Senior Goldman Sachs Middle East banker resigns - sources

By Dinesh Nair

DUBAI, April 15 | Mon Apr 15, 2013 5:36am EDT

DUBAI, April 15 (Reuters) - Khaled Eldabag, a senior investment banker at Goldman Sachs Group Inc who handled some of the Wall Street firm's biggest clients in the Middle East, has resigned, two sources familiar with the matter said.

Eldabag, a Dubai-based managing director at Goldman whose clients included Abu Dhabi investment fund Mubadala, resigned last week, the sources said on Monday, speaking on condition of anonymity as the matter is not public.

The sources were not aware of Eldabag's plans but one said he would remain in the region. Goldman Sachs declined to comment.

Goldman topped the rankings for announced M&A transactions in the Middle East, with deals worth $5.9 billion in 2012, according to Reuters data.

Eldabag, who joined Goldman Sachs in 2007, advised on several high-profile deals, including the recent state-backed merger of property firms Aldar Properties and Sorouh Real Estate, the sources said.

Last year he also advised Mubadala on its $2 billion stake purchase in Brazil's EBX, an investment holding company controlled by billionaire Eike Batista.

Unlike some of its peers in the region which cut staff last year in response to a dearth of deals, Goldman has kept a steady headcount over the last few years.

But in recent months, the bank has lost some of its senior regional staff, including its Qatar Chief Executive Tamim al-Kawari, who joined local bank QInvest and Rayan Fayez, its investment banking head in Saudi Arabia, who joined J.P. Morgan Chase Inc last year.

M&A activity in the region is showing signs of revival after the global financial crisis hit investor sentiment.

• Link this
• Share this
• Digg this
• Email
• Reprints

18.12 | 0 komentar | Read More

Germany's Merkel will stand for full term in election-spokesman

BERLIN, April 15 | Mon Apr 15, 2013 5:55am EDT

BERLIN, April 15 (Reuters) - Chancellor Angela Merkel will stand for a full four-year term in the September election, her spokesman said on Monday, amid German media speculation that she might step aside in 2015 midway through a third term.

"The chancellor is naturally standing for the full legislative period," her spokesman Steffen Seibert told a government news conference.

Earlier Bild newspaper published a story saying Merkel might step down in 2015 if she were to win re-election in September. The year 2015 would mark 10 years in power for Merkel and she would be 60 in 2015.

The newspaper, citing a new book by a Bild journalist, published quotes from Merkel telling sources that she considers "10 years to be the maximum time" someone should stay on as chancellor or state premier.

18.12 | 0 komentar | Read More

TREASURIES-U.S. bond prices slip but weak equities limit falls

LONDON, April 15 | Mon Apr 15, 2013 6:05am EDT

LONDON, April 15 (Reuters) - U.S. Treasuries dipped in Europe on Monday on some profit-taking after the market's rally last week, but losses were curbed by falls in equities following weaker-than-expected macro economic data from China.

The Treasury market rallied sharply on Friday as data showed consumer spending and retails sales declined more than expected in March, stoked concern that growth in the world's biggest economy was slowing.

Ten-year T-notes were 3/32 down in price to yield 1.73 percent, one basis point up from late U.S. trade on Friday. The yield has steadily pulled away from 11-month highs just over 2 percent set in early March, as surprisingly weaker U.S. data and renewed concern about how the euro zone was handling its weaker economies lifted demand for safe-haven debt.

"We had a big move on Friday on the disappointing data, especially the consumer confidence. Now the potential for yields to move lower is rather limited. We are now waiting until we get data later this afternoon," said Philip Marey, a strategist at Rabobank.

"Although the New York Fed manufacturing index is a regional index, we could get an idea of where things are in April because some of the slowdown in March could be due to seasonal factors."

Marey, however said he saw little impetus for yields to go much higher than they are given the downbeat data so far.

Prospects that Japanese buyers could switch out of ultra-low yielding domestic bonds into non-denominated assets after the Bank of Japan's huge monetary stimulus were also seen limiting any sell-off in Treasuries.

"Generally I would look for a position to get long... Asian equities are retreating and European equities are pulling back. I wouldn't be surprised when guys in New York come in and start buying on the dips," a trader said.

• Link this
• Share this
• Digg this
• Email
• Reprints

18.12 | 0 komentar | Read More

Cyprus central bank chief calls for its independence to be respected

NICOSIA, April 14 | Sun Apr 14, 2013 4:58am EDT

NICOSIA, April 14 (Reuters) - Cyprus's central bank governor said on Sunday he was willing to work with the government to pull the island out of its economic crisis, provided the bank's independence was respected.

A rift between Governor Panicos Demetriades, appointed last May by the communist former administration, and the ruling centre-right government has deepened in recent days and pressure has grown on him to resign over his handling of the crisis.

In the past week, the Cypriot parliament started an investigation against Demetriades, President Nicos Anastasiades's government withdrew the appointment of his deputy, and three central bank officials resigned.

The ongoing saga drew a scathing response from European Central Bank (ECB) President Mario Draghi, who wrote to the Cypriot president telling him any attempt to effectively sack the governor could land Cyprus in the European Court of Justice.

"My intention to work with the country's democratic institutions is a given," Demetriades was quoted as saying in an interview with the Phileleftheros newspaper.

"We are ready to respond to every call for cooperation and coordination for the benefit of this country always, however within the framework of total respect towards the central bank's independence, as stipulated by the ECB."

Under European Union law, a governor can only be dismissed if he no longer fulfils the conditions required for the performance of his duties, or if he is guilty of serious misconduct.

The investigation launched by Cypriot lawmakers this week is seeking to find out whether Demetriades supplied enough information during an investigation into the demise of Cyprus's two biggest lenders, which left the economy in disarray.

The collapse of the Mediterranean island's banking system imposed massive losses on depositors in order to qualify for a 10 billion euro ($13 billion) bailout by the European Union and International Monetary Fund.

The departures in the past week from the regulator's board have slimmed the six-member board to two, including Demetriades. However, executive power rests with the governor so while they add to the pressure on Demetriades to quit, they are not expected to affect policy-making.

The government, in power for under two months, has sought to play down accusations it was intervening with the central bank's duties.

Government spokesman Christos Stylianides said authorities demanded Demetriades take back comments he made on the sidelines of a Eurogroup meeting in Dublin this week that the central bank's independence was under attack.

• Link this
• Share this
• Digg this
• Email
• Reprints

18.12 | 0 komentar | Read More

UPDATE 1-No Egypt request for bigger IMF loan, central banker tells paper

Sun Apr 14, 2013 5:12am EDT

* Egypt has not asked for increase on $4.8 billion loan

* Senior IMF official has said loan size could be changed

* Egypt needs financial help to overcome budget crisis

CAIRO, April 14 (Reuters) - Egypt has not asked the International Monetary Fund (IMF) to increase a $4.8 billion loan it has not yet drawn down, central bank governor Hisham Ramez told al-Shorouk newspaper on Sunday.

On April 2 the IMF's Middle East and Central Asia director said the size of the loan could be changed depending on the country's needs.

Ramez said that Egypt could still request an increase of $1 billion on the loan if the maturity period was extended to more than 30 months from the 22 months agreed last November.

He reiterated the government's position that Egypt would not seek an emergency loan from the global lender and said that talks with an IMF delegation that arrived in Cairo 10 days ago were going well.

The most populous Arab country needs the loan to ease economic strains after two years of political upheaval. Low reserves of foreign currency threaten Egypt's ability to buy in wheat, of which it is the world's biggest importer, and fuel.

President Mohamed Mursi's government postponed implementating the loan in December in the face of unrest triggered by a political row over the extent of his powers.

Any IMF deal is likely to require Cairo commit to tax increases and cuts in subsidies, a highly sensitive issue at a time when Mursi is facing protests over his management of the country before this year's parliamentary elections.

Shortages of subsidised diesel have paralysed transport in parts of Egypt and the Egyptian pound has lost 9 percent of its value against the dollar since late last year.

• Link this
• Share this
• Digg this
• Email
• Reprints

18.12 | 0 komentar | Read More

Yemen c.bank FX reserves hit 6-mth low as bombings hit oil exports

Sun Apr 14, 2013 5:43am EDT

* Gross reserves fall to $5.8 bln in February

* Oil exports drop 30 percent from January

* Yemen hit by oil pipeline bombings

* Inflation at 5-month high of 7.1 pct y/y in January

By Martin Dokoupil

DUBAI, April 14 (Reuters) - The foreign reserves of Yemen's central bank shrank by $457 million in February to their lowest level since last August as oil exports from the impoverished Arab country plunged by a third, data showed on Sunday.

The Arabian peninsula state, which relies on crude exports to replenish its reserves and finance up to 70 percent of budget spending, has suffered from frequent bombings of its main oil pipeline since political turmoil started in 2011.

Gross foreign assets held by the central bank fell to $5.8 billion in February, covering 5.9 months of imports, from $6.2 billion or 6.4 months of imports in January, central bank data showed. Net reserves, which factor in the central bank's foreign obligations, stood at $4.5 billion in February.

The central bank, which received a $1 billion loan from Saudi Arabia last year to support its reserves, did not explain the decrease in its monthly bulletin.

In March, its vice governor told Reuters that reserves of $6.2 billion were appropriate, but that the level would depend on whether Yemen continued to suffer pipeline bombings by Islamist militants and disgruntled tribesmen.

Attackers blew up parts of Yemen's main 110,000 barrel per day oil export pipeline in February and March, halting the flow of crude. Another explosion occurred earlier this month, only two weeks after the pipeline was repaired.

A long closure of the line last year forced Yemen's largest refinery at Aden to shut, leaving the country dependent on fuel donations from Saudi Arabia and imports.

Yemen exported $210 million worth of crude oil in February, a drop of more than 30 percent from January, the data also showed. The government's share of those exports was 1.8 million barrels in February, the lowest level since May 2012.

In January, the International Monetary Fund warned that the political transition following the overthrow of President Ali Abdullah Saleh in February 2012, and security concerns - particularly attacks on key oil and electricity facilities - threatened the economic outlook.

Yemen's economy improved last year but its recovery remains fragile in the second-poorest Arab state after Mauritania. A third of Yemen's 25 million people live on less than $2 a day, and unemployment is estimated at around 35 percent.

Last year wealthy Gulf Arab states, Western governments and other donors pledged $7.9 billion in aid over several years to Yemen, but only a small fraction has so far arrived.

The IMF said earlier this month that it was discussing fresh financial aid to Yemen, which a central bank official said could be as large as $500 million.

The country faces a fiscal deficit of 6.0 percent of gross domestic product this year, the IMF has forecast, more than the 5.7 percent estimated for 2012.

Inflation in Yemen picked up in January, climbing to 7.1 percent on an annual basis, the highest level since August 2012, from 5.8 percent in December, the central bank data showed.

The central bank has cut its key interest rate by 5 percentage points to a three-year low of 15 percent since October 2012 to spur the economic recovery, after the rial currency stabilised at about 214 to the U.S. dollar and inflation fell from a peak of 25 percent in October 2011.

The governor of the central bank said earlier this month that he was comfortable with the current level of interest rates and that he expected economic growth to accelerate to about 7 percent this year from 4.5 percent in 2012.

• Link this
• Share this
• Digg this
• Email
• Reprints

18.12 | 0 komentar | Read More

UPDATE 3-United States puts Japan on notice in currency report

Fri Apr 12, 2013 7:47pm EDT

* Washington watches to ensure Tokyo not targeting yen level

* China again escapes "currency manipulator" label

* U.S. says Chinese yuan "significantly undervalued"

By Anna Yukhananov

WASHINGTON, April 12 (Reuters) - The Obama administration on Friday put Japan on notice that it was watching its economic policies to ensure they were not aimed at devaluing the yen to gain a competitive advantage.

In a semi-annual report on currency practices of major trade partners, the United States also said China's currency remained "significantly undervalued," but again stopped short of labeling the world's second-biggest economy a currency manipulator.

It has been more than 18 years since the U.S. Treasury has designated any country a manipulator. China was labeled a manipulator between 1992 and 1994.

The U.S. Treasury said it would press Japan to adhere to the commitment it made in February as a member of the Group of Seven and Group of 20 nations to let the market determine exchange rates. The U.S. move followed comments by Japanese officials that suggested they were targeting a weaker yen.

Treasury's report highlighted statements made by Japanese officials last year who said they wanted to "correct the excessively strong yen," and also some proposals to ease monetary policy by purchasing foreign bonds.

But since then, Japan has mostly avoided commenting on the yen and has not intervened in currency markets, according to the congressionally-mandated report.

"We will continue to press Japan to adhere to the commitments agreed to in the G7 and G20 ... and to refrain from competitive devaluation and targeting its exchange rate for competitive purposes," the report said.

The Treasury also said it was closely monitoring policies in Japan meant to support the growth of domestic demand. The Bank of Japan launched a massive bond-buying program earlier this month to try to shock the economy out of two decades of stagnation.

The policy has sharply undercut the value of the yen - ending the dollar to another four-year high against the Japanese currency on Thursday - and refueled a debate about competitive devaluations.

YUAN UNDERVALUED, NOT MANIPULATED

The U.S. Treasury also said China did not meet the legal requirements to be deemed a currency manipulator, although Beijing controls the pace at which the yuan can rise by intervening in foreign exchange markets.

The label is largely symbolic, but would require Washington to open discussions with Beijing on adjusting the yuan's value. Many U.S. lawmakers have accused China of deliberately keeping the yuan undervalued to gain a trade advantage.

As in other reports over the last several years, the analysis on China reflected both the administration's desire to maintain good relations with its top creditor and an attempt to keep up pressure for changes in China that could benefit the U.S. economy and mollify domestic critics.

Efforts to take a stronger stance on China's currency moves have also faded due to an increase in the value of the yuan, a big drop in China's global trade surplus and a rise in labor costs that has made Chinese products less competitive.

The report said China had allowed the yuan to rise 16.2 percent against the dollar in inflation-adjusted terms since June 2010, when China moved off its exchange rate peg.

The yuan, also known as the renminbi, hit a record high against the dollar on Friday as China's central bank fixed its official midpoint for the currency at the strongest level yet ahead of a Beijing visit by U.S. Secretary of State John Kerry.

"Nonetheless, the available evidence suggests the renminbi remains significantly undervalued, intervention appears to have resumed, and further appreciation of the renminbi against the dollar is warranted," Treasury said in a statement.

The top Democrat on the U.S. House of Representatives Ways and Means Committee, Sander Levin of Michigan, said "action is long overdue" on what he called serious problem.

"Currency manipulation needs to be addressed in ongoing trade negotiations, especially the Trans-Pacific Partnership talks," he said in a statement, referring to an 11-nation Asia-Pacific free trade agreement that Japan is moving toward joining.

The United States also said it remains concerned that China's progress may not last. For example, China's trade surplus has narrowed not only due to a higher yuan, but also because of weak demand for Chinese exports in advanced economies, suggesting the trend may reverse once the global economy recovers more.

The U.S. Business and Industry Council condemned the currency report, and called on the Obama administration to use tariffs to punish China for manipulating the yuan.

"The Treasury Department's latest refusal to label China a currency manipulator once again demonstrates President Obama's deep-seated-indifference to a major, ongoing threat to American manufacturing's competitiveness, and to the U.S. economy's return to genuine health," the Council said in a statement.

As in the previous report, Treasury also kept the pressure on South Korea, urging it to limit foreign exchange intervention except in exceptional circumstances.

South Korea says it intervenes to smooth the volatility of its won currency. But Treasury said it had gone into the market throughout 2012.

• Link this
• Share this
• Digg this
• Email
• Reprints

18.12 | 0 komentar | Read More

UPDATE 3-Judge denies $20 million severance to outgoing AMR chief

Fri Apr 12, 2013 7:53pm EDT

* CEO Horton's payout set in AMR-US Airways merger

* Judge says payment not authorized under bankruptcy law

* AMR plans to address severance in reorganization plan

By Jonathan Stempel and Tanya Agrawal

April 12 (Reuters) - A judge has rejected a proposed severance package of nearly $20 million for Thomas Horton, the chairman and chief executive officer of American Airlines parent AMR Corp, saying the payout was not allowed under federal bankruptcy law.

U.S. Bankruptcy Judge Sean Lane in Manhattan issued his decision on Thursday, after having approved at a March 27 hearing AMR's planned $11 billion merger with US Airways Group Inc.

Horton's $19.9 million severance had been part of the merger agreement and was to consist of equal amounts of cash and shares of the combined company.

Lane had suggested at the hearing that severance might be better addressed in AMR's reorganization plan, which the company has yet to submit and which requires creditor approval.

U.S. Trustee Tracy Hope Davis, a Department of Justice monitor for the bankruptcy, also opposed Horton's severance.

"It's American Airlines' current intention to address Mr. Horton's compensation arrangement in the plan of reorganization," said Mike Trevino, a spokesman for the carrier.

The combined company would be run by US Airways CEO Doug Parker, with Horton as nonexecutive chairman. Parker would become chairman after the first annual shareholder meeting, probably in the spring of 2014.

The plan of reorganization will address how creditors will get paid back. Shareholders of AMR may end up with a stake of at 3.5 percent in the combined company, which an attorney for AMR's creditor's committee has said could be valued at between $350 million and $400 million.

Horton first joined AMR in 1985, left in 2002 for a four-year stint at AT&T Corp and then returned. He became CEO of AMR when it filed for bankruptcy in November 2011.

AMR at first opposed merging while still in bankruptcy, but reversed itself under pressure from creditors. The merger would create the world's largest airline, and AMR and US Airways hope to save more than $1 billion of annual costs by 2015.

UNCLEAR PURPOSE

Davis had called Horton's proposed payout too large relative to severance for nonmanagement workers, and improper because it was not part of a program for full-time workers in general.

Lane rejected AMR's argument that these restrictions did not apply because the payout would be made - or could be voided - by the combined company after the merger closed.

"It is unclear what purpose would be served by the court's approval of the severance if (the combined company) could later veto the severance through a vote of its board," he wrote.

The judge also said deferring to AMR's "business judgment" in allowing the payout was "exactly what Congress sought to prevent" in capping severance awards by companies in bankruptcy.

AMR has said the payment to Horton recognized his efforts in leading the company through bankruptcy and into the merger.

Its lawyer, Stephen Karotkin, told Lane on March 27 that the desire of AMR directors to maximize value and see the merger through justified payments to Horton and others.

The combined carrier would take the American name and be based in AMR's hometown of Fort Worth, Texas. US Airways is based in Tempe, Arizona.

The case is In re: AMR Corp et al, U.S. Bankruptcy Court, Southern District of New York, No. 11-15463.

• Link this
• Share this
• Digg this
• Email
• Reprints

18.12 | 0 komentar | Read More

Troika concludes Greek bailout review, next aid tranche soon -source

Sat Apr 13, 2013 6:52am EDT

By Annika Breidthardt

DUBLIN, April 13 (Reuters) - An inspection team of international lenders has finished its review of Greece's reform progress, paving the way for another 10 billion euros aid payment, a source with knowledge of the talks said on Saturday.

The deal reached on Friday, concludes the first review by the so-called "troika" of the European Commission, the International Monetary Fund and the European Central Bank since they unlocked fresh aid in December, staving off a chaotic bankruptcy.

In exchange for the December deal in Greece's 240-billion euro bailout, Athens passed a fresh round of austerity measures.

"The third review mission of the programme was completed last night in Athens with a staff level agreement," one delegate with knowledge of the discussions told Reuters.

The official added the Eurogroup of euro zone finance ministers and the IMF's board would each likely discuss the agreement in May, a condition for the money to actually be paid.

Klaus Regling, the head of the euro zone's rescue funds, said on Friday the European Financial Stability Facility (EFSF), under which Greece's rescue is handled, stood ready to disburse 10 billion euros ($13 billion) to Athens once conditions were met.

"Greece would get 2.8 billion euros after the milestones have been met. In addition 7.2 billion (euros are) available in bonds to recapitalise the banks. This is based on a tranche already approved last December," he told reporters.

Greece has received about 200 billion euros in rescue loans since its first bailout in May in 2010. But despite imposing a 75-percent debt cut on private-sector bondholders and receiving debt relief from its official lenders last year, it is still far from returning to bond markets.

The recapitalisation of Greece's banks and shrinking the country's spendthrift public sector had been key issues on the agenda of talks with the troika, which resumed its visit in Athens earlier this month.

Plans for Greece's National Bank to integrate its newly acquired rival Eurobank were suspended this week after the troika raised issues over the size of the merged entity and the banks said they were unlikely to raise enough capital to stay private.

Lay-offs are also a sensitive issue in Greece where unemployment has hit a record high of 27.2 percent and the economy is now in its sixth year of recession.

With the country's constitution protecting state workers from dismissal, Greek Prime Minister Antonis Samaras said in an interview with a newspaper on Saturday that the government could reduce staff by scrapping job positions.

"There is no doubt we need a smaller but also better public sector," Samaras said. "The constitution doesn't ban the dismissal of state workers whose position has been scrapped."

Samaras was expected to meet the ruling coalition's party leaders on Saturday and discuss the progress of the talks with the troika. ($1 = 0.7635 euros)

• Link this
• Share this
• Digg this
• Email
• Reprints

18.12 | 0 komentar | Read More

Ten bln euros for Cyprus bailout non-negotiable, Germany says

BERLIN, April 12 | Fri Apr 12, 2013 6:13am EDT

BERLIN, April 12 (Reuters) - The European Union and International Monetary Fund's 10 billion euro contribution to the bailout for Cyprus is non-negotiable, the German government said on Friday.

Euro zone finance ministers meeting in Dublin gave political backing to 10 billion euros of loans for the island on Friday and German finance ministry spokeswoman Marianne Kothe said there were no plans or requests to raise that amount and that it was "not up for negotiation".

Government spokesman Steffen Seibert, speaking at the same news conference in Berlin: "The international credit programme of about 10 billion euros is of course very high in relation to size of the Cypriot economy."

Euro zone officials in Dublin said Cyprus had not asked for more money in emergency loans, but was most likely considering a request front load the payment of EU structural funds that come from the EU's long-term budget.

18.12 | 0 komentar | Read More