This has some interesting stuff in it so I forwarded it in
its entirity.
---------------
(Embedded image moved to file: PIC12196.PCX)
April 2, 1998 NewsWatch
| Chase Stock Price | 136 | +1 1/8 |
| Dow Jones Industrial | 8868.32 | +68.51 |
| Average | | |
| | | |
|--------------------------+------------+--------------->
Six Gainers, Six Losers Among 12 Leading Bank Stocks; Dow, Bonds Up
Bank Stocks: Yesterday's trading saw six gainers, six losers among the
leading banks listed above, with most changes moderate. Chase closed up 1
1/8, Citicorp up 1/2, J.P. Morgan down 1 1/16.
Dow Industrials: Closing up 68.51, the Dow posted its second straight gain,
joined yesterday by other major indexes, the NASDAQ Composite at a record
high close.
Bonds: Treasurys rallied late yesterday on short-covering, a strong dollar
and expectations for follow-through bond buying in overseas markets. In
the day's only major economic report, the National Association of
Purchasing Management said its index of business activity surged to 54.8%
last month from 53.3% in February, whereas economists had expected the
figure to be unchanged to slightly lower. In late trading, the benchmark
30-year Treasury bond was up 23/32, trimming yield five basis points to
5.88%.
Other Indexes: Tokyo's Nikkei 225 stock index closed down a steep 3 1/3%
today (Thursday), Hong Kong's Hang Seng down 1 1/4%. Late this morning,
London's FT 100, retreating from somewhat bigger gains earlier, was up a
mere 6 points at 6023 after gaining 1.44% yesterday.
[Wall Street Journal, New York Times, Investor's Business Daily, CBS Radio,
others]
All items are from today's news media unless noted otherwise.
CHASE IN THE NEWS
Some 45% of automated teller machines (ATMs) impose surcharges, up from 33%
last year, according to a random survey of 200 ATMs statewide and nearly 70
in New York City, says the New York Public Interest Research Group.
Nationwide, says the U.S. Public Interest Research Group after surveying
470 banks and 46 credit unions, 71% of ATMs charge consumers who bank
elsewhere and often face a fee from their home institutions. Newsday
reports Chase and Citibank spokesmen said neither charges non-account
holders ATM fees. No state has approved legislation to ban ATM fees, but
Sen. Alfonse D'Amato (R-NY) vows Congressional legislation will be passed
this year to ban ATM surcharges. [Daily News, New York Post, Washington
Post, others]
Chase first-quarter earnings per share are expected to jump 14% from last
year to $2.26 -- the best showing among money center banks, according to
analysts as calculated by First Call Corp. Chase, Bankers Trust and J.P.
Morgan are expected to take the heaviest blows from weak Asian results, but
Chase and BT "are expected to make up for the losses through revenue from
other businesses, particularly corporate finance and advisory," according
to Ryan, Beck & Co. analyst Lawrence Cohn. Analysts also predict "big
mortgage originators" Chase, Norwest and Fleet Financial will "show gains
based on low interest rates and mortgage refinancings." [American Banker]
Morgan Stanley Dean Witter has reportedly offered its custody business for
sale, and "people familiar with the situation" said Chase, Citicorp and
Bank of New York are among potential buyers of the business. The companies
would not comment. [Wall Street Journal, New York Times, Financial Times]
Chase is preparing for the introduction of a single European currency with
a pan-European infrastructure. Rather than maintaining separate computer
systems in each country, Chase is putting its EMU-based computer operations
on its mainframe in Bournemouth, England. While each country's operations
will be partitioned, the central processing site will allow for seamless
cross-border payments and information flows. Chase?s Martin Lebouitz is
quoted. [April 1, First/Corporate EFT Report via NewsEdge]
The Vanguard Group, which manages $360 billion in stock, bond and
money-market mutual funds, has applied for permission to sell investments
to Europeans. The funds would be marketed by a small sales force in
Brussels, Belgium, administered through an Irish subsidiary of Chase
Manhattan Corp., and managed by investment managers at Vanguard's Malvern
complex. [First/The Philadelphia Inquirer via Knight-Ridder/Tribune
Corporation]
Chase Manhattan International is bookrunner for Unibanco's two-year 150
billion Italian lire bond with a 7.50% coupon. [Financial Times]
U.S. commercial banks "are beginning to crack the market in Japan for
pension fund management." Chase, Citicorp, Bankers Trust and J.P. Morgan
are noted as "among the original entrants to Japan's trust banking market."
Japan's pension fund assets are predicted to hit $3 trillion in 2005.
[American Banker]
An article in yesterday?s American Banker reports on frustration within the
banking industry on the lack of a unified approach to payment system policy
.. Complaining about a "silo" mentality, bankers are saying consistency and
unification will be necessary if the banking industry is to retain its
central clearing role as Internet commerce takes off. Chase?s Lori Hricik
is quoted.
The House by 411 to 8 passed and sent to the Senate a bill that would
effectively negate the Supreme Court's recent ruling restricting
credit-union membership. The bill, opposed by the American Bankers
Association, would let credit unions accept outside members so long as they
come from companies or groups with fewer than 3,000 persons, and credit
unions could apply for exceptions to accept even larger groups. The New
York Times report says credit unions compete mostly with smaller banks, not
big ones like Chase. [Wall Street Journal, New York Times, others]
Speculating about the direction of the U.S. Federal Reserve's short-term
interest rates, The Washington Post notes Chase's John Lipsky "expects
economic growth to fall to a paltry 1% rate this year, a pace so slow that
the Fed will lower rates to make sure the economy doesn't slip any
further." [April 1]
INDUSTRY NEWS - U.S. MARKETS
Providian Financial Corp. agreed to buy a $1.1 billion unsecured credit
card portfolio from First Union on undisclosed terms estimated by analysts
at $75 million to $100 million. The pact follows Providian's January
purchase of a separate $1.1 billion First Union portfolio of credit-card
receivables. The news plus Providian's saying it expects this year's
earnings to jump 27% to 30% sent Providian stock up 4 1/8 at 61 9/16
yesterday. [Wall Street Journal, American Banker]
Chicago's Northern Trust Corp., becoming the latest bank to leave futures
brokerage, will shut down that unit and transfer its business to Spear,
Leads & Kellogg. Spear Leads will not pay but will inherit many of
Northern's costs and most of the unit's 49 staffers. [Wall Street Journal,
others]
A Web site on America Online on which unhappy employees and other critics
vented bitter jokes and other sentiments opposing the merger of Union Bank
of Switzerland (UBS) and Swiss Bank Corp. (SBC) vanished over the weekend
after news about the site was distributed by Bloomberg News. Typical
jokes: UBS means "Unemployed Before Summer," SBC means "Severance Beats
Connecticut." [New York Times]
The Securities and Exchange Commission charged former Salomon Smith Barney
investment-banking associate Arjun Sekhri, 32, and five friends and
relatives with reaping $1.8 million in illegal profits by using
confidential information provided by Mr. Sekhri to trade call options and
common stock involved in six big corporate mergers including Worldcom's
$34.5 billion bid for MCI. [Wall Street Journal, New York Times, others]
INDUSTRY NEWS - INTERNATIONAL MARKETS
As Japan's "Big Bang" financial deregulation got under way, amid earlier
reported bad-loan write-offs by the nation's top 19 international banks for
the fiscal year ended March 31 totaling some $76.6 billion, the banks'
financial struggles seem likely to continue. Some banks are taking action.
Sanwa Bank, which wrote off an estimated $7.06 billion in loans, announced
a plan to split into four relatively independent companies under a trading
company; the four would specialize in administration and three kinds of
banking -- retail, commercial and investment. [Wall Street Journal]
In Japan, the real-estate broker Dai-Ichi Corp., with some $277 million in
liabilities, declared bankruptcy after its four main creditor banks refused
to reschedule loans, and the giant trading company Marubeni Corp. said it
would post its first annual loss since 1952, mainly because of losses of an
estimated 51 billion yen ($383 million) on shareholdings in other
companies. [New York Times]
Moving closer to a deal that could restart disbursement of International
Monetary Fund (IMF) rescue money to Indonesia, IMF and that nation reached
compromise on some revised targets. They would give Indonesia more leeway
to spend and run a budget deficit, allowing for 9.1 trillion rupiah ($1.1
billion) to be spent on food and fuel subsidies in the current fiscal year
ending next March 31. IMF formerly had insisted on elimination of such
subsidies. [Wall Street Journal]
Kazahkstan's state-run electric company is discussing with Merrill Lynch,
J.P. Morgan, France's Societe Generale and Holland's ABN Amro the
possibility of offering a bond issue of at least $100 million in the U.S.
and Europe. Meanwhile, that nation's Kazkommertsbank plans a $100 Eurobond
by the end of July. [Wall Street Journal]
Commerzbank aims to double net income over the next three years and add
1,600 jobs this year. The bank set aside the equivalent of $476 million
for bad Asian loans. Chairman Martin Kohlhaussen said net profits from
investment banking should total 1.35 million deutschemarks ($729 million)
in 2000 -- up over 200% from last year. [Financial Times]
The European Commission gave France's Credit Lyonnais a month to propose
sale of assets or be forced to repay part of state aid received in a 100
billion franc ($16.2 billion) bailout. [New York Times]
Yugoslavia, citing a need for market stabilization, devalued its dinar by
45% to 10.92 to the dollar from six, pressuring domestic prices upward.
[New York Times]
Mexico for the first time is requiring banks to report "significant"
transactions exceeding $10,000. The anti-money-laundering rules took effect
yesterday after being delayed three months. Separately, Financial Times
reports the country's Finance ministry announced the cost of saving the
peso in the 1995 crisis rose to 14.5% of gross domestic product, up from
the previously estimated 11.9%. [Wall Street Journal]
State Street asset management unit State Street Global Advisors opened its
first office in South America -- in Santiago, Chile. [American Banker]
BankBoston last week broke ground in Buenos Aires for a $100 million
headquarters building in Argentina. With 81 branches and $6.6 billion of
assets, BankBoston runs the fourth-biggest privately owned bank in
Argentina. [American Banker]
BankAmerica named John Masters chief executive of Bank of America Canada.
[American Banker]
Corporate Employee Communications, ChaseNet 270-4502, fax -7745, E-mail
Mary Ann Glass
09:21 AM
peace
