HTC drags Taiwan stocks to 13-week closing low

TAIPEI, Oct 30: Taiwan stocks fell 0.6 percent to its lowest closing level in 13 weeks on Monday, trailing regional bourses, as smartphone maker HTC Corp tumbled by the maximum allowed in a session after it forecast a fall in revenue in the current quarter. The main TAIEX index finished 42.39 points down at 7,091.67, its lowest ...more

Australia shares edge higher; Virgin soars

MELBOURNE, Oct 30: Australian shares nudged up 0.2 percent on Tuesday as investors bought into defensive sectors, though the market lacked broad direction with Wall Street closed for at least two days due to powerful storm Sandy.Shares in Virgin Australia Holdings Ltd jumped 5.4 ...more

Hong Kong shares ease as developers sink again, China up

HONG KONG, Oct 30: Hong Kong shares weakened in morning trading on Tuesday, with local developers slipping further into the red in the wake of curbs on real estate purchases in the territory announced last Friday.. ...more.

RBI penalises Vijay Co-op Bank, Ahmedabad

MUMBAI, Oct 30: The Reserve Bank of India (RBI) has imposed a

penalty of Rs 5 lakh on The Vijay Co-operative Bank Ltd., Ahmedabad,for violation of Know Your Customer (KYC) ..more

South Korea to inspect FX trading at banks as won strengthens

SEOUL, Oct 30: South Korean authorities plan to inspect foreign exchange trading at banks operating in the country from next week, a senior finance ministry official said on Tuesday, a move seen as aimed at curbing the won’s strength.The central bank ...more

Mutual fund distributor registration fees slashed by up to 80%

NEW DELHI, Oct 30: Taking forward the steps initiated by the government and the market regulator Sebi to revive mutual fund investments, the fund houses have slashed the distributor registration fees by up to 80 per cent to boost their sales....more

BOJ eases policy as recession risk delays deflation end

TOKYO, Oct 30:The Bank of Japan eased monetary policy on Tuesday for the second straight month by increasing asset purchases, as slumping exports and factory output heighten pressure for bolder action to support an ....more

Wal-Mart’s investment in Bharti arm as per law: Rajan Mittal

NEW DELHI, Oct 30: Bharti Enterprises has rejected allegations that it had violated rules in the investment by Wal-Mart Stores Inc in its subsidiary."(There is) no violation. It is as ....more

Sydney Harbour top property in Australian ‘Monopoly.

Apple software, retail chiefs out in overhaul

No move to dismantle MSP and PDS, says Montek...

UBS to slash 10,000 jobs in fixed income exit ...

 



HTC drags Taiwan stocks to 13-week closing low

TAIPEI, Oct 30: Taiwan stocks fell 0.6 percent to its lowest closing level in 13 weeks on Monday, trailing regional bourses, as smartphone maker HTC Corp tumbled by the maximum allowed in a session after it forecast a fall in revenue in the current quarter.

The main TAIEX index finished 42.39 points down at 7,091.67, its lowest close since July 26. HTC dropped 7 percent to T$219.50.

The Taiwan dollar was up slightly to stand at T$29.258.

Foreign investors were net sellers on Friday, bringing their total selling to T$32.3 billion this month.

(agencies)

Australia shares edge higher; Virgin soars

MELBOURNE, Oct 30: Australian shares nudged up 0.2 percent on Tuesday as investors bought into defensive sectors, though the market lacked broad direction with Wall Street closed for at least two days due to powerful storm Sandy.

Shares in Virgin Australia Holdings Ltd jumped 5.4 percent after the country’s No. 2 airline said Singapore Airlines would buy a 10 percent stake for A$105 million ($108 million), helping it to vie with Qantas Airways.

A separate plan by Virgin to buy regional carrier Skywest sent the smaller airline’s shares surging 57 percent.

The benchmark S&P/ASX 200 index gained 8.8 points to close at 4,485.7, building on a gain of 0.1 percent on Monday.

Australia’s leading biopharmaceutical producer, CSL Ltd , rose 0.5 percent. Phone company Telstra Corp Ltd gained 1.0 percent.

‘The banks and the defensive stocks have done okay, but it is a wishy-washy performance,’ said F.W Holst research manager David Spry.

‘Gains will be hard to sustain because earnings are under a bit of pressure in Australia and there is a feeling it will be difficult to achieve any meaningful growth this financial year,’ Spry said.

The broader market is down 2 percent from a 15-month high hit earlier this month.

Major banks rose, led by a 0.9 percent rise in Commonwealth Bank of Australia.

CBA said at its annual general meeting on Tuesday that it expected demand for credit to remain subdued and it would retain its conservative business settings.

Shares in rural services company Elders Ltd collapsed 22 percent to A$0.19 in heavy volume about 10 times an average session, one day after saying it plans to put its main business up for sale.

Shares in casino operator Crown Ltd eased 0.5 percent. Chairman James Packer told the annual shareholders’ meeting Crown was set to take advantage of growing Chinese tourism by upgrading its facilities.

U.S. Stock markets will be closed for a second day on Tuesday, as Wall Street turned its attention to whether markets would be able to resume functioning on the month’s final trading day on Wednesday.

New Zealand’s benchmark NZX 50 index lost 10 points to 3,941.3.

(AGENCIES)

Hong Kong shares ease as developers sink again, China up

HONG KONG, Oct 30: Hong Kong shares weakened in morning trading on Tuesday, with local developers slipping further into the red in the wake of curbs on real estate purchases in the territory announced last Friday.

Chinese banks were among the losers, as profit taking emerged following gains prompted by strong third-quarter earnings from three of China’s ‘Big Four’ banks. The fourth, Industrial and Commercial Bank of China (ICBC), is due to post its results later on Tuesday.

The Hang Seng Index went into the midday trading break down 0.5 percent. It is now down 1.8 percent from last Thursday’s 2012 closing high. The China Enterprises Index of the top Chinese listings in Hong Kong shed 0.7 percent.

In the mainland, the CSI300 Index of the top Shanghai and Shenzhen listings edged up 0.2 percent, while the Shanghai Composite Index was up 0.1 percent.

‘It’s mostly range-trading at the moment, but Chinese companies that have posted good third-quarter earnings should get a lift if we get a positive China PMI on Thursday,’ said Edward Huang, equity strategist at Haitong International Securities.

Beijing is due to post its official PMI on Nov 1 at 0100 GMT. The PMI were expected to show factory activity accelerated in October to its fastest pace in five months, strengthening hopes that growth is recovering in the world’s second-largest economy.

ICBC and Bank of Communications, China’s fifth-largest lender, slipped 1.4 and 1.8 percent respectively ahead of their third-quarter corporate earnings expected after markets close on Tuesday.

Losses on Tuesday trimmed their October gains to 10.3 and 6.8 percent respectively, but both are still trading at a 44 and 57 percent discount to its historical median 12-month forward price-to-book value, according to Thomson Reuters StarMine.

In the past 30 days, analysts have upgraded their earnings-per-share estimates for both banks by an average of about 3 to 4 percent, according to StarMine.

Shares of Warren Buffett-backed Chinese automaker BYD Co Ltd slumped 5.5 percent in Hong Kong and 1.3 percent in Shenzhen after posting a 94 percent slide in third-quarter net profit due to a slumping domestic market and its money-losing solar energy business.

CHINA & HK PROPERTY SHARE PRICE DIVERGE

On Tuesday, New World Developments slipped a further 2.7 percent after sinking 6.4 percent on Monday. It is still up 88 percent on the year, compared to the 16 percent rise on the Hang Seng Index.

The Hong Kong government had late on Friday imposed a 15 percent tax on foreign and corporate real estate buyers and stiffened the resale stamp duty fees in the hope of calming the city’s property prices, which have surpassed historical highs hit in 1997.

Henderson Land slipped 1.1 percent and Wharf Holdings lost 1.5 percent, but Hang Lung Properties bucked weakness in the sector, up 1.1 percent after also outperforming on Monday with a 1.8 percent loss.

Dealers cited the company’s sizeable exposure to the mainland Chinese property market.

The Chinese property sector was strong, particularly in mainland markets, on Tuesday after the second-largest player in the sector by market capitalization, Poly Real Estate posted a 95 percent rise in third-quarter earnings late on Monday.

Poly jumped 2.4 percent in Shanghai, helping the Shanghai property sub-index rise 1.3 percent.

(AGENCIES)

RBI penalises Vijay Co-op Bank, Ahmedabad

MUMBAI, Oct 30: The Reserve Bank of India (RBI) has imposed a

penalty of Rs 5 lakh on The Vijay Co-operative Bank Ltd., Ahmedabad,for violation of Know Your Customer (KYC) norms and operational instructions and distributing dividend without obtaining prior approval from RBI.

The Reserve Bank of India had issued a show cause notice to the bank in response to which the bank submitted a written reply.

After considering the facts of the case and the bank’s replies as also personal submission in the matter, the RBI came to the conclusion, that the violation was substantiated and warranted

imposition of the penalty, a RBI release said. (UNI)

South Korea to inspect FX trading at banks as won strengthens

SEOUL, Oct 30: South Korean authorities plan to inspect foreign exchange trading at banks operating in the country from next week, a senior finance ministry official said on Tuesday, a move seen as aimed at curbing the won’s strength.

The central bank and the Financial Supervisory Service—a financial markets regulator—plan to jointly investigate the banks to look into their foreign exchange and derivatives trading, the official said.

Analysts and traders said the move underscored the intention of policymakers to cap the won’s rapid appreciation for fear it would hurt the competitiveness of exporters. Officials at the ministry and the Bank of Korea denied the argument.

‘There’s been an increase in (currency derivative) positions in the first half. It’s partly because their equity has increased, but the U.S. Fed implemented QE3 and conditions have changed, and so we want to closely monitor the market,’ another finance ministry official said.

All officials declined to be identified.

South Korea introduced ceilings on currency derivative positions at banks two years ago as part of its efforts to mitigate the rush of foreign capital into the country because a sudden reversal in the flow could cause a currency crisis.

The government has said it could adjust the ceilings depending on the market’s situation on a quarterly basis and analysts said the planned inspection could lead to a toughening in the regulations for the next quarter.

‘I think they’re trying to slow (the won’s appreciation) down to a point. But in the long term, the strengthening trend (of the won) will be maintained,’ said Ma Ju-ok, economist at Kiwoom Securities.

Traders showed a muted reaction as they have already been wary of potential market interventions by local foreign-exchange authorities. The won was down less than 0.1 percent against the dollar as of 0140 GMT.

South Korea and other emerging market economies have been complaining about large capital inflows resulting from ultra-loose monetary policy in advanced countries that were lifting their currencies and destabilising their markets.

The won has gained 5.1 percent against the dollar this year and the pace of increase has quickened in recent weeks. In cross-rate terms, the won has strengthened nearly 10 percent against the yen and by 5 percent against the yuan so far this year.

South Korean exports fell 5.6 percent during the third quarter over a year earlier as the protracted crisis in Europe put an additional dent on demand around the world at a time of slowing growth elsewhere.

The country’s economy, the fourth-largest in Asia, posted almost no growth in the July-September period over the previous quarter as a gloomy export performance prompted companies to slash investment in plants.

Sustained current account surpluses, mainly as a result of depressed imports, also supported the won’s strength, with data from the Bank of Korea showing on Tuesday that the country posted a current account surplus of $3.9 billion in September.

It was smaller than a revised $4.46 billion surplus in August, but the country has been posting current account surpluses each month for three and a half years. (AGENCIES

Mutual fund distributor registration fees slashed by up to 80%

NEW DELHI, Oct 30: Taking forward the steps initiated by the government and the market regulator Sebi to revive mutual fund investments, the fund houses have slashed the distributor registration fees by up to 80 per cent to boost their sales.

The revised registration fees, which mutual fund industry body AMFI (Association of Mutual Funds in India) charges to the MF distributors, would be effective from November 1.

Besides, AMFI has also announced a small registration fee of Rs 3,000 for a newly created cadre of distributors, which includes retired government employees, teachers and bankers.

The Securities and Exchange Board of India (Sebi), which regulates mutual funds and other segments of capital markets, recently announced a slew of measures for benefit of mutual fund industry, including provision for a new distributor cadre and incentives for reaching out to smaller cities.

The government has also favoured steps for encouraging investors to put their money in mutual funds, equity and insurance products, rather than in idle assets like gold.

As per the regulations, all mutual fund distributors are required to get registered with AMFI and get an ARN (AMFI Registration Number) for selling MF products.

"The revised fees will be effective from November 1, 2012 and shall be made applicable to those distributors who apply for fresh registration on or after November 1, 2012 and to the existing ARN holders whose ARNs are falling due for renewal on or after November 1, 2012," AMFI said in a circular.

As per the revised structure, the ARN fees for NBFCs have seen the biggest decline of 80 per cent to Rs one lakh (from Rs five lakh earlier), while fees for proprietary firms have also been slashed considerably from Rs 10,000 to Rs 3,000.

The fees for individuals and senior citizens have been lowered from Rs 5,000 to Rs 3,000.

A similar fee of Rs 3,000 would apply to the newly approved distributor class comprising of postal agents, retired teachers, retired government and semi-government officials, retired bank officers and other similar persons with a service of at least ten years in their organisations.

AMFI further said that the "fees for renewal of ARN will be 50 per cent of the fees payable for fresh registration under respective category of distributors".

ARN is allotted to individual agents, brokers, and other intermediaries engaged in selling mutual funds after they pass the AMFI/NISM (National Institute of Securities Market) certification test. Besides, AMFI also allots ARNs to corporates engaged in business of selling mutual funds.

The ARNs allotted to mutual fund distributors are valid for a period of three years and need to be renewed thereafter. (PTI)

BOJ eases policy as recession risk delays deflation end

TOKYO, Oct 30:The Bank of Japan eased monetary policy on Tuesday for the second straight month by increasing asset purchases, as slumping exports and factory output heighten pressure for bolder action to support an economy on the cusp of recession.

The move was widely expected by markets as the central bank has faced renewed calls from politicians for further steps to achieve its 1 percent inflation target.

The central bank expanded its asset-buying and lending programme by 11 trillion yen ($137.82 billion) to 91 trillion yen with 10 trillion of the increase split evenly between longer-term government bonds and treasury bills. One trillion was earmarked for an increase in purchases of riskier assets, half of it assigned to exchange-traded funds (ETF).

The yen jumped and 10-year bonds erased earlier gains after the stimulus came just a notch above the 10 trillion yen figure priced in by markets.

The BOJ also said it would create a new loan programme to supply banks with cheap long-term funds without limiting the amount of cash made available.

In a rare gesture, the government and the BOJ issued a joint statement pledging their combined efforts to overcome deflation and strengthening a commitment to the inflation goal.

‘The BOJ will pursue powerful monetary easing aiming for 1 pct inflation and until that goal comes into sight,’ the statement said.

The central bank is set to cut its economic and price forecasts in a semi-annual outlook report due out on Tuesday, and push back the timing for achieving its 1 percent inflation target, having earlier aimed for sometime in the fiscal year ending March, 2015.

The BOJ set a 1 percent inflation target and expanded asset purchases in February, and followed up with another stimulus in April. It boosted asset purchases by 10 trillion yen again in September to ease the pain from the global slowdown.

But the government has piled renewed pressure on the BOJ, with consumer prices falling for five months in a row in September and diminishing prospects for beating deflation any time soon.

The market reaction suggested investors looked past the BOJ’s pledges, focusing instead on the size of the immediate stimulus.

‘The contents of the BOJ’s easing were within the expectations and the market may have been slightly disappointed, which led the yen rises,’ said Koichi Haji, chief economist at NLI Research Institute in Tokyo.

‘The BOJ will likely continue to face monetary easing pressure.’

Data on Tuesday showed industrial production fell in September at the fastest pace since last year’s earthquake and job availability dropped for the first time in more than three years, heightening the case for further BOJ action.

Since 2003, the BOJ has never eased policy for two months in a row, usually opting instead to spend several months weighing the impact of its action on the economy before expanding stimulus again. The unusual move this time underscores the political heat the central bank was under amid growing signs of weakness in the economy.

Economics Minister Seiji Maehara, a vocal advocate of aggressive monetary easing, attended the BOJ’s rate review for the second straight time to make a direct call for action.

But many economists say the BOJ’s move will have little direct effect of stimulating the economy with markets already awash with extra cash.

Bank lending rose just 1 percent in the year to September even as the BOJ pumped more than 60 trillion yen so far via its asset buying and lending programme, as companies remain reluctant to borrow for investment due to the murky outlook.

The central bank sees room to boost purchases in Japan’s 685 trillion yen market for government bonds. But some in the bank worry that trying to nudge down yields further could distort markets with five-year bonds now yielding less than 0.2 percent.

Japan’s economy outperformed most Group of Seven peers in the first half of this year on spending for reconstruction from last year’s earthquake. But weak exports and a strong yen have led some analysts to project Japan may fall back into recession.

Two government representatives can attend BOJ policy meetings. They cannot vote but can express their views and request a delay in votes on policy decisions. (AGENCIES)

Wal-Mart’s investment in Bharti arm as per law: Rajan Mittal

NEW DELHI, Oct 30: Bharti Enterprises has rejected allegations that it had violated rules in the investment by Wal-Mart Stores Inc in its subsidiary.

"(There is) no violation. It is as per the law of the land," Bharti Enterprises Vice-Chairman and Managing Director Rajan Bharti Mittal told.

The Rs 455.8 crore investment by Wal-Mart in Cedar Support Services Ltd, a subsidiary of Bharti Ventures, had come under attack from CPI Rajya Sabha member M P Achuthan, who wrote to Prime Minister Manmohan Singh last month saying it was "illegal" and flouted FDI rules.

He further said the government had also asked about it and the company has furnished details.

"We have given them (replies)...We have given our submissions to the government," Mittal said when asked to comment on Department of Industrial Policy and Promotion referring the issue to RBI.

When asked for comments about Commerce and Industry Minister Anand Sharma informing the Rajya Sabha in September that Wal-Mart had made the investment in Cedar via its Mauritius arm but the RBI had no FDI data of the same, Mittal said: "I have no idea. We have given everything what is required".

In a letter to the Prime Minister, Achuthan, a Member of the Standing Committee on IT had alleged "the entire FDI has been diverted and illegally invested by Cedar in its 100 per cent subsidiary Bharti Retail Ltd, which is carrying out multi-brand retail operations".

Stating that the fact could be verified from the audited accounts filed by Cedar with Registrar of Companies, the MP had asked the government to "undo this illegal investment immediately; initiate penal proceedings against Wal-Mart and Bharti group under FEMA".

Achuthan had further said: "Ban Wal-Mart permanently from India, including its joint venture for the wholesale cash and carry operations with the Bharti Group." (PTI)

Sydney Harbour top property in Australian ‘Monopoly

SYDNEY, Oct 30: Sydney’s Opera House and Bondi Beach are amongst some of the iconic landmarks featuring in Australia’s first official Sydney Monopoly board game, but Sydney Harbour scooped the title of most exclusive property.

‘It has taken a while, we apologize for that, but as soon as the opportunity came up, we grabbed it with both hands and we wanted to get Sydney to the Monopoly market as soon as possible,’ said Reid Herbert from the games manufacturer Winning Moves on Tuesday, the day the board game was officially launched.

Sydney Harbour now takes its place among other plum properties, the equivalent of Boardwalk in the U.S. Version and Mayfair in the London edition.

‘Sydney Harbour is highly regarded as one of the world’s finest harbours for its beauty ... Which is also integral to the Sydney Monopoly board,’ Herbert said in an earlier statement.

After deciding to make the game, the company in early 2012 called for public nominations for landmarks via Facebook. From a flood of nominations 22 places from Sydney and the greater Sydney area were selected.

‘It was enlightening consulting with the public, who resoundingly favoured our two famed harbour properties, the Sydney Harbour Bridge and the Sydney Opera House,’ Herbert added in the statement.

Other destinations include Circular Quay, ‘national’ surfing beaches such as Manly and Cronulla, and Coogee Beach, a popular swimming spot.

Additional Sydney twists include extra points for the best float at the annual Sydney Mardi Gras, a gay pride celebration attracting over 20,000 international visitors each year.

Monopoly is played in 111 countries and in 43 languages around the world, the company said. The Sydney version is set to go on sale from Nov. 1.

(AGENCIES)

Apple software, retail chiefs out in overhaul

SAN FRANCISCO, Oct 30: Apple Inc CEO Tim Cook on Monday pushed out the powerful head of the company’s mobile software products group, sources said, in a major management shake-up that also claimed the recently hired chief of the retail stores division.

Scott Forstall, a long-time lieutenant of late Apple co-founder Steve Jobs, was asked to leave following years of friction with other top executives and his recent refusal to take responsibility for the mishandling of the Apple’s much-criticized mapping software, people familiar with the situation said.

Sources said Forstall refused to sign a public apology after Apple’s mapping product, which displaced the popular Google Maps on the iPhone and the iPad in September, contained embarrassing errors and drew fierce criticism.

Instead, Cook signed the letter last month.

Forstall will leave the company next year, Apple said in a statement. He did not respond to emails seeking comment.

The executive changes are the biggest at Apple in more than a decade, and mark the first major move by Cook to shape his own management team since Jobs’ death a year ago.

John Browett, who was hired as the company’s retail chief just seven months ago after serving as CEO of U.K. electronics retailer Dixon’s, will also leave Apple.

His efforts to improve profits at the stores had alienated employees and sources close to Apple said Cook had concluded he was simply the wrong person for the job.

‘These changes show that Tim Cook is stamping his authority on the business,’ added Ben Wood, analyst with CCS Insight, said. ‘Perhaps disappointed with the Maps issues, Forstall became the scapegoat.’

INCREASING COMPETITION

While Apple has enjoyed enormous success since Cook took the helm, recent stumbles including the Maps debacle and several earnings disappointments have underscored the long-term challenges the company faces in retaining its dominance in the smartphone and tablet markets.

In Google, Amazon.Com Inc, Microsoft and Samsung Electronics, Apple faces an array of powerful competitors who are determined to own a piece of the exploding mobile-computing market.

‘Competition is moving much faster to be more Apple-like,’ said Tim Bajarin, president of technology research and consulting firm Creative Strategies.

The executive changes hand substantially more responsibility to Jonathan Ive, Apple’s celebrated industrial design chief, who will now oversee both hardware and software design.

Eddy Cue, a long-serving executive who runs online products, will take charge of Apple Maps and the Siri voice search software. Craig Federighi, who oversees the OSX software that powers the Macintosh computers, will take charge of the iOS software.

The retail stores will report directly to Cook while a search is conducted for a new head of the division.

Shares of Apple, the world’s largest publicly traded company by market value, have declined 14 percent in the past month since reaching a 52-week high of $705.07 in September.

UPROAR OVER MAPS

People with knowledge of Apple’s inner workings said Forstall’s departure was years in the making, and came to a head with the Apple Maps incident.

A 15-year veteran of the company, Forstall was once considered a possible CEO candidate and is credited with playing a central role in making the iPhone and the iPad two of the most successful consumer electronics products ever.

But Forstall was also considered a hard person to work with, and he alienated other senior executives with his abrasive style, one person familiar with the situation said. This person added that once Jobs passed away, Forstall was left with few defenders at the top of the company.

The fate of the executive, who had 1,000 people directly reporting to him, was sealed by the Maps debacle. Even after a public uproar over the shortcomings and widespread calls for Apple to revert to Google Maps, Forstall would not acknowledge the gravity of the problem, a source with knowledge of the matter said.

Forstall instead likened the situation to the complaints over the antenna in an earlier iPhone and insisted it would blow over without a public mea culpa, the source said. But Cook disagreed, and issued a public apology with his own signature on it after Fortstall would not go along, the source added.

Apple described Monday’s moves as a way to increase ‘collaboration’ across its hardware, software and services business. Forstall will serve as an advisor to Cook until his departure.

Putting the mobile and personal computer software teams together under Federighi could improve operations within the company, particularly as the capabilities and features of smartphones and PCs increasingly converge, said analysts.

Ive, now responsible for design across all products, has played a key role in Apple’s success by imbuing its gadgets with a distinct look and feel.

BGC Partners analyst Colin Gillis said Ives could now help reinvigorate the look of Apple’s software, which has been slow to evolve.

‘If you have two different heads, you have two different fiefdoms,’ he said.

QUESTIONS ABOUT BROWETT’S HIRING

Browett, the ousted retail chief, was simply not a good fit for the company, people familiar with the matter said—raising questions about how well the high-profile hire was vetted in the first place.

A source familiar with Browett’s hiring said Apple board member Millard Drexler, a legend in consumer retail who is now CEO of J. Crew, did not even meet Browett before he was hired.

Browett took over from Ron Johnson, who is credited with making the Apple stores as revolutionary a force in retailing as the products have been in computing. Johnson left the company last year to become CEO of J.C. Penny.

Browett angered store staff when he cut some workers’ hours in effort to make staffing more efficient. He also could not improve the slow pace of Apple’s retail expansion in China, a region Cook has said was key to the growth of the company.

(agencies)

No move to dismantle MSP and PDS, says Montek

NEW DELHI, Oct 30: Pitching for direct cash transfer of food subsidy, Planning Commission Deputy Chairman Montek Singh Ahluwalia today assured this would not result in dismantling of current system of procuring grains at minimum support price (MSP) and distribution through PDS.

"...About the cash transfer (of subsidy), the accusation is that you want to dismantle the PDS. This is completely wrong because there is no question of dismantling the minimum support prices," Ahluwalia said at a meeting of state food ministers for strengthening PDS.

The government would continue the public procurement of food grains like wheat and paddy and sell it without subsidy through PDS, he said adding that food subsidy would be transferred directly into the bank accounts of the beneficiaries to plug leakages.

Echoing similar views, Food Minister K V Thomas said, "Among other measures to check the leakage and diversions, an alternate model of direct transfer of food subsidy is being considered".

Finance Ministry has proposed to introduce direct cash transfer of food subsidy in Delhi and six union territories including Chandigarh and Puducherry.

Ahluwalia also hinted there would be pressure on global food prices and there is high export potential. However, according to government data, India is net importer of edible oils and pulses.

He also pointed out that if India achieves high economic growth in next ten years, the per capita income would be doubled which would led to change in food mix.

"I think that if we succeed in the economic growth target, that we have set ourselves, then per capita income of the country will be doubled in ten years.

"The complaint today is that the prices of non-food grains items are high. The prices of vegetable, milk and meat are rising much more than food grains. In the overall food economy, the PDS is shrinking part," he added. (PTI)

UBS to slash 10,000 jobs in fixed income exit

ZURICH, Oct 30: UBS unveiled plans to wind down its fixed income business and fire 10,000 bankers in one of the biggest bonfires of finance jobs since the implosion of Lehman Brothers in 2008.

The move will focus the Zurich-based lender and wealth manager around its private bank and a smaller investment bank, ditching much of the trading business that saw it lose $50 billion in the financial crisis and one suspected rogue trader lose $2.3 billion last year.

Chief Executive Sergio Ermotti, a former Merrill Lynch banker who took over after the trading scandal, is spearheading the three-year investment banking overhaul that is aimed at saving 3.4 billion Swiss francs ($3.63 billion), on top of existing cuts of 2 billion francs.

The Swiss bank will separate many fixed-income activities in order to wind down positions in businesses it will exit as they are no longer profitable due to far tougher capital rules on riskier business introduced after the crisis.

Current investment bank co-head Carsten Kengeter will leave UBS’s top management board to head the discontinued unit.

The remaining investment bank, comprised of equities, foreign exchange trading, corporate advice, and precious metals trading, will be run by Andrea Orcel, a recent Ermotti hire from Bank of America who currently co-runs the unit with Kengeter.

‘The net impact of all these changes will be transformational for the firm,’ chairman Axel Weber and Ermotti told shareholders in a letter. ‘Our overall earnings should be less volatile, more consistent and of higher quality.’

The measures translate to a 15 percent staff cut, taking UBS’s overall staff to 54,000, from 63,745 now.

Roughly 2,500 jobs will be cut in Switzerland, with the remainder mainly in London and the United States, where UBS runs considerable trading operations out of Stamford, Connecticut.

A smaller investment bank will leave UBS to focus on its private bank, which looks after the affairs of rich people. It is the second-largest operation of its kind in the world after Bank of America with 1.6 trillion francs in assets.

UBS shares, which soared 7.3 percent on Monday in anticipation of the announcement, were indicated to open up 0.9 percent in an otherwise weaker market, according to pre-market indications from bank Julius Baer.

‘Overall, I think it’s a good move to abandon activities which don’t earn anything and concentrate on those which create value for shareholders,’ Bank Sarasin analyst Rainer Skierka said. He rates UBS stock at neutral.

INVESTMENT BANK LOSSES

UBS was one of the banks hardest hit by the financial crisis when its fixed-income unit racked up more than $50 billion in losses after gorging on subprime securities, forcing it to seek a bailout from the Swiss government in 2008.

After settling a damaging U.S. Tax probe in 2009, the bank had just started to rebuild client confidence when the $2.3 billion trading scandal surfaced in September last year.

Kweku Adoboli, who worked on the bank’s London-based exchange-traded equities funds desk, has pleaded not guilty to two counts of fraud and four of false accounting over the costly bets. His trial is under way in London.

Ermotti’s overhaul comes against the backdrop of far tougher regulation on riskier securities trading activities, and represents a return to advisory roots stemming from UBS’s purchase of Warburg, a British merchant bank, in 1995.

The expected UBS cuts will add to existing cuts of 3,500 jobs, part of the tens of thousands of jobs the financial sector has shed globally since the financial crisis of 2008.

The bank aims to pay out more than 50 percent of profits to shareholders from 2015, after paying a symbolic dividend of 0.10 francs a share last year. It has put away funds in the third quarter for an unspecified dividend this year, financial chief Tom Naratil told journalists.

The costs related to the investment banking split will also lead to a fourth-quarter and full-year loss, when taken together with charges on the bank’s own debt, UBS said.

UBS’s private bank also faces challenges, with profits falling as Swiss banking secrecy is weakened by repeated demands from foreign governments determined to recoup tax on undeclared funds held in offshore accounts.

The unit secured 7.7 billion francs in net new money from clients in the third quarter, which represents the highest result in a third quarter—traditionally a slow one for the business due to summer holidays—in five years.

UBS’s rival Credit Suisse said last week it was also cutting more costs as part of efforts to bolster its profits and capital position.

UBS swung to a third-quarter net loss of 2.172 billion francs, hit by the restructuring charges as well as 863 million francs in charges on the value of its own debt. Analysts in a Reuters poll had forecast a net profit of 457 million francs.

UBS targets a drop in risk-weighted assets to below 200 billion francs by the end of 2017, from 301 billion currently. Of this the investment bank will soak up roughly 70 billion, less than half of what it accounts for today. (agencies)

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