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tv   Countdown  Bloomberg  October 21, 2015 1:00am-3:01am EDT

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(the lion sleeps tonight.) woman snoring take the roar out of snore. yet another innovation only at a sleep number store. shakeup, new capital and spend off on the banking units. we speak to the new ceo about his plan. anna: ferrari prices of the top end of the range, with an ipo that gives it a $12 billion valuation. trading higher on speculation that the boj will act. welcome. the first hour. it is 6:00 here in london.
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let us talk about what is happening in commodities. guy: the world feels a little more empty in terms of the glass half-full argument. a lot of pressure in global trade, numbers out at the moment talking about navigating the challenging market. down, talking about china being a difficult place to. anna: better than estimated net levels, but the china comments are interesting. growth is expecting, but as a slower grace. guy: aluminum trading in a down side, probably the most key oil.dity -- copper, this is the price. i made this chart here for you to show you what is going on. oil is trading at a key level. gotas the financial price
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down to near 40, that is when i rock invaded kuwait. in the sand,ine using trading back down towards it. will we bounce back off of it? yes, history will tell us that. nevertheless, we have been down at level since the crisis. opec and u.s. producers playoff of each other, so much of the story about the falling price of oil. it is been about the u.s. but opec as what to claim back market share. and according to the iea, they are saying u.s. crude demand is waning. an increase inee 2016. we watch the story with interest. raisingdit suisse billions of dollars in capital. third-quarter,
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following an investment loss. we go to zurich, learning about what happened. so of course we heard from the ceo. saying there will be a lot he is doing. basically streamlining the bank. he wants to grow the swiss bank and possibly ipo this unit in 2017. so the message is clear. focus on asian pacific, the largest and growing segment of wealthy entrepreneurs in these emerging markets. he was of course under pressure, and he is then under pressure since he got the job in the summer to downside the investment bank read these returns, as you were saying in the third quarter, they are really under pressure from capital requirements. they offer record low interest rates.
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what we had today was a comprehensive plan. we heard about cost-cutting, job losses, and we also heard about this capital raising. this will please shareholders because we had earlier heard estimates between 5 billion and 10 billion, it is on the lower side. he wants to raise $6 billion and he is confident he can do this without much pain. anna: francine, why did credit suisse need such an overhaul? down memory lane. francine: go back to brady pressuree was under because he failed to grow the investment bank. he failed to do it fast enough. this is what we're expecting today. in terms of share price, it has returned only 13%. 12% over the last two
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months, something had to be done to revise profits. the bank was not affected by the banking crisis in 2008. and it was just hard to get going. that with thises big strategy overhaul, i think he sees it as a reboot. it will deliver the shareholders and unlock the value he sees. abouthat is he saying what he sees as success? he is a guy that thinks outside the box. i'm curious to know, you cannot above the interview yet, but how he is going to measure what he does and the bank? today, you and i have interviewed in many times, the one thing that will be key is shareholder value. maybe five years down the line, i think he wanted to present they was a plan that gave confidence to shareholders and investments that he gave looks to everything.
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when you understand what credit not wanteded, he did to throw numbers and say i will cut costs by this much -- without giving some kind of plan of his thinking. again, the capital raising goes lower than analysts had estimated, at least at the lower end of the estimates. it means he has to do extra cost cuts, these go hand-in-hand. he is trying to do some thing that was balance, but i would say success at the end of the day will be share price in three or four years from now. guy: thank you very much, indeed. francine will be back later on, we will hear from her them. i'm sure it is fascinating. i love the sound of the bells an in zurich. us, we talked thiam.ane -- their breaking news
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chief executive is set to step down. stepping down from syngenta, the biggest maker of agricultural chemicals. i want to show you first of all the significant move we shop in the share price. come closer to my screen. this is syngenta over the past 12 months. it is a turbulent rise from a look at the screen. that itthe share price did rise of the very start in may, and came humbly down as a deal from monsanto -- arrival in the united states -- that deal rebuffed by syngenta. not being bought out by rival and having to admit that this -- that theytober 15 -- would see an erosion in 2015 earnings, a slowdown in latin america where they can about 45% of their overall sales. the slump they predicted not only by' syngenta but also the rivals saying there will be
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a slump in the agricultural markets. waning demand it from farmers for crop protective chemicals because they're not able to sell their products in such a high price anymore. so commodity prices have been falling along with the rest of the market. so we are seeing a concern for syngenta. this is why we hear from the ceo, he decided the time is now that he will go after 14 years. he says he has worked at the company and he wants now the benefit of a new perspective. and the new leader for syngenta -- the interim one will be the chief financial officer john ramsey. breaking news that the ceo will step down after a turbulent 12 months, rebuffing an offer fr om monsanto and the times will get tougher. anna: let us to hong kong, though. and talk about the asian trading session. david is standing by.
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there,t so great days but that has people hopeful about the end of this month. that data is good news. as i mentioned earlier, depending really on how you splice the data for the short of it is that we are out the u.s.. and without japanese exports to the u.s., japan would be in a deeper hole. at this point, you had exports to china for example -- and i think the market reaction shows up 2%. exports to china were down for a second straight month. exports to the u.s. were up for a 13th straight month -- double-digit growth in exports there. so if you strip that away, you do understand of course why japan keeps reporting these trade deficits. in fact, it is 42nd out of the last 45. a lot of that is structural because japan has to import energy needs, about a quarter. before the data came out, the
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portion of economists that we asked whether or not they think the boj will act next week, it was roughly under 50%. now i would not be surprised if that number has gone a bit higher. so you do have the japanese yen weakening for the next couple of days. overall, have a look at this. asia is doing much much better. volumes are not as thin as they have been this week. perhaps we see the holiday, fairly quiet around the middle district here in hong kong. ssion generally a risk seeion this wednesday. anna: the rest of hong kong might be on holiday. but david ingles is there. exports grew last month at the slowest pace in a year. brett miller joins us live from tokyo now.
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let us try to understand what they are telling us. what are driving these numbers? is it as simple as saying china is slowing down? brett: it is almost that simple. have seen data from china this week, it might look pretty good. the economy grew 6.9%. but for other countries that ship goods to china, it is quite bad. it is the weakest growth in more than five years, having a lot of affect on countries like japan that export to china. we saw japanese exports to china drop 3.5%. we also saw exports fall to indonesia, malaysia, thailand. they are countries very exposed to china and the slow down there. so we are seeing in general chinese demand really setting things in the region in general. but we do look at u.s. exports, european exports -- they look pretty good.
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japan,ngs are good for car sales and auto parts to the u.s. are helping. but china comes in and we get pretty close to zero in terms of growth for exports to japan. anna: and what do the export numbers then mean for japanese policy? we have a boj meeting looming at the end of the month? brett: that is right. it is increasing pressure on the government and the bank to figure out weston list is needed. economyow, the japanese contracted. if we look at the december data, it is not encouraging. and we had some weak industrial production data on top of that, so most recent survey of economists said about 42% looking at the possibility of kuroda easing policy. a might change that, throwing people into the camp saying we will see stimulus next week. of course, i would just sort of
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warned that kuroda likes to surprised. as more and more people think he will ease policy, he may start to look the other way. he really doesn't want to have as much impact as he can to really move markets. s what heound that whai did last. the chance for surprise this time are starting to wane. anna: brad miller in tokyo. guy: what is the data we are watching later on? the bank of england will publish a paper at 10:30 discussing the british banking system. anna: and we get a brazilian rate decision, they keep their key rate the same for a second month. guy: bank of england governor mark carney speaks at the how the union outlining banking industry was impacted.
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you will be able to watch the event on our website, bloomberg.com/europe. anna: i doubt that very much. 13 minutes at 6:00. andext, the pomp circumstance continues. we look at the billions of pounds of deals that could be on the table. ♪
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anna: welcome back. 70 minutes past 6:00 here in london. is to raisesuisse capital as part of an overhaul that will see the initial public offering of its banking unit. that came as the zurich-baskeed bank missed analysts investments. just over $1 billion a year earlier. japanese stocks have risen
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on more speculation of stimulus, following unexpectedly weak trade data. 0.6% --in december rose that is the slowest in more than a year. and the expectation was a 3.8 percent increase. guy: ferrari, after raising nearly $900 million in its ipo, shares at the top end of the range. have a value of around $12 billion and shares will trade under, get this, the kicker -- race. anna: the chinese president is due to meet david cameron today, before they both attend a business summit in london. inressing british lawmakers parliament, he stressed the independence of the economy. caroline hyde joins us. as does the founder of
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moohla. much has been made of the links between the countries? caroline: he was talking to realizingmps, that the u.k. wants to be the hub. they want to rival hong kong, london was a rival singapore -- the two biggest areas of yuan trading. he understands this. he said we are pioneering in our issue of dominating sovereign bonds. he is trying to woo the chinese by selling our own yuan- nominted debt. the first western country to do that, and the first western country did become a part of the investment bank read all of the saying, i hear you. i understand what you're trying to do. and i receptive to it.
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clearly, this is going to be music to david cameron's years. they are desperately -- himself and john osborne -- saying that the u.k. wants to dominate the space. guy: what is going on at home? caroline: it seems the government can tell the party line when it comes to the president, as well. suddenly, we see a slight rise in the yuan. we see stabilization and speculation that the chinese authorities are actually propping up their own currencies at the moment. as their president goes off to extol the virtues of trading in the united kingdom. thed we not understand that banks are trying to prop up the banks on shore? offshore, we saw the most rise since october the 12th. carrie a bit of a move happening in the market at the moment. but of course the central bank also sold sovereign debt. anna: when they were in the u.s., the chinese were telling us there would not be any further weakening of the
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currency. they were saying that was not their plan. gemma, what do you make of the visit so far? a lot of what caroline has been saying, the financial links. she was talking yesterday about the importance of london as a financial center for offshore trading in the chinese currency. term: over the shorter come there is concern they're taking the other. britain is already one of the top destination for chinese investors. the treasury is hoping that with the next 10-20 years as china becomes our second largest trading partner, one of the main beneficiaries is would be our infrastructure. ,ut the concern there is utility companies for example, does that mean we pay more for our utility bills? because they've had to these bills by guaranteeing higher prices. guy: the city of london -- bending over backwards to make the rules are as flexible as possible. gemma: that is one way to put it. there is a delicate balance.
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that is how foreign investment is good to be important. if you think about from britain's perspective, our goals and a product we want to finance, and the government is more restrictive, our pensions are more restrictive, we need to have foreign investment. the same time, you don't want to bend over backwards to much. you need to maintain some sort of control of your assets, as well. statese: the united withng eyebrows, ping obama saying they will end any sort of hacking. and get hacking continues. i think slightly raised eyebrows to that certainly when you have the headlines the fact that we are seeing steelmakers up to 5000 jobs to go in the united kingdom because of what people feel is the dumping of steel in the u.k. very cheap prices from china coming up here, but look at the statistic, we spend -- back in 2013i think -- you are investing
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six times more. we are net importers for china . they have to correct that because you have germany there with a surplus. and we are there with the deficit. anna: not without controversy, we saw ping meeting with the house of commons. he made some pointed remarks before the speech about the importance of india being a democratic country. they were thrown in. and they have been protected on both sides of support of the chinese government. but they're not protesters, supporters. against the human rights record. guy: caroline hyde on the china story. we just take a step back and look at the global copyright now. and you china into context in -- how seriousan is a slowdown in your book? there is a greater divergence. that is the more interesting story. economists are looking at
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raising rates, others are looking at having to provide stimulus and support. that means as an asset manager, they are differentiating and add value to more you. that is quite exciting. in terms of the china story in particular, once you look at japan for example, if you are able at the corporate sector to be able to strengthen your margins and cut costs and you are more protected, japan will be greater hit by the china story. so i think what is going on at the economic level and what is going on at the corporate level, again those are also two different stories. an you think we will seen these big banks going in different directions. anna: nobody is really expecting a change from the ucb tomorrow. but we actually see any action or is it just a lot of talk or different emphasis coming through? gemma: the interesting thing,
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the rhetoric does move markets. expectation is driving returns. so what is much more interesting have certaint you central banks looking in one direction and others in a different one. the question is, is the dog weighing the tail or the tail wagging the dog. the investors focusing on central banks, but central banks focusing on investors. so -- guy: you actually believe the fed is going to raise rates? gemma: absolutely, the question is the timing. guy: i'm in the market, i have a short-term timeframe. tell me do i win? gemma: with more confidence we can say the timing keeps getting established that they want to air on the side of caution. the economy is still -- guy: because the markets are mispricing where that is coming from? or is because of the economy? about but the bad thing
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that is, the longer it goes on the less room we have to maneuver. because if you have any type of shakeup with a oppositely cannot cut rates again. that the focus on that. anna: they're hovering around 30%. are we going to see a change in rhetoric from the fed, those speakers of the fed and saying it is still on the table for 2015. are they going to stop saying that? genmma: eventually they have to. or they will be proved wrong. to give people and the markets a bit more of an early warning. so actually, we are due to see that. 4546, what is that telling about the economy? gelmma: there are concerns over chinese growth. and even though there are investors out there that are trying to call the bottom, it is like catching a falling knife. it is always the very hard to see what the catalyst will be for change. things are slowing down. anna: gemma godfrey.
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think you for joining us. is going toss ceo raise capital. we will hear from him later on. thiam from credit suisse.
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guy: six: 29 in london. stocks have risen on the collision of more stimulus on week traded a. exports in september rose by 0.6%. that is a slow suspension and more than a year, much lower than expectation of a 3.8% increase. guy: filing requested a to begin impeachment proceedings against the brazilian president, dilma rousseff. it comes after a bribery scandal at petrobras which is pushed her approval rating to record lows. isse will seesu
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the initial public offering of its banking unit. that came as the zurich-based bank missed analyst. increase from $850 million from just over $1 billion next year. let us hear from the ceo. tidjane: showing that it is the wealthiest country in the world per capita. there a lot of assets. there are 200 and three countries in the world, and to be a leading bank is a plus. frankly, we have got me the most of our presence. it is a good possibility for us and we need to do more. banking a swiss universal where we have everything. we are number one in equity, dcm . for 20 years and through them, we had a really good investment
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bank in a really good retail network. we're number 14 futures market shares. it is always easier to do more where you are strong and you want to grow. the notion that we need to put more capital into switzerland and invest over the next years is vital. then there is a variation in the discussion. is an like about the idea asset that is undervalued in our portfolio, universal banks in the wealthiest country in europe have to be on highest multiple. and the way to get that uplift is to have a market price. or 20%, and we price in the market, there are several benefits. it is an incentive for managers to deliver on the objective because it is driven by the market. there is a big consolidation in the swiss market. because of the increased
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compliance costs. a lot of smaller entities are not viable anymore. so we can be a consolidator or a platform aggregator. we have the compliance systems and all the infrastructure. it is about bringing them to us. and having that company gives us a currency to play the game. it is very strategic read and finally, i consider icing on the cake is the raising of capital benefits. for the company, what we said was 2 billion to 4 billion. ancine: given the volatility in the markets, how concerned are you about interest rates? >> it is very dependent on market conditions. of course, if we would only do it if it makes sense from a shoulder value perspective, and -- we willitions
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rate. we are dependent on the market. operationally we can do all the things we need to do with the company to be ready to ipo in 2017. we spent 27 months discussing with the regulator, and we understand what they are trying to achieve. he can do many things, but not control the markets. : francine joins us now from zurich. he is determined to make sure the value of the business is only realized. francine: he certainly is. unlockingard today is the value force with them. the other thing is the capital raising and what he would do with the investment bank. the two go together. but depending on how much you raise capital, you have to cut costs less. so what he is saying is he will raise capital by around $6 billion in cost cuts will be
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around $3.5 billion. so as i like he is more forgiving to shareholders, but quite aggressive with his cost cuts. he was talking about changing the investment banks also in london, because he says it is very expensive in london. he talks about one of his keywords, focusing on three reasons. is a very regional bank, focusing on asia and europe and the u.s.. this is how he is restructuring and remodeling the bank. fran, we will catch up with you little bit later. but the more to come from that interview we have just done with the new boss at cs. he is going to have his work cut out. he is turning out on the right foot. anna: the former barclays ceo says some banks are scaling back or even exiting the u.s. as result of cover capital rules. he spoke to bloomberg.
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>> i feel like the recent decision to exit to sell the private banking business in the u.s., is very hard to run a business that is performance-based compensation if you're under the rules of eu compensation. that was very regulatory driven. if you look at the levels of capital that are required in the u.s. for the foreign banks, they are genetically different from before the crisis. prior to the crisis, the amount of capital that deutsche bank sseclays or credit sui would keep in their business would be a function of the size, complexity of the business. but it would be flexible as the business grew and shrunk. the capital to move around. today, there is a much higher level of capital required in the u.s. business regardless of the size of the business. and it is not flexible. it stays here. and it has changed the economics
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for the foreign banks in the u.s. and i think that is something that i don't want to say they're struggling with it, what is exactly the right business model for the foreign banks? >> using we could see those foreign banks pull out of u.s. businesses? bob: yeah. >> every few years you watch an rbs or deutsche bank over hire and build up the verticals in the u.s., and the bailey. do you think the structural changes are going to happen out of the u.s. market for ever? bob: in some cases, that is probably the right decision. if someone has a weak business proposition and there is higher capital, it probably means they would exit. but there are people with strong business models that have to adjust to the much higher capital and much more stringent leverage rules. that is still going on. i am biased here, but do i think barclays -- with the qualities of the equities we have -- we
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are talking about constraints. please say we cannot cut to success. what are the opportunities? if you are running the bank, where are the opportunities? itself the u.s. is not the. where would you go? bob: this is incredible time to be investing in financial services. the buffer of capital that is being applied is not going to end. as you both know, too big to fail -- if the political and regulatory leaders in the u.s., u.k., and europe are not dealing with resolution and recovery, living will, waste to allow larger banks to fail without creating systemic risk. tooer, they will prevent big to fail by buffer upon buffer of capital, separation and risks from deposits. i'm going on and on. what is his create?
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an incredible osborn advertorial process. gemma, founder of moolah. talking there about the european banking sector, doing business in the u.s. because of the way the capital is put up for u.s. businesses, it seems to be recent regulations really changing banking. gemma: pressure from both ann's, revelatory costs are going up. return cycle returns are going down. with interest rates as low as they are, the amount they can actually earn off of the thread is narrow. they're getting it from both angles. it from both angles breed is a tough environment. guy: jamie dimon was making that point earlier. not bob. what is the right trade around this? obviously, the markets
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are going up they will be one of the most interesting parts of the market to invest in. but there are three areas everyone is looking at. and we are seeing the shift away in terms of investment banking to the more profitable areas. they do this cost-cutting and restructuring -- guy: they all want to be asset and wealth management over here, and you wonder how you differentiate over there? whether this constant drive to raise more capital is ever going to go away? gemma: differentiation is a different issue. they're going to become more and the utility, kind of a transaction behind-the-scenes. i think it is less a focus on differentiation, but maintaining market share and extract value out of wallaets. anna: second be summing up the driven by the regulatory environment. just generally.
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gemma: they're able to restructure the businesses, they will definitely be a move. se halfeard, credit suis is in investment banking. it is hard for wealth management. it is unsustainable. it is national. it should create opportunities, as well. diamond that is where he sees the opportunities enough. are they going to keep spinning stuff off as a look at where the cost of capital is the highest? is it a no-brainer to sell the business? gemma: at what cost? what price will he get for the asset? guy: versus all the other metrics you throw into it. gemma: but have to make our decision, part of the investment banking is profitable. the concern that investments have, will they cut the muscle? anna: talking to you about the positive ipo or the planned ipo
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of the swiss banking unit -- we have another ipo the shape of ferrari. guy: luckily she wore red today. i cannot make up my mind. anna: we do not actually talked either. it all happened by accident. the ferrari ipo, some in the make sense to you? they want to take all other brands and use money that they raise -- gemma: what is going to fuel their growth> have scarcity of supply. secondly, there is china. that is an area of growth. but it is slowing down. interestingly, if they preach ont 10,000 cars a year limit they come under more regulatory scrutiny. there are a few things limiting their growth. guy: why would you want to ipo?
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nevertheless, you are a car company that is what happens been money on the move. electric vehicles are the future. losing on the technology. aston martin is struggling. why do you want to buy in a business, and is tim cook said earlier on, this is going to go through a major resolution. and that is going to cause cash. gemma: they are astronomical. but what there and betting on is that people want to own it. owning a ferrari. it is highly more expensive. but if you look at it, can be very small. they have a loyalty program, which we should talk about as well. if you hold the shares for three years, you get special voting rights. , maybe to be very small some volatility in the market. anna: they want scarcity and
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cars and in shares. guy: is opec about to crush the u.s. oil boom? has it crushed the boom? that is one of the top stories on our website. we will look at the story, coming up next. ♪
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anna: welcome back. 6:46 in london. will raise suisse capital as part of an overall that will see the ipo of its banking unit. that came as the bank reported first-quarter profits. reports,ed analysts just over $1 billion a year earlier. anna: japanese stocks have risen on speculation of more stimulus, following unexpected lee week trade data. is the slowest expansion in more than a year, much lower than it economists had expected. it was 3.8% expectation.
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nearly $900aising million in its ipo, shares at the top end of the ferrari range far out strip the stock will. they will have debt around $12 billion and shares will trade under the ticker race. uk's largest peer-to-peer lending service will be holding a conference in london today. it resulted in the first platform to earn billion pound. s. in the folks on the sector right now, it is a hot sector. i was at a conference recently or people were pointing up the amount of venture capital money is going into peer-to-peer lending. mean, it is not all about money coming out? >> venture capitalists take risks. it allows businesses to start up and grow. a lot of businesses startup
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venture funded. anna: is it money well spent? >> it is really exciting, the u.k. has amazing opportunity to lead the world. given that we lead the world of finance, technology is pretty good, too. i think it is right that the sector is getting the focus that it is. beforeched 10 years ago, the word was even invented. we were the original venture capitalist. guy: the tax situation is changing, are we going to see peer-to-peer going into a different environment? the whole nature is becoming much more widespread, sort of ingrained into the financial -- much more mainstream. as a result, regulatory risk is going to grow. you'll become part and parcel of the environment. if you put the regular tory story against the growth and opportunity and against the changing in the banking story, have we seen the kind of sharp upswing?
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how is the lifecycle developing? gilles: we actually campaigned for regulations. they thought we were certifiable. we were being quite sensible. the campaign for many years for regulations and achieved it, being related by the sca since april 2014. and one of the reasons for campaigning for it was to play some part -- i don't want to be too presumptuous -- played some part in getting a regime that did provide some sort of consumer protection did not kill a nascent industry. that is what we got. anna: that links to emerging markets. people think about the big story could be in emerging markets, where there perhaps our businesses in particular that do not have access to the banking networks that may be european businesses do. do you -- maybe there is less relation there? gilles: they are split into one camps.
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china is about seven times bigger than the united states, intern about four times bigger than us. those countries and china, it is completely unregulated. it is doing about 12% of lending in the country. that is of concern to lenders, try to work out how to position himself. in the developed world, certainly in the u.k. and the u.s., you could use alternative the banks to people who are a have access. compete -- byand providing a better service and value. rather than providing a financial solution to people who do not have an alternative. guy: you expect relations to get tighter? gilles: that is a sin against today. the finance association chairman at our big industry conference, we are announcing a change to our principles. that is to try and stay ahead of
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relation, if you like. in some ways, such a burden upon ourselves that is higher than the relation part -- just to make sure that it does increase. guy: the underlying assumption is that -- gilles: it behaves well and provides great value to consumers. it is not misleading to consumers. that is part of the reason for the changes, to make disclosure more common. so investors can choose between platforms. and make apples to apples and return in a more transparent way. if we can deliver against those returns, i see no reason why the regular would want to increase the burden. anna: there are a lot of lenders and london. gilles: i have heard of them. anna: more and more creep out of the woodwork when we have these conferences. some are in trouble, should they be saved or bailed out by the industry? gilles: i do not think so. there was a recent high profile
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case about a peer-to-peer not based in the u k, and they were using a number of the finest association the got into trouble. but in the u.k., there has been a couple of very small wind downs rather than failure. consumers have not lost any money. but i think consumers understand they are getting a materially better return from investing on peer-to-peer platforms. in return for tying up your money and taking up a small about the money for well expand risks. guy: that is a loss i mixed in. i listen on the radio, and i'm told the money is protected if i put in the bank. and there are all kind of security procedures are being put in place. that money is guaranteed. you think there is a danger that you end up having to be included in that, as result of which are the cost starts ticking. the people understand the risk? you explain it clearly, do you read all the blueprints? lles: the standing point as
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regulators all say it is a risk to consumers. we should in some way prevent ordinary people from having access to which you come up with some kind of test for sophistication. some financial jargon. you are very keen to avoid that, saying we built a business for retail consumers. therefore, judges by whether we explain the risk. fairly. so we did a survey of our customers and said you understand the risks involved? please list them. and given your understanding of them, if you make the decision to invest in a sort of sensible rational trail and the risk and return? and the answer was overwhelmingly yesterdyes. gilles andrews, the chairman and cofounder of a peer-to-peer. guy: the country can fight
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slowing growth was spending. that came as the government announced a $25 billion fund combining both public and private money. > the way out of this what some have described as an impending recession is to spend, rather than to cut back in any way. if we are spending on ways of diversifying and also on infrastructure, but only investing massively in infrastructure, especially power and roads and rail, we are investing our culture as well. while, bob diamond says africa governance a good opportunity. to comey want people in and develop specialized banking for women businesses.
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specialized banking for the agricultural sector. specialized banking for the natural resources sector. so it is fun. it is a lot of hard work. but i think what is really important is that africa is open for business. not many emerging economies with this much potential allow for investments in bank but also allow majority ownership. guy: let us draw some lines between the dots there. nigeria looking to invest oil. africa is a commodity story. the commodity story very much at play as we watch the oil price come down towards the critical $40 level. one big stories we are running on bloomberg.com, tim coulter joins us from our digital team. tim, everyone is waiting and watching can figure out whether guys couldshale survive the opec onslaught. tim: it is interesting to take stock.
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it is than 11 months since they made the decision to respond to shale. and we saw them expand them i think you have a chart over there. how u.s. shale production has continued to expand, back to the level where it was a year ago. there is been a lot of pain for everybody. ysna: every producer pa the price because it is weekend. tim: where does it go from here? continues to look like an l-shaped market. guy: is there no up in your mind? tim: it doesn't seem like it. when you talk to people, they don't think there is much of the recovery anytime soon. anna: we spoke in last week about planning around the prices. they're not far off from where we are now, nothing like a huge bounce in the price. tim, thank you very much. we will tweet out the story
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shortly. guy: coming back, we have a talk about credit suiise. i also talk about how the chinese markets have been crushed. you have shanghai down 3%. but we will come back. and we will see you in a moment. ♪ ♪
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(ee-e-e-oh-mum-oh-weh) (hush my darling...) (don't fear my darling...) (the lion sleeps tonight.) (hush my darling...) man snoring (don't fear my darling...)
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(the lion sleeps tonight.) woman snoring take the roar out of snore. yet another innovation only at a sleep number store. anchor: a swift shakeup. credit siu's spins off its banking unit. anchor: an ipo that gives us a $12 billion valuation. anchor: bad news is good news. e stocks higher on anticipation the boj will push for action. guyome, i'm geithner --
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johnson. anna: i am anna edwards. breaking news from a number of businesses here in europe. guy: let me show you what we think is going to happen. reasonablyg to get a positive start to european trading. let me get you the numbers for you. at the moment, this is where we stand. percent in terms of where equities are going to be opening. shanghai down. corporate news raking. sw credit siu's story -- uise story. caroline poring over the details. caroline: looking at revenue. when you are looking at the profit, 134,000 new
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customers. at $2.8coming in billion -- 2.8 billion pounds overall. that is ahead of where some analysts thought the numbers would be. uptick in operating profit, 10%. 375 million pounds. that does seem to be slightly ahead of where analysts such as morgan stanley numbers have been seen the numbers. they are saying it is 9.8 percent return notable -- percent. turn notable in italy. they are having to pay more for the europa league. expecting revenue to be down. the investment come at the cost to be rising. they have to invest in the europa league.
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with the loss of the champions league, that could weigh on germany and austria. churn, 9.8%. loste seeing overall, some in customers. trying to recalibrate whether they are paying the more pricey subscription. upped the price of description. sales are rising. profit is rising. ofthe moment, additions customers. : thank you very much. getting numbers from the designer in the u.k.. looking to be in line or ahead. guy: in-line or fractionally ahead. nothing really to see. final quarter, strong royalty
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momentum. not anything that will surprise the market. the full yearsay revenue is in line with market expectations. we will talk to the ceo, joining us for his first interview of the day. just after 7:30. guy: the biggest news today, one of the biggest, our next story. uisse raising capital. missed estimates following a loss. -- francineeft quad lacqua sat down. francine: he is raising capital, cutting costs by the tune of 3.5 nguyen franks.
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a refocus of the strategy. it.as reorganized said this is a huge reboot and he is confident, with the amount of capital he is raising, he will have enough for a safety cushion. we can do what we did last week which is taking a number non-preemptive crunch. francs 1.3 billion swiss of firm commitments from good names. raise --tive was to and we raised 4.7 million. francine: he was brought in to boost investor confidence.
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he is trying to root boost investor confidence. anna: what about the investment bank? a lot of weight on the company during the most recent quarter. -- that await on the company during the most recent quarter. francine: his criticism was he was he wasn't strong enough to cut the investment bank. shrink it to focus on asset management. the other thing that came out of the strategic overhaul, the reboot, they are hoping to unlock value in the swiss business. with an ipo. thiam: switzerland is a very wealthy market. the wealthiest in the world. not a bad place to occupy. leading bank there is
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a plus. we have neglected it read we have not made the most of our presence in switzerland. focusing onf swis switzerland, we are number one in equity. we have been for 20 years and switzerland. we have a great investment bank. ultrahighber one in net worth. more, where to do you are strong. the notion we need to put more capital in switzerland. it is right on. there is a valuation discussion. what i like about the ipo, it is going to put a price on a message which i believe is undervalued. a domestically focused, universal bank in the wealthiest country in europe.
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15-20% in the market. several benefits. fors an incentive management to deliver on your objectives. consolidation in the swiss market because of the increased compliance cost. a lot of smaller entities. we can be a consolidator. an aggregator. we have the compliance systems. it is about ringing them to us. to plate into that game. it is very strategic. finally, icing on the cake, there is a material capital benefit. 24 billion. nothing to squeeze at.
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francine: given the volatility of the market, the interest rates. mr. thiam: we will only do the ipo if it makes sense. are nott conditions propecia's, we will wait. we think operationally we can do the things we need to do. is something we have spent months discussing with the regulator. they understand what we are trying to achieve. after that, we can do many things but not control markets. francine: this is a comprehensive plan. guy: it is. we are getting details in terms of how he is going to reshape the swiss business.
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job cuts, 1600 instance are and. -- switzerland. francine: we only have half an hour to understand the strategic overhaul. he was not giving me a figure but he broke it down like this. u.s. will bethe lost or transferred. he is selling the private bank. 1800 jobs possibly in london will be relocated or loss. 1600 and switzerland. jobs changed or transferred to cheaper countries. he said london was very expensive. that is a ballpark figure but would not commit saying how many job cuts will happen. anna: thank you. francine look. laqua.qu guy: let's see what is happening
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in asia. david english. -- ingles. david: a dramatic change for the shanghai composite. 85 or 90 points. a broad-based, we are looking at 800-900 of the stocks. within the index. doing a lot better compared to the forecast. i have been trying to look for a reason why we are seeing this turn in the markets. the best comment i have seen so far. we are looking at speculation forwardhe pbc may come with more easing. it gives you a sense of how touchy sentiment is at the
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moment. once the market starts to turn, it does turn. one analyst in shanghai basically saying this is fairly normal. it is a normal correction, given we have had a bit of a run up. could turn once we get signals or if we get signals that they may step in. the other market story, nikkei. take a look at the strong rally toward the close. you are looking at the best day for the nikkei in three or four weeks. this has to do with the disappointing trade data that came out. fueling expectations the boj may step in. exports to china fell for the second straight time. a trade deficit in japan. weekr yen for example, a -- the fourth or fifth straight
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day where we are seeing dollar yen move up. that is a tailwinds to the session in japan. quickly, let me show you shares of toyota. coming out with breaking news they are recalling 6.5 million vehicles, 2.7 in north america. over what they call faulty power window switches. which once melted, can cause smoke and maybe fire. they are recalling the vehicles to put a fix in for the windows. have a look what is happening across the region. asia, a bit quiet. markets doing the opposite. a quiet day.
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back to you guys. guy: getting the sense of where david would rather be. fast and furious. we are going to break down the ferrari ipo. more on that when we come back. ♪
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welcome back to "countdown." . a strategic overhaul, the ipo of this was thinking unit. -- swiss banking unit. , over $1creased billion a year earlier. anna: japanese stocks have risen on the expectation of central
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bank stimulus. the loweste 0.6%, expansion in more than a year and lower than economist expectations. after $900i trading billion in an ipo. demand outstripping stocks made available. they will have an enterprise by you, which includes debt, around $12 billion. will tradehares under the ticker race. let's talk to an analyst who is in milan for us. come on going out of the range. do you think he got all he wanted out of this? guest: yes. ofn he floated the idea
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floating ferrari, for ferrari to be seen as a luxury goods maker, not a carmaker. he is right. he valued the company about 10 billion dollars. this is what he is getting. the price on the upper range of what was indicated. this operation is not strictly industrial. from an industrial point of view, it has ties. mainly, it is going to stay there. untouched by the operation. means, he separated to two parts of the business.
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luxury ferrari from mainstream and premium cars. including maserati and a jeep and other brands. anna: mention some of the other brands. what is good to be the result of this? be used for? cash he wants to boost brands such as jeep and i'll fall remail. what would you be looking for him to do with the money? operation, thes euros,ise, one billion and the debt that is being transferred, 3 billion, this is going to be reducing the debt ratio. way, it will help financial investment plans fiat has.
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pretty good plans. ambitious plans for the next four years. eurosl in best 50 billion -- invest 50 billion euros in a for romero, jeep, the other brands. this is not directly and industrial operation. it will separate the businesses. the family will keep the fiatity of ferrari even if will merge or whatever. we were hearing about a revolution coming to the car industry. can you give me a sense of how going to be to
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invest in new technology? is it going to keep r&d up? if we are going to see a migration to a lecture to vehicles or electric motors to generate more performance, will to deliver that technology with its current structure? : it is true, but at the same time ferrari has potential. as was presented to the fec for the ipo, ferrari has the potential to increase all you. right now, they have the cap of 7000 cars a year. they say they will increase gradually, maintaining exclusivity, the number of cars sold toward 19,000 units.
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ferrarigoing to help finance operations. it has a cap on profit. this is a good reason for hope. despite the debt that has been charged on ferrari. anna: thank you for joining us. let's bring in our next guest. the head of equity capital, joins us in the capital -- studio. we are talking about two ipo's. ahead in new york. the ferrari one. one that has just been announced, from credit squeeze. -- suisse. by a sensetivated that part of the businesses are not fairly valued.
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ceos are looking for opportunities to create val ue. how much more of this is there to come? large businesses around the world. our ceos going to look at this and say, my chemicals division down the road is not only valued? the value of this business is not reflect that? : despiteh challenging secondary hasets, investor response been positive. you are seeing larger ipo's perform strongly. forc ceo ceosy to look at this -- albertsons postponed its
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offering. there have been some high-profile u.s. that have not happened. always depends on what is going on in the secondary market. we are in a challenging time, with the vicks up. what you are seeing, a reflection of european kets outperforming and reflecting inflows into europe. guy: what is your expectation? you are expecting more? see a: we are going to fairly low conviction market in terms of investors conviction. said, as long as you can deliver one of three things, growth, strong yields, a genuinely differentiated equity story, there will be a market for you.
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ofa: in terms differentiation, pricing a minority stake, boosting the evaluation, to that -- does that make sense? an alternative would just the to publish more information and tell analyst with a have been missing. ofeth: it is a function ceos looking at what their options are. transparency is one lever. investors look for less complexity and new ideas, that is going to be a root they can choose which is productive. guy: 2016, better than 2015? gareth: good question. forre looking at markets 2015, what we have seen, a lot of regulatory change. credit suisse.
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governments, all those things are in play. anna: thank you for joining us. , we aren we come back going to talk technology. see you in a moment to r. ♪
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guy: 8:30 in frankfurt. sse seeks to raise capital. net income rose. rose on thee stocks expectation of stimulus. the slowest
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expansion in a year. anna: a group of high-profile begin in peach and -- file a request for impeachment proceedings against the brazilian president. kong, asian markets interesting. this is where we stand at the moment. up quite sharply. the reason is the expectation that bad news is good news. bad news could mean more stimulus. shanghai took a beating. anna: shanghai coming under more pressure. the boj does meet. aong with the fed and ecb, focus on central banks as we head toward the end of the month. guy: the bloomberg terminal, 0.5% we think on the euro
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stocks. uisse, weke credit siu think will open a little higher on the back of the major strategy. anna: let's go to caroline hyde for earnings stories. caroline: breaking news when you look at switzerland. company, making news and another area. leaving.s this is the company, agricultural company. bid for by monsanto. up goes the share price. down it comes when they rebuff the offer. saying, they are concerned about latin america. 12% drop. is steppingceo
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down. he says it is time for a new perspective, the leader. the new leader is the cfo for the time being. also, breaking news on this patent maker. shares, $400 million worth. amending the debt facilities by restructuring to the tune of 6000 jobs. are rightsizing the business, so they say. metals, commodities. prices under pressure. lonmin shares, down 80%. over the past five years. remember the tragic facilities in 2012. when to keep an eye on as they restructure. the gooding up with numbers. 10% growth in profit.
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they are adding new customers. 134,000 added to read 54 million users. adding a particular broadband. they have kept pretty stable in the u k, despite the fact they have lost the champions league. last way, arm holdings. analyst estimates. a growth story in their share price. we have seen them rising 19%. marchf the recent high in because everybody is factoring slowdown in the smart phone market. we are likely to see a 10% growth story for smartphones this year. 28% last year. slowdown in china is phenomenal. 20% growth.
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this year, 1.2% growth in china. nevertheless, because of new areas of expansion to read smarter chips, this is a company that designs chips using nearly every own in the world. iphone 6 is. we are seeing them get into the internet of things, servers. this diverse occasion -- diverse occasion is helping them. anna: we will return in just a moment. al-assadnews, asher has been in moscow. he had talks with putin on tuesday. ofkey expecting a new wave syrian refugees from aleppo. just before the weekend. more breaking news coming through on the syria story.
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guy: we will return, the tech company out of with numbers. caroline has in running through the details. good morning. happy with what you have delivered? >> topline revenue up a 17%. growth across a number of markets. where the products are used. happy with the q3 results. sense that risks are on the upside? concerns about smart phone sales and china. you see them in line with current expectations. but you are entering with royalty momentum. . >> when you look at how the numbers have played out, come through. licensing revenue at the lower end of the range.
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guy: consolidation in the chip sector. what of that mean for royalties? your businesses? fewer customers? if there are fewer customers, what does that mean? or is that a good thing? consolidation is a theme in the semi conductor industry. companies coming together to create very big companies. having the means to invest in leading edge technology. scale is required for that. building chips is an expensive game. we want big companies to work. on the other hand, we are seeing a lot of stock activity, across the internet of things. licenses in q3, 38 licenses with 27 different companies. a lot of that is new startup activity. guy: what is the margin comparison between those
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comedies coming in and bigger companies producing high-value chips? company thatense a we have already designed, that is effectively 100% margin. bigger,to work with leading edge companies in the development of new products. we have a close partnership model. we like to work with big companies as we defined the next generation. it ends up being more fit for purpose and successful. anna: you talk about consolidation in the chip sector. talk about whether they could be interest in your business. is that something you have to talk to shareholders about? guest: there are always rumors but the business model, we insist on being in independent company. guy: where is the focus on new chips?
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?hat is the purpose give me a sense, because you are designing this stuff. it is going to ultimately power the thing in my pocket. what can you expect? guy: -- guest: it is going to power the home,in your pocket, workplace, car. the breadth of our business. ies,re working with company the cloud providers. microsoft and ibm. people making leading edge chips for smartphones. people making leading edge chips for networking equipment and servers. it is a broad market where our technology is being used. anna: it is focused on smartphones. when does the other out of the business, when does that become the material in terms of royalties? guest: mobile is a big thing for us.
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a lot of the technologies get used in other markets. the chip used for smartphones can be found in a digital tv for example. in terms of royalties, roughly 60% of units are not in mobile devices. strong growth in networking, 20%, embedded that it is, up 30%. we are seeing the growth coming through. is a more diversified business than most people assume. as the units are shipped, we get paid a royalty. that comes through straight to our margins. guy: you talk about the breath, the focus of the business. opportunities. when does the smartphone business scale in the size and profit and profitability of that side of the business? or does it get located elsewhere? you are diversified but it is
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uneven. of iot.ise give me an understanding of how that is going to work. guest: mobile does account for a disproportionately large part of the revenue. investing to make sure that happens quickly. we announced we will be increasing investment over the next couple of years to celebrate our market share in some of these areas where we are already starting to see success. andant it to happen sooner in larger magnitudes. anna: what are you experiencing in china right now? nearly 20% growth in 2014. this is a big market for internet of things. what do you see in china to mark
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guest: the growth of smartphones is slowing down globally. at the same time, we are seeing a greater amount of content. we believe that is a great market for revenue growth for us. at the same time, we are working with lots of committees and china, focusing on i.t. devices. servers. networking equipment moving the data to and fro. a big market for us and very important. cameron's push to do more with china the right it? undergoing the -- is undervaluing the potential or overvaluing it? >> there is no doubt china is a large market. it is important. establishing strong links between the countries is a good thing. we get a lot of support from the british government. --a: no chip market
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producing going on there in china at the moment. small percentage but a priority of the chinese government. they have investment increase the amount of chip manufacturing on the mainland. that is a positive trend our business. the more people doing design, the better. model supports the objective they have. and i: you were at buckingham palace yesterday. pleasure of the going there. it was as surreal as you ask act area at -- as you expect. are night ip company. had he make that work well making sure it is not only a short-term benefit but long-term benefit? guest: we have a strong team in china. many of us visit on a periodic
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basis. it we want to make sure the team is doing the right thing, developing relationships with the right customers. supporting them well. what they want. make sure we have strong government relationships as well. you have to take a broad view. most markets. guy: how much money do you spend on security? we hear from banks all the time, hack attacks. how much money do you spend on making sure your ip is protected? how valuable is that information? how much money do you have to spend securing it? guest: i couldn't tell you how much we spend but we have vigorous defenses. one thing about our business, we are with hundreds of companies. 400 companies. our ip. to license ar
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we have to protect what we do but it is out there. efforts say, this need to be a board level discussion. is it? guest: absolutely. we make sure we have a strong i.t. department internally looking at security risks and constantly staying on top of things. i'm comfortable with where we are and what we are doing. anna: think you very much to read the ceo of arm holdings to read guy: blue sky thinking. how can the pay-tv company make up for the loss of the champion leg football auction it did not win? we will discuss that next. ♪
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are the stories you
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need to know. anna: credit suisse to raise money. reportedsed bank missing analyst estimates. japanese stocks have risen on the expectation of more central bank stimulus. exports rose by 0.6%. moreargest expansion in than a year, much lower than economist acted. anna: toyota recalling 3.6 million vehicles worldwide. vehicles involved produced in japan between january 2005 and august 2006 and also later. guy: the pay-tv company sky has
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posted a rise in first-quarter sales as more people subscribe webheir website evening -- service. big sporting events like the champions league. is the web's dreaming service going to compensate? guest: if you look at the numbers, we see that to an extent. rn was u.k., the chu stable. the impact from the champions league, but if you look at impact changes. the impact was more significant. overall, if you look at the aggregate numbers, they continued with strong customer intake. growth higher than the loss here. -- e a robust
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anna: what doctors are driving expansion? guest: the company has a good record cutting cost. they are realizing synergies by consul biting -- consolidating businesses. ng on centralizing programming. the expansion -- fit into the it media consolidation, netflix, we are seeing at the moment? guest: there are concerns. cable cutting, cord cutting. the pay-tv business. those fears are here. businessok at sky's model, it focuses on getting the premium content and distributing to a greater number of clients.
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and if they are successful getting the right content, the business will be successful. anna: think you for joining us. loan hawkof england's is unflinching when he looks at the risks facing the economy. john pharaoh -- jonathan ferro spoke to him. >> there are greater risks out there. the question is whether these affect the central outlook for the u.k. economy or simply compound some of the downside risks. moment, ifthe anything, it compounds the downside risk. risks to crystallize in a material change, they have to be transmitted into the
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economy through financial channels and confidence channels, not the direct traded channels. anna: jonathan ferro is here. what else did he say? jonathan: he is not alone, thinking the risks are not having an effect. we have a bloomberg poll that said 80% of respondents agreed. voting for a rate hike me here and now. i noticed the seasonal effects to his voting. -- 2015, votes for a hike. i asked him why, the wait and see policy. much act toally say me wants to get moving. he wants to go with the right riskget moving, and do not
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a lane behind the curve which he thinks we are risking current. >> the market does not have the first u.k. rate hike. can you explain it? jonathan: you know how hard i asked him? the division between the mpc, the bank of england, and market pricing. he would not give me anything. at the end of the day, there is a massive difference between coming into sharp relief at the end of the year, and the first height being pushed at 2017. there are just associated with it. the fed,rsation with it is not priced in. anna: it is a funny phrase read what else is coming up on "on the move? you have conversations about the u.k.. jonathan: we will speak about
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credit suisse as well. one thing we haven't spoke about this morning, the possible .mpeachment in brazil politically, that is a meeting. -- amazing. it is going to grip everybody and emerging markets. this is a downturn in growth, what that means politically and domestically. anna: thank you very much. coming up in five minutes. guy: european equities, we think probably 0.5% higher for the get go trade. we will see you tomorrow. ♪
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jonathan: good morning and welcome to on the move. i am jonathan ferro, right here in the city of london. moments away from the start of european trading. rebooting. credit suisse plans to raise more than $6 billion and fresh capital. we speak to the ceo about his plan. is bad news good news? stocks trade higher on speculation that the boj will be forced to act. ferrari prices at the top end of the range. sells for $62 a share. ahead of the open, 20 seconds away.
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this is what puts you marked as this is what futures markets are doing. dax futures up by 19 points. let's get your european market open. good newsyesterday, is bad news. we saw stocks fall in the eurozone, ending with better than expected. it is bad news equals good news, because of japanese exports are meeting -- there is hope of stimulus. recalibrating? yesterday, that came off the table. .1%.100 a more apt -- more appetite for equities here it copper -- equities. let's have a look at how the oil market is doing. we are getting data from the u.s. later

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