The rebel investor demanding sweeping changes at HSBC, including the possible break-up of the bank, yesterday claimed to have won expressions of interest from nine out of the UK's 30 biggest institutional investors, reports The Guardian .
Eric Knight, whose shareholder group owns about 1% of HSBC, claims that the bank's share price is up to 50% undervalued after a disastrous foray into sub-prime lending in the US, a wasteful $40bn acquisition spree, and a failure to exploit opportunities in China.
Yesterday Mr Knight was in London drumming up support for a formal strategic review of HSBC, presenting a 240-page dossier to major institutional investors in which he attacks HSBC's share price performance compared to its rivals. The dossier also highlights what he claims is a deeply flawed boardroom bonus scheme which allows directors to scoop huge payouts even if shareholders see little return.
THE DOLLAR TUMBLED TO ITS weakest ever against the euro and fell against a range of other major currencies as bets hardened that the Federal Reserve will cut interest rates next week to stave off a deeper slump in the US economy, reports The Telegraph.
Traders in Asia sold the US currency against the euro, the yen, sterling as well as the Australian and New Zealand dollars, pushing it to a new low of $1.3869 against the euro in London.
The dollar has been under increasing pressure over the past three months as the liquidity crisis grips financial markets and fears grow of a broader slowdown in the US economy. Treasury Secretary Hank Paulson yesterday warned that the trouble in the financial markets was likely to last longer than any financial shocks of the past two decades.
BARCLAYS CAPITAL HAS THROWN a $1.5 billion (£738 million) lifeline to a third, controversial, highly geared fund that ran into trouble because of the global liquidity squeeze, reports The Times.
Golden Key, which has $5 billion of assets under management, is a structured investment vehicle (SIV) that was designed by Barclays Capital and managed by the Geneva-based asset management group Avendis.
In a statement, Golden Key said it had been working with a “leading investment bank” to develop a restructuring proposal. A spokesman for Golden Key declined to name the bank but sources said it was BarCap.
The fund said it had told its security trustee that the discussions with the bank were “well advanced”.
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Two global vehicles
'Further plug advice gap'
Must appoint separate CEOs and boards
Advisers do come out well
Will report to Mark Till