Financial Services Industry Archive

Battered by the slump in global markets, venture-capital firms and their private-equity counterparts are turning to investments in public companies, usually as PIPE — private investments in public equity — investors. It may be the only bright part for VCs these days, as the global recession has slowed new financings and fundraising activities to a crawl. For instance, formation of...

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In what is now an investing cliché, Warren Buffett once remarked: “Be fearful when others are greedy, and greedy when others are fearful.” Goldman Sachs seems to be heeding the Oracle’s advice. Monday, the bank raised a fund with about $5.5 billion in capital commitments to buy private-equity assets on the secondary market from endowments and pensions that have been stung by...

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While emerging market stocks boom on speculation that Asian economies will recover faster previously expected as governments in the region boost spending, there’s a whole host of financial considerations that are being pushed to the bottom drawer. At the top of the list is the rising amount of corporate debt on the balance sheets of emerging market companies. Last week, one analyst issued...

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Goldman Sachs‘ earnings are on the upswing again thanks to trading of plain-vanilla securities such as currencies and Treasury bonds. The investment bank also thinks it can still make money in private equity, but that won’t happen for a while. For now, the Wall Street firm’s private-equity exposure will continue to be painful. Goldman is expected to report a gain when it...

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For banks, March was as kind as February was punishing. Valuations have skyrocketed as favorable accounting regulations have been approved by FASB, while investor confidence over lending is on the rise. Even before Wells Fargo announced a bullish first-quarter profit forecast last week, the bank noted that despite a bad fourth quarter in 2008, it managed to increase lending activity by 11...

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If you want to pick a fight on Wall Street, go into Harry’s on Hanover Square sometime on a Thursday evening and loudly announce that you think restrictions should be placed on short-selling. Even if you don’t get the short end of a zealous trader, you’re unlikely to make friends fast. Several months after temporarily banning short-selling in financial stocks, that’s...

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It’s official. Well, semi-official, anyway. Ailing life insurers are in line for a big chunk of the $130 billion in TARP funds, according to a story leaked by U.S. Treasury officials to the Wall Street Journal. And Treasury may be trying to soften the blow by leaking it rather than stating it. Life insurers like Lincoln National and Hartford have been buying up savings and loans since...

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Insurance companies such as XL Capital, Partner Re and Everest Re have been taking advantage of low valuations on their own hybrid securities — debt securities with some stock-like features, such as trust preferred notes — to buy them back through tender offers. But if buying back hybrids has recently been more attractive, it doesn’t mean all insurers are in a position to take...

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Last week wasn’t a good one for Goldman Sachs — or for the taxpayer. Byron Trott, vice-chairman of the bank and long-time confidante of Warren Buffett, announced last Tuesday he was leaving to start a merchant-banking fund that will invest in and advise companies controlled by families or entrepreneurs, according to Bloomberg. Later that day, Bloomberg went on to report that Mark...

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In a struggle that will almost certainly result in fewer and larger players, fund management companies are using diverse tactics to compete for a shrinking asset pool. After spectacular stock market losses and client withdrawals, firms seek a competitive edge in various ways as the industry consolidates. Industry insiders expect radical change. Mohammed El-Erian, chief executive of bond giant...

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