STAN.L - Standard Chartered PLC
| Previous close | 680.40 |
| Open | 689.40 |
| Bid | 689.40 x 0 |
| Ask | 676.00 x 0 |
| Day's range | 686.00 - 694.00 |
| 52-week range | 573.80 - 742.60 |
| Volume | 2,325,158 |
| Avg. volume | 5,797,273 |
| Market cap | 21.741B |
| Beta (5Y monthly) | 1.51 |
| PE ratio (TTM) | 37.85 |
| EPS (TTM) | 18.20 |
| Earnings date | 29 Jul 2019 - 02 Aug 2019 |
| Forward dividend & yield | 0.17 (2.51%) |
| Ex-dividend date | 08 Aug 2019 |
| 1y target est | 8.78 |
- Bloomberg
U.S. Plans to Evacuate Some Americans From Wuhan: Virus Update
(Bloomberg) -- The novel coronavirus spread to more countries in the Asia Pacific region as China reported a surge in deaths and new cases due to the outbreak.The virus has killed at least 41 people in China, with media reports citing chaotic scenes as hospitals in the city of Wuhan turned away people who were unwell. The U.S. plans to close its consulate in the city temporarily and evacuate some Americans from the area, Dow Jones reported.Australia and Malaysia confirmed infections on Saturday, while the virus also spread to South Asia as Pakistan and Nepal reported cases. U.S. health authorities say they are monitoring more than 60 people for potential illness, while France identified the first cases in Europe.Nearly 1,300 cases in China, at least 41 deaths: Tracking the outbreakQuickTake: Learn more about the virusHere are the latest developments:China blocks outbound tours (10:40 p.m. HKT)China banned all outgoing overseas group tours starting on Jan. 27, and suspended domestic group tours as of Jan. 24, CCTV reported. Beijing also will prohibit buses from entering and leaving the city from Jan. 26.The Ministry of Culture and Tourism had ordered travel agencies and tourism companies to stop selling tour packages, according to a document seen by Bloomberg. The ban coincides with the start of the Lunar New Year holiday, when millions of Chinese travel across the country and abroad.Duke, NYU delay China classes (10:30 p.m. HKT)Duke Kunshan University, a joint U.S.-China institution, and New York University’s Shanghai campus have delayed the resumption of classes after a spring break until early February in response to the virus outbreak.Duke postponed classes until Feb. 17 and restricted access to the campus in China’s Jiangsu province. The university also is helping to pay international and Chinese students who want to return home.NYU Shanghai will delay the start of the spring semester by one week, to Feb. 10, a university spokesman said.U.S. evacuating Americans (7:15 p.m. HKT)The U.S. plans to evacuate 90 people from Wuhan to the U.S. in a charter flight on Sunday, Dow Jones reported, citing a source it did not identify. China’s Foreign Ministry is aware and approved of the plan, the report said.Diplomats and medical personnel will be on board the flight, according to the report. The plane can seat 230 people and the U.S. consulate is approaching Americans to offer to evacuate them with costs borne by those who accept it, Dow Jones said.Australian cases rise (6:45 p.m. HKT)Australia reported three cases of coronavirus in the state of New South Wales, with the men diagnosed after travelling to China. Two were in Wuhan, the epicenter of the virus, while another man had contact with an individual confirmed to have the virus, a statement from New South Wales Health said. The country reported its first case earlier on Saturday in Melbourne.Hong Kong marathon scrapped (4:35 p.m. HKT)Hong Kong raised its response level to the coronavirus to “emergency” and will cancel its largest marathon to help with disease control efforts, Chief Executive Carrie Lam said at a briefing. The Standard Chartered Hong Kong Marathon, originally scheduled for Feb. 8 and 9, involves 70,000 people and the government “believes it has to be canceled,” Lam said.School holidays for non-tertiary students will be extended to Feb. 17, she said. Hong Kong will also halt flights and rail services to Wuhan indefinitely, Lam said. The city’s health authorities earlier said the confirmed number of cases rose from two to five.Medical supplies shortage in Hubei (4 p.m. HKT)China widened the lockdown and shut down public transport 16 cities in Hubei province where the virus originated. In Wuhan, the capital city and ground zero of the infection, officials also sought to limit the movement of private motor vehicles.There is a severe shortage of medical equipment, including protective suits, N95 masks and goggles in Wuhan, an official in Hubei province said at a press conference.Another case in Japan (3 p.m. HKT)Japan reported a third case of the virus, saying that the patient from China isn’t in serious condition.Malaysia’s three cases (11:40 a.m. HKT)A woman and her two grandchildren -- Chinese nationals from Wuhan -- traveled to Malaysia from Singapore. They are related to a 66-year-old man and and his son who had tested positive for the virus in Singapore, Malaysian Health Minister Dzulkefly Ahmad said.Singapore health authorities tipped Malaysia off that the family had entered the country. The three are in stable condition with symptoms of a cough, and have been isolated, the health minister said. Five others who were traveling with them have tested negative for the virus.Wuhan doctor reported dead (10:20 a.m.)A doctor in Wuhan has died from the virus, local media reported. It’s not clear if the 62-year-old specialist was working on the front lines to treat the illness, with some saying he had retired.Calls for investigation on Wuhan residents (9:45 a.m. HKT)Curbing the virus from spreading out from Wuhan is the political responsibility of Hubei, Jiang Chaoliang, the party secretary of the province, said in a meeting this Friday.For new cases outside the province involving people that have been to Wuhan city, investigations should be launched on how they got out, Jiang was reported as saying .Australian infection (9:05 a.m. HKT)Australia reported its first confirmed case of the coronavirus following the infection of a Wuhan man who flew into Melbourne on Jan. 19. The patient, a visitor in his 50s, has pneumonia and is in a stable condition, authorities said.Australia has raised the level of travel advice for Wuhan and Hubei Province to “Level 4 -- do not travel.”Chinese military doctors (9 a.m. HKT)Military doctors from the People’s Liberation Army arrived in Wuhan to respond to the coronavirus problem, according to Radio Television Hong Kong.China Death Count, Cases Rise (8:07 a.m. HKT)At least 41 people have died and an additional 444 infections have been confirmed across 29 Chinese provinces, authorities said in a statement, a dramatic increase in the toll from the outbreak of coronavirus centered on the city of Wuhan.The number of confirmed cases has climbed to 1,287 including 237 severe cases, the government said.Chinese authorities have locked down public travel in Wuhan and several surrounding areas in an effort to contain the infection’s spread. Health officials around the globe have been expecting more cases and deaths, though the dramatic increase in the tally may raise fears that the outbreak is worse than initially thought.‘Doomsday’ scenes in Wuhan (7 a.m. HKT)Health centers in Wuhan are struggling to meet demand from hundreds of unwell people, with many turned away from hospitals crammed with patients lying in packed corridors, the South China Morning Post reports.Wuhan deaths (5:01 a.m. HKT)Hubei provincial authorities release case reports of 15 people who died recently in the province. The deceased patients were ages 55 to 87 years and many had underlying chronic disease, such as high blood pressure and type-2 diabetes.Of the 14 for whom gender was noted, four were females. One case, a 76-year-old woman who died on Friday, developed a persistent fever 13 days after she was admitted to Wuhan’s Third Hospital with a broken arm. Her symptoms progressed to bilateral pneumonia and shortness of breath. She slipped into a coma and died of respiratory failure days later.Nepal Reports First Confirmed Case (Saturday, 12:07 a.m. HKT)A 31-year-old student in Nepal tested positive for the virus after returning from Wuhan where he is doing his PhD, the Kathmandu Post reported, becoming South Asia’s first confirmed case.He was discharged from hospital after his health improved but an official at the Epidemiology and Disease Control Division said they are trying to track down the man after a lab result came back positive for the virus.\--With assistance from Eric Roston, Daniel Flatley, Alexander Ruoff, Maria Jose Valero, Michael Heath, Jason Gale, Natalie Lung, Fion Li, Sharon Chen and Denise Pellegrini.To contact Bloomberg News staff for this story: Michelle Fay Cortez in Minneapolis at mcortez@bloomberg.net;Rudy Ruitenberg in Paris at rruitenberg@bloomberg.net;Blake Schmidt in Hong Kong at bschmidt16@bloomberg.netTo contact the editors responsible for this story: Drew Armstrong at darmstrong17@bloomberg.net, Shamim AdamFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
Lebanon’s New PM Tackles Old Debt With Risk, Reward Aplenty
(Bloomberg) -- Lebanon’s sky-high bond yields and credit default swap spreads may start to dip if a new government unveiled this week can ease concerns about a sovereign default.Investors are watching a $1.2 billion Eurobond, payment for which is due on March 9. Its price has risen this week due to the formation of the government, ending a period of caretaker rule since protesters forced the resignation of the prime minister in October. But it’s still trading at just 83 cents on the dollar, equating to an annualized yield of around 185% if they were to be paid back in full. That suggests there are still plenty of investors with doubts.Incoming Finance Minister Ghazi Wazni said in an interview Wednesday that the March securities would be at the top of the cabinet’s agenda when it meets next week. New Prime Minister Hassan Diab is set to visit countries in the Gulf Cooperation Council, raising the possibility that Lebanon gets funding from allies such as Saudi Arabia and Qatar.“The market is on edge around the real potential for a missed redemption,” said Paul Greer, a London-based money manager at Fidelity International, which owns a small amount of Lebanese debt. “We think the chances that Lebanon pays the bond are higher than what the market is assuming, but clearly the risks are very high.”Lebanon’s political struggles and the absence of external funding have sent its default risk soaring. The government’s five-year CDS has increased above 2,900 basis points, among the world’s highest, since ratings companies warned they may downgrade Lebanon if it got local holders of the March bond to swap into longer-dated notes.That means investors have to pay 61 cents upfront plus quarterly fees to get five-year insurance on a dollar of the country’s debt, implying a default probability of about 95% for the time period, according to Bloomberg data.For now, it’s unclear whether Lebanon will jeopardize its sovereign rating by pushing ahead with the swap plan. The government also has $1.3 billion of Eurobonds maturing in April and June, although those have fewer foreign holders than the March notes, roughly half of which are owned by international investors, according to JPMorgan Chase & Co.Investors have to decide whether potentially fat returns make up for the risk of investing in a country struggling with its worst economic and political crisis in decades. Standard Chartered Plc said a debt restructuring will become much more likely if Lebanon fails to secure sufficient external funding in the next six months.“The government formation and a statement around the bond repayments being a priority are no guarantee that the dollar bonds due in March and June will be paid out,” said Greer, whose developing-nation debt fund outperformed 94% of peers in the past year.(Updates prices throughout, adds default probability estimate in 6th paragraph.)To contact the reporter on this story: Netty Ismail in Dubai at nismail3@bloomberg.netTo contact the editors responsible for this story: Alex Nicholson at anicholson6@bloomberg.net, Paul Wallace, Srinivasan SivabalanFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
Singapore Finds a Hedge Against Mall Rats
(Bloomberg Opinion) -- Being a shopping-mall landlord is a risky business in the age of e-commerce, even in retail-crazy Singapore. So it’s only sensible that CapitaLand Mall Trust is merging with CapitaLand Commercial Trust, which owns offices.The S$8.3 billion ($6.2 billion) deal between the two sister real estate investment trusts, or REITs, will create a property owner of some heft. The combined entity will have the firepower to undertake up to S$4.6 billion in overseas acquisitions. At home, the revenue stream from shops — under pressure from online sales — will get commingled with more stable office rents.That will be a relief. CapitaLand Mall Trust’s income available for distribution grew a healthy 7.5% last year, but the REIT’s tenants saw sales decline 1.4% on a per-square-foot basis, with electrical and electronics, home furnishings and information technology and telecommunications recording falls of more than 10%, according to figures released Wednesday.This is part of a global trend. As I wrote in July, Singapore’s Generation Z — those born after 2000 — won’t be mall rats. It will be a challenge for landlords to eke out positive rental “reversions” when tenancies come up for renewal. More than half of Rafffles City Singapore, a marquee property in the trust’s portfolio, was leased out again last year, and the owner saw no increase in rates. At The Atrium@Orchard — another prestigious downtown location — rentals dropped 6.5% from when CapitaLand Mall signed them three years earlier.Mind you, Singapore’s office market is also showing signs of fatigue. Rents for Grade A offices stopped rising in the December quarter as the city’s small, open economy slowed amid U.S.-China trade tensions. Colliers International Group Inc. forecasts they will climb just 1% in 2020, before sliding 4% next year. Things could get uglier still if the co-working trend comes under strain following last year’s WeWork debacle.Even those worried about the shared-space segment should be encouraged by the technology industry — especially fintech. With 21 bids for up to five new digital bank licenses, the outlook for the city’s office market is more optimistic than it is for retail. CapitaLand Commercial Trust generally experienced positive rental reversions during the December quarter. Properties such as Six Battery Road, formerly Standard Chartered Plc’s Singapore headquarters, and 21 Collyer Quay, where WeWork will move in after HSBC Holdings Plc moves out, could do even better after the landlord spruces them up this year.Singapore’s office market will also undergo transformation as city planners make a deliberate attempt to have more people living in and around the central business district. The idea is to increase the utility of the island’s priciest real estate so that it’s not a ghost town after working hours. As part of the plan, old office towers near the central bank and the stock exchange will be redeveloped as mixed-use properties that have more space to sell or rent out. Neither these structural changes nor the cyclical ebb and flow of office demand and supply is a surprise to property builders and owners. Assessing the retail industry is trickier. Not only could it be facing terminal decline because of surging digital consumption, it’s also driven by tourism. Interest in the city peaked after the 2018 release of “Crazy Rich Asians,” and continued to rise — to about 5 million visitors in the third quarter of 2019 — after Hong Kong’s anti-government protests. The recent outbreak of a new respiratory virus, however, is a reminder of how ephemeral such gains could be.The virus, which originated in the central Chinese city of Wuhan, may or may not be a repeat of the deadly 2003 SARS epidemic, which hit Singapore hard. Yet it gives real-estate investors another reason to want their rents coming from a combined pool of retail and offices. That way, the profit available for distribution will become more future-proof — at least until artificial intelligence makes it unnecessary for humans to show up for work at all.To contact the author of this story: Andy Mukherjee at amukherjee@bloomberg.netTo contact the editor responsible for this story: Matthew Brooker at mbrooker1@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
Merkel, Mnuchin Diverge on Generation Thunberg: Davos Update
(Bloomberg) -- Sign up here to receive the Davos Diary, a special daily newsletter that will run from Jan. 20-24.The rich and powerful are in Davos, Switzerland, for the World Economic Forum’s 50th annual meeting, and the gathering is being closely watched to see how the global elite aims to tackle problems they helped create, above all climate change.Germany’s Angela Merkel called on world leaders to work together to fight global warming and take the views of concerned young people seriously, saying time is running out to protect the planet.U.S. Treasury Secretary Steven Mnuchin, meanwhile, questioned whether Swedish activist Greta Thunberg is qualified to talk about economic issues linked to climate change and told 17-year-old to go and study the subject in college.Thunberg has called a climate strike for Friday at 11 a.m. local time near the forum.To get all the highlights delivered to your inbox, sign up for the Davos Diary newsletter. Here’s the latest (time-stamps are local time in Davos):RBC Says Fossil Fuels Necessary in Green Shift (5 p.m.)Royal Bank of Canada Chief Executive Officer David McKay said any shift to a more climate-friendly economy still depends on fossil fuels.“We have a longer-term transition as we change the energy source, we move to a greener economy, but it is a transition,” McKay told Bloomberg TV. “You need fossil-based fuels to make that transition -- they’re not going away overnight.”U.S. Has ‘Perfect’ Justification for Auto Tariffs: Ross (4:35 p.m.)The U.S. wants to negotiate a trade deal with the European Union but will apply tariffs on car imports from Europe if deemed necessary, according to Commerce Secretary Wilbur Ross.“We have a perfect justification to put tariffs on if we wish to,” Ross said in a Bloomberg TV interview. “The president had decided it was better to negotiate. We’ve had very constructive negotiations with the German car manufacturers, with the Koreans and with the Japanese.”“If people do silly things, if they do protectionist and discriminatory things like the pillar one of the digital service tax, we’re obviously going to respond,” Ross said, referring to plans by France. “The clear intent was to be discriminatory. We have other laws that also enable us to retaliate against discriminatory behavior. If there is discriminatory behavior, we will fight back.”Booms and Busts Are Not Dead: Solomon (3:25 p.m.)David Solomon, the chief executive officer of Goldman Sachs Group Inc., said the U.S. economy is “in good shape” and Davos delegates he has spoken with are generally upbeat about the outlook for this year.“I would say that there will be booms and busts again at some point, although I don’t see one anytime soon,” Solomon told Bloomberg TV.“I’d say I see and I hear what I call kind of a confident, middle-of-the-road view of the current economic environment,” he added. “The overwhelming likely scenario is that the economy chugs along this year.”Merkel Says Recession Danger Receding (3 p.m.)The danger of Germany slipping into recession is receding thanks to an easing in tensions between major global trading partners, Merkel said.“I think we should be happy that the first phase of a trade deal between the U.S. and China has been agreed,” she said during a Q&A session after her speech.“With each step -- an orderly British exit from the European Union, with trade deals and no trade war, less protectionism -- we are reducing the danger of a recession,” Merkel added. “At a time when we have a lot of trade conflicts, you see that global economic growth slows.”Europe can contribute to growth and stability and foster confidence in the euro by completing the integration of its banking system and capital markets, the German leader said.Merkel Rejects Excluding Suppliers from 5G (2:55 p.m.)Excluding individual suppliers, like China’s Huawei Technologies Co., from fifth-generation mobile networks would not necessarily make them more secure, Merkel said.“I don’t think I make myself particularly secure if I shut out an entire supplier and don’t know how they are developing,” she said during a Q&A session.“To be honest, we have already dealt with spying and industrial espionage in former times, and in that sense I wouldn’t change the equipment completely,” she added. “But we do have to be careful.”NATO Chief Urges Europe, U.S. to Stick Together to Meet China Challenge (2:50 p.m.)China’s rise makes it even more important that Europe and the U.S stay together, NATO Secretary General said in a Bloomberg TV interview, in a thinly-veiled plea for a de-escalation in the transatlantic trade spat. As long as Europe and the U.S. cooperate “then we are safe and secure” and can meet any potential challenge, Jens Stoltenberg said.“There are opportunities, but also some challenges, because China is now the second largest defense spender in the world and they are investing heavily in new very advanced weapon systems,” Stoltenberg added.NATO’s chief stopped short of calling China a strategic adversary or calling for an outright ban of Chinese companies from the procurement of 5G network equipment. He did, however, warn that a cyber attack against an ally could trigger NATO’s collective defense clause, which obliges all member states to respond to the attacker.Standard Chartered Says Anxiety “Very High” Over China Virus (2:50 p.m.)Standard Chartered Plc is taking extra precautions to protect Chinese staff from an outbreak of the SARS-like coronavirus, according to Chief Executive Officer Bill Winters, who had intended to travel next week to Wuhan, a city that has been locked down by authorities trying to halt the spread.“When someone gets a cold now, question is whether it’s something much worse,” he said in a Bloomberg TV interview. “We are staying close to our clients and helping them understand exposures.”The bank is “identifying working capital needs if things progress as they have done over the past 24 hours,” given that “tourism and transportation industries are at some risk coming into Chinese new year”Tackling Climate Change ‘Matter of Survival’: Merkel (2:45 p.m.)German Chancellor Merkel said meeting emissions-reduction goals could be a “matter of survival” for Europe and young activists pushing for change should be taken seriously.“The question of achieving the Paris Agreement goals could be a matter of survival for the whole continent and that is why there is pressure to act,” Merkel said in a speech. “Time is pressing, and we must be careful as the older members of society that we treat the impatience of youth in a positive and constructive way.”The German leader said she was concerned about the conflict between campaigners for a cleaner planet and those who don’t believe in global warming. She said the scientific evidence is clear, and emotions should not be confused with facts.Mitsotakis Says Turkey-Libya Deal Unacceptable (2:34 p.m.)Turkey’s maritime border agreement with Libya is unacceptable and illegal, Greek Prime Minister Kyriakos Mitsotakis said, amid growing tension in the eastern Mediterranean.“Turkey has been difficult to deal with,” Mitsotakis said in a Bloomberg interview. “There’s a constant state of provocation, which leads Turkey nowhere.”“We don’t need Turkey’s permission” to supply Europe with Cypriot, Israeli or potential Greek gas, Mitsotakis said earlier in Davos. The pact signed by Libya and Turkey has an impact for the planned EastMed pipeline project, he said.Time is ‘Worry’ in EU, U.K. Trade Talks: Dutch PM (1:45 p.m.)The clock is ticking for the EU and the U.K. to hammer out a trade deal by the end of the year, according to Dutch Prime Minister Mark Rutte.To agree on a trade deal “we need to agree on level playing field and all the other issues,” the Dutch leader said in a Bloomberg TV interview. “It’s an awfully short amount of time so I hope that coming next summer, June, July, that Boris Johnson will at least contemplate extending, if necessary, this transition phase.”Coming to an arrangement is “very difficult and there is still the risk that you will have a cliff edge scenario’ like we had experienced last year.”U.S., China Must Adjust for Stable World: Singapore PM (1:30 p.m.)Both the U.S. and China must make adjustments if they are going to reach a lasting phase-two trade deal that benefits the rest of the world, according to Singapore Prime Minister Lee Hsien Loong.The U.S. must decide whether to create rules that allow “the best man” to win or only let America come out on top, Lee said in an interview with Bloomberg’s Editor-in-Chief John Micklethwait.“America First means you do the best for the United States,” Lee added. “So do you do the best by prospering in the world, and there are other countries who are doing well, or do your best by being a big country in a troubled world? And I’m not sure that the second is a very good answer.”Maersk Sees Flat Global Trade Growth in 2020 (1:24 p.m.)Global trade will likely expand in line with 2019’s growth of “slightly less than 2%,” A.P. Moeller-Maersk A/S Chief Executive Officer Soren Skou said in a Bloomberg TV interview.The reason why freight rates have “gone up quite substantially” since October is mainly the introduction of new more environmentally friendly fuel. “Many of our customers recognize that it’s good for everybody that we go to a cleaner fuel,” Skou said.Trump Policies Good for Business, Moelis Says (1:21 p.m.)U.S. President Donald Trump’s policies and deregulation moves have been good for business and generated “substantial rewards,” Moelis & Co. founder Ken Moelis said in a Bloomberg TV interview.Trump has done a good job of telling the story of how the U.S. economy is booming, with low unemployment, Moelis said, adding that despite “a lot of hand-wringing” in the U.S., the country remains a “tremendous place” with great laws, great capital markets and innovation.Men’s Hiring Bias Slammed by Finnish PM (1:04 p.m.)Finnish Prime Minister Sanna Marin said it’s now clear that women need laws to protect them from discrimination in the work place and the issue can’t be left in the hands of the private sector.“You need laws and structures that lead the way to gender equality,” 34-year-old Marin said during a panel debate. “It doesn’t just happen by itself.” The concern is that an unconscious bias kicks in, steering men in a position to hire toward “similar-minded and similar-looking people” who are deemed to be “more qualified.”Dutch Finance Minister Says Brexit Risks EU Power (1 p.m.)After Brexit, the EU risks becoming a weak player in global politics, because the U.K.’s departure offsets the bloc’s balance, according to Dutch Finance Minister Wopke Hoekstra.“When there is a balance between France, Germany, and the U.K., we in the Netherlands are at ease,” Hoekstra said in a Bloomberg TV interview. “That balance is now gone, and for the European Union, both in economic terms, but also in geopolitical terms, Brexit is very bad news.”Saudi Arabia Must Act on Emissions: Minister (12:30 p.m.)Saudi Arabia must advocate for solutions to tackle climate change as one of the world’s largest energy producers, according to Energy Minister Abdulaziz Bin Salman.“We cannot sit on our hands as a producer without advocating for something that brings a solution to the emissions issue,” he said during a panel discussion. “We can’t see all components of sustainability and market stability without also being involved in the other debate which has to do with climate change.”Facebook Says Bezos Hack May Highlight Phone Vulnerabilities (12:13 p.m.)The hack of Amazon.com Inc. billionaire Jeff Bezos’s phone, allegedly via a WhatsApp message, brings to light potential security weaknesses in smartphone operating systems, according to Facebook Inc. Vice President Nicola Mendelsohn.The company would take allegations that its service was used in a hack very seriously and would look into it, Mendelsohn, who helps run Facebook’s Europe, Middle East and Africa business, said in a Bloomberg TV interview.The Idea of a Waste-Free Global Economy Is Catching On (11:50 a.m.)When British yachtswoman Ellen MacArthur was promoting the idea of the circular economy on the sidelines of Davos in 2012, the big attraction was curiosity about what she was up to after her sailing career.Eight years on, firms such as Adidas AG, Unilever NV, and BlackRock Inc. are embracing MacArthur’s vision. Her foundation is pushing an economic system where product lifespans are extended and components used repeatedly. The idea is to replace the “linear” model of growth -- extraction, production and disposal -- and reduce the strain on the planet’s limited resources.“We had our own event in one of the hotels, and to be honest most people came because they were intrigued about what I might be doing,” said MacArthur, who once held the world record for the fastest solo circumnavigation of the globe. “Things have changed enormously since then.”Deutsche Bank Expects ECB Review to Be ‘Constructive’ (11:07 a.m.)Deutsche Bank AG Chief Executive Officer Christian Sewing is “hopeful” that the planned strategy review by the European Central Bank will lead to change.The ECB’s decision to cut interest rates below zero was right at the time, but “we missed the exit,” he said on a panel. Negative rates are leading to a widening gap between winners and losers as only a small share of the population benefits, Sewing said, adding that monetary policy is “reaching its limits.”U.S.-Europe Risk Trade Flare-Up Over Cars, Digital Tax (10:43 a.m.)The U.S. and Europe looked set for a renewed clash over everything from car tariffs to digital taxes in a sign that a new American focus was emerging following President Donald Trump’s trade truce with China.Commerce Secretary Ross said the U.S. was still considering slapping levies on European auto imports even as it hopes for a “peaceful resolution” of differences. Mnuchin declined to say if he was still pushing for an optional digital tax after an agreement for a global framework was reached with France on Wednesday.Mnuchin Tells Thunberg to Go to School (10:35 a.m.)Mnuchin questioned whether Thunberg is qualified to talk about economic issues linked to global warming.Asked at a press conference to comment on the debate over the economics of climate change spurred by the teenager, Mnuchin quipped: “Is she the chief economist?” He then said: “After she goes and studies economics in college, she can go back and explain that to us.”Mnuchin has repeatedly clarified the U.S.’s climate stance after Trump took a swipe at environmental “alarmists” in his speech Tuesday. “There’s a misinterpretation as to what our view is,” Mnuchin said. “The U.S. administration very clearly believes in clean air and clean water.”Canada in Strong Fiscal Position: Morneau (10:30 a.m.)Canadian Finance Minister Bill Morneau said low interest rates mean central banks have less room to maneuver and suggested fiscal policy needs to play a greater role in addressing economic challenges.“I think we have to be realistic” about expectations of central banks, Morneau said in an interview with Bloomberg TV. “Their ability to be effective in the case of challenges is different than it was in the last real challenge.”Canada is managing its “fiscal framework very well,” which makes it “resilient in the face of challenges,” Morneau added.“What we see is that Canada has taken a very responsible approach,” he added. “Whether you’re a rating agency or someone looking at our ability to deal with financial issues or concerns, we’re in a particularly strong position. Probably the strongest position among G-7 countries because of our very strong balance sheet to start with.”Allow Venezuela to Unleash Its Potential: Guaido (10 a.m.)Juan Guaido, Venezuela’s opposition leader, called for a return to democracy in the South American nation so that it can fully exploit its oil reserves and “unleash” its potential.“What we want is a free Venezuela, a democratic Venezuela which respects human rights, where you can invest, where we can also make the most of our oil reserves and so that we can really unleash the potential that we have,” Guaido said in a speech. “We want to mobilize people despite the terror unleashed by the dictatorship.”Nigeria Says OPEC Ready to Cut Further (9:49 a.m.)OPEC’s production cuts are enough for now to avoid an oversupply, but ministers will convene again in March and will be ready to make further cuts if necessary, Nigerian Minister of State for Petroleum Resources Timipre Sylva said in a Bloomberg TV interview, adding that the country would like to see oil prices between $60 and $70 a barrel.“We see a lot of optimism in the market” amid easing of trade tensions between U.S. and China,” Sylva said. “If the U.S. and China are able to consummate a good deal at the end of the day, we expect that there’ll be demand growth.”Cantor’s Jain Concerned by Negative Rates (9:38 a.m.)Cantor Fitzgerald LP President Anshu Jain said there are long-term adverse consequences linked to investing in trillions of dollars of negative yielding debt.“If you wind up investing at negative yields in effect locking in a loss, that will have repercussions,” Jain said in an interview. “Of greater concern for me is repercussions for insurers and pension funds, and these will be felt for years to come.”Italian Coalition is Stable, Gualtieri Says (9:20 a.m.)The stability of Italy’s ruling coalition will not be affected by Foreign Minister Luigi Di Maio stepping down as head of his party, according to Finance Minister Roberto Gualtieri.“Di Maio will remain the foreign affairs minister and the parties have said they are strongly committed to the stability of the government. So nothing will change,” Gualtieri told Bloomberg TV.“What we can have is a continuation of this alliance or a strengthening of this alliance, these are the only two options,” he added. “We have very strong numbers in the parliament in both chambers and the government will continue until the end of the legislative term.”Kaeser’s Wish for Trump: Listen to the Kids (8:45 a.m.)At a Tuesday dinner that Donald Trump held with business executives, Siemens AG Chief Executive Officer Joe Kaeser said he told the U.S. president he had three things to say: a compliment, a request, and a wish.The compliment was on how Trump has spurred U.S. Economic growth. The request was for Siemens to be treated like a U.S. company on government projects because of its 50,000 American workers. His request was to urge the president to listen to young people’s demand to protect the climate.“They may not be able to help us. They’re young people -- they have a problem and they don’t know how to solve it, but shouldn’t we bring them to the table,” Kaeser said he told Trump, adding that his daughter Ivanka Trump responded that it was something that they might look into.Merkel Succession Team to Be Decided This Year (8:42 a.m.)Germany’s Christian Democrats want to assemble their team to succeed Chancellor Merkel by the end of this year, the party’s chairwoman said in a Bloomberg TV interview.Annegret Kramp-Karrenbauer, who is also Merkel’s defense minister, said that now isn’t the time for a cabinet reshuffle as proposed by a party ally earlier in the month.“For 2021, the CDU needs a new team for the future, with new faces, and we’ll put that in place this year. For me, that’s a more important perspective than a short-term change,” she said.Debt Buildup Reaching Danger Point: Georgieva (8:40 a.m.)IMF Managing Director Kristalina Georgieva warned that debt in some countries is at dangerous levels.“The buildup of debt is reaching a point where for some borrowers it’s a present danger -- for example poorer countries,” Georgieva told Bloomberg TV. “43% of low income countries are already at or close to debt distress.”Low interest rates “means high, high appetite for yield,” Georgieva said, adding that “high appetite for yield means high appetite for risk.”The global economy is in a better place than in October, when the IMF published its latest forecasts, and central banks have done what they can to support growth so it’s up to governments to step up, Georgieva said.Germany Must Spend Cash More Quickly: AKK (8 a.m.)Germany needs to speed up the process of spending government funds, and surplus cash should be invested “sensibly” in infrastructure and the military, according to German Defense Minister Kramp-Karrenbauer.“If we look at our budget and our investment right now, then we see that we have no problem with money, we have enough money,” Kramp-Karrenbauer, who is also the head of Chancellor Merkel’s party, said in an interview with Bloomberg TV.“The problem is that we are too slow and too complicated in the process. Not enough is invested as a result and this is the construction site we need to work on,” she said.Merkel’s government agrees that surpluses “shouldn’t be tucked away for a rainy day” but instead directed toward “investment in technologies of the future, in our infrastructure,” Kramp-Karrenbauer added.Coronavirus Only ‘Real Threat’ to Markets: Prince Max (7:45 a.m.)There is nothing “really threatening” on the horizon for markets, with the possible exception of the coronavirus, according to Prince Max von und zu Liechtenstein, chief executive officer of LGT Group Foundation.“I think there is a little bit more downside risk than upside chances,” Prince Max said in an interview with Bloomberg TV. “But the market has been resistant so hopefully we will enjoy a good market for a little bit longer.”LGT is hoping for the long-term trend of negative rates to eventually reverse, Prince Max added. “But realistically our expectations for this year for a significant rate change is not there,” he said. “So we are not too optimistic on that front.”\--With assistance from John Follain, Birgit Jennen, Craig Stirling, Cagan Koc, Yuliya Fedorinova, Javier Blas, Fergal O'Brien, Oliver Sachgau, Patrick Donahue, Jenny Leonard, Saleha Mohsin, Viren Vaghela, Haslinda Amin, Francine Lacqua, William Horobin, Reema Alothman, Matthew Martin, Philip J. Heijmans, Sotiris Nikas, Nikos Chrysoloras and Doug Alexander.To contact the reporters on this story: Iain Rogers in Berlin at irogers11@bloomberg.net;Chris Reiter in Berlin at creiter2@bloomberg.netTo contact the editors responsible for this story: Chad Thomas at cthomas16@bloomberg.net;Simon Kennedy at skennedy4@bloomberg.netFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Yahoo Finance UK
Tackling climate crisis 'enormous opportunity' for investors
Standard Chartered CEO Bill Winters said investors have 'an enormous opportunity and I would say obligation' to invest in green projects.
- Bloomberg
Lebanon Gets New Government After Three Months of Protest
(Bloomberg) -- Lebanon unveiled a new cabinet lineup Tuesday, some three months after mass protests against entrenched corruption brought down the government and shook the economy.The incoming team of 20, led by former education minister Hassan Diab, will have to act fast to address the country’s worst financial and economic crisis in decades. Tens of thousands of people have taken to the streets in recent months to demand a wholesale overhaul of the country’s sectarian power-sharing system, exacerbating an economic decline years in the making and raising investor concerns that Lebanon could default on its debt obligations for the first time.Lebanon’s Eurobonds extended their gains with the government formation, which came after more than a month of political wrangling. But the breakthrough did not satisfy many of the demonstrators, who’ve denounced the new lineup as having “one color” -- because the choice of names was influenced to a large extent by the pro-Iranian Hezbollah militia and its political allies.Lebanon’s Eurobonds Extend Advance With New Government FormedRemittances and other inflows on which Lebanon’s economy has traditionally relied have plummeted as confidence has dwindled, prompting banks to impose informal limits on the withdrawal and transfer of hard currency in a bid to hold on to what remains of their reserves. The pound has weakened by more than a third against the dollar on the black market since protests began on Oct. 17, triggered by plans to tax a popular messaging application.When he was first named as prime minister, Diab promised the people a government of experts to lead them out of crisis. He repeated that pledge on Tuesday night, vowing that his team, replete with holders of advanced degrees, would work to meet the core demands of protesters, which range from a clamp-down on corruption to a new, more equitable election law to prepare the country for a fresh vote. The government met Wednesday to discuss a plan of action to save the country from what Diab described as a looming “catastrophe”.“I salute this revolution,” he said in his first comments after the cabinet was formed. “This government represents the aspirations of protesters across the nation and will work to satisfy their demands.”New Faces, Old TacticsMany of the new ministers are little-known to the public, having spent their careers in academia or the professional realm, but are still considered to have political loyalties.Incoming Finance Minister Ghazi Wazni, for instance, is a well-known economist close to veteran parliament speaker Nabih Berri. Nassif Hitti, a former diplomat and expert in international relations, was named foreign minister. Raoul Nehme, a well-known banker, was named minister of economy.For the first time, a woman, Zeina Adra, was appointed to the defense portfolio in a government that includes six women, the largest share in Lebanon’s history.The lineup was agreed after intense horse-trading between Berri, Hezbollah, the Free Patriotic Movement founded by President Michel Aoun and a handful of other political parties considered by protesters to be part of the old regime that needs to go.The stakes are high for Lebanon, which straddles the region’s geopolitical fault lines and has often been a proxy battleground for the Middle East’s broader conflicts. The 15-year civil war ended in 1990 but still haunts a country where the warlords became the rulers and have remained in power ever since.More ProtestsEven before the names were unveiled, protesters had poured into the streets of downtown Beirut and blocked major thoroughfares to its north and south to reject a government they said had been divvied up by those same political figures and would not work in the people’s interests. Demonstrators had largely dispersed by daybreak, however, with little violence reported.“We waited all this time, only for them to divide up the cheese as they always did,” said one protester, carrying a Lebanese flag, who appeared on LBCI television. “This government will not pass.”Economic ChallengesFormer Prime Minister Saad Hariri, a Sunni Muslim who resigned in late October, had vowed to implement much-needed fiscal and structural reforms to unlock $11 billion in international aid pledged in 2018, but complained that political disagreements inside his national unity government hampered progress. A conference of international backers convened in Paris in the midst of the protests has raised hopes among many Lebanese that the formation of a new government would accelerate access to that support.Standard Chartered said the new government was likely to prioritize the funding crisis and would look to restore confidence and secure international financing from Gulf Arab countries and beyond.“We think Lebanon’s funding model has run its course and will need to be re-visited by the new cabinet,” Standard Chartered economist Carla Slim said in a note. “Still, chances of debt restructuring could rise materially if Lebanon fails to secure sufficient external funding in the next six months. We think any restructuring would best be tackled under an IMF programme to both secure funding and ensure timely implementation of reforms.”Lebanon’s precarious financial situation has many investors pricing in a sovereign default. A $1.2 billion Eurobond that matures in March saw a record slump last week, fueled by reports local lenders have been selling the instruments to avoid participating in a central bank-initiated voluntary debt swap.The Lebanese pound has plunged on the black market to some 2,500 against the U.S. dollar since the protests began on Oct. 17, while the central bank has stuck to the official rate of 1,507. Hours before the government was unveiled, Lebanon’s money changers announced that they would sell dollars at no more than 2,000 starting Thursday in an effort to ease the burden of price gains on consumers.(Updates with markets in paragraph 3, details in paragraph 5, analyst quote in paragraphs 15-16)To contact the reporters on this story: Dana Khraiche in Beirut at dkhraiche@bloomberg.net;Lin Noueihed in Cairo at lnoueihed@bloomberg.netTo contact the editor responsible for this story: Lin Noueihed at lnoueihed@bloomberg.netFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Simply Wall St.
At UK£6.99, Is Standard Chartered PLC (LON:STAN) Worth Looking At Closely?
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£5k to invest? I’d buy these FTSE 100 dividend stocks right now
Rupert Hargreaves believes these FTSE 100 income investments could pay you for life. The post £5k to invest? I'd buy these FTSE 100 dividend stocks right now appeared first on The Motley Fool UK.
- Bloomberg
China’s Credit Growth Holds Up in December
(Bloomberg) -- Sign up for Next China, a weekly email on where the nation stands now and where it's going next.China’s overall credit growth held up in December and a gauge of borrowing costs fell, signaling that policy makers are beginning to see some progress in channeling credit to the economy.The stock of outstanding aggregate financing expanded by 10.7% in the 12 months to December, the same pace as in November, the People’s Bank of China said Thursday. The previous total financing measure was adjusted to include sovereign and local government debt, the PBOC said. The growth rate refers to an adjusted historical series for the purposes of comparison.The amount of new bank loans in the month slipped slightly, to 1.14 trillion yuan ($166 billion), versus a projected 1.2 trillion yuan. Broad M2 money supply grew 8.7% in the month from a year earlier. The weighted average interest rate on ordinary loans fell to 5.74%, the lowest since mid-2017. Despite monetary easing throughout last year, borrowing costs remained stubbornly high and the recent data will encourage policy makers attempting to brake China’s economic slowdown into 2020.The uptick in money supply at the end of a year when banks are usually short of credit quota added to evidence domestic demand is recovering amid continuous policy easing and a trade thaw with the U.S. The PBOC has pledged to keep monetary policy flexible in 2020 and keep credit expansion in line with the growth of nominal gross domestic product.What Bloomberg’s Economists Say..“Recent data have revealed some stabilization in the economy, and 4Q GDP data due on Friday are expected to show growth holding at 6% year on year. External pressures have eased somewhat with a ‘phase one’ trade deal with the U.S. Even so, the economy is still under considerable strain -- and this will require further policy support.”David Qu and Chang ShuFor the full note click here“Interest rates in the open market are largely stable now,” Sun said. The PBOC will “continue to conduct open market operations to ensure market stability ahead of the Spring Festival, as well as providing favorable financial conditions for the real economy.”Sun also said the average reserve requirement ratio level for all banks is 9.9% after the cut earlier this month. “It’s at an appropriate level,” he said. While there’s still room for more cuts if economic growth warrants, that room is “limited,” he said.“We expect further policy easing to be implemented” though the scale of stimulus would be moderate, Wang Tao, chief China economist at UBS Group AG in Hong Kong, wrote in a note before the data. “More details of policy support measures will be announced in the upcoming National People’s Congress meeting in March.”Statistical ChangeThe methodological change to the total-social financing gauge -- China’s broadest measure of credit growth that includes regular bank loans, shadow banking and now sovereign and local debt -- had little impact on the pace of credit expansion in December.Including sovereign and local government debt into aggregate financing can “reflect the intensity of both monetary policy and fiscal policy,” said PBOC spokeswoman Ruan Jianhong. The new gauge can “help improve policy setting and implementation.”Some economists were skeptical of the change.“Local bonds and government bonds belong to fiscal policy, and by adding them into the gauge, it actually mixes the fiscal policy together with monetary policy,” said Ding Shuang, chief China and North Asia economist at Standard Chartered Bank Ltd. in Hong Kong. ““After taking out the bond element, we found that in general the credit growth in 2019 was faster than 2018, pointing to a more accommodative environment.”Shadow banking -- consisting of entrusted loans, trust loans and undiscounted bankers’ acceptances - continued to contract in 2019. The stockpile stood at 22.22 trillion yuan at the end of year, down from 24 trillion yuan at the end of 2018.(Adds shadow banking details in final paragraph. An earlier version of this story was corrected to fix the unit in the chart.)\--With assistance from Miao Han and Tomoko Sato.To contact Bloomberg News staff for this story: Yinan Zhao in Beijing at yzhao300@bloomberg.net;Heng Xie in Beijing at hxie34@bloomberg.netTo contact the editor responsible for this story: Jeffrey Black at jblack25@bloomberg.netFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
Too Much Cash Forces Taiwan’s Insurers Back to Home Market
(Bloomberg) -- For the first time in years, Taiwan’s insurers are snapping up local Treasury bills, a sign of desperation as they grapple with what to do with a wave of cash from the redemption of foreign investments.At least $17.4 billion from Formosa bonds -- securities listed in Taiwan but denominated mainly in dollars -- were called or will be repaid early in the six months through March 2020, according to data compiled by Bloomberg based on issuers’ announcements. Buying fresh Formosa bonds, or other investments linked to overseas assets, has become harder thanks to moves by Taiwanese regulators to limit insurers’ foreign-currency exposure.That explains why institutional investors that usually prefer long-dated assets to match their liabilities popped up at recent auctions of 273-day and even 182-day bills issued by Taiwan’s Finance Ministry. Insurers took up 10% of the nine-month bill and almost 9% of the six-month one, in their first such bill purchases since 2016.“It’s surprising that they bought the Treasury bills, as they usually invest in longer-term bonds,” said Aaron Shie, a trader at Concord Securities in Taipei. The flatness of the yield curve might help explain the move, Shie said.Interest rates on the bills sold earlier this month were each about 0.48%, not terribly far from the 0.795% yield on 20-year bonds sold at an auction on Tuesday. Insurers lapped up 41% of the longer-tenor bonds, even with their record-low rate.The yield on Taiwan’s 10-year government bonds fell to 0.6226% Thursday, the lowest-ever closing level.The bills at least offer the option of a fresh investment at maturity later this year, and the potential for higher returns should yields climb as the global economy pulls out of its current slowdown.The flip side is that sustained demand from the insurers may keep a lid on fixed-income returns, as Formosa bonds face early maturities. Almost all buyers of Formosa bonds are insurers. Issuers of the callable securities have lately been retiring them when able, taking advantage of lower interest rates.The majority of the $186 billion in outstanding Formosa bonds are callable, with around $23 billion estimated to be redeemed early in the first quarter, Lawrence Lai, Standard Chartered Bank strategist in Singapore, wrote in a note earlier this month.Given prospects for strong demand, Taiwan’s 10-year government bond yield is seen sinking to a record low of 0.6% by April, according to a Bloomberg survey published last month. It closed lower at 0.63% Wednesday, reaching a five-month low a day after another strong debt sale.With regulators’ worries over foreign-currency exposure, the recent auction patterns may be around for a while.“Overseas investment may grow slowly” due to regulatory limits, a Fubon Life Insurance Co. representative said in a written response to questions. “Given that spare cash at hand is pretty big,” insurers have been looking at longer-term bonds along with bond exchange-traded funds, stocks, property and short-term assets from T-bills to bank-deposits and commercial paper, according to Fubon.(Updates bond yield in the sixth paragraph, adds comment on Formosa bonds in the ninth paragraph.)To contact the reporters on this story: Cindy Wang in Taipei at hwang61@bloomberg.net;Miaojung Lin in Taipei at mlin179@bloomberg.netTo contact the editors responsible for this story: Sofia Horta e Costa at shortaecosta@bloomberg.net, Christopher Anstey, Fran WangFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
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Forget buy-to-let! I’d invest in these 2 FTSE 100 stocks to get rich and retire early
These two FTSE 100 (INDEXFTSE:UKX) shares could offer higher returns than buy-to-let property, in my opinion.The post Forget buy-to-let! I’d invest in these 2 FTSE 100 stocks to get rich and retire early appeared first on The Motley Fool UK.
- Reuters
Exclusive: Dubai's Emaar to sell view from world's tallest tower - sources
Emaar Properties is selling the observation decks of the world's tallest skyscraper the Burj Khalifa, four sources told Reuters, potentially raising $1 billion for Dubai's biggest developer amid a real estate downturn. Two of the sources said Emaar had appointed Standard Chartered to advise it on the sale of the popular "At The Top" tourist attraction. Emaar, in which the Dubai government has a minority stake of 29.2%, and Standard Chartered declined to comment.
- Oilprice.com
Texas Is Already Feeling The Shale Slowdown
The shale oil production slowdown is already materializing in large parts of Texas, and it’ll be just a matter of time before it starts to seriously impacting the regional economy
- Reuters
StanChart exits three Southeast Asia coal plants worth estimated $7 billion
Standard Chartered has pulled financing for three coal-fired power plants in Southeast Asia amid a global push to cut greenhouse gas emissions, throwing into doubt projects worth an estimated $7 billion and piling pressure on the coal industry. Banks and investors are facing pressure from environmental groups to stop funding power projects fired by the polluting fossil fuel, seen as a major risk to global plans to tackle climate change under the Paris Climate Agreement that demands a virtual end to coal power by 2050. Just last week, Credit Suisse said it would stop financing new coal-fired power plants.
- Yahoo Finance UK
Investors pull $5bn from Hong Kong as protests continue
The Bank of England said political risks in the region are 'a key vulnerability' and could create global problems.
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My top pick in 2019 rose by 140%. Here are the stocks I’m buying for 2020
Roland Head highlights three stocks from his portfolio that he's banking on for 2020.
- Bloomberg
Thai Bank M&A Is About Coups and Condoms
(Bloomberg Opinion) -- It’s only fitting that Thailand’s second-largest bank pipped a Japanese rival to buy a lender in Indonesia. The elixir of youth is a great attraction to those who no longer have it.Just like in Japan, the aging Thai population is propelling the economy into long-term stagnation, leaving the likes of Bangkok Bank Pcl with no choice except to seek their fortunes in younger societies bubbling over with credit demand at juicy yields. Hence, the $2.7 billion bid for 90% of Indonesia’s PT Bank Permata.At 1.8 times book value, the first major overseas acquisition by a Thai bank isn’t cheap. But the mid-tier Indonesian lender was a coveted asset. At one stage, Singapore’s Oversea-Chinese Banking Corp. had weighed a bid. Japan’s Sumitomo Mitsui Financial Group Inc. had also shown interest in buying out the existing owners, Standard Chartered Plc and PT Astra International. Since Astra is Toyota Motor Corp.’s Indonesian partner and controls half of the car market, it seemed logical that a Japanese institution would want to get into the driver’s seat at Permata, a specialist auto financier.But Bangkok Bank decided to open its checkbook. And why not? When local businesses have been steadily funneling capital out of the country, how long can banks stay put at home? Since 2010, Thai companies have led or taken part in $83 billion of overseas M&A, including 18 deals of $1 billion or more. Billionaire Dhanin Chearavanont’s Charoen Pokphand Group Co., and Thai Beverage Pcl of Charoen Sirivadhanabhakdi have been the heavy hitters, fighting to acquire assets in China, Vietnam, the U.S., and wherever they can find them.As I’ve noted before, Thailand’s per capita income is a fifth of South Korea’s, 73% less than Taiwan’s, and a third lower than Malaysia’s, but its outbound-to-inbound investment ratio of 1.9 is higher than all three. Thai demographics are also among the worst in the world. With a fertility rate of 1.5 live births per woman, far lower than the replacement rate of 2.1, it now appears that the small-family drive begun by activists like Mechai Viravaidya, known as Mr. Condom, in the 1970s, has worked a little too well: The 68 million population is expected to shrink by a third by the end of the century. Apart from population, the other big driver is politics. The Thai overseas M&A wave picked up momentum as democracy was snuffed out in 2014 by the second military coup in eight years. Since then, private investment in the domestic economy has ebbed and flowed with global demand. Last year was good; this year is bad. Elections in March returned Prayuth Chan-Ocha, the former general who led the junta, as prime minister. But with efforts under way to break up the country’s most vocal opposition party, there’s little optimism about resumption of a real democracy in the Southeast Asian country. Bangkok Bank shareholders are a little miffed about the overseas shopping expedition. Their dividend checks could be at risk. But the draw of a young market where large banks still earn a 15%-plus return on equity, the best in Asia, is compelling. Permata is not in the league of a PT Bank Rakyat Indonesia or a PT Bank Central Asia, but as Japanese lenders like Mitsubishi UFJ Financial Group Inc. know only too well, you try to get a foot in the door in Indonesia when it opens even a little.The pull of Indonesia adds to the push to expand beyond a moribund home market. Even with dirt-cheap money — Thai 10-year government bond yields of 1.6% are lower than even in the U.S. — loan growth in the domestic economy has collapsed to 3.8%. The prognosis isn’t cheery, either. A quarter of Thailand’s people will be over 60 by 2030. And unlike Japan, which managed to get rich before it got old, per capita national income of $6,600 last year is only half of the high-income threshold. Indonesia is an even lower $4,000, but there, the ratio of people 65 or older is half that of Thailand’s 12%. Bangkok lenders have to seek out youth — from Indonesia to India and Bangladesh. Condoms and coups have left them with no choice. To contact the author of this story: Andy Mukherjee at amukherjee@bloomberg.netTo contact the editor responsible for this story: Patrick McDowell at pmcdowell10@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Simply Wall St.
How Much Are Standard Chartered PLC (LON:STAN) Insiders Spending On Buying Shares?
We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The...
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UPDATE 2-Bangkok Bank to buy Indonesian lender for $2.7 bln in overseas expansion
Bangkok Bank Pcl, Thailand's third-largest lender by assets, said on Thursday it had agreed to buy an 89.1% stake in Indonesia's PT Bank Permata for about $2.7 billion, in the first major overseas acquisition for a Thai bank. Standard Chartered and Indonesian conglomerate PT Astra International jointly controlled Permata, each owning 44.56% in the bank that operates about 330 branches across 62 cities in Southeast Asia's biggest economy.
