Henrique de Campos Meirelles, governor of Brazil’s central bank, has made the rebuilding of foreign currency reserves a priority. Interview by Brian Caplen. Q Brazil is more stable than it has ever been before. How has this been achieved? A Brazil is engaged in a very serious economic stabilisation programme involving an inflation-targeting monetary regime and a free-floating exchange rate.
Vneshtorgbank is using its acquisition of Guta Bank to build up its retail services, planning more branches and aiming for a leading role in the mortgage market. By Brian Caplen.Russian state-owned Vneshtorgbank is pushing ahead on the retail front, aiming to claim an 8%-10% share of the market by 2010. During that period, total assets are expected to rise from $15bn to $35bn, including a forecast rise in mortgages from $150m to $2bn and in consumer lending from $300m to $3bn.
As new frameworks such as Basel II are implemented by Asia’s regulators, the region’s banks will have to adopt innovative new ways of raising debt and capital.Brian Caplen explains. In the grim days following the Asian financial crisis, efficient capital management was not a concept much in vogue with the region’s banks.Staying alive in any shape or form was the focus, not fussing about different forms of capital. But now the onward march of regulation in Asia and new demands from shareholders are concentrating the minds of bank management.
Germany’s medium-sized companies’ political clout has led to banks coming up with innovative capital-raising solutions for them, says Brian Caplen. Refusing to lend to the Mittelstand in Germany is the fastest route to bad publicity and political outcry. These small and medium-sized enterprises account for three quarters of output in Germany, higher than in most other western European economies where large firms dominate. What’s more, they have a large political voice.The fact remains, however, that lending to the Mittelstand at low margins does not make economic sense for banks, even if it makes good politics.
A US fund is leading the way in dealing with Germany’s bad loan overload. Brian Caplen reports. The great potential of German distressed debt may not be obvious to all but it is proving attractive to Lone Star, the US private equity fund that has purchased two-thirds of all the non-performing loans (NPLs) sold by German banks.Yet with an estimated €300bn of bad loans in the German banking system and so far only €10bn sold, there is no danger of supplies evaporating.
A lot of the groundwork for a German revival is complete. The news remains bad but then the darkest hour is often just before the dawn. Brian Caplen reports.While the headline news about Germany’s economy remains dire and political battles continue to be fought over reforms and job losses, behind the scenes Europe’s largest economy is showing signs of restoration to at least some of its former glory.
With a 52% increase in first half profits, Standard Chartered could hardly have done better. But on the acquisition front, it seems to have gone sideways, selling a 9.76% stake in South Korea’s KorAm and watching HSBC beat it for a stake in China’s Bank of Communications (BoCom). Group CEO Mervyn Davies explains the bank’s strategy to Brian Caplen.
Barclays Capital’s CEO explains how proving itself in Europe is an ideal platform for building its US business. By Geraldine Lambe and Brian CaplenWhen Barclays Capital CEO Bob Diamond was passed over for the top position at Barclays last October, there was a lot of media speculation that if a good offer came from another firm, he would be happy to jump ship. Mr Diamond’s rebuttal is adamant and he says his “enriched mandate” to combine the wholesale and institutional businesses gives him a good enough reason to stay.