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July 2, 2012

Daily newsletter from NYSSA for investment professionals

Top Story

Trader explains how bankers manipulated Libor
An anonymous insider from a major U.K. bank said he, along with colleagues, helped manipulate the London Interbank Offered Rate. The insider said bankers submitted artificially low rates because the financial institution could not be seen as having higher borrowing costs. He said everything seemed aboveboard because it wasn't done in secret. The Telegraph (London) (7/1)

U.K. demands independent review of how Libor is set
The U.K. government ordered a review of how the London Interbank Offered Rate is set after Barclays settled an allegation that its staff manipulated the rate. "It's very important [the review] takes all of the actions necessary, holding bankers accountable ... making sure there's proper transparency, making sure the criminal law can go wherever it needs to uncover wrongdoing," Prime Minister David Cameron said. Barclays acknowledged it submitted artificially low estimates for its borrowing costs, but managers thought it was OK because of a conversation in 2008 between the CEO and an official at the Bank of England. The Wall Street Journal (7/1), The Telegraph (London) (7/1), Bloomberg (6/29), Financial Times (tiered subscription model) (7/1), Reuters (6/30)

Agius steps down as Barclays chairman after Libor settlement
Marcus Agius, chairman at Barclays for 5½ years, has resigned following the settlement his bank reached with regulators over claims that the lender tried to manipulate the London Interbank Offered Rate. "As chairman, I am the ultimate guardian of the bank's reputation. Accordingly, the buck stops with me and I must acknowledge responsibility by standing aside," Agius said in a statement. The Wall Street Journal (7/2), The New York Times (tiered subscription model)/DealBook blog (7/1), Reuters (7/2), Financial Times (tiered subscription model) (7/2)

Industry Update

CFTC may ease up on overseas reach of swaps rules
The Commodity Futures Trading Commission might allow U.S. banks with foreign derivatives operations to avoid swaps regulations. Commissioners are moving toward allowing foreign branches, subsidiaries and other affiliates of U.S. banks to fall under regulations in the jurisdiction they are in as long as the rules are deemed comparable to U.S. regulations. Bloomberg (6/29), Financial Times (tiered subscription model) (6/30), Reuters (6/29), The New York Times (tiered subscription model)/DealBook blog (6/29), Nasdaq.com/Dow Jones Newswires (6/29)

Fighting health care reform will cost GOP election, Schumer says
If Republicans continue to make opposing President Barack Obama's overhaul of the health care system a top priority, it is going to hurt them in upcoming elections, said Sen. Charles Schumer, D-N.Y. "Bottom line is most Americans are not for repeal. If you look at all the polls, a little more than a third are for repeal," he said. The Hill (7/1)

New York Focus

Financial firms move Wall Street jobs to cheaper locations
Under pressure to cut costs, many of New York's biggest financial companies are moving jobs from Wall Street to other locations in the U.S. where it is less expensive to live and do business. Functions such as accounting, compliance, human resources and legal support are being sent to places like North Carolina; Jacksonville, Fla.; and Salt Lake City. The New York Times (tiered subscription model) (7/1)

Career Development

Why smart bosses set boundaries to avoid burnout
To avoid burning out, some bosses set clear limits on their after-hours availability. It's possible to simply refuse to respond to e-mails after business hours, business leaders say, but only if you're determined, disciplined and consistent about maintaining radio silence. "... The first time you answer an e-mail at 2:30 in the morning, they know they've got you," one unidentified manager says. EblinGroup.com/Next Level Blog (6/19)

People & Personalities

Curry has faced tough start as comptroller of the currency
Thomas Curry began as comptroller of the currency as banking regulators were beginning to understand the significance of bets JPMorgan Chase made on credit derivatives that went sour. Curry has spent his time at the Office of the Comptroller of the Currency defending the agency's ability to keep up with major financial institutions' risk taking. The Wall Street Journal (7/1)

On The Economy

Consumer confidence and spending drop to lowest levels in 2012
Consumer confidence and spending data suggest the economic recovery is continuing to lose momentum. The consumer confidence index by the University of Michigan and Thomson Reuters fell to its lowest level in June since December. The Commerce Department said consumer spending in May was the weakest since November. Los Angeles Times/Money & Co. blog (tiered subscription model) (6/29)

Financial Products

ALPS ETF buys large-cap stocks that pay high dividends
ALPS Advisors brought to NYSE Arca an exchange-traded fund that buys a diversified portfolio of U.S. large-cap stocks. Aiming to deliver a higher dividend yield than most U.S. large-cap indexes, the ALPS Sector Dividend Dogs ETF buys the five highest-dividend-paying stocks in each of the 10 Global Industry Classification Standard sectors that make up the Standard & Poor's 500 index. ETFdb.com (6/29), IndexUniverse.com (6/29), Benzinga.com (6/29)

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