Category Archives: Finance

GM, in a Marathon with Opel

 

RUESSELSHEIM, Germany – General Motors (GM) has the ability to turn the situation to its troubled European unit, Opel, and has already charted where you want to take your brand to the next 10 years, told Reuters the new chief financial officer Opel, Michael Lohscheller, in his first interview since taking office a week ago.

Lohscheller, 43, will have a difficult task, since GM’s European operations lost a total of 16.000 million over the past 12 years despite repeated job cuts, most recently in 2010 that included the plant closure of Opel Antwerp in Belgium.

“To run a marathon you need a reasonable basic speed, but you have to sweat and ideally increase the pace near the end. It has much in common with what we are doing here,” said former CFO of Volkswagen, and participated in 75 marathons since 1987, including races in New York, Chicago and Berlin.

“You can not just start at full speed and stay completely out of breath after three months, we have to be able to stick to a speed and maintain it, the strength is extremely important. Opel recovery is a long term project,” said.

Last November, GM was forced to retract its 2011 target balance in Opel, and the unit has come to build another 700 million dollars in losses in the first half of the year, prompting analysts to call for their disposal.

Lohscheller declined to provide details of the plan to 10 years beyond the announcement of 23 models by the end of 2016, but the fact that Opel is preparing for another decade as a GM brand could disappoint investors who are pushing Detroit to loosen the brand once and for all.

 

 

Apple’s Action on Wall Street Shines

 

Shares of Apple closed Monday up to 1.88%, to 675.68 units on the Nasdaq market, according to data from CNNMoney.com and after hitting an intraday record high of 676.73 dollars.

On Friday, a U.S. jury determined that the South Korean firm copied Samung key features of the iPhone and the iPad and ordered to pay compensation of 1,050 million dollars to the signature block.

Just on August 20, Apple became the most valuable company in the U.S., when its shares reached 665.15 U.S. dollars value to reach a market value of $ 618.900.

The verdict could lead to a total ban on sales of key products of Samsung and Apple likely to consolidate in the mobile communications market.

Samsung said the decision is “a loss for American consumers” because they stifle competition and raise prices.

Apple said it plans to seek a ban on sales of some Samsung devices within the next seven days.

 

Bundesbank Rejects Debt Purchase

 

BERLIN – The Bundesbank said on Monday he remains critical of the European Central Bank’s plan to intervene in the bond market to reduce the cost of financing in Spain and Italy, adding that this is the responsibility of states and not central banks.

The Bundesbank opposes the plan of the ECB President, Mario Draghi, to restart the program to buy bonds on the ground that involves a monetary financing of government, in breach of European law.

The bank said in its monthly report, issued Monday, the volume of buying bonds “could be unlimited and should in any case be enough.”

“The Bundesbank remains critical to the purchase of government bonds of the euro system, which brings considerable risks to stability,” the Bundesbank said.

“Decisions about the possibility of an even wider pooling of risks of solvency must be rooted in financial policy, which means the governments and parliaments, and should not occur through the balance sheets of central banks.”

 

 

Greece Agrees 10.800 MDE Savings

 

ATHENS  – Greece is closer to finalize the budget cuts required by their international creditors in exchange for financial aid, after reaching an agreement that will save 10.800 million 11.500 million required for said Friday an official from government.

Complete the scheme savings of 11,500 million euros for the period 2013-2015 is key to a positive review of its creditors, expected in Athens next month for a final verdict on whether cash flow will keep the country mired in a austerity policy.

“We are in a right way. Measures have been identified by a value of 10.800 billion euros,” told to Reuters by an official of the Ministry of Finance after a meeting of senior government officials late on Friday, speaking on condition of anonymity.

He did not specify in which areas the cuts would be made and said talks would continue to finalize the package on Monday.

The Greek government has imposed measures widely accepted, but has been avoiding to release details of the savings, expected mainly on pensions and state salaries, and up to 40,000 public sector redundancies.

The measures must be approved by the three ruling parties in the coalition, and later by the “troika” comprising representatives from the European Union, International Monetary Fund and the European Central Bank.

Greece has been rescued twice and financially dependent on funds from the second agreement for 130.000 million euros agreed in March that will allow you to keep paying bills, pensions and public sector wages.

Prime Minister Antonis Samaras, will next week their first meetings with the leaders of the euro zone after taking office, which seek to ensure that Athens will keep its promises of greater austerity.

Also expected to raise its proposal to extend the measures over four years instead of two years to soften the impact on the Greek population, which is facing the worst economic downturn in the country since World War II.

 

Care Home sector on the up as occupancy rates raise despite economic crunch

Europe has been facing tough economic times for a while and UK has been no exception either.

The last couple of years have specially seen ‘cash crunch’ in Britain and while the current administration has touted the London 2012 Games as the small impetus needed, it seems to have done scant little for overall economic well-being of the country. And many business sectors have felt the adverse impact of these hard times, with aviation and tourism taking the biggest hits.

But it seems that the care home sector has actually rebounded in the tough times and occupancy rates are now on the up.

The nursing home sector has seen a high occupancy rate of 87.8 percent in 2011, which is a lot more than the past five years in the UK and occupancy rates have also been up in rest of Europe as well.

The margin rates in the UK care homes were also up from 30.1 percent in the previous year to 30.5 percent in 2011 and while that is only a small increase, it still is a positive trend that is predicted to continue through 2012 as well.

The fact that the market share of the nursing home has amplified is in itself a heartening trend for those observing UK’s healthcare sector. The country’s social care sector has come under particular criticism in the past few years and the government has also proposed important reforms that are all set to come into effect in the coming years.

It is despite this general air of negativity and the downward economic turn that the healthcare sector has registered growth and that might also have something to do with the number of elderly who are desperate for proper care and medical attention. Something that everyone involved must take notice of.

Brazil Launches Plan for $66 Million

 

 

BRAZIL – The Brazilian government launched a series of measures Wednesday to attract up to 133.000 billion reais (66 million) in private investment for development of new roads and railways, necessary to clear the bottlenecks in transport the country.

The measures include a plan to double the capacity of concessions to major highways and rail roads, said Paulo Passos, Minister of Transportation, during an event in Brasilia.

The government, through the state development bank BNDES, will also offer subsidized loans to investors who wish to participate in projects.

The measures are an effort of the government of President Dilma Rousseff, to modernize the country’s economy stagnated in the last year after showing an average growth rate above 4% for much of the last decade.

The government says that with the modernization of infrastructure, which considers improving roads and railways collapsed, can lower business costs and give greater efficiency to the economy in the coming years.

During the ceremony, Rousseff said that the measures would help Brazil, the largest country in Latin America, to be “richer, stronger, more modern and more competitive.”

The president added that such investments can be made “Brazil finally has an infrastructure compatible with its size.”

The government also expects the investment to revive the economy in the short term. Passos noted that the investment is expected to take place during the next five years.

“This is not an investment program to be diluted in the next 15 or 20 years,” he said.

The program provides grants to expand the old and overloaded system of roads and railways in Brazil. In addition to plans for the construction of highways, the government hopes to attract investment for up to 10,000 kilometers of rail track network in the country.

They envisaged in the coming weeks the Government announced similar projects for ports and airports.

Economists welcomed the measures, after saying for some time that Brazil had to unclog its outdated roads, ports, railways and air terminals if ever hoped to free the economy from the shackles that had held for so long.

Experts believe that compared with past efforts to encourage consumer spending as the solution to the stagnation of growth, infrastructure projects can generate long-term benefit of much greater.

“This package, if it materializes, would be a very positive effort to address the constraints on the potential long-term growth in Brazil,” wrote Nick Chamie, an analyst at RBC Dominion Securities in Toronto in a report released Wednesday.

The deteriorating infrastructure not only slows the movement of goods and services but raises the prices of everything from fuel storage to the cost of labor. That, in turn, exacerbates the historic Battle of Brazil against inflation and takes Brazilian companies competitiveness against foreign rivals.

When compared with China, where the government has invested in a fast and intensive infrastructure projects in Brazil vowed to continue its recent expansion materialized slowly.

And because of the bureaucracy, legal problems and costs that are out of control quickly, some of which never materialized.

As a result, the goods are delayed at least twice in the same distance in China and other markets more efficient, according to experts in logistics.

 

 

JPMorgan Strikes Deal for $100 Million

 

 

NEW YORK – JPMorgan Chase & Co won a preliminary court approval for a settlement of $100 million to credit card customers who accuse the U.S. bank of trying to generate higher costs by increasing the minimum payments.

The settlement resolves the claims on the bank’s decision in late 2008 and 2009 to increase minimum monthly payments to thousands of customers, including people who transferred balances from other institutions, to 5% of their account balances from 2 % previously.

The credit card users accused JPMorgan to increase minimum payments to force them to accept higher rates to maintain a lower payment requirement, or to cause late payments that would generate new costs or fines.

Judge Maxine Chesney district in San Francisco gave preliminary approval for the deal, which he described as fair, reasonable and acceptable. She scheduled a hearing in which to consider final approval on 16 November.

According to court documents, lawyers for the credit card users ask for up to 25 million from the settlement fund for legal fees, plus a $ 1.5 million to cover the costs of litigation.

 

 

 

The Dollar Was Sold at 13.32 Pesos

 

 

The dollar sold free on a peak of 13.32 dollars, seven cents more than in last Wednesday’s close, while the lowest cost is the purchase of 12.78 pesos in banks in Mexico City.

The euro lost nine cents to the weight compared to the end of the session exchange of Wednesdays, when they reach the sale price up to 16.37 pesos, while the yen was bid up to 0,171 pesos per unit.

Base bank said the dollar’s decline against major currencies rise after Ben Bernanke, chairman of the Federal Reserve, noted that the euro zone is close to finding a solution to the long term stability.

He said also influenced by the expectation that the Government of China cut the reserve requirements of the banking system to boost the economy.

The Bank of Mexico (Banxico) indicated in the Official Journal of the Federation that the exchange rate is 13.1201 pesos to settle liabilities denominated in foreign currency payable in Mexico.

The central bank added that Interbank Interest Rates Balance for 28 days down 0.0037 percentage points to settle at 4,777%, while at 91 days, the rate 0.0012 percentage points subtracted to operate 4.7900% and 182 days is at 4.8250%.

 

Citi Reports Lower Profit

 

NEW YORK – U.S. bank, Citigroup, on Monday reported a drop in profit in the second quarter due to losses from the sale of a stake in a bank in Turkey and its impact on asset performance problems that drag from the credit crunch.

The net profit fell to 2.900 million, or $0.95 per share in the second quarter from 3.340 million in the same period last year, the bank said.

Revenues for the second quarter amounted to 18.400 million. Analysts expected a profit of $0.89 per share on sales of 18.760 billion in the second quarter, according to Thomson Reuters I / B / E / S.

Citigroup is the third largest U.S. bank by assets.

Citigroup shares rose 2% on transactions prior to market opening, just after the results were known.

 

 

 

 

Spain Prepares Additional Adjustments

 

MADRID – The tough economic adjustment measures approved this week by the Government of Spain will have a positive impact on the public accounts of 56.400 million euros over the next two and a half years, according to a official document released Saturday.

The figure would be below the 65.000 billion euros, said Wednesday by President Mariano Rajoy, and would be generated through new tax increases and tax cuts, that is intended to convince Europe and investors that the country is serious about implementation of reforms.

The gap of 8.600 million will be covered with a series of measures such as energy taxes, which are expected to be announced later this month.

“The estimated impact of these measures is approximately 13.500 million in the remainder of 2012, 22.900 million in 2013 and 20.000 million in 2014,” said the Spanish government in a note.

“This estimate excludes the impact assessment for further action, such as energy and environmental taxes to be announced shortly,” he added.

Of the 56.400 million forecast for revenues to date, about 29,000 million will come from changes in tax rates and 27.000 million budget cuts.

Spain needs to eliminate 65.000 million of its budget deficit to reach the goal of EU fiscal gap of 2.8 from 2014.

The publication of the document comes a day after Finance Minister Cristobal Montoro, refused to put specific figures to fit in the presentation of the new reform plan to cut the bloated budget deficit.

Thousands of people demonstrated in Madrid on Friday after learning of the new cuts that led to police intervention and left some detainees.

 

 

KOF’s SharesTumble 8.21%

 

MEXICO CITY – Shares of Mexican Coca-Cola FEMSA (KOF), the largest bottler of the popular beverage brand in the world, plunged on Wednesday after shareholders sold part of the securities received as payment for Recent acquisitions of the company.

KOF papers lost 8.21% on the Mexican Stock Exchange to 163.22 pesos.

Operators mentioned earlier a cross of 2 million shares and 60,000 ADRs (American Depositary Receipts), which initially contributed to the decline, at a price of 167 pesos.

The director of investor relations KOF, Jose Castro, said some family members who received shares as payment for the franchises acquired, sold part of the securities in the market to capitalize on the recent rise of the station.

“This is good news for KOF, because now these actions are in the market, achieved a good base of investors,” Castro told Reuters by telephone.

KOF, a partnership between Mexico’s FEMSA and The Coca-Cola Co, materialized in the last 12 months the purchase of three bottling system in Mexico, through agreements with payment of shares.

KOF, which operates in territories of Mexico, Central America, Colombia, Venezuela, Brazil and Argentina, bought the local bottlers Queretano Group, CIMA and Tampico, which were held by private investors.

KOF’s shares earlier this month played a maximum of 192 pesos on the local stock market, which meant a profit of 47% from its close of 2011.

Earlier titles in New York fell 8.19% to 122.27 one dollars.