Q&A with RDIF's Kirill Dmitriev

The Russian Direct Investment Fund, the sovereign wealth fund established in 2011 to make equity investments in the Russian Federation, announced this week that it had teamed up with Abu-Dhabi’s department of finance to create a joint venture to invest in Russian infrastructure.

 The $5 billion contribution from the Abu Dhabi department of finance is the largest investment from the Middle East ever made into Russia, according to Kirill Dmitriev, chief executive of the RDIF, who spoke to Private Equity News, sister publication of Financial News, about the joint venture.

Five questions five years on from Lehman

Financial News has this week been asking high-profile names from the world of finance – including Larry Fink, Michael Tory and Ed Bonham Carter – about their memories of the US bank's collapse in September 2008.

The fall of Lehman Brothers in mid-September 2008 was the spark that inflamed the financial sector and the banking industry, paving the way for a full-blown crisis.

Egypt funds slump 40% in run up to clashes

Investors in Egyptian equities have seen the value of some funds fall by almost 40% over the last three years

The country was one of the first in the Middle East and North Africa to play host to government protests that would eventually spread across the region and become known as the Arab Spring. Demonstrations had remained largely peaceful – former president Hosni Mubarak’s government was ousted in 2011 – but violent clashes erupted last week between the country’s military and protesters loyal to his recently-ejected successor Mohamed Morsi.

Sun shines on real estate deals

Summer fun in the real estate sector is paving the way for an even more dramatic revival in activity later this year.

The volume of deals has already proved lucrative, attracting $369 million in investment banking fees in Europe, the Middle East and Africa, according to Dealogic, in the year to date. This compares with $225 million over the same period a year ago. Real estate analysts are confident the pace will accelerate.

Lord to replace Linhares at iShares

Joe Linhares, BlackRock’s head of iShares in Europe, the Middle East and Africa, is stepping down from his role and will be replaced by Rachel Lord, Citigroup’s global head of corporate equity derivatives, Financial News has learnt.

Lord to replace Linhares at iShares Linhares will return to the US to take on an undefined role that will be confirmed in “autumn”, according to an internal memo from David Blumer, head of Emea at BlackRock, and Mark Wiedman, global head of iShares. A spokesman for the world’s largest fund manager confirmed the contents of the memo but declined to comment further.

UK pensions giant backs auditor shake-out

The Universities Superannuation Scheme, the UK’s second-largest pension scheme and an advocate of audit reforms, has welcomed steps taken by the country’s Competition Commission to loosen the stranglehold of the Big Four.

 

The UK Competition Commission this morning proposed to increase the frequency of audit tendering by FTSE 350 companies but stopped short of requiring them to change firms regularly.

Under the proposed rules, FTSE 350 firms will have to re-tender their audit work every five years. The Financial Reporting Council, the UK’s corporate governance regulator, currently says firms must do this every 10 years or explain why they are not doing so.

Banks to find creativity stifled on 'whacky' pay

Banks to find creativity stifled on 'whacky' pay

 Pay consultants in the City of London said investment banks would be hard pressed to find imaginative ways of offsetting the impact of incoming European Union rules on bonuses, after a report from the consultancy Mercer hinted banks could be getting creative.

 Under the rules, which come into force next year, banks will have to cap bonuses for their highest earners at no more than 100% of fixed salary, or 200% given shareholder approval.
A survey of 78 financial services organisations published today by Mercer suggested that banks were looking at “creative compensation alternatives” as well as base salary increases in order to maintain the high levels of rewards for top bankers.

Hedge funds bet against emerging markets

Hedge funds bet against emerging markets

Hedge fund managers are positioning themselves to profit from a slowdown in developing economies, led by overheated credit markets in China. A number of them are buying protection on sovereign debt through credit default swaps.

Since the start of the 2008, China’s ratio of credit-to-GDP has exploded. London-based hedge fund investor Noster Capital believes it is now at higher levels than those seen on the cusp of the credit crises in the US and UK in 2007, Japan in 1990 and Korea in 1998.

Noster’s estimation is based on levels of business, household and local government debt in China but does not include bonds issued by the central government.

Trade of the Week: Porto shorto

Trade of the Week: Porto shorto

The fate of Portugal’s bailout returned to the top of policymakers’ concerns this week, as the resignation of a key government minister prompted market falls in the country's banks.

Trade of the Week: Porto shorto

With stocks in Portugal’s domestic banks facing significant pressure, the country’s stock-market regulator on Wednesday introduced a 24-hour short-selling ban until midnight on Thursday to protect three beleaguered institutions – but wily traders who acted quickly could have got away with a healthy profit.

Deutsche Bank adds UK dealmaker

Deutsche Bank adds UK dealmaker

Deutsche Bank has hired a veteran UK coverage specialist, who has previously worked on high-profile deals for Cookson Group and Logica, as it looks to build on a positive first half for UK investment banking revenues.

Simon Gorringe, a managing director in UK investment banking at Bank of America Merrill Lynch, left the bank late last month, according to the UK's Financial Services Register.

He is set to join the UK coverage team at Deutsche Bank in September, following a period of gardening leave, according to three sources. Gorringe could not be reached for comment.

Liontrust evokes spirit of ‘09

Liontrust evokes spirit of ‘09

 Strong net inflows at Liontrust Asset Management over the past three months have lifted the boutique investment firm to within touching distance of an AUM figure last held in 2009 – just before the departure of two star fund managers.

The UK-listed group said in an interim management statement this morning that assets had hit £3.3bn at the end of June, thanks in part to its 12th successive quarter of net inflows.
The £302m figure for the second quarter was more than three times the inflows for the same period last year and was driven by retail investors, who allocated £134m. Offshore funds brought in a net £179m, but institutional accounted for £11m of net outflows.

An LME dragon dance with David Beckham

The great and the good flocked to Hong Kong this week for the first LME Week Asia since the metals bourse was acquired by Hong Kong Exchanges & Clearing.

The occasion was marked unconventionally, with HKEx chief executive Charles Li dressing up as football legend David Beckham before partaking in a traditional Chinese dragon dance with outgoing London Metal Exchange chief Martin Abbott. Who knew metals could be so fun?

But beyond the glitz and glamour there was also some discussion about the future of the partnership between the two bourses.

With the costumes now firmly stowed and discussions beginning on how Hong Kong can raise its game even higher next year (Alex Ferguson maybe?), Financial News takes stock of where plans are at in the post-HKEx LME era.

KKR’s Genesis Care targets US debt market

Yet another private equity-backed Australian company is tapping the US debt market.

Following successful debt issues by Gresham Private Equity-owned Barminco and Pacific Equity Partners-owned cinema operator Hoyts Group last month, a KKR-owned healthcare business, Genesis Care, has launched a refinancing of its own.

Pickup in hiring points to U.S. economic resilience

(Reuters) - U.S. employers stepped up hiring a bit in May in a show of economic resilience that suggests the Federal Reserve could begin to scale back its monetary stimulus later this year.

The United States added 175,000 jobs last month after adding only 149,000 in April, the Labor Department said on Friday.
The pick up in hiring came despite tax hikes and sweeping budget cuts earlier in the year. The unemployment rate ticked up a tenth of a point to 7.6 percent, which economists called encouraging because more Americans were began to hunt for jobs.

Buffett joins Twitter and proclaims 'Warren is in the House'

 

 

Billionaire Warren Buffett joined Twitter as @WarrenBuffett and sent his first tweet on Thursday, declaring "Warren is in the house".

 

Buffett, the chairman and chief executive of Berkshire Hathaway, tweeted during an interview with Fortune magazine at the University of Nebraska Omaha that was broadcast online on Thursday. He had over 10,000 followers within about 10 minutes of sending his first tweet.