Financial Services Industry Archive

Looking to ease the worst financial crisis since the Great Depression, the U.S. Federal Reserve is pumping new dollars into the economy. But that rush of ready cash probably won’t translate into waves of new business loans for credit-strapped companies. For the moment, concerns about the “credit crunch“, which has already curtailed business lending, are playing a...

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WaMu is poised to be sold. Now, all it needs is a buyer. A major private equity investor in Washington Mutual has agreed to conditions that clear the way for a possible sale. Unfortunately, the Seattle-based Washington Mutual may be so severely damaged that no suitor will want the place. On the heels of the federal government’s $85 billion bailout of insurer AIG, WaMu returns to center...

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Like a good neighbor, former Allstate CEO Edward Liddy is there. Liddy was reportedly named CEO of AIG shortly after the New York-based insurance giant was given an $85 billion federal government bailout. As part of that deal, AIG CEO Robert Willumstad announced he was leaving and the government brought Liddy in to run the store. Liddy was Allstate CEO from 1999 until 2006. In addition to...

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It’s Morgan Stanley’s turn in the spotlight. Whether it likes it or not. Morgan reports quarterly earnings tomorrow, and there’s investor concern the results  will fall below expectations. More disturbing: The possibility the investment bank’s balance sheet is fast deteriorating, brought down by heavy exposure to the subprime mortgage market and other weak...

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Goldman Sachs is sending a message to the outside world: It intends to remain an independent investment bank, even if that means being the last of the breed left standing on Wall Street. Today, Goldman’s Chief Financial Officer David Viniar told industry analysts that the investment house was not interested in acquiring a commercial bank. Moreover, Viniar asserted Goldman was...

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At a time when the stock market is plunging and a once-venerable Wall Street investment house is going bankrupt, it may seem like all is lost.  Not true. In fact, amid the carnage, some examples have emerged that stir — shall we say — a cautious optimism about getting free of this mess. Specifically, I’m referring to three major deals that were just announced: Bank of America...

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Bank of America CEO Kenneth Lewis is only beginning his quest to acquire Merrill Lynch and build a global financial empire.  His next step: Getting his skeptical shareholders to agree that the $50 billion all-stock transaction for Merrill is in their interests, too. To that end, Lewis may find the best way to woo his antsy  investors, who must approved the Merrill deal, is to immediately...

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(Note: This post first appeared in BNET’s Sterling Performance blog.) “Lehman decided to play chicken with the market — and they lost.” In what’s been likened to Black Monday (1987) today around 5,000 UK-based employees will lose their jobs as 158-year-old investment bank Lehman Brothers filed for bankruptcy protection under Chaper 11 of the US Bankruptcy Code. All of the...

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It’s a tale of two very different mega-transactions: Bank of America Corp.’s purchase of brokerage firm Merrill Lynch & Co.  offers a prospect of brighter days ahead for the newly-merged company, while the bankruptcy filing of investment house Lehman Brothers merely serves to spotlight the sorry history of massive excess bringing down many venerable firms...

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Earlier this year, New York-based JP Morgan Chase tried to acquire the sagging Washington Mutual in an all-stock deal worth $8 per share. At the time, WaMu’s CEO Kerry Killinger’s  reply to Chase leader Jamie Dimon was your basic, ”thanks, but no thanks.” Apparently, Killinger was betting that an infusion of capital from private investors, coupled with an...

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