Year in Numbers

The seven fat years in the run-up to the collapse of Lehman Brothers, when Deutsche Bank built its investment bank from bit-part player to the biggest show in town, are now a distant memory. For a business that once boasted a €2trn balance sheet, bigger than its rivals and more than the annual economic output of most countries, recent years have been humbling, with cuts – to the cost base, to personnel, to the balance sheet – the name of the game. At its height, the investment bank pulled in €21bn in revenues a year. But bosses will be lucky to...

The first wave of standardised interest rate swaps made the shift to newly created swap execution facilities in February 2014, bringing the US derivatives market a step closer to the vision that G-20 leaders agreed in Pittsburgh almost five years ago. However, what some regulators envisaged as a big bang was in reality more of a whimper. Despite covering the four major currencies across all benchmark tenors for interest rate swaps, and the eight key credit default swap indices in the US and Europe, the trade execution mandate caused little more...

One record fine has barely earned its place in the history books before the next eye-popping settlement has supplanted it. Such has been the case of inflating penalties over the past two years. JP Morgan’s US$13bn fine for mortgage-linked misbehaviour held the record for just six months before a new record – a US$17bn penalty at Bank of America for similar wrongdoing – topped it. Wrongdoing linked to an array of offences from mis-selling to market manipulation and sanction breaches, and a new-found confidence from regulators in extracting big...

Both regulation and the desire to cut costs have encouraged banks to review their equities businesses. But regulation has lent the issue extra urgency. In July, the European Securities and Markets Association published a consultation paper hinting that MiFID II (the latest set of rules that will govern trading in the EU) will force banks in Europe to unbundle their equities offering and charge separately for services, such as equities research, that they offer clients. “It is important that members, users and participants should face...

The apparent success of holdout investors in the sovereign debt restructurings of Greece and Argentina has re-ignited talk about the need to reform the system, and to do so quickly. But advisers involved in the process say any changes will take years to take effect – and ultimately might have little impact on how restructurings are carried out anyway. Holders of some €6.5bn par value of Greek bonds managed to escape the estimated 70% haircut dished out in the country’s 2012 exchange – the biggest sovereign restructuring ever. And, thus far at...

On the face of it, many banks represent compelling investments. Certainly, their shares are cheap: price-to-earnings ratios at some of the world’s largest banks remain in the single digits, while on a price-to-book measure many are trading at less than one times book (and some at less than half their claimed book value). There are – of course – good reasons for that. Reasons that have convinced many equity investors simply to steer clear. Obvious bargains, they are not. “Do I think they [bank stocks] are bargains?” asked Ed Firth, head of...

In September, Chinese e-commerce company Alibaba toured major investment centres across the globe as it sought to drum up investor enthusiasm for its IPO on the New York Stock Exchange. In Asia, the company took in Hong Kong and Singapore. The only major Asian investor base it failed to try and woo was Japan’s. It was a notable absence, particularly given that 32.4% of Alibaba is owned by a Japanese citizen – Masayoshi Son, chief executive of SoftBank and Japan’s most dynamic entrepreneur. For Japan, the absence appears to confirm a slow but...

In the old folk tale, only Ali Baba knew how to access the secret cave of treasure. But with the largest IPO in history, the real-world Alibaba has done a particularly good job of spreading the wealth around. The company’s New York Stock Exchange debut this year is already the stuff of legends; Alibaba shares have risen nearly 70% in less than two months. Yet the success of the US$25bn sale, one of the most eagerly awaited listings ever, was hardly pre-ordained. Chinese companies pursuing US listings have a decidedly mixed record. The...

Alibaba has had quite a year. In September, the Chinese internet-based business services company founded by Jack Ma in his bedroom in 1999 completed the largest IPO in history, raising US$25bn on the New York Stock Exchange. Investors ploughed into a stock that surged, paused, then rose again, hitting US$118.50 a share on November 7, up 68% in the seven weeks since its debut. That pushed the firm’s market capitalisation beyond the US$280bn mark, far outstripping the valuation of Walmart, the world’s largest bricks-and-mortar retailer. On...