|Bid||8.71 x 1400|
|Ask||9.77 x 1200|
|Day's Range||8.31 - 8.72|
|52 Week Range||8.31 - 12.85|
|Beta (5Y Monthly)||0.76|
|PE Ratio (TTM)||11.00|
|Forward Dividend & Yield||0.72 (8.50%)|
|Ex-Dividend Date||Jan 05, 2020|
|1y Target Est||12.45|
(Bloomberg) -- The second-largest investor in Santander Consumer USA Holdings Inc. plans to come out against the auto lender’s proposed $1 billion tender offer for its own shares, arguing it should increase the proposed price, according to people familiar with the matter.Canyon Capital Advisors, which owns a 4.1% stake in Santander Consumer, intends to come out against offer, arguing it also provides significant benefits to parent company Banco Santander SA while inadequately compensating minority holders, the people said, asking not to be identified because the matter is private.The Los Angeles-based investment firm intends to argue that the tender offer should be raised, they said. Santander Consumer announced last month it would pay $23 to $26 per share in a modified Dutch auction.Canyon Capital believes, the people said, that range is well below the benchmarks set in two prior transactions: the company’s 2014 initial public offering and company’s repurchase of shares held by former Chief Executive Officer Tom Dundon in 2015.A buyback at the top end of the range would value Santander Consumer’s stock at about par to tangible book value, or assets minus goodwill and other intangibles, according to Canyon Capital’s calculations. That compares with the more than 3 times tangible book fetched in its IPO and the 2.5 times tangible book paid for Dundon’s stock.Better PremiumCanyon Capital doesn’t like the premium shareholders would be getting in the potential buyback either.The top end of the range is about 12% higher than where the stock was trading the day before the offer was announced. That’s lower than premiums paid in other buyouts and tender offers at Banco Santander affiliates in recent years, including a 22% premium for its subsidiary in Mexico and 42% for Banco Espanol de Credito SA, they said.A successful tender offer would also boost Banco Santander’s ownership of the auto lender to 80% from about 72%, which would benefit the Spanish lender, the people said. It would allow the parent company to consolidate Santander Consumer’s tax assets and liabilities with other subsidiaries it owns similar stakes in, triggering a capital boost of roughly 500 million euros ($544 million), they said.That would enable Banco Santander to issue about 4 billion euros worth of additional loans, they said.Minority shareholders would also be left with a much less liquid stock, following a buyback of up too 13% Santander Consumer’s outstanding shares, the people said.A representative for Santander Consumer wasn’t immediately available to respond to a request for comment. A representative for Canyon Capital declined to comment.Santander Consumer’s shares traded at $23.18 a share the day before the tender offer was announced. The stock closed down less than 1% to $25.97 in New York trading Wednesday, giving the company a market value of $8.8 billion.Another top-10 shareholder, who spoke to Bloomberg on the condition of anonymity, also said Santander Consumer should increase the offer price because it undervalues the stock and benefits the parent company.To contact the reporter on this story: Scott Deveau in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Liana Baker at email@example.com, Matthew Monks, Michael HythaFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- European banks have a problem with their boardrooms.From the Anglo-Asian giant HSBC Holdings Plc to Spain’s Banco Santander SA and Switzerland’s Credit Suisse Group AG, a troubling phenomenon has become apparent at many of the region’s lenders: the weakness of the body tasked with ensuring the company’s success.Bankers are already under pressure because of rock-bottom interest rates and digital disruption, so it’s far from ideal that their boards appear slow, clumsy and overly beholden to their chief executives. Proper corporate governance matters as much now as it did during the financial crisis. While lenders may be simpler and safer by some measures, they’re still impenetrable to the outside world, and new risks are always emerging. Their CEOs need to be chosen, managed and held in check more effectively.An endless series of boardroom dramas has beset Europe’s banks in the past year. Consider HSBC. the continent’s biggest lender has just embarked on its biggest overhaul in decades (its third attempt to adapt to the post-crisis era), a plan that involves tens of thousands of job cuts, scrapping buybacks and reallocating capital to more profitable businesses. It’s hardly the time to be leaderless.Yet six months after ousting CEO John Flint, who only held the job for a year and a half, HSBC’s board hasn’t made up its mind whether it wants to give his interim replacement Noel Quinn the job, or to hire externally.In fairness, finding the right boss for a sprawling bank with a $2.7 trillion balance sheet is the most important task of the board and Chairman Mark Tucker — alongside setting the strategy. It mustn’t be rushed. But a strategic overhaul of this magnitude needs a leader who owns the new plan. The longer the appointment drags out, the tougher it will be for Quinn to execute; and the harder it would be for a credible external candidate to implement someone else’s turnaround story. The board has given itself until as late as August, but time isn’t on its side after the favorite outside candidate, UniCredit SpA’s Jean Pierre Mustier, committed himself to his current employer.HSBC’s board is in fine company when it comes to messy situations. At Barclays Plc, another regulatory probe into CEO Jes Staley — this time looking at his relationship with the disgraced financier Jeffrey Epstein — raises questions about oversight at the top of the firm. Staley was fined previously for attempting to unmask a Barclays whistleblower. The London-based bank took two months to go public on the latest inquiry, and it hasn’t shared details of its own review into the CEO’s relationship with Epstein. While one shouldn’t jump to conclusions, more transparency from the board would have been invaluable to investors.Elsewhere, the Credit Suisse board hardly covered itself in glory during a months-long spying scandal that cost CEO Tidjane Thiam his job. While Thiam was cleared of knowing about the surveillance operations against employees, past and present, it’s pretty damning that neither he nor the board were aware of those activities being carried out by key personnel. The Swiss giant’s directors must share responsibility for an episode that damaged the bank’s reputation and upset employees.In April, Santander faces its own embarrassing showdown in a Spanish court. After withdrawing its offer of the CEO post to Andrea Orcel — the former head of investment banking at UBS Group AG — over a disagreement on pay, Santander is being sued by Orcel for more than 100 million euros ($108 million). Why Santander would have agreed to honor UBS’s generous financial obligations to Orcel, and then withdrew the proposal, is unclear. A detailed account of alleged text messages between Santander Chairman Ana Botin and Orcel and his wife, published by Reuters, points to personal relationships possibly playing a bigger role than they should have in a CEO appointment.For its part, UBS botched its own internal CEO succession plan, and eventually hired Ralph Hamers from ING Groep NV — despite the Dutch bank’s failings over money-laundering and Hamers’s lack of experience in UBS’s core businesses. That was a controversial move by the directors of the world’s biggest wealth manager. In the age of the “purposeful company,” bank boards should be leading the way on properly representing their shareholders, as well as employees and society. It isn’t obvious whose interest they’ll serve by remaining so ineffective. To contact the author of this story: Elisa Martinuzzi at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Elisa Martinuzzi is a Bloomberg Opinion columnist covering finance. She is a former managing editor for European finance at Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
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(Bloomberg) -- Deutsche Bank AG may have defused a potential land mine in its still-fragile turnaround.A once-treacherous decision about whether to retire one of the bank’s riskiest bonds in April has almost become a nonevent amid signs of progress in the overhaul and overwhelming evidence of the lender’s ability to sell Additional Tier 1 notes in a red-hot market. The bank has also avoided much of the opacity that riled Banco Santander SA bondholders ahead of a similar AT1 call decision last year.“They’ve done everything right, particularly since this is an asset class that’s created so many problems for them in the past,” said Sebastiano Pirro, a portfolio manager at Algebris Investments. The upcoming AT1 call decision “won’t be a big deal either way,” he said. Pirro declined to comment on Algebris’s holdings.Potential market indifference about the call marks a sharp turnaround for the unprofitable lender, as its AT1s have been whipsawed for years by concerns about capital levels, coupon payments and the ability to sell new notes. It also reflects a focus on investor communication that has let the German lender sidestep the confusion and complaints triggered by Santander’s unprecedented skipped call.“I don’t think it matters hugely whether they call or not, as long as they don’t follow the same path as Santander,” said Filippo Alloatti, a senior credit analyst at Hermes Investment Management.Market regulations bar Deutsche Bank from indicating whether it will redeem the old AT1 before it issues an official call notice. The announcement can come as late as 25 days before the voluntary April 30 redemption date. If the $1.25 billion 6.25% bond is left outstanding, the coupon will reset to about 436 basis points over five-year swaps, which currently works out at about 5.7%.The bank has explained how it will decide whether to exercise the call, and made it clear that selling new AT1s doesn’t necessarily mean that old ones will be redeemed. It declined to comment on the call decision when contacted by Bloomberg News, including on whether it has received regulatory permission for a redemption.Step forwardOn Feb. 11, the bank bagged a bumper $14 billion order book as it sold a new $1.25 billion perpetual AT1, its first such offering since 2014. The sale extended a run of recent wins for Chief Executive Officer Christian Sewing, including a surge in fixed-income trading last quarter and a share-price boosting investment from U.S. fund manager Capital Group.“The AT1 issue is another step forward in the active, diligent balance sheet management we’ve been undertaking over the past three years,” Group Treasurer Dixit Joshi told Bloomberg News.Shares of the lender were little changed on Monday. They have jumped almost 50% this year.READ MORE: Deutsche Bank Trading Surge Gives Comfort Six Months Into RevampStill, the bank will pay a 6% coupon on the bond, suggesting investors needed a hefty incentive to take on the risk amid continued losses and falling revenue at key units. The yield, which is now about 5.7%, is the highest for any outstanding AT1, based on Bloomberg Barclays index data.Deutsche Bank’s bondholders may have drawn comfort from the relatively muted price reaction to better-rated Santander’s howl-inducing AT1 rollover last year. The price of the extended note quickly recovered, and the Spanish lender had no difficulties selling a new issue this year.“In Santander’s case, the problem wasn’t the extension, it was the communication -- and Deutsche Bank is super focused on this,” Pirro said.(Updates with stock price in 10th paragraph.)To contact the reporter on this story: Alice Gledhill in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Hannah Benjamin at email@example.com, Neil Denslow, V. RamakrishnanFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Following the departure of its CTO last month, Tandem Bank, the U.K. challenger bank co-founded by fintech veteran Ricky Knox, has lost another key member of its team: chief product officer Matt Ford, who is departing for a career in venture. Ford joined Santander InnoVentures, the venture capital arm of the Spanish incumbent bank, in December, TechCrunch has learned.
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Moody's Investors Service ("Moody's") assigned a B2 rating to the proposed senior unsecured notes of at least $500 million due up to 10 years to be issued by CSN Islands XI Corporation and unconditionally guaranteed by Companhia Siderurgica Nacional (CSN) (B2 stable). The proposed issuance is part of CSN's liability management strategy and net proceeds will be used to fund a tender offer for the totality of CSN's outstanding notes due in 2020 and to pay down other existing debt maturing in the short term. The rating of the proposed notes assumes that the final transaction documents will not be materially different from draft legal documentation reviewed by Moody's to date and assume that these agreements are legally valid, binding and enforceable.
Moody's Investors Service ("Moody's") has today affirmed the respective local currency, long- and short-term deposit ratings of Ba1/ Non-Prime for Banco RCI Brasil S.A. (Banco RCI), Ba2/Non-Prime for Banco PSA Finance Brasil S.A. (Banco PSA) and Ba1/ Non-Prime for Banco Ford S.A. (Banco Ford). At the same time, Moody's has affirmed the ba3 baseline credit assessments (BCA) for Banco RCI, as well as the ba3 BCA for Banco PSA, and it has lowered to ba3, from ba2, the BCA on Banco Ford.
Looking for stocks with high upside potential? Just follow the big players within the hedge fund industry. Why should you do so? Let’s take a brief look at what statistics have to say about hedge funds’ stock picking abilities to illustrate. The Standard and Poor’s 500 Index returned approximately 26% in 2019 (through November 22nd). Conversely, hedge […]
Banco Santander Brasil is making new hires as part of a revamp of its investment banking business in an effort to gain market share. Gustavo Miranda, the new head of investment banking at the bank, has hired Renato Boranga, who was formerly at Moelis & Co , as head of mergers and acquisitions. Miranda, who became head of investment banking in October, has also appointed Pedro Leite da Costa, previously at Goldman Sachs and advisory firm One Partners, as head of equity capital markets (ECM).