Liam Proud
ReutersBreakingviews
United Kingdom
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Past articles by Liam:
Wanted: Chillaxed CEO for $21 bln French laggard – Breakingviews
Frédéric Oudéa will depart from SocGen after 15 years at the helm. He leaves a bloated bank with one of the lowest valuations in Europe and an unclear appetite for change. Breakingviews imagines a letter from a headhunter specialising in cushy job placements. → Read More
Stablecoin panics may be a feature not a bug – Breakingviews
Crypto tokens like Terra and $80 bln Tether were supposedly pegged to the dollar. Yet the former failed and the latter wobbled. Holding 100% cash reserves would help. But there’s no fun, or money, in that. Users can always flock to the new, sketchy coin offering juicy rewards. → Read More
SoftBank’s Son is running out of ammunition – Breakingviews
The stock market values the $60 bln technology conglomerate at half the sum of its parts. In the past, founder Masayoshi Son has used buybacks to prop up the shares. High leverage and slumping markets make that tricky. More radical measures, like a breakup, seem off the table. → Read More
Stablecoin crash drags crypto ideals back to earth – Breakingviews
TerraUSD, a digital token supposedly pegged to the U.S. dollar, slumped to a fraction of that. The popular store of value is vulnerable because its design is based on trading incentives, not hard reserves. For crypto fans there’s a tradeoff between decentralisation and stability. → Read More
Chelsea buyer will struggle in financial league – Breakingviews
A group led by LA Dodgers owner Todd Boehly and U.S. buyout firm Clearlake will pay $3 bln for the UK soccer club. Unlike current owner Roman Abramovich, they’ll be eyeing a return on their investment. Yet $2 bln of pledged spending, including a new stadium, make that tricky. → Read More
European banks mount fragile trading fightback – Breakingviews
The markets divisions of Deutsche Bank, BNP and Barclays are outpacing U.S. rivals, reversing a decade of plunging market share. Yet sustaining that growth will be hard, and shareholders clearly dislike the business. It may be a blip on a long-term trend of American dominance. → Read More
Goldman’s financial alchemy extends to crypto too – Breakingviews
The U.S. bank made a bitcoin-backed loan to $27 bln Coinbase. Regulatory suspicion of cryptocurrency means a third party will hold Goldman’s collateral, which the latter won’t touch. If it avoids censure, the loan’s lucrative nature means the rest of Wall Street could pile in. → Read More
Deutsche can leave Credit Suisse in the dust – Breakingviews
Europe’s erstwhile bank basket case is now valued by investors on the same multiple of book value as the Swiss wealth manager. Rate hikes and a debt-trading boom will play to its strengths. Meanwhile, Credit Suisse’s weak capital ratio and slow growth will keep its shares gloomy. → Read More
What is Morgan Stanley smoking in Twitter LBO? – Breakingviews
The bank is leading a $13 bln debt package for Elon Musk’s buyout and lending $12.5 bln against his Tesla stock. Interest will eat up the social network’s cash flow and Musk may undermine its revenue. A good relationship with the world’s richest man may justify the risk, though. → Read More
European banks’ buyback boom faces bad-debt risks – Breakingviews
After two lean years, investors had hoped 2022 would bring bumper payouts from Barclays, BNP Paribas, and other big lenders. But the Ukraine war raises the chances of a recession. Rebuilding default buffers, which are slimmer than before the pandemic, may now be the priority. → Read More
French financial royalty falls flat in music SPAC – Breakingviews
A blank-cheque vehicle backed by billionaire François-Henri Pinault and banker Matthieu Pigasse struck a $1 bln deal with Deezer. The European music streamer has carved out a niche and may fend off Spotify. But the SPAC is paying a higher multiple for a slower-growing company. → Read More
Goldman can close valuation gap on Morgan Stanley – Breakingviews
The bank run by David Solomon is worth 40% less than James Gorman’s group, based on multiples of tangible book value. Before the pandemic the discount was 20%. Morgan Stanley’s earnings are steadier, but its rating is rich. If Goldman keeps a lid on costs, the divide will narrow. → Read More
EU bank dumpster divers still have rich pickings – Breakingviews
A big investor, probably Capital Group, sold 1.8 bln euros of Deutsche Bank and Commerzbank shares. Betting on the basket cases has worked well since 2020. France’s SocGen and Italy’s UniCredit may offer similar rewards now, though shareholders may have to work a little harder. → Read More
Bank bidders solve tricky German M&A puzzle – Breakingviews
Advent and Centerbridge revived their $2 bln Aareal deal by offering a 12% bump and letting rebel shareholders stay invested. It should work, defying the trend of failed German takeovers. The lesson is that debt-free deals with a flexible buyer stand the best chance of success. → Read More
Apple Pay push is scarier for fintechs than banks – Breakingviews
The $2.9 trln iPhone maker is beefing up its in-house financial tools and muscling into consumer credit, Bloomberg reported. That’s bad news for technology partners and pay-later rivals. Lenders have less to fear: underwriting big loans isn’t lucrative enough to appeal to Apple. → Read More
Hackers turn crypto’s strength into Achilles heel – Breakingviews
Attackers stole $540 mln from a blockchain linked to an online game. Theft is growing as developers roll out untested new blockchain products with shaky security. So-called decentralised finance makes it easy to create new crypto services, but criminals are mopping up the spoils. → Read More
Alphabet fiddles as app-store antitrust fire burns – Breakingviews
The $1.8 trln Google parent will let Spotify use its own payment service, skirting a 15% fee. The move piles pressure on rival Apple to do the same. But it’s just a pilot project and probably still includes a hefty charge. U.S. and EU regulators may force the duo to go further. → Read More
EQT makes savvy $7 bln play for buyout big leagues – Breakingviews
The Swedish group is acquiring Baring Private Equity Asia. The price looks reasonable. And by paying mostly in stock, CEO Christian Sinding is putting his share-price premium to good use. EQT will finally have a global presence, helping it go toe-to-toe with U.S. giants like KKR. → Read More
EU housing boom risk is more social than financial – Breakingviews
Watchdogs in Germany and elsewhere have hiked bank capital requirements and warned property may be 30% overvalued. Yet mortgage-lending standards remain solid, suggesting pandemic savings are mainly to blame for the runup. There’s little regulators can do about wealth inequality. → Read More
Deutsche CEO’s new plan is a dicey bet on peace – Breakingviews
Christian Sewing hopes to boost revenue 4% a year to hit a 10% return on tangible equity target in 2025. A prolonged Ukraine war and soaring energy prices could make that impossible. Sewing would then be back to square one: cutting his way to higher returns rather than growing. → Read More