Wednesday 30th July 2014
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The Union Bank of the Philippines (UBP) released a 49% drop in net earnings in the first half of 2014, as it came in to just PHP3.2bn, almost half of its net earnings in the same period last year. In the April to June period alone, net income fell 36% from PHP2.18bn in the second quarter of 2013 to PHP1.6bn in the second quarter of 2014. However, it is important to note that net interest income grew by 29% year-on-year, as it came in at PHP5.2bn in the half of 2014 – Rangold chief executive Mark Bristow will present the firm’s Q2 results at noon on Thursday this week at The Forum, London Stock Exchange Around 10.00 am today some traders on Moscow Exchange’s Derivatives Market reportedly experienced difficulties entering orders via the FIX protocol, with some valid messages rejected with an error code. The FIX protocol has been functioning as usual since 11:37 am says the exchange. Moreover, the exchange stresses other protocols to access the Derivatives Market’s trading system have been functioning as usual - Société Générale Securities Services in Luxembourg has been mandated by wealth manager Bedrock, with $6bn in assets under management, to provide custody, fund administration and registrar services for its range of UCITS funds - Moody's Investors Service has assigned a first-time provisional (P)B3 corporate family rating (CFR) to Empik Media & Fashion SA Group. At the same time, Moody's has assigned a provisional (P)B2 rating to the firm’s proposed senior secured notes due 2019 to be issued at EM&F Financing AB, a wholly owned and guaranteed subsidiary of EMF, reflecting its overall ranking within the debt capital structure. The outlook on the ratings is stable. This is the first time Moody's has assigned ratings to EMF - Lithuania will adopt the euro on January 1st next year. Lithuania will become the 19th member state to adopt the euro. "Lithuania's consistent efforts have paid off: today the eurozone has opened the door for us," said Algirdas Butkevičius, prime minister of Lithuania, on the announcement. The entry of Lithuania into the euro family is of great importance for the whole euro area. "It's a demonstration of the continuing attractiveness of the single currency project and its relevance for the future of our community," added Sandro Gozi, State Secretary for European Affairs of Italy and President of the Council of the EU. The conversion rate has been set at 3.45280 Lithuanian litas to the euro – Global macro hedge fund manager Atreaus Capital is now live with SunGard’s Hedge360 Risk Reporting Service. Delivered as a managed service, the Hedge360 Risk Reporting Service provides highly customized daily risk reports, offering transparency to investors and integrated internal risk management to hedge funds. Trading a broad range of products with an emphasis on FX and commodities, in the form of both OTC derivatives and futures - AnaCap Financial Partners LLP, the specialist European financial services private equity firm, together with HIG and Deutsche Bank, have completed the acquisition of a €495m portfolio of non-performing and sub-performing loans from Volksbank Romania. Under terms of the agreement, funds advised by AnaCap will jointly acquire the entire portfolio with HIG and Deutsche Bank. The portfolio of 3,566 loans in total is backed by a mix of primarily residential, commercial real estate and development land. APS Romania will be appointed as Master Servicer. The transaction is the largest of its kind in Romania to date, and came about as a result of the ongoing pressure on financial institutions across Europe to restructure and divest assets in order to clean up balance sheets and comply with new capital requirements. After a prolonged correction following the financial crisis, the property market in Romania is now showing strong signs of improvement. GDP and unemployment have recovered on the back of labour market reforms in 2011 and an IMF financing package. House prices, which declined 38% since their peak in mid-2008, are now on the rise, with the areas surrounding central Bucharest and other main cities increasing 4% for 2013.

FTSE Group’s March review of countering bribery criteria and FTSE4Good

Friday, 09 March 2012
FTSE Group’s March review of countering bribery criteria and FTSE4Good FTSE Group, the global index provider, has announced changes following its March FTSE4Good and ESG Ratings semi-annual review; including the roll-out of new countering bribery criteria to be applied to the assessments of over 1200 companies.  http://www.ftseglobalmarkets.com/

FTSE Group, the global index provider, has announced changes following its March FTSE4Good and ESG Ratings semi-annual review; including the roll-out of new countering bribery criteria to be applied to the assessments of over 1200 companies. 

The changes are expected to lead to improvements in the index; supported by new research from Edinburgh University that shows that the engagement FTSE carries out with companies regarding new FTSE4Good criteria has led to hundreds of companies globally improving their environmental, social and governance practices.

The FTSE4Good Index Series is designed to measure the performance of companies that meet globally recognised corporate responsibility standards, and to facilitate investment in those companies. The index series is now being complemented with the launch of the FTSE4Good ESG Ratings, to provide a broader range of ESG data and services.

The indices are governed by an independent ‘FTSE4Good Policy Committee’ which meets in March and September for index reviews.  This committee directs the evolution and development of the criteria for the index series, and approves additions and deletions to the index at reviews in line with the inclusion criteria and index ground rules. 

The FTSE4Good ESG Ratings can be used in a variety of ways, building a basis for active portfolio management, company engagement, customised indices, ESG risk analysis or research and analysis.

24 additions, 13 deletions to the FTSE4Good Index Series

The March semi-annual review has seen 24 new additions to the FTSE4Good Index Series from ten countries. This includes Siemens, a company which has faced up to the very costly and damaging bribery scandals of its past, through making considerable changes throughout its business to embed new governance and compliance systems.  Another company that has made significant changes and is added is EDF.

As a result of stringent criteria for nuclear safety and waste disposal being introduced in 2010, companies involved in nuclear power generation are no longer excluded from the index series. EDF has become only the fifth company globally to meet the detailed industry-specific criteria. The largest number of additions at this review are from the USA, contributing seven of the companies. Representation of South Korea has also seen a significant increase with four companies joining the existing eleven. At the same time, 13 companies are being deleted from the index for no longer meeting the FTSE4Good criteria. More details on additions and deletions are available on FTSE’s website (see notes section for more details). The changes to the index will be effective after the close of markets on 16 March 2012.

Details of the new criteria can be found at the following link upon free registration http://www.ftse.com/analytics/ftse4good-esgratings/

Countering Bribery Criteria Roll-Out

The practice of bribery is a risk to long term investors.  Although it can allow companies to secure lucrative contracts in the short term it can have disastrous consequences when these acts are uncovered, through litigation and impacts on intangible value such as brand and reputation.  As new bribery regulations, such as the 2011 UK Bribery Act, are introduced around the world, and with increased global communication, the risks associated with bribery are increasing.  FTSE is responding by providing investors with more detailed corporate bribery data through the FTSE ESG (Environmental Social and Governance) Ratings service and will also be incorporating this within the criteria assessments for the FTSE4Good Index Series.

Previously only those companies deemed to be facing the very greatest potential risk of bribery were being assessed, now the criteria will be rolled out to cover an additional 1200 companies that are defined as “medium risk” based on their industrial sector, countries of operation and public sector contracts.  Of these, approximately 550 are in the FTSE4Good Index Series, and 130 companies will need to make improvements in order to maintain inclusion in the index.  The criteria, set out in full on FTSE’s website, consider how well companies are reducing the likelihood of bribery and draws on Transparency International’s Business Principles for Countering Bribery Details of the new criteria can be found at the following link upon free registration http://www.ftse.com/analytics/ftse4good-esgratings/.

Edinburgh University research on the impact of FTSE4Good on corporate practices

Established over a decade ago now in partnership with EIRIS, the FTSE4Good Index has a track record of regularly strengthening the eligibility criteria. These enhancements provide investors with a more detailed analysis of ESG investment risk but also act to stimulate change in corporate practices.  FTSE’s Responsible Investment Unit undertakes a direct engagement programme with companies facing potential deletion from the index series. Research from Edinburgh University has identified that this form of engagement has been highly effective at stimulating improvements in corporate practices.  From an analysis of the responses of over a 1000 companies they found that the rate of improvement on ESG practices doubles when the company is in direct engagement with FTSE regarding FTSE4Good criteria. See Mackenzie et al (Nov 2011) at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1966474 It is expected that FTSE’s engagement with companies on the countering bribery criteria will also have this impact.

 

2 See Mackenzie et al (Nov 2011) at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1966474

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