deutschland said Berlin had sent signals to Europe and the Group of Seven nations that it “basically supports” transparency with regard to the tests. (Reporting by Brian Rohan)

UPDATE 1-ECB to keep buying govt bonds- Gonzalez-Paramo

FRANKFURT, June 17 (Reuters) – The European Central Bank will continue to buy government bonds until markets have sufficiently stabilised, ECB executive board member Jose Manuel Gonzalez-Paramo told a German newspaper.

“So far the programme is going very well,” he said in an interview published in Financial Times Deutschland on Thursday.

The ECB started buying sovereign bonds last month in a controversial decision aimed at supporting bond markets rattled by concerns over the ability of some government to rein in debt and budget deficits.

Gonzalez-Paramo told the newspaper that liquidity had returned to markets at levels above those seen in early May.

“But the situation is not yet entirely normal,” he said.

Nonetheless, while investors remain cautious, he said it was “not correct, at least not entirely correct” to assume that the ECB is currently the only buyer of government bonds.

Gonzalez-Paramo said it was very frustrating that rating agencies were still acting in a pro-cyclical way, but was critical of the idea that the ECB could act as a rating agency.

“It is not the job of a central bank to offer ratings or publish its internal evaluations,” he said.

The Greek crisis, which investors fear could spread to other weak euro zone states, has highlighted problems in the system under which the ECB accepts bonds as security for loans based on the judgment of major ratings agencies such as Standard & Poor’s, Moody’s and Fitch.

“We will do everything to be less dependent on rating agencies,” Gonzalez-Paramo said.

Greece, Spain and Portugal have all seen their credit ratings cut in recent months as worries intensified about their heavy public debt.

In the latest move, Moody’s cut Greece’s rating to junk status on Monday, highlighting persistent doubts over the country’s ability to exit a severe debt crisis. [ID:nN14207740] (Reporting by Maria Sheahan; Editing by Neil Fullick)

ECB will continue buying government bonds – Paramo

June 17 (Reuters) – The European Central Bank will continue buying government bonds until markets have sufficiently stabilised, ECB executive board member Jose Manuel Gonzalez-Paramo told a German newspaper.

Bonds | Global Markets

“So far the programme is going very well,” he said in an interview published in Financial Times Deutschland on Thursday.

The ECB started buying sovereign bonds last month in a controversial decision aimed at supporting bond markets, which have been rattled by a loss of investor confidence in some governments’ ability to rein in debt and deficits.

Gonzalez-Paramo told the paper that liquidity has returned to markets at levels above those seen in early May.

“But the situation is not yet entirely normal,” he said. (Reporting by Maria Sheahan; Editing by Kim Coghill)

Wal-Mart invests in debit card seller Green Dot

(Reuters) – Wal-Mart Stores Inc (WMT.N) has taken a minor stake in the prepaid debit card seller Green Dot Corp in a move that would give the U.S. retail giant indirect access to the U.S. financial space.

Stocks | Mergers & Acquisitions | Bonds | Global Markets | Cyclical Consumer Goods | Non-Cyclical Consumer Goods

In a filing with the U.S. Securities and Exchange Commission this month, Green Dot said it had issued 2,208,552 shares of Class A common stock to Wal-Mart.

The stake would represent less than 1 percent of the combined voting power of outstanding Class A and Class B common stock after offering, Green Dot said.

In February, Green Dot had filed for an initial public offering of up to $150 million. [ID:nN26201233]

An attempt by Wal-Mart to open a U.S. bank was abandoned in 2007 after intense lobbying from the sector.

The Wal-Mart stake report was first published by the Financial Times on Wednesday.

Monrovia, California-based Green Dot sells prepaid debit cards and reloading services to U.S. consumers at roughly 50,000 retail stores including Wal-Mart, Walgreen Co (WAG.N) and 7-Eleven.

Wal-Mart began a push into Canada’s financial space on Tuesday, launching a domestic bank and a rewards credit card, in what could be just the first foray by the U.S. retailer into an already-crowded Canadian banking sector. [ID:nN15271919] (Reporting by Sakthi Prasad in Bangalore; Editing by Michael Shields )

Greece Gets Cut Down

There was little impact when Moody’s downgraded Greece’s credit rating to junk status, reports Reuters. Despite any progress Greece began, the risks of the bailout package and “doubts over the country’s ability to exit a severe debt crisis” were enough for Moody’s to make the steep cut. In the aftermath of the announcement, the euro dropped, but other markets were largely unchanged. Greece’s future economic growth will affect its credit ratings, but Moody’s “saw a low probability of Greece restructuring its debt.” While Standard & Poor’s downgraded Greece to junk status in April, Fitch has the country at BBB-minus and has “no immediate plans to follow suit and cut Greece’s debt to junk.”

While news broke of Greece’s downgrade, the Financial Times reported that China was considering investments worth several billion dollars. China is eyeing a variety of projects that concern shipping, logistics, and airport projects. However, there’s no guarantee that things will work out, since a previous deal with China “collapsed when Athens refused to sell a stake in National Bank of Greece.” The troubled nation is hoping other countries will also invest for the sake of economic growth.

In the wake of last week’s hack into AT&T (T) that accessed the e-mails of more than 1,000 iPad owners, the Wall Street Journal looks into the security flaws of mobile devices. Last year, there were 16 more security flaws in the operating systems of smartphones than in 2008, although “there’s little evidence malicious hackers have exploited such holes on a significant scale.” Even applications on mobile devices are increasingly vulnerable. The mobile version of Safari had five holes in 2008, but that number shot up in 2009 to 22. Despite companies moving quickly to plug holes, it took Apple (AAPL) three months to fix one it discovered. Steve Jobs better be careful, because the larger his company grows, the more hackers seem interested in it.

Starbucks (SBUX) is encouraging its patrons to loiter. The coffee giant announced that it will now be offering free Wi-Fi, courtesy of AT&T, and there’s no time limit, reports the New York Times. Currently Starbucks offers two hours free for those who bought a Starbucks card. For noncardholders or cardholders who want to use more than two hours, it costs $3.99 for a two-hour session. Starbucks had very little choice in the matter: McDonald’s (MCD) started offering free Internet access earlier in the year, and other specialty coffee shops also let customers use Wi-Fi free. Despite the new change, the company “does not expect that the free access and content will make people linger longer.” The free Wi-Fi also gives customers access to free articles, music, and videos as well as free access to some paid sites.

As of right now, Research in Motion (RIMM) has only one touchscreen phone—the BlackBerry Storm—but if rumors are correct, that could change soon, according to the Wall Street Journal. RIM will be shipping a new phone using a new operating system by the end of September, and that new phone is supposedly “a touch-screen smartphone with a slide-out keyboard.” Although RIM “sells more smartphones globally than any company besides Nokia (NOK),” it’s losing shares of North America to Apple and Google (GOOG). To combat this issue, RIM’s new phone shares a lot of qualities with the iPhone, such as “letting users swipe through screens and expand images with their fingers.”

Finally, video game publishers are gravitating away from the low-quality video games based on movies that are slapped together and thrown out into the market in time for the movie’s theatrical release, reports the Los Angeles Times. Next year, there are expected to be only eight movie-based video games, as opposed to this year’s 11. Of this year’s games, the large majority of them are based on children’s movies. Older gamers want higher quality games, which can take three years to make. Not seeing any profitability in video games adapted from movies, “several major game publishers have nearly abandoned Hollywood-inspired games.”