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Strategies & Market Trends : The Financial Collapse of 2001 Unwinding -- Ignore unavailable to you. Want to Upgrade?

To: philv who wrote (43)	3/10/2017 2:20:33 PM
From: elmatador	Read Replies (2) \| Respond to of 13807

How The Largest U.S. Banks Have Strengthened Their Core Capital Ratios Since 2012 As regulatory requirements became stricter in the wake of the economic downturn, the largest U.S. banks worked diligently to improve their common equity tier 1 (CET1) capital ratio figures. Since late 2012 (when the banks began disclosing fully phased-in CET1 estimates), Morgan Stanley has grown its CET1 ratio by an average of ~130 basis points (1.3% point) each year, while progress for Bank of America has been much slower at 30 basis points (0.3% point) each year. Details about the regulatory CET1 targets for each of these banks, and their capital buffers, can be found here. U.S. banking giants have put in a considerable amount of effort over recent years to prioritize Basel III compliance – on several occasions shrinking profitable operating units to clean up their balance sheets. Investors in the banking sector also felt the impact of the tighter regulatory oversight, as dividend payouts and share repurchases from the banks remained low for years after the economic downturn. But as overall economic conditions improved, and as the banks made sizable progress towards achieving their capital requirement goals, dividends and share repurchases have jumped higher over recent years. Notably, JPMorgan handed out more cash to investors through dividends and share buyback plans in 2016 than it has ever done in the past, and some other banks (especially Morgan Stanley) are also expected to reach a similar position of strength over coming years. Morgan Stanley has the distinction of being the best capitalized major banking giant in the world, with the bank reporting a CET1 figure of just under 16% at the end of 2016. Morgan Stanley’s CET1 ratio has benefited over the years from its decision to remain stingy with returning cash to shareholders – instead focusing on acquiring 100% of Smith Barney from Citigroup. The bank’s long-term strategy of cutting down on the capital-intensive fixed income trading business has also helped reduce the size of its risk-weighed assets, which in turn has given the CET1 figure a boost. In fact, Morgan Stanley’s efforts to shrink its balance sheet also led to its capital requirements being reduced by the Basel committee as a part of its 2016 annual review of global financial giants. The huge difference between Morgan Stanley’s current CET1 ratio and its 2019 regulatory target of 10% gives the bank considerable leeway in handing out cash to investors in the form of share repurchases and dividend hikes – something that we believe will result in a sizable jump in payouts this year. We represent dividend payouts and share repurchases in our analysis of Morgan Stanley in the form of an adjusted dividend payout rate, as shown in the chart below. You can understand how a change in Morgan Stanley’s adjusted payout ratio affects its share value by making changes here. forbes.com

To: philv who wrote (43)	3/13/2017 6:10:03 AM
From: elmatador	Read Replies (1) \| Respond to of 13807

Saudi deputy crown prince to meet Trump. Could they cut a deal on oil output? Saudi deputy crown prince to meet Trump, investment in focus Deputy Crown Prince Mohammed bin Salman, in charge of Saudi Arabia's reforms, left on Monday for Washington to meet President Donald Trump on a visit expected to promote the world's top oil exporter as an investment destination. It will be the first meeting since Trump took office in January between the U.S. President and the powerful prince leading the kingdom's efforts to revive state finances by diversifying away from falling crude oil revenues. Under the plan, which seeks to promote the private sector and make state-owned companies more efficient, Riyadh plans to sell up to 5 percent of state oil giant Saudi Aramco in what is expected to be the world's biggest initial public offering. Facing a growing budget deficit after recent falls in oil prices, the kingdom also announced an austerity drive to reduce state spending, although industry sources say it has also promised major development projects later this year to soften the economic impact of those cuts. A royal court statement said that in his talks with Trump and other U.S. officials, Prince Mohammed, who heads a supercommittee driving economic reform and is also Saudi defense minister, was expected to "discuss reinforcing bilateral relations and review regional issues of mutual interest". It said that the working visit would start on Thursday but gave no further details. John Sfakianakis, director of economic research a the Gulf Research Center, said the focus of the visit would be "to showcase Saudi investment opportunities... the Saudi Aramco IPO as well as the reforms undertaken in the wider economic space." The trip takes place less than a year after the prince, son of Saudi King Salman bin Abdulaziz and the second in line to the throne, visited Silicon Valley to sell his vision of market-oriented reforms and a transformation of the kingdom's society. By freeing the kingdom from the statist model of its past, he hopes ultimately to create new private sector jobs for younger people in a country where half the population of 21 million Saudis -- there are also 10 million expatriates -- are estimated to be under 25. Younger Saudis face entrenched unemployment, a skills shortage, a lack of housing and growing pressure on living standards as the kingdom's oil income grows ever less able to finance the needs of a rising population. King Salman is currently in Japan on a month-long Asia tour to build ties with the world's fastest growing importers of Saudi crude and promote investment opportunities, including the sale of a stake in its giant state firm Saudi Aramco. Trump spoke by telephone with Salman soon after he took office in January and agreed to support safe zones in Syria, according to a White House statement. Salman invited Trump "to lead a Middle East effort to defeat terrorism and to help build a new future, economically and socially," for Saudi Arabia and the region, Saudi media reported. Before his departure for the United States, Prince Mohammed met Citigroup’s Chief Executive Officer Michael Corbat in Riyadh on Sunday to discuss investment opportunities in the kingdom and globally, SPA reported. ALSO IN WORLD NEWS Malaysia says talks on with North Korea for return of nine citizens Relief camp in China swells as thousands flee conflict in Myanmar (Reporting by Mohamed El Sharif, Marwa Rashad and Katie Paul in Riyadh, Writing by Sami Aboudi and William Maclean, Editing by Dominic Evans)