UK and Hong Kong sign deal; London in leading position

Lots of small deals for FIG bankers… But no big transformational ones

Lobbying intensifies over OTFs; Isda, BBA voice concern

The UK has always had a difficult relationship with its closest neighbour – France. In the last century, there were plenty of Brits who resisted the idea of linking the south of England with the north of the continent by train. And let’s not even get started on the whole European Union thing. But could a slew of French bankers be heading north through the tunnel in the near future? Socialist presidential candidate Francois Hollande, leading in the polls, has promised to crack down on what he perceives as the excesses of the French banking sector. Embattled president Nicolas Sarkozy has responded by saying he’ll bring in a transaction tax in France, whether the rest of Europe adopts it or not.

Refinancing options are running out for many European companies with looming debt maturities. Could the banks’ own funding problems finally precipitate the distressed debt opportunity this market has been waiting for? Or are the consequences of asset disposals too brutal for many banks to take?

"Are you going to write things down?"

After several years in the making, the documentary The Wall Street Conspiracy is premièring in New York City next month. It tracks the growth of naked short selling and its role in the financial crisis, focusing on the small group of crusaders who have dedicated their lives to educating the masses on the negative impact of borrowing stocks and failing to deliver.

Max Ziff must have one of the more daunting jobs in Europe. As managing director and head of sovereign advisory at Houlihan Lokey he has been charged with kick-starting Greece’s faltering privatization programme.

The ECB doesn’t have to take the same losses on Greek debt as the private sector – but it should.

Long-time watchers of Hong Kong brokerage are quite familiar with CLSA’s annual Feng Shui Index, which uses Chinese feng shui principles to predict movements of the Hang Seng Index. It’s a bit of fun, but has on occasions been unnervingly accurate, and Hong Kongers – never above a bit of superstition in their approach to investment – have tended to seek it out with a mixture of curiosity and faith.

US Fed to incentivize investors; Single-family homes new asset class

"To be an Apple in the wealth-management arena with regards to technology would be the holy grail"

On the day the British news media indulges in a spasm of outrage at the granting to RBS chief executive Stephen Hester of a 2011 bonus worth £963,000 ($1.5 million) in RBS shares – 60% of his entitlement under the 2010 remuneration plan approved by 99.2% of shareholders, including the UKFI which manages the UK government’s 82% stake in RBS – Euromoney sits down with the chief executive of another bank to discuss the vexed subject of pay. The debate on this has gone all awry, he wails. All across the industry pay is coming down fast. In a classic example of the law of unintended consequences, it is only policymakers’ and regulators’ pressure to reduce variable bonuses and instead increase fixed pay as a proportion of total remuneration that has prevented it from falling even further in line with sinking revenues and profits in investment banking.

The State Oil Fund of Azerbaijan has always feared risk. Now it’s seeking higher yields, branching out into listed securities, real estate, gold and emerging market debt. But is this ultra-cautious fund really ready?

David Einhorn’s £7.2 million ($11.3 million) fine by the UK’s Financial Services Authority for insider trading in Punch Taverns stock should make some hedge fund managers and investment bankers very afraid.

At long last, investment bankers are bowing to the inevitable. Four years after the crisis, the industry is undergoing a much-needed transformation, as banks exit businesses they simply cannot make a return on. Bank chiefs are struggling to adapt to the new rules of the game. It should lead to an era of greater specialization and further consolidation.

Until recently, European public-sector finance did not set the pulses racing. But as the latest sovereign downgrades hit home, some investors are shunning any SSA borrower with ‘Europe’ in its name. The days of boring old triple-A seem to be over.

"Bankers are not going to repeat the errors of the past or buy 10-year bonds with three-year funding. Such a duration mismatch would ultimately be suicide"

New strictures have breathed life into shadow banking – it now constitutes about a quarter of the global financial system – and regulators fear they have created a monster. But look closer and there's much more to this financial Frankenstein…

I must admit that the cacophony surrounding Stephen Hester’s bonus has taken me aback. In late January, Royal Bank of Scotland decided to award its chief executive a near-£1 million bonus for 2011 in addition to his £1.2 million salary which, under enormous media and political pressure, Hester was forced to decline.

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