Emerging Europe

Companies are holding record levels of cash – but with a growing focus on counterparty risk, and the deposit tax introduced in Cyprus, deciding where to put that cash is more delicate than ever. While money market funds hold some allure, a growing regulatory burden is tempering corporate treasurers’ shift to the product.

Finance minister Rimantas Sadzius reveals Lithuania’s 2015 euro adoption plan, touts the benefits of convergence and strikes a bullish – and contrarian – tone on eurozone policymaking.

Sberbank chief German Gref, who – as the former economics minister – was the boss of Central Bank of Russia governor-designate Elvira Nabiullina, says the bank’s dominance in the country’s economic affairs won’t exert undue influence over monetary policymaking.

As the price index of all goods and services produced within the country, the GDP deflator is the truest measure of domestically sourced inflation (or deflation), according to BCA Research.

The taboo-breaking imposition of capital controls in Cyprus confirms the broad array of new challenges corporate treasurers face. Euromoney discusses euro contingency plans with key bankers amid fears of corporate deposit outflows.

European authorities hope their repeated assurances that Cyprus is a special case will curb contagion and ensure the fiasco there does not set a precedent for future bank crises.

January 2014 targeted for adoption; Moody’s boosts sovereign to Baa2.

The Kazakh banking sector is still burdened by a big non-performing-loan problem. Central bank governor Grigoriy Marchenko explains how the country is approaching the issue with more urgency and a more conservative approach to financial management.

Correlation books and CVA exposure on the block; RWA relief boosts capital.

Putin gets a strong but pliant central bank governor in Elvira Nabiullina. She might please other constituents too.

Plan might founder due to federal stance akin to that for a wider Eurobond.

The agonizing process of agreeing a bailout in Cyprus has set troubling precedents for creditors, laid bare fractures within the European currency union and reminded investors of the ad hoc, inconsistent and arbitrary nature of its institutions’ response to sovereign crises.

What do the Greek general elections, the US Supreme Court decision on the Affordable Care Act (ACA or ‘Obamacare’) and the Italian general elections have in common, asks BCA Research.

The use of commercial cards is the norm for travel and entertainment expenditure, but there has been a big push by banks to encourage companies to adopt card-based solutions to procure higher-value items and improve cash management.

Once seasonal rouble demand for tax payments has passed later this month, the currency should suffer, given Russia’s close links to Cyprus.

Amid political pressure to reduce cannabis-related crime, the legalization of the drug for medical usage could create a $40 billion industry in the US alone, opening up new investment opportunities – with Portugal, Spain, Israel, Czech Republic and Canada also on the radar for venture capitalists. Some even describe the opportunity as a new form of social-impact investing.

With Latvia set to join the eurozone in 2014, and Moody's upgrading its bond rating this week, finance minister Andris Vilks is confident of the benefits to the country in joining the single currency – and aware of the efforts needed to convince a sceptical population.

Euromoney investigates the market impact of the ECB’s comprehensive assessment of banks, which consists of three legs: identifying portfolios that need scrutiny; the asset-quality review (AQR); and a stress test to be completed by October 2014.

Controversial depositor bail-in on the cards as island touted as unique case for the eurozone.

Inconclusive elections make further structural reforms difficult. This raises doubts about OMT eligibility, which had been widely assumed, argues the Institute of International Finance (IIF).

The ramifications of selling contingent convertible bonds (CoCos) to retail buyers could be brutally illustrated by the bailout of Cyprus’s banking sector, while ties with Russia complicate strategy.

The Italians have mightily protested against excessive austerity, and they are not the only ones. Maybe some good will come out of what most see as a bad election result. Maybe not.

Turkey has grown by leaps and bounds for more than a decade. Yet its stock market remains dependent on foreign capital and successful IPOs are rare. Can the country finally succeed in adding depth to its capital markets?

The multi-year investment bet: meet the emerging markets whose exchange rates need to strengthen or weaken, or where domestic demand needs to cool down amid overheating risks.

First Eurolira deals; Eurorouble bonds in vogue

Rosneft signs second tranche; Maroc Telecom next

CDS spreads are indicative of liquidity, not default, risk. The ban on naked shorting will drain bond market liquidity and increase volatility.

The prospect that quantitative easing by the US Federal Reserve could come to an end much sooner than expected has frightened investors, but the negative effects on emerging markets shouldn’t be overstated, say analysts.

In an environment of currency volatility, the luxury sector could prove to be a refuge, especially as global top-end spending appears to be holding up well, according to BCA Research.

The ground-breaking liquidity coverage ratio (LCR) has triggered a quiet revolution between banks and corporates in liquidity management practices, with both seeking more price-competitive products as new regulations begin to bite.