Yesterday, 8:37 PM
- With attention already starting to shift to regulatory approval, Charter Communications (CHTR +2.5%) CEO Tom Rutledge says his company's $55B acquisition of Time Warner Cable (TWC +7.3%) will do better with the FCC than Comcast's: Think small.
- "If you look at the ecosystem, who we're playing with in terms of other competitors, they're very large, and we'll still be a relatively small company compared to the large phone companies, compared to Comcast, compared to the wireless companies," he told CNBC.
- Charter's simultaneous deal for Bright House Networks may pump up its own leverage, but it was critical to the TWC bid, says analyst Craig Moffett: Virtually debt-free Bright House and its borrowing capacity likely added as much as $18/share to Charter's $195.71/share offer. Moffett says TWC's handling of Altice's (OTC:ATCEY) counter-play was masterful.
- About that debt: TWC bondholders are still nervous about the combined load (While the firm's 30-year bonds rose 11.7% today, they're still down about 16% from last month). Moody's is likely to push TWC into junk rating territory as debt-to-EBITDA rises from TWC's 2.97 to about 4.79 for the combination. But again, Bright House's addition and "conservative voice on the board" may be mitigating the effects.
- And MoneyBeat's deal tally: Aside from big winner TWC, winners include Goldman Sachs (NYSE:GS), (eventually) rewarded for backing Charter, and UBS, working as sole adviser to Bright House; Losers include Comcast backer JPMorgan Chase (NYSE:JPM), and Deutsche Bank (DB -3.4%) -- a Charter backer back when, but unseen in the new deal.
- Previously: Charter to merge with Time Warner Cable, buy Bright House (May. 26 2015)
Fri, May 22, 12:10 PM
- Welcome back my friends to the show that never ends ...The New York Department of Financial Services is probing more abuse of forex markets by the banks - this time by the use of automated trades driven by computer algorithms, reports the FT.
- Findings could indicate more widespread abuse than what U.S. and U.K. authorities disclosed on Wednesday (along with nearly $6B in fines and a number of guilty pleas). Sources remind that this week's charges related to manipulation performed by bank employees, but this probe covers electronic trading, which accounts for the majority of forex transactions.
- Trading platforms under the scope include those from Barclays (NYSE:BCS) and Deutsche Bank (NYSE:DB), and information has been subpoenaed from BNP Paribas (OTCPK:BNPQF), Credit Suisse (NYSE:CS), Goldman Sachs (NYSE:GS), and SocGen (OTCPK:SCGLY).
- The investigation into Barclays is the most advanced, but DFS has initially reached similar nefarious conclusions about the goings-on at Deutsche too. The probes of the other lenders are at even earlier stages.
- Previously: Lawsky stepping down as New York's top bank regulator (May 20)
Thu, May 21, 3:16 AM
- Deutsche Bank (NYSE:DB) reshuffled its management board late on Wednesday, consolidating restructuring authority under co-Chief Executive Anshu Jain while waving goodbye to its retail banking head Rainer Neske.
- The shake-up comes before today's contentious annual meeting. Shareholders have previously expressed dismay at the bank's lagging profits, hefty fines and sluggish reforms.
Tue, May 19, 7:53 AM
- At issue is a possible U.K exit from the EU as newly re-elected PM David Cameron has pledged to renegotiate Britain's ties with Europe, and by 2017 give citizens a thumbs up/thumbs down vote on the U.K.'s continued EU membership.
- Deutsche Bank (NYSE:DB) has launched a working group to consider moving some U.K. operations to Germany or elsewhere in the eurozone in the case of a so-called Brexit, according to a spokesperson.
- Deutshce has 16 locations in the U.K. with just under 9K employees. It had 21 locations five years ago.
Tue, May 19, 4:35 AM
- Deutsche Bank (NYSE:DB) is studying whether to move large chunks of its British operations to Germany if the U.K. leaves the EU, underlining the potential fallout in the City of London in the event of a "Brexit".
- The German lender, which employs 9,000 people in the U.K., is the first major bank to start formally examining the consequences of a British referendum on EU membership.
Mon, May 18, 4:30 PM
- Deutsche Bank's (NYSE:DB) retail operations have lagged under Rainer Neske's leadership over the past few years, and the bank's recent decision to sell Postbank means a big cut in the activity under his watch.
- The WSJ reports Neske will exit this week (what's expected to be a contentious annual meeting is on Thursday).
Fri, May 15, 2:42 PM
- Any talks between Charter Communications (NASDAQ:CHTR) and Time Warner Cable (NYSE:TWC) about a merger may be up in the air, but bankers won't be the bottleneck, as they're ready to talk about $25B or even more to make it happen.
- Following previous reports that Charter could go for $25B-$30B in debt, the cableco is talking with the same four bankers that committed $24B to Charter's early-2014 bid: Bank of America Merrill Lynch (NYSE:BAC), Credit Suisse (NYSE:CS), Deutsche Bank (NYSE:DB) and Goldman Sachs (NYSE:GS).
- As one banker noted, "it should be quick to move to next steps, as the banks know the company pretty well," and said the package should end up as two-thirds bonds.
- Aside from any regulatory issues, leverage seems to be foremost on the mind of dealmakers (and investors). Liberty Broadband's (NASDAQ:LBRDA) Greg Maffei has gone public with the notion that Liberty could raise capital through rights offerings or tap $700M in cash to help with funding while maintaining its 25% stake in Charter.
- Other banks could join in too, which could make such a deal one of the largest junk bonds ever. Time Warner's on the edge of junk status, rated BBB/Baa2 by S&P and Moody's.
Mon, May 11, 1:18 PM
- Formerly president of the Clearing House Association, Paul Saltzman will join Deutsche Bank (NYSE:DB) as vice chairman and executive sponsor of the Comprehensive Capital Analysis and Review process, reports the WSJ. The Fed in March rejected Deutsche's capital plan, citing "numerous and significant deficiencies" in the way the bank's U.S. unit identifies risks, projects losses, and imposes internal controls.
- Saltzman will oversee Deutsche's CCAR efforts globally and report to Jacques Brand, CEO of the lender's U.S. operation.
Fri, May 1, 9:54 PM
- With plans (but not detailed plans, yet) to go public, Spanish-language broadcaster Univision swung to a $139.7M net loss in Q1, from a year-ago profit of $6.2M.
- The company hired Morgan Stanley (NYSE:MS), Goldman Sachs (NYSE:GS) and Deutsche Bank (NYSE:DB) to lead an IPO that it hopes will raise $1B, which would value the broadcaster around $20B.
- Revenues were up 0.6% to $624.7M. Univision blamed its loss on termination fees that it owed to the private-equity owners of its parent, Univision Communications, as well as to Grupo Televisa (NYSE:TV).
- Televisa used convertible debt to build a 38% stake in Univision and has the right to take that to 40%, so it is set to draw a payoff from Univision's eventual offering. It also drew a record $314M rebroadcasting royalty from Univision in 2014.
Mon, Apr. 27, 7:28 AM
- "The first plan didn’t turn out how you had hoped," says an analyst. “The management team is pretty much unchanged. Why should we believe this team will deliver this time around when it didn’t first time around?” Dropped today is the bank's hope for 12% ROE in 2016. Now, 10% is the goal in the medium term (it was 3.9% in Q1).
- Co-CEO Anshu Jain, speaking on a conference call, naturally disagrees with the assessment, tough notably missing from today's plan were details of how it will get to cost savings of €3.5B. “How are you going to make sure that these targets that you set today will actually be achieved," asks another analyst. "Five years is a long time to achieve those.”
- Source: Bloomberg
- DB is down 4.1% in premarket action.
- Previously: Deutsche Bank announces strategic overhaul (April 27)
Mon, Apr. 27, 3:53 AM
- Outlining its "next phase of strategy," Deutsche Bank (NYSE:DB) announced its much-anticipated strategic overhaul this morning, designed to close the gap with rivals for profitability and capital adequacy.
- The German lender said it would target €3.5B in annual savings by scaling back its investment bank and retail operations, floating a majority stake in Postbank and increasing automation. Deutsche also lowered its targeted ROE to at least 10% from 12%.
- Yesterday, the bank said legal costs halved its first-quarter net profit to around €559M.
- Previously: Deutsche Bank profit plunges on legal costs (Apr. 26 2015)
Sun, Apr. 26, 11:10 AM
- Deutsche Bank (NYSE:DB) reported first-quarter net profit that plunged to €559M from €1.1B a year earlier as hefty litigation charges outweighed a near record of €10.4B (+24% Y/Y) in revenue.
- Last week's $2.5B legal settlement for Libor rigging bit into the group's bottom line and totally depleted the €1.5B it set aside in legal reserves.
- Deutsche also said co-chief executives Anshu Jain and Jurgen Fitschen, as well as strategy chief Stefan Krause, will present details of its long-awaited overhaul on Monday morning.
Fri, Apr. 24, 6:22 AM
- Deutsche Bank's (NYSE:DB) supervisory board gathered today to review a sweeping restructuring plan to cut back investment banking operations and scrap the Postbank chain to restore profitability.
- Another proposal calls for Deutsche to exit retail banking entirely, selling both Postbank and its own-branded retail chain to become a pure investment and commercial bank.
- The decision, which may be announced as early as Friday evening, follows yesterday's $2.5B fine for the bank's alleged benchmark interest rate rigging.
- Previously: Deutsche Bank reportedly receives offer for China bank stake (Apr. 23 2015)
Thu, Apr. 23, 12:20 PM
- About the deliver restructuring plans which will include sizable cuts in its investment bank and the sale of businesses, Deutsche Bank (DB +0.1%) has received at least one offer from a Chinese firm for its 20% stake in Hua Xia Bank, reports Reuters.
- The value of Detusche's stake is nearly $5B, according to Reuters, though a final decision on divestment has yet to be made. Deutsche first bought a piece of Hua Xia in 2006, and later boosted its holding to 19.99% - the max allowed under Chinese rules.
- Previously: FT: Deutsche decides against total exit from retail banking (April 23)
Thu, Apr. 23, 8:56 AM
- In addition to the fine, Deutsche Bank (NYSE:DB) will fire seven employees to settle U.S. and U.K. investigations into the bank's role in rigging Libor.
- It's the largest penalty so far in the interest rate rigging probes, and comes on top of another €7.1B the bank has paid over the past three years to settle other investigations. There's more to come as regulators look into forex and MBS dealings.
- Source: Bloomberg
- Previously: FT: Deutsche decides against total exit from retail banking (April 23)
Thu, Apr. 23, 8:39 AM
- Rather than seeking to become a "European Goldman Sachs," Deutsche Bank's (NYSE:DB) top brass sees the business model as something closer to JPMorgan, reports the FT, which says the option of the bank splitting itself in two -with retail operations as one company and investment banking, wealth management, and global banking as another - will not be the way forward.
- Instead, Deutsche will sell Postbank - the German retail operation - and cut about €150B of assets from the investment bank unit. Deutsche will continue to operate its own-brand retail business.
- The recommendation is set to go forward to the board at a meeting tomorrow.
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