Financial Services Industry Archive

In the coming months, the number of hedge funds will plummet. Pressured by the massive consolidation within the commercial banking industry and fallout from the global credit crunch, hedge fund industry consolidation –which began a few years ago — is accelerating. Presently, the hedge fund industry is worth up to $2 trillion, but experts contend that  nearly 30 percent of the...

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The drama’s still on as the $700 billion bailout goes to the U.S. House of Representatives today. Worthy of note, however, is what the version passed by the Senate on Wednesday says about executive compensation. In a nutshell, if the U.S. Department of the Treasury buys distressed assets at an auction from a firm that has sold more than $300,000 in assets, a bunch of restrictions kick in....

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Looking to divert attention away from their own incompetence, many investment bankers on Wall Street are calling for the elimination of mark-to-market accounting, a framework adopted by companies to make more transparent the current values of certain (often illiquid) financial instruments. In my opinion, a likely critic of fair value, known as Financial Accounting Standard No. 157, would be...

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Which do you prefer — a bank merger requiring government assistance or one that does not? That’s the big question revolving around today’s surprise announcement that Wells Fargo has entered a deal to acquire Wachovia for nearly $15 billion in stock. This agreement seeks to supplant Citigroup’s previously announced deal to acquire Wachovia for much less, $2.16...

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Washington Federal Savings, with thrift operations in eight western states, disclosed last week that it would report the first quarterly loss in its history of approximately $39 million for the quarter ending September 30, as a result of its holdings in Fannie Mae and Freddie Mac Preferred Stock. A look at the company’s third-quarter 10-Q suggests, however, that as the housing market...

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Throughout this ongoing economic crisis, the hardcore anti-bailout crowd crows that everything can be fixed if we just act more like multi-billionaire Warren Buffett. Apparently, Buffett sees gold where others envision only muck. So the “Oracle of Omaha” is digging deep–but not too deep, mind you–to acquire ownership stakes in a couple of venerable but wobbly...

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Morningstar Inc., the Chicago-based company best known for rating mutual funds,  isn’t slowing down its quest to become an international investment research powerhouse despite the gloomy global economy. With the announced purchase today of United Kingdom-based Fundamental Data Limited, Morningstar CEO Joseph Mansueto continues bulking up the firm’s research capabilities...

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The credit crunch has turned some of the nation’s largest manufacturers into  lenders of last resort for many customers. But now it appears the “factory bank” is starting to close the loan office. As traditional commercial lending tightens, many small and mid-sized companies are relying more on their manufacturing and equipment suppliers for loans to help pay for...

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Clarifying “mark to market” accounting should be good news to executives and could be one of the few positives to come out of the financial  crisis. The U.S. Securities & Exchange Commission and the Financial Accounting Standards Board issued a joint statement Sept. 30 recommending that companies be given more leeway as they value certain assets. “Mark to market”...

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The proposed economic “recovery” plan is starting to resemble a Christmas tree as lawmakers rush to hang shiny new ornaments on the controversial legislation that’s now before Congress. Earlier this week, a stripped-down version of the proposed $700 billion bill failed to pass the U.S. House of Representatives by 12 votes, a move that sparked a swift and furious...

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