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ECONOMICS – FINANCE – WORLD NEWS – GREEK DEBT

“Unlike cigarettes, banks don’t actually kill people”

Unlike cigarettes, banks don’t actually kill people.” That’s how Anthony Browne, new head of the BBA, the British Bankers Association, opened the organizations annual conference. The BBA is currently working on a proposal to have City bankers register with an independent organization, which can ban them from their profession in case of ethical or professional misconduct. A regulation like that would exceed the power of the FSA (Financial Services Authority), which only extends to senior-level management and traders. read article

In other banking news, Credit Agricole is getting closer to selling its Greek operations Emporiki to Alpha Bank, after looking to strike a deal for months. Alpha Bank is Greece’ second largest bank and if you’re thinking “where in god’s name did they get the money from?”, just bear with me. The total price will amount to €1, a joke, an insult, a token fee. Overall, Credit Agricole will lose around €2bn on the entire operation (including transaction fees of more than €300m), as the Wall Street Journal reports.

As part of the deal, Credit Agricole will need to inject an additional €550 million into Emporiki before the sale, which it hopes to complete by year-end. It will also need to maintain a €1.4 billion credit line to Emporiki that the Greek bank would repay in three installments over the next two yearts.

Yesterday’s big news came in right after lunch, with Citigroup’s CEO Vikram Pandit resigning after five years of service. Pandit had been with Morgan Stanley for ages, then left Wall Street to start his own hedge fund, Old Lane, which was then bought by Citigroup, who promoted Pandit in practically no-time. Rumor has it that Pandit may have resigned over disagreements with the chairmen of the board, but other sources say the parting had been on perfectly friendly terms. According to the FT:

Michael Corbat, the new chief executive, said he did not want “to alter the strategic direction” of Citi, with a continued concentration on increasing the size of its emerging markets business and the shedding of the remainder of Citi Holdings, the “bad bank” of non-core assets.

Corbat was formerly Citi’s head of international operations for EMEA. But despite the above statement, changes of direction due to new management are likely. Plus, all this is following Sandy Weill’s (ex-chairman) comment regarding the necessary separation of investment and retail banking, which had led to the initial formation of Citigroup in 1998.

Also in the US (and also yesterday, sorry about that), a more acceptable presidential debate took place between Barack Obama and Mitt Romney. Obama was more on his A-game than last time, but it appears that the jury is still out on who won. The Washington Post has put another 2-minute summary video together. So is anyone going to turn this into a rap battle a la Keynes vs Hayek or what?!

Otherwise, happy news for the UK, with employment number rising and jobless benefit claims falling between August and September. The unemployment rate beat expectations by 0.3% and the overall number of working people rose to the highest level ever recorded (i.e. since Q1 1971, when ‘records began’). read article

Yesterday (jesus…) was a historic day for Cuba: the country abolished its travel restrictions and announced that its citizens will be able to leave the country for up to 24 months starting on January 14, 2013. A Cuban blogger responded saying the island would be empty come January. read article

So long.

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2 Responses

  1. princess1960 says:

    perfect ..K theory is free spend for F..(you know i start to like)..(lol)…
    thank you

  2. […] When Vikram Pandit left his position as CEO of Citigroup, everybody denied that there had been tensions in the bank’s senior management. The 180-degree-turn of the company’s strategy says something quite opposite. Last week, there was the modest announcement that 150 jobs would be cut. Last night, the number of overall job cuts within the company rose to 11,000, more than double of what Pandit had had in mind. According to Fortune Magazine, Citi employed 266,000 people this year. read article […]

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