“Dublin eyes Allied Irish control in shakeup-report - Forbes” plus 4 more

Dublin eyes Allied Irish control in shakeup-report - Forbes
Italy's Tremonti tells banks to take up bonds - Reuters
HSBC bids for ING's private banking unit -report - Reuters
CRM execs gained millions in stock sales - Poughkeepsie Journal
Kuwait fund: No plans to sell Citi, Merrill stakes - Asbury Park Press

Dublin eyes Allied Irish control in shakeup-report - Forbes

Posted: 06 Sep 2009 07:40 AM PDT

DUBLIN, Sept 6 (Reuters) - Ireland will take a majority stake in Allied Irish Banks as part of a restructuring of the sector in the process of setting up the National Asset Management Agency, a bad bank, the Sunday Tribune reported.

The paper said the extent of state investment in Bank of Ireland remained uncertain as -- unlike in the case of Allied Irish -- the cabinet believed it had an 'outside chance' of raising sufficient funds privately through a rights issue.

The newspaper report, which did not clearly cited sources, was printed alongside an interview with Finance Minister Brian Lenihan but the comments on the two banks were not sourced to him and his spokesman said he had not addressed the issue in the interview.

'He's always said that depending on the losses that happen after the valuation of the land and development (loan) books (transferred to NAMA) and (depending on) the need for recapitalisation, the state may take majority stakes in the banks but we've never separated out the two (banks),' the spokesman said.

The government has acquired 25 percent indirect stakes each in the two top lenders Bank of Ireland and Allied Irish Banks after injecting 3.5 billion euros ($5 billion) into each via preference shares.

Lenihan reiterated to the paper that the creation of a 'bad bank' to cleanse the banking sector of up to 90 billion euros of risky assets could involve him taking direct majority stakes in the two top banks, although he has said in the past that nationalising them fully would be a mistake.

'I have made it clear, a majority stake is not a problem,' Lenihan told the Sunday Tribune.

'There is an onus on the banks to attract private investment,' he said. 'But they haven't been able to attract any private investment. I cannot wait forever.'

The Sunday Tribune also said there were plans for a 'third force' in Irish banking, adding that bancassurer Irish Life & Permanent might end up with 45 percent of that new group.

The reference to a third force echoes earlier reports that said it would include building societies.

(Reporting by Andras Gergely) ($1=.7008 Euro) Keywords: IRELAND BANKS/

(andras.gergely@reuters.com; +35315001518; Reuters Messaging: andras.gergely.reuters.com@reuters.net)

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Italy's Tremonti tells banks to take up bonds - Reuters

Posted: 06 Sep 2009 06:57 AM PDT

CERNOBBIO, Italy, Sept 6 (Reuters) - Italian Economy Minister Giulio Tremonti criticised the country's banks on Sunday for not taking up bonds offered by the government to help them during the global economic crisis.

Italy first offered bonds to banks last year for 10 billion to 12 billion euros but the take-up has been slow. On Friday, the country's biggest bank Intesa Sanpaolo (ISP.MI) suggested it might not now make use of them. [ID:nL4156151]

"When the banks say that they don't need (the bonds), that they don't like them, they are saying something which goes against the interest of the country," Tremonti told a press conference at a meeting in Cernobbio, a lakeside town in northern Italy.

The government has said banks should use the funds raised by the bonds to lend to small businesses and Tremonti pressed this point home.

"These instruments were not made for the banks but for small businesses," Tremonti said.

Italy's small and medium size businesses, like those in other European countries, have been hit particularly hard by the credit crunch, triggered by the global financial crisis.

The country's banks, including Intesa Sanpaolo and rival UniCredit (CRDI.MI), have launched various initiatives to help small business, including moratoriums on debt repayments and special funds set aside for lending.

Tremonti said large banks did not work well for Italy's economy, which has relied heavily on small businesses for any growth in the past.

"Our country needs regional banks and the crisis has made that clear," he said.

Italy's banking system is still heavily populated by small territorial banks, with strong local links and often with a cooperative structure. (Reporting by Jo Winterbottom; editing by Karen Foster)

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HSBC bids for ING's private banking unit -report - Reuters

Posted: 06 Sep 2009 06:36 AM PDT

LONDON, Sept 6 (Reuters) - British bank HSBC (HSBA.L) has made a bid of about 1 billion pounds ($1.63 billion) for Dutch financial group ING's (ING.AS) private banking businesses, according to a report in The Sunday Times.

The report said DBS (DBSM.SI), a Singaporean investment fund, and Julius Baer (BAER.VX), the Swiss wealth manager, would also likely bid for the unit and that a preferred bidder would be named in the next 10 days.

ING, which has put its private banking operations in Switzerland and Asia up for sale to pay down bailout funds it received from the Dutch government, is also considering plans to split its insurance arm from its banking business, said the report.

The Sunday Times said DBS was interested only in the Asian unit but that Julius Baer was keen on both assets.

Neither HSBS nor ING was immediately available for comment. ($1=.6123 Pound) (Reporting by Rhys Jones; editing by Karen Foster)

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CRM execs gained millions in stock sales - Poughkeepsie Journal

Posted: 06 Sep 2009 06:36 AM PDT

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CRM's Trade Industry Workers' Compensation Trust, with 147 members, for example, developed a deficit in 2006 of $4.7 million, according to state figures. The company's 905-member Wholesale & Retailers Workers' Compensation Trust, meanwhile, showed a 2006 deficit of $5.2 million that mushroomed to $18 million in 2007 - the same year officers and directors made $3.5 million on stock sales.

The company's biggest loser, by far, however was the Healthcare Industry Trust, which was developing problems even before CRM went public. The trust, which was founded in 1999 and grew rapidly to include 465 hospitals, nursing homes, medical offices and ambulance companies, developed a $7.4 million deficit in 2005. The shortfall soared to $91 million by 2006, according to figures provided by the Workers' Compensation Board.

"We are angry but not surprised," David Smeltzer, former chairman of the trust, said in response to information about the stock sales. "I would ask how much more did they make prior to 2005."

Tax liabilities cited

CRM's Scardino said the stock sales did not affect the health of the funds. "None of that reduced the numbers available to pay claims or anything like that with the trusts in New York," he said.

In a statement, the company noted tax liabilities of the company's principals soared in 2005 when CRM went public and moved its governing operations to Bermuda; the offshore move triggered a hefty "inversion tax," they said.

Additionally, under statutes governing the move, the father and son Hickeys were not permitted to own more than 25 percent of shares; Hickey Sr., president of Hickey-Finn and Company Inc., a Poughkeepsie insurance brokerage, sold an additional number of shares then, CRM officials said. CRM's board members receive $50,000 annually and $25,000 in restricted stocks.

Donald Brown, Hickey Jr.'s attorney, deferred specific comment on the tax issues to CRM. But he said, "Dan Hickey and other principals … sold certain shares of stock for valid business and tax reasons." Hickey resigned from the company in March with a $3.3 million severance package and 9.9 percent of company stock; the stock is currently selling for about $1 a share, down from $13 when the company went public.

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Kuwait fund: No plans to sell Citi, Merrill stakes - Asbury Park Press

Posted: 06 Sep 2009 07:40 AM PDT

DUBAI, UNITED ARAB EMIRATES — Kuwait's sovereign wealth fund said Sunday that it has no plans to sell stakes in Citigroup Inc. and Merrill Lynch & Co. because it has faith in the potential of the U.S. banks.

"The authority has no intention of selling its holdings in Merrill Lynch or Citigroup in the near term, since the authority's investment policies are based on a long-term vision," the Kuwait Investment Authority said in a statement published in local newspapers al-Rai and al-Qabas. The comments were attributed to both the fund itself and to Finance Minister Mostafa al-Shimali.

The KIA pumped $5 billion into the two banking giants in January 2008 just as the financial crisis was gathering steam. Some Kuwaiti members of parliament criticized the deals when their value later tumbled.

Sunday's comments were in response to questions from lawmaker Walid al-Tabtabai.

While noting that it is capable of selling its holdings in the two companies if it chooses to, the fund said it nonetheless remains committed to its investments for now.

"Despite the sharp decline in international share prices, we think the crisis will pass with time because central banks are working to deal with it," according to the reports. "We think the investments in these two companies is a good investment in the long-run."

Phone calls to the fund seeking additional comment went unanswered Sunday.

The KIA invested $3 billion in Citigroup and $2 billion in Merrill Lynch when they needed cash following losses stemming from the credit crisis.

Merrill was later bought by Bank of America Corp., making the KIA a big shareholder in that company.

The Kuwaiti fund described the combined firm as "an unrivaled company in its outreach and financial services," and said that it received about nine-tenths of a Bank of America share for each Merrill share it held.

OPEC member Kuwait rarely releases details about its foreign investments. In February, al-Tabtabai said the KIA lost 9 billion dinars ($30.73 billion) from March to December last year.

Rachel Ziemba, an analyst at RGE Monitor who tracks sovereign wealth funds, estimates Gulf Arab funds and central bank holdings tumbled to a 2009 low of $1.10 trillion in February from a peak of $1.37 trillion August 2008 as a result of the financial meltdown.

An influx of fresh oil profits and a rebound in the stock market have pushed the Gulf's foreign holdings up to $1.24 trillion through August, she estimates.