Archive for April, 2009

Satyam seeks to delist from Euronext Amsterdam (AFP)

Tuesday, April 14th, 2009 | Finance News

India's scandal-hit Satyam Computer Services, in which Tech Mahindra is set to buy a majority share, on Tuesday said it plans to delist its depository shares from the Euronext Amsterdam.

NYSE Euronext is the regulated market of Euronext Amsterdam, where Satyam's American Depository Shares are currently traded.

"The Satyam board has decided that the financial and legal burdens of a listing no longer justify a listing on Euronext Amsterdam," the firm said in a statement to the Mumbai stock exchange.

The application for delisting is still to be approved by Euronext Amsterdam.

Satyam however said it plans to remain listed and traded on the Indian stock exchanges and the New York stock exchange.

India's Tech Mahindra will have to pay nearly 600 million dollars for a majority share of Satyam, which has been struggling since its founder confessed to falsifying accounts in January.

Satyam, ranked as India's fourth-largest outsourcer by revenues before the scandal broke, acts as back office for some of the world's biggest companies such as Nestle SA, General Electric Co and General Motors Corp.


Bernanke sees signs of economic stability (Reuters)

Tuesday, April 14th, 2009 | Finance News

NEW YORK (Reuters) –
U.S. Federal Reserve Chairman Ben Bernanke said on Tuesday the latest figures on housing and consumer spending suggest a rapid contraction in the economy could be easing.

"Recently we have seen tentative signs that the sharp decline in economic activity may be slowing, for example, in data on home sales, homebuilding and consumer spending, including sales of new motor vehicles," Bernanke said in remarks prepared for delivery at Morehouse College in Atlanta.

Bernanke is scheduled to deliver the speech at 1:30 p.m. EDT, but the remarks were posted on the Fed's website ahead of time.

While some recent reports have suggested a moderating of the economy's downturn, data on Tuesday was less encouraging, with the Commerce Department reporting retail sales fell 1.1 percent in March.

Calling the current financial crisis the worst since the Great Depression, Bernanke explained the litany of emergency measures taken by the central bank and the Treasury Department with the aim of restoring battered credit markets.

Bernanke said such efforts were ongoing, but added that some of the programs might one day have to be removed in order to prevent all the stimulus from building into an outright threat of inflation.

"We have a number of effective tools that will allow us to drain excess liquidity and begin to raise rates at the appropriate time," he noted. "That said, unwinding or scaling down some of our special lending programs will almost certainly have to be part of our strategy for removing policy stimulus once the recovery is under way."

That day was clearly not at hand quite yet, since Bernanke said the Fed was exploring an expansion of the types of credit made available through its program to restart securitization markets, known as the Term Asset-Backed Securities Lending Facility or TALF.

Bernanke did not specify what areas he had in mind, but analysts believe it would include bonds backed by commercial real estate, a sector that has been deteriorating quickly in recent months.

The TALF has so far been met with much weaker demand than the Fed had foreseen. While the central bank had allotted $200 billion in loans, only about $6.4 billion in deals have emerged in two auctions thus far.

Bernanke took pains to justify actions taken to save insurance giant AIG, which has been embroiled in a controversy over lavish bonuses paid after the firm was already on taxpayer-funded life support.

The Fed chief argued that the firm's collapse would have compromised the entire global financial system.

"I can assure you that monetary policy-makers are fully committed to acting as needed to withdraw on a timely basis the extraordinary support now being provided to the economy, and we are confident in our ability to do so," Bernanke said.

(Reporting by Pedro Nicolaci da Costa; Editing by Andrea Ricci)


Report: Fannie Mae CEO Allison to head TARP (AP)

Tuesday, April 14th, 2009 | Finance News

CHARLOTTE, N.C. – A published report says Fannie Mae CEO Herb Allison is expected to be named by the Obama administration to head the government's $700 billion Troubled Asset Relief Program.

President Barack Obama could announce his intention to nominate Allison as assistant secretary for the Office of Financial Stability as early as this week, the Wall Street Journal reported Tuesday.

Allison, 65 years old, is the former chairman of investment company TIAA-CREF and served as president and chief operating officer at Merrill Lynch.

A Treasury spokesman was not immediately available for comment.