EMERGING MARKETS-Rouble leads emerging currency losses on rate cut hints

LONDON, April 17 (Reuters) - The prospect of deeper interest rate cuts took Russia's rouble more than 2 percent lower on Friday, knocking it off 4-1/2-month highs against the dollar, while Russian equity markets also slipped.

The rouble touched a low of 51.2 per dollar after central bank governor Elvira Nabiullina said late on Thursday the currency had found its equilibrium and its appreciation provided a basis for further rate cuts.

After slumping to around 80 per dollar in late 2014, the rouble has rallied as the oil market shows signs of having bottomed out and fighting in eastern Ukraine between pro-Russian separatists and Ukrainian government forces has eased.

"The rouble has appreciated so much recently that from the point of view of the central bank and government it makes sense to try and cap it so as not to erode too much the competitiveness gains they got from the depreciation," said Sebastien Barbe, head of emerging market strategy at Credit Agricole in Paris.

After markets close on Friday, Standard & Poor's and Fitch are due to publish ratings for Russia. Downgrades are seen as unlikely because of the more stable economic conditions seen in recent months.

Russian dollar-denominated stocks fell 1.5 percent and the rouble index also slipped as oil prices came down from 2015 highs, but they are up some 16 percent this month. The likelihood of rate cuts may boost local bonds though, with 10-year yields touching a new 4-1/2 month low around 10.3 percent.

Broader emerging market stocks also paused in a rally that earlier took the MSCI emerging markets index to a new seven-month high.

Though the benchmark gave up earlier gains to fall 0.2 percent, it was still headed for a third consecutive weekly gain after lackluster economic data in the United States persuaded more investors a rate hike from the Federal Reserve is less imminent than once thought.

The Asia Pacific ex-Japan index eased 0.2 percent but stayed near seven-year highs after a 2.3 percent gain for Shanghai shares.

In emerging Europe, Turkish stocks rose 0.8 percent while the lira fell 0.3 percent approaching the record lows hit earlier this week on back of pre-election tensions.

Hungary's forint remained under pressure near a three-week low against the euro after the European Union suspended a development fund payment over concerns about how Budapest allocated the money. Hungarian stocks also slipped, led by a 0.75 percent loss for its biggest bank, OTP.

For GRAPHIC on emerging market FX performance 2015, see link.reuters.com/jus35t

For GRAPHIC on MSCI emerging index performance 2015, see link.reuters.com/weh36s

For GRAPHIC on MSCI emerging Europe performance 2015, see link.reuters.com/jun28s

For GRAPHIC on MSCI frontier index performance 2015, see link.reuters.com/zyh97s

For CENTRAL EUROPE market report, see

For TURKISH market report, see

For RUSSIAN market report, see ) (Additional reporting by Sujata Rao; Editing by Mark Trevelyan)

18.12 | 0 komentar | Read More

Britain postpones bill sale due to platform supplier problems

LONDON, April 17 (Reuters) - The UK debt management office postponed a tender of treasury bills on Friday citing technical issues with a third party platform supplier.

The UK DMO said it would make a further announcement at 1200 BST (1100 GMT), and that any bids already submitted would be deemed null and void.

Traders told Reuters that Bloomberg terminals were experiencing an outage on Friday morning. Bloomberg could not be immediately reached for comment. (Reporting by John Geddie; editing by John Stonestreet)

18.12 | 0 komentar | Read More

'Reform or stimulus' policy divide grows as China slows

* China aims for 7 pct growth in 2015, a quarter-century low

* Some policy advisers calling for more stimulus

* Others call for structural reforms for sustainable growth

* Concern that monetary stimulus fuelling speculative bubble

By Kevin Yao

BEIJING, April 17 (Reuters) - With China's economic growth heading for a quarter-century low, think-tanks and advisers to the government are polarising into those calling for more stimulus to arrest the slowdown and a rival camp emphasising structural reforms as the route to sustainable growth.

The debate among the think-tanks, which influence decision-making but do not wield direct power, is reflected in the ambivalent mood music coming from China's leaders, who accept the need to adapt to a "new normal" of slower but better quality growth, while fretting that a deeper downturn could fuel debt defaults, unemployment and social unrest.

To prevent growth from dipping below 7 percent, some economists are urging Beijing to step up policy support on top of the two interest rate cuts since November and a reduction in the level of deposits banks must hold in reserve.

"Employment is a lagging indicator; if the slowdown persists, it will definitely affect employment," said a senior economist at a well-connected think-tank who declined to be named.

"We still need to cut interest rates, bank reserve ratios and taxes, (and) the exchange rate should become more flexible."

Employment is for now holding up despite signs of rising job losses in some regions, including the rust-belt northeastern provinces, which Premier Li Keqiang visited last week, pledging to "stand up to" the downward pressure on the economy.

"The real downward pressure may be even bigger than the headline figures," said an economist who advises the government.

"The biggest difficulty is not slowdown itself. Many debt-laden firms cannot repay bank loans, and we must boost the money supply as quickly as possible to reduce real interest rates."

The economist called for deeper cuts to banks' reserve requirement ratio (RRR) this year, probably by 3-4 percentage points from the current 19.5 percent, and some yuan depreciation to help exporters.

Despite the rate cuts and lower RRR, falling inflation has kept real borrowing costs high.

Lu Zhengwei, chief economist at the Industrial Bank, has also called for yuan depreciation to support growth, but China's leaders are concerned it would encourage a further outflow of capital. Premier Li has ruled it out, even as he conceded that the 2015 growth target won't be easy.

"They will have to cut interest rates and RRR and boost investment, which may only provide a short relief for the economy but cannot change the downward trend," said Lu.

BOOST OR BUBBLE?

But other advisers say Beijing should tolerate lower growth, chastened by the experience of its last heavy stimulus programme after the global financial crisis, which saddled state-owned enterprises and local authorities with a mountain of debt, run up sometimes for projects of doubtful value.

These advisers argue that reforms to make the economy more efficient and responsive to market signals, which in the short term means letting weak companies fail and unproductive jobs evaporate, will produce better quality growth, while excessive stimulus could promote dangerous asset bubbles.

"They (leaders) are worried about the economy, but policy steps have limited effectiveness due to excessive investment in the past," said an economist with a think-tank affiliated to the National Development Reform Commission, the top planning agency.

Cai Fang, vice head of the Chinese Academy of Social Sciences (CASS), a government think-tank, also wants more emphasis on reforms. He advocates relaxing rules on family planning and the household registration system, which ties people's access to services to their residential status.

"We have used a variety of approaches to appropriately stimulate economic growth, but they are apparently not very useful," he told a high-level conference last month.

"That will make policymakers realise that they cannot use traditional means to boost economic growth potentials and must look to reforms to unleash dividends."

Those dividends should include government's long-term goal of reducing the burden of debt in the economy, while excessive stimulus risks further inflating speculative bubbles.

"If we pump out more money through monetary policy, it will spur further crazy rises in the stock market," said another CASS economist. "The government is riding a tiger." (Editing by Will Waterman)

18.12 | 0 komentar | Read More

Putin sees return to growth in Russia in under 2 years

MOSCOW, April 16 (Reuters) - President Vladimir Putin said on Thursday Russia's economy could return to growth in less than two years, even though he considers it unlikely that the West will lift economic sanctions over the Ukraine crisis soon.

In a televised call-in with the nation, Putin acknowledged that there were difficulties for Russia's economy, which has been hit by a fall in global oil prices as well as the sanctions.

But, asked about a prediction he made earlier that the economy could return to growth in two years, he said: "With what we are seeing now, the strengthening of the rouble and the growth in the markets ... I think that it may happen faster ... but somewhere in the region of two years."

Putin has made clear that he largely blames the West for Russia's economic problems, including the weak rouble, higher inflation and falling revenues.

The central bank expects the economy to contract by 3.5 to 4 percent this year and by 1 to 1.6 percent in 2016.

Sitting at a desk in a television studio in front of rows of telephone operators taking calls from viewers, Putin said the sanctions were politically motivated by Western powers which he accused of wanting to "contain" Russia.

"I think they do not relate directly to events in Ukraine," he said, adding the sanctions had remained in place even though Russia believed Kiev was to blame for the failure to implement a ceasefire deal fully in east Ukraine.

He said he had recently discussed the sanctions with business leaders.

"I told them we can hardly expect sanctions to be lifted now because they are purely political," he said.

Putin's ratings in Russia have soared since the country annexed the Crimea peninsula from Ukraine just over a year ago but relations with the West are at their lowest point since the Cold War ended nearly a quarter of a century ago.

Western leaders say they have overwhelming evidence that Moscow has provided pro-Russian separatists fighting Ukrainian government forces in east Ukraine with soldiers and weapons. Russia denies this and says the West was behind the overthrow of a Moscow-backed Ukrainian president in February 2014.

Putin, 62, has held a call-in almost every year since he was first elected president in 2000, answering questions on issues ranging from local housing problems to regional and international conflicts.

They have often been marathon performances, the longest lasting 4 hours 47 minutes in 2013, and been used by Putin to show he is in command and ready to address the people's problems, large or small. (Additional reporting by Elizabeth Piper, Vladimir Soldatkin, Lidia Kelly, Andrey Kuzmin, Polina Devitt, Jack Stubbs, Jason Bush and Maria Tsvetkova; Writing by Timothy Heritage; Editing by Elizabeth Piper)

18.12 | 0 komentar | Read More

Russia's Putin says S-300 sale prompted by Iran's flexibility in talks

MOSCOW, April 16 (Reuters) - Russian President Vladimir Putin said on Thursday Iran's willingness and flexibility in trying to find a solution with the West over its nuclear programme had spurred his decision to renew a contract to deliver an S-300 missile defence system to Tehran.

But the president, in his annual televised call-in show, said Russia would still work "as one" with its partners in the United Nations over Iran and that deliveries of the S-300 would work as a deterrent in the Middle East.

"And now with the progress of the Iranian nuclear track - and that is obviously positive - we do not see any reason to continue to keep the ban (on the delivery of the S-300) unilaterally," he said. (Additional reporting by Elizabeth Piper, Vladimir Soldatkin, Lidia Kelly, Andrey Kuzmin, Polina Devitt, Jack Stubbs, Jason Bush and Maria Tsvetkova; Writing by Elizabeth Piper, editing by Timothy Heritage)

18.12 | 0 komentar | Read More

Greek budget revenues beat target in March-deputy finance minister

ATHENS, April 16 (Reuters) - Greece's ordinary budget revenues in March stood at 4.2 billion euros, beating the country's target of 3.2 billion euros, deputy Finance Minister Dimitris Mardas told reporters on Thursday.

Ordinary net budget revenues exclude receipts from social security organisations and local governments. The figure differs from the one monitored by Greece's EU/IMF lenders but indicates the country's progress in repairing its finances.

Greece suffered a revenue shortfall in January and February because of lower tax receipts and is dangerously close to running out of cash in the coming weeks. (Reporting by Lefteris Papadimas; Writing Karolina Tagaris, editing by Deepa Babington)

18.12 | 0 komentar | Read More

UPDATE 1-MOVES-Movaghar becomes BAML's CEEMEA DCM head, Presley joins

(Adds Presley's replacement at Credit Suisse)

By Michael Turner

LONDON, April 15 (IFR) - Bank of America Merrill Lynch has appointed Karim Movaghar to head its CEEMEA debt capital markets team and has hired Josh Presley from Credit Suisse to work on the syndicate desk, according to an internal memo seen by IFR.

Movaghar will report to Fernando Vicario and Marc Tempelman, co-heads of EMEA corporate banking and DCM. He replaces the recently departed Alex von Sponeck.

Movaghar has been BAML's head of emerging market and corporate debt syndicate since 2011, and before that was at Morgan Stanley.

Meanwhile Josh Presley will join the US house as a director, focusing on emerging market and corporate transactions.

Based in London, Presley will report to Jeff Tannenbaum.

At Credit Suisse, David Anthony, who is already on the syndicate desk covering corporates, will take on Presley's old responsibilities, according to a bank spokesperson. (Reporting By Sudip Roy, writing by Michael Turner; editing by Alex Chambers, Julian Baker)

18.12 | 0 komentar | Read More

Germany declines comment on Greek bankruptcy plan report

BERLIN, April 15 (Reuters) - The German government declined comment on Wednesday on a story in German weekly Die Zeit which said Berlin was working on a plan that would allow Greece to receive financing from the European Central Bank even if it missed payments to creditors.

"The plan under discussion is aimed at allowing he ECB to continue financing of Greece in the event of bankruptcy," the Zeit article said. "In addition, Greek banks would be restructured, allowing them to continue to take part in central bank operations even after a state bankruptcy."

The article said that in exchange, Athens would have to show a readiness to cooperate and fulfill its reform obligations. (Writing by Noah Barkin; Editing by Caroline Copley)

18.12 | 0 komentar | Read More

China's central bank asked lenders to check margin trading risk - memo

BEIJING, April 15 (Reuters) - The Shanghai branch of China's central bank has ordered commercial lenders to check for risks in their margin trading business, according to a memo obtained by Reuters.

The move comes after margin trading soared among brokerages, prompting regulators to clamp down on risky behaviour earlier this year.

The People's Bank of China (PBOC) ordered commercial banks to provide their margin trading accounts and a list of connected wealth management products, according to the document and two sources with direct knowledge. This was supposed to have been completed by the end of March.

In the second half of 2014, margin trading increased rapidly in Shanghai and Shenzhen, with data showing that banks are one of the main sources of margin finance funding, according to the memo. As a result, there was a need to ensure the business is transparent and control risks, it added.

The PBOC asked commercial banks to report risks and the measures that they will adopt to handle them.

The Shanghai branch of the PBOC could not be reached for comment.

"Last year, the PBOC started to tighten control over the WMP market, as proceeds from WMP were inappropriately invested, making the central bank's loan and deposit data less accurate," one of the sources with direct knowledge said.

(Reporting by Li Zheng in Beijing and Engen Tham in Shanghai; Editing by Nick Macfie)

18.12 | 0 komentar | Read More

UPDATE 1-Russian navy ships in English Channel on way to drills

(Recasts with statement)

MOSCOW, April 14 (Reuters) - Russian navy vessels entered the English Channel on Tuesday on their way to the northern Atlantic for anti-aircraft and anti-submarine defence drills, the Northern Fleet said.

The squadron, led by the Severomorsk anti-submarine ship, had carried out drills in the Bay of Biscay and will later head for the northeastern Atlantic, a spokesman for the Northern Fleet said in a statement.

Russia's Interfax news agency had reported that the squadron would hold drills in the English Channel but the fleet's statement did not confirm this.

It is not unusual to have Russian warships in the Channel. NATO dismissed in November a Russian media report that a squadron of Russian warships had conducted military exercises there.

Relations between Russia and the West have sunk to post-Cold War lows since the start of the crisis in Ukraine. (Reporting by Gabriela Baczynska, editing by Elizabeth Piper)

18.12 | 0 komentar | Read More

UPDATE 1-Nestle nears sale of frozen food unit to Brakes - source

(Adds Nestle declined to comment, Credit Suisse mandate, price range and background)

By Sophie Sassard

LONDON, April 14 (Reuters) - Nestle is in advanced talks to sell its frozen food unit Davigel to Brakes Group, owned by buyout fund Bain Capital, a person familiar with the situation said on Tuesday.

The talks, reported earlier by French daily Les Echos, are ongoing and a deal is expected to be signed soon, said the person, who asked not to be named because the discussions are private.

Credit Suisse is handling the sale for Nestle, which is expected to raise between 200 million and 300 million euros ($211-317 million), said a second source.

Reuters reported last year that Nestle was exploring a possible sale of Davigel and that Brakes Group was one of the potential buyers.

Davigel, which supplies frozen and chilled meals and ice cream to restaurants and hospitals, was part of the Buitoni frozen food business Nestle bought in 1989.

Nestle, the world's largest food company whose wide range of products includes Gerber baby food and Perrier bottled water, announced two years ago it was seeking to divest underperforming businesses.

Over the past few years, it has sold the PowerBar and Musashi brands to U.S. group Post Holdings, as well as its U.S. frozen pasta business to Brynwood Partners and the bulk of its Jennie Craig business.

It also sold a 10 percent stake in fragrance and flavor maker Givaudan in December 2013.

Nestle declined to comment, while Brakes Group and Credit Suisse were not immediately available for comment.

($1 = 0.9478 euros) (Reporting by Sophie Sassard in London; Additional reporting by Joshua Franklin in Zurich; Editing by Tom Pfeiffer and Mark Potter)

18.12 | 0 komentar | Read More

UPDATE 2-China's new bank loans beat forecast, but monetary growth slows

(Repeats to fix formatting, with no changes to text)

* March new loans 1.18 trln yuan, vs f'cast 1.03 trln yuan

* March TSF 1.18 trln yuan, vs 1.35 trln yuan in Feb

* March M2 money supply +11.6 pct y/y, vs f'cast +12.3 pct

* Q1 new loans at 3.61 trln yuan, TSF at 4.61 trln yuan

* More policy steps expected to support growth

* FX reserves fall by $110 bln in Q1

By Kevin Yao

BEIJING, April 14 (Reuters) - Chinese banks made 1.18 trillion yuan ($189.87 billion) worth of new loans in March, beating expectations, as the authorities ramped up efforts to avert a slowdown in economic growth while lenders cut their exposure to the risky shadow financing.

Economists polled by Reuters had expected new local-currency loans at 1.03 trillion yuan in March, compared with 1.02 trillion yuan in February.

In spite of the expanded loans, growth in broad money supply slowed, which could put the central bank under more pressure to support the economy.

Broad M2 money supply (M2) in March rose 11.6 percent from a year ago, missing market expectations of 12.3 percent and slowing from February's 12.5 percent pace.

Outstanding loan growth was 14 percent in March. Analysts polled by Reuters had expected outstanding loans to grow by 14.5 percent, versus the previous month's 14.3 percent.

The People's Bank of China (PBOC) said that total social financing (TSF), a broader measure of overall liquidity in the economy, was 1.18 trillion yuan in March, versus 1.35 trillion yuan in February.

A KIND OF REFINANCING?

New bank loans totalled 3.61 trillion yuan in the first quarter, versus 3 trillion yuan in the same period last year, while TSF totalled 4.61 trillion yuan in the first three months, versus 5.6 trillion yuan a year earlier.

New loans in the first quarter made up for 78.3 percent of TSF, a rise of 24.1 percentage points from a year earlier.

"It seems like there's a refinancing under way from shadow banks to banks," said Tim Condon of ING.

"We get a large increase in loans but it doesn't translate into economic activity. It's just rolling over intermediary credit into the banking system. It's a healthy thing. We want to clean up shadow banks," he said.

Condon said the M2 growth data "is consistent with data that we are seeing across the economy, and that is that the all the activity indicators are slowing."

The central bank said after the data release that it will use a variety of policy tools to keep liquidity conditions appropriate and maintain "reasonable" growth in credit and social financing, and the borrowing costs for companies have declined.

The loan data came out one day after the government announced poor exports for March and one day before China announces its economic growth for 2015's first quarter. Economists expect GDP growth slowed to a six-year low of 7 percent.

FOREX RESERVES DROP

The central bank has cut interest rates twice since November, on top a cut in the amount of cash that bank hold as reserves in February, in a bid to keep liquidity conditions accommodative.

It has also guided short term money rates downward sharply in the interbank market, which finally began yielding results in April, with the benchmark seven-day bond repurchase agreement falling below 3 percent for the first time since Oct 2014.

The economy still faces persistent downward pressures due to a property market downturn, widespread factory overcapacity and elevated local debt levels, as global demand remains erratic.

China's foreign currency reserves - the world's largest - fell by $110 billion in the first quarter to $3.73 trillion, following a drop of about $50 billion in the previous quarter, amid signs of capital outflows.

Mark Williams, an economist at Capital Economics, estimated that the dollar's strength during the course of the first quarter may have shaved $130 billion off the dollar value of China's reserves, by reducing the value in dollars of reserves held in euro and yen.

"If that is correct, the PBOC was still a net purchaser of reserves in the first quarter, albeit on a much reduced scale," Williams said. (Editing by Richard Borsuk and Simon Cameron-Moore)

18.12 | 0 komentar | Read More

JGBs little changed, 20-year bonds sold ahead of auction

TOKYO, April 13 (Reuters) - Japanese government bond prices were little changed on Monday, giving up early gains as brokers sold 20-year bonds ahead of an auction later in the week.

The 10-year JGB futures ended 0.01 point down at 147.72 , with trade volume one of the lowest so far this year.

They were slightly firmer in early trade, tracking gains in U.S. bonds on Friday.

The 20-year JGB yield rose 1.5 basis points to 1.130 percent ahead of Thursday's auction of 1.2 trillion yen ($10 billion) 20-year JGBs while The 10-year cash JGB yield rose 0.5 basis point to 0.340 percent.

In contrast, the five-year JGBs were solid with their yield falling 0.5 basis point to 0.090 percent even ahead of Tuesday's five-year JGB auction.

Market players see strong auction results as the Ministry of Finance has reduced the issue amount to 2.5 trillion yen this month from 2.7 trillion yen until March.

($1 = 120.6100 yen) (Reporting by Tokyo Markets Team; Editing by Muralikumar Anantharaman)

18.12 | 0 komentar | Read More

GLOBAL MARKETS-Weak China trade data hammers Aussie, weighs on Europe shares

* Asia shares shrug off surprise fall in China exports

* Australian dollar takes big hit, euro dips vs dollar

* European shares pause after weak Chinese data

By Nigel Stephenson

LONDON, April 13 (Reuters) - A shock fall in Chinese exports hammered the Australian dollar on Monday, though expectations of fresh economic stimulus from Beijing helped Asian stocks higher

Chinese shares, which have been rallying on expectations of further steps to boost the economy, hit seven-year highs on Monday even after data showed exports fell 15 percent in March while imports contracted at their fastest rate since May 2009. Economists had forecast a 12 percent increase in exports.

The Australian dollar fell nearly 1.5 percent after the data from China, which is the main market for Australia's exports of natural resources.

The Aussie was last down 1.4 percent at $0.7567, its weakest since April 2.

Adding to the gloom for the Aussie, the World Bank also cut its 2015 growth forecasts for developing East Asia and China.

"All of that provides quite a negative picture for the Aussie, particularly as the data we had overnight was very much driven by a decline in exports, which is going to be seen as quite a negative factor for the region," said Ian Stannard, head of European FX strategy at Morgan Stanley in London.

The Chinese data also weighed on sentiment in Europe. The pan-European FTSEurofirst 300 share index .FTEU3>, which touched its highest level since 2000 on Friday, edged lower.

In Asia, MSCI's main index of Asia-Pacific shares outside Japan rose 0.5 percent, heading back towards its highest since September, reached last week.

China's CSI300 index closed 1.8 percent higher while the Shanghai Composite rose 2.2 percent.

"We continue to expect more monetary easing for a variety of reasons, and the trade data offers further support for this," Oliver Barron, analyst at China-focused investment bank NSBO said in a note to clients.

Tokyo's Nikkei 225 index ended flat in choppy trade as investors took profit on gains in major stocks such as Toyota Motor Corp after the index hit 20,000 last week.

EURO DOWN

The euro was down 0.4 percent at $1.0563, a four-week low. Data on Friday from the Commodity Futures Trading Commission showed speculative investors' short euro positions, or bets the single currency will weaken, were only slightly below the previous week's record high.

The European Central Bank is one month into a 19-month asset-purchase programme, helping weaken the euro.

The dollar index, which measures the greenback against a basket of currencies, edged up. The U.S. currency was up 0.1 percent against the yen at 120.36 yen.

Sterling hit a fresh five-year low, under pressure from Friday's weaker-than-expected UK industrial output data and concerns about political uncertainty after next month's British general election.

In fixed income markets, Italian yields held firm before an auction that kicks off the busiest week of euro zone debt sales in almost a year. Italy's 10-year yields were flat at 1.23 percent.

The ECB programme has pushed euro zone government bond yields lower, with German 10-year yields hitting a record low of 0.14 percent last week. Germany will sell 10-year bonds later this week.

Crude oil prices rose as traders bet a slowdown in U.S. drilling would contribute to higher prices. Brent crude were last up 58 cents at $58.46 a barrel.

The stronger dollar helped push gold lower for the fourth session in five. It last traded at $1,204.90 an ounce. (Additonal reporting by Jemima Kelly in London, Blaise Robinson in Paris and Lisa Twaronite in Tokyo; Editing by Catherine Evans)

18.12 | 0 komentar | Read More

UPDATE 1-D.E. Shaw in talks to buy Italian NPL business from GS -sources

(Adds details)

By Massimo Gaia

MILAN, April 13 (Reuters) - U.S. investment firm D.E. Shaw has started exclusive talks to buy the Italian non-performing loan business of Archon, a real estate unit of investment bank Goldman Sachs, two sources close to the matter said.

The New York-based firm will have about two weeks to negotiate exclusively the purchase of a 2-billion euro ($2.1 billion) portfolio of Italian non-performing property loans as well as the platform and staff to manage it, the sources said.

D.E. Shaw, which had $36 billion in investment capital as of March 1, did not respond to requests for comment. Goldman Sachs had no comment. KPMG, which is advising Goldman on the deal, had no comment.

The move by D.E. Shaw highlights international investors' growing appetite for Italian assets at a time when reform efforts in the country gather momentum and there are tentative signs its economy could leave a three-year recession.

Investment firms Fortress, Pimco and Bayview Asset Management were also in the running for the Italian arm of Archon. ($1 = 0.9475 euros)

(Writing by Danilo Masoni, editing by Valentina Za)

18.12 | 0 komentar | Read More

Pimco Total Return Fund slashes US government-related holdings in March

NEW YORK, April 10 (Reuters) - The Pimco Total Return Fund decreased its exposure in U.S. government-related securities to 21.60 percent in March, from 35.29 percent in February, according to Pimco's website on Friday.

Pimco Total Return Fund's mortgage holdings held steady at 32.91 pct in March, compared with 32.86 percent in February, Pimco said.

(Reporting By Jennifer Ablan; Editing by Chris Reese)

18.12 | 0 komentar | Read More

UPDATE 1-Pimco Total Return Fund slashes US government-related holdings in March

(Adds asset allocation shifts in non-U.S. developed, emerging market holdings, paragraphs 2-9; adds byline)

By Jennifer Ablan

NEW YORK, April 10 (Reuters) - The Pimco Total Return Fund decreased its exposure in U.S. government-related securities to 21.60 percent in March, from 35.29 percent in February, according to Pimco's website on Friday.

Pimco Total Return Fund's mortgage holdings held steady at 32.91 pct in March, compared with 32.86 percent in February, Pimco said. Most notable was Pimco Total Return Fund's exposure in non-U.S. developed holdings, which increased to 2.56 percent in March, compared with a negative position of 2.70 percent in February.

The Pimco Total Return Fund, with assets under management of $117.4 billion at the end of March, remains the world's largest bond fund, although it is now only slightly bigger than the Vanguard Total Bond Market Index fund, which has assets of $116.8 billion.

The March asset allocation moves in the Pimco Total Return Fund, the Newport Beach, Calif.'s flagship portfolio, corroborates with recent market views by Dan Ivascyn, Pimco's Group Chief Investment Officer.

Ivascyn has said that Pimco believes "lower neutral policy rates is now largely priced into the markets, and thus we see limited upside for high quality duration over the cyclical horizon. As such, our preference is to position Pimco portfolios flat to modestly underweight high quality duration like U.S. Treasuries, U.K. Gilts or German Bunds."

At the end of March, the Pimco Total Return Fund held 6.75 percent of its portfolio in investment-grade credit and 4.83 percent in high-yield junk bonds, according to its website.

Pimco saw select opportunities in emerging markets.

The Pimco Total Return Fund increased its exposure in the sector to 23.96 percent by the end of March, compared with 18.09 percent the previous month.

Ivascyn said going into 2015 that weaker commodity prices, a stronger dollar and a potential shift in Federal Reserve policy should weigh on the emerging markets as a whole over the next year. "This should result in attractive investment opportunities for the long-term investor," he said about emerging markets. "For example, local rates in Mexico are attractive given the high yields offered in the context of a high quality country with strong linkages to the U.S." (Reporting By Jennifer Ablan; Editing by Chris Reese and David Gregorio)

18.12 | 0 komentar | Read More

CORRECTED-Main players in Ukraine debt battle prepare to face off

(Drops word French in para 10)

By Sujata Rao

LONDON, April 9 (Reuters) - Three years after facing off over Greece's debt workout, the two giants of debt restructuring - Lazard and Blackstone - are again preparing to do battle, one for Ukraine and the latter on behalf of its creditors.

The aim of having private investors take a $15.3 billion hit on their Ukrainian debt holdings as part of a $40 billion international rescue package sounds like peanuts compared to Greece, where creditors took a 75 percent haircut on 200 billion euros of debt. But Russia's involvement this time is injecting an extra frisson: accused of supporting an anti-Kiev insurgency, Moscow is also a prominent creditor potentially capable of derailing the plan.

Another prominent player is Franklin Templeton, one of the world's biggest asset managers, whose star investor, Michael Hasenstab, has staked over $6 billion of clients' money - and his reputation - on Ukraine.

Here are profiles of some of the main players in the talks.

UKRAINE

NATALIA YARESKO - Ukraine's U.S.-born finance minister, a former State Department official and fund manager, received Ukrainian citizenship only last December when she took up the job. She speaks fluent Ukrainian, albeit with an old-fashioned accent common to descendants of Ukrainian immigrants in North America.

For a Ukrainian government salary a tiny fraction of what she once earned, Yaresko is said to work from 7:30 a.m. to midnight as part of her mission to put Ukraine's finances on track. She says her private sector experience makes her sensitive to the creditors' interests.

Her message to investors has been clear: first, the $15.3 billion target is "set in stone", and second, Greece's restructuring experience proves Ukraine must cut its debt, rather than just extending bond maturities.

RUSSIA

SERGEI STORCHAK - Moscow has rejected restructuring and says it will not participate, arguing the $3 billion Ukrainian Eurobond it holds must be classed as bilateral rather than private debt.

Deputy Finance Minister Storchak, who negotiated the repayment of $21.3 billion to the Paris Club of creditor states in 2006, has been arguing Moscow's position. He was arrested in 2007 on embezzlement charges that were dropped for lack of evidence.

LAZARD

BOZIDAR DJELIC - A former Serbian finance minister and Belgrade's EU entry negotiator, Djelic heads the team advising Ukraine at Lazard.

Djelic joined Lazard only last year but the firm, since advising Indonesia in the 1970s, has built a fearsome reputation in sovereign restructurings, most recently forcing Greece's creditors to take the 75 percent haircut.

Djelic, who speaks six languages and has an MBA from Harvard Business School, has worked for Credit Agricole and McKinsey, among others, and in the early 1990s advised the Russian and Polish governments on privatisations. In 2012, he ran for president of the European Bank for Reconstruction and Development (EBRD), arguing that as a "transition citizen", born in Serbia, raised in France and educated in the United States, he was ideally placed to lead the institution.

Whatever his negotiating skills, observers reckon he has a strong hand. "Generally speaking, in sovereign debt restructurings, debtors have a decisive advantage," said Mark Walker, head of sovereign advisory at Millstein and Co. in New York and a former senior advisor at Lazard who co-led the recovery team for Greece in 2011-2012.

"In Ukraine's case, the creditors would be hard pressed to recover payment because the country likely doesn't have any resources outside the country they can seize, and no resources inside the country with which to pay."

FRANKLIN TEMPLETON

MICHAEL HASENSTAB - The fund manager, known for pulling off big contrarian bets in Hungary and Ireland, may have met his match in Ukraine, where he holds over a third of sovereign Eurobonds. Hasenstab has stayed silent on Ukraine, other than a video shot in Kiev last April, in which he said he was confident Ukraine would flourish over the next 5-10 years.

But with a big writedown on Ukraine looming, investors made net withdrawals of $2.24 billion from the $69 billion Global Bond fund last year, according to Lipper data. Most of the outflows happened in December

"By taking a large share of the market of a small country, Templeton and Hasenstab became hostage to their own investment policy," one bondholder said. "I can't see what choice they have now. They can block restructuring but if it becomes distressed debt, they may have to sell at a loss."

Templeton has also set up a creditors' committee, hiring Blackstone and law firm Weil Gotshall to advise it. But its supposedly high-handed methods have irked some other creditors.

"Franklin isn't talking with anyone," said one person who holds Ukrainian debt. "Other bondholders are talking, so the question is, will they play ball or try to strong-arm the rest of us?"

BLACKSTONE

MARTIN GUDGEON - Advising Ukraine's creditors is the latest in a series of high-profile roles Blackstone has landed in Europe since Gudgeon joined the firm as head of European Restructuring in 2007. He is among the top global names advising on how to deal with multi-billion dollar debt piles; assignments from his past include Italy's Parmalat, Dubai World and UK bank Northern Rock.

Interestingly, Gudgeon sat on the other side of the table in 2009 when Blackstone acted for Ukraine after the global crisis led to the default of state energy firm Naftogaz. Blackstone was paid 1 million euros a month for this, with bodyguards for employees thrown in, the Financial Times reported at the time.

Under Gudgeon, Blackstone won the prize mandate of advising Greece's creditor committee in 2011, helping ensure that new notes swapped for old ones were under English law and effectively guaranteed by the European Financial Stability Facility. That made it hard for further cuts to be made to this debt. (Additional reporting by Natalia Zinets and Alessandra Prentice in Kiev; Ivana Sekularac in Belgrade; Jason Bush in Moscow)

18.12 | 0 komentar | Read More

UPDATE 2-IMF sees Brazil economy shrinking, growth hinging on austerity

(Adds IMF recommendations on Petrobras, tax reform, productivity)

By Alonso Soto

GOIANIA, Brazil April 10 (Reuters) - The Brazilian economy will likely shrink this year, but the South American country could return to growth in 2016 if it succeeds in boosting investor confidence with its austerity drive, the International Monetary Fund said on Friday.

The IMF lowered its 2015 forecast for Brazil's economic performance to a 1 percent contraction from the 0.3 percent growth it forecast in January due to tighter fiscal and monetary policies and a drop in investment by state-run oil company Petrobras.

The IMF said an "immediate priority" for Brazil's recovery is swift resolution of problems at Petroleo Brasileiro SA, as Petrobras is formally called. A massive political kickback scandal at the company has forced it to cut back investment and has paralyzed work by its construction and engineering contractors.

The IMF said implementation of austerity measures is crucial for Brazil to regain the trust of investors so it can bolster growth.

"Determined implementation of these measures should help restore confidence and foster a recovery in growth and investment in due course," the IMF said in a press release following an assessment of Brazil's financial and economic situation by its executive directors.

Faced with an imminent recession, President Dilma Rousseff has embarked on an aggressive drive to cut public spending and raise taxes to balance the government's overdrawn accounts.

Finance Minister Joaquim Levy told a business group in the central Brazilian city of Goiania on Friday that the belt-tightening is needed to guarantee sustainable growth in the world's No. 7 economy.

To achieve its fiscal goals this year the Brazilian government need "ambitious, front-loaded measures," the IMF said.

The IMF praised a decision to end a policy of funneling taxpayer money into state banks for subsidized lending that was implemented by Rousseff and her predecessor Luiz Inacio Lula da Silva to spur growth in the wake of the 2008 financial crisis.

It also backed the government's new focus on cutting current government spending and tax exemptions to allow room for priority spending on investment and social programs.

Brazil must simplify its tax system and reform its pension and wage indexation systems to reduce fiscal pressures, it said.

Supply-side reforms are critical for boosting economic productivity and priority should be given to investment in infrastructure and expanding the private sector's role, the IMF recommended.

It welcomed Brazil's scaling down of its daily foreign exchange intervention program and said use of the program should remain limited to allow for further depreciation of the country's currency. (Reporting by Alonso Soto and Anthony Boadle; Editing by Leslie Adler and Peter Galloway)

18.12 | 0 komentar | Read More

Pimco Total Return Fund slashes US government-related holdings in March

NEW YORK, April 10 (Reuters) - The Pimco Total Return Fund decreased its exposure in U.S. government-related securities to 21.60 percent in March, from 35.29 percent in February, according to Pimco's website on Friday.

Pimco Total Return Fund's mortgage holdings held steady at 32.91 pct in March, compared with 32.86 percent in February, Pimco said.

(Reporting By Jennifer Ablan; Editing by Chris Reese)

18.12 | 0 komentar | Read More