Egypt Sukuks, Chi-X Bid, Facebook, Zynga Share-Fees: Compliance
Egypt, home to the Arab world’s largest Muslim population, will issue its first Islamic debt guidelines in 2011 to catch up with the Persian Gulf and Southeast Asia and help spur sales.
The goal of the regulations is to help companies that want to issue sukuk, according to remarks by Ziad Bahaa El-Din, chairman of the Cairo-based Egyptian Financial Supervisory Authority, in a telephone interview in Cairo Oct. 7.
Al Baraka Bank Egypt ESC, a Cairo unit of Bahrain-based Islamic lender Albaraka Banking Group, may sell dollar- denominated Islamic bonds, known as sukuk, in the second half of 2011, the bank’s chairman, Adnan Ahmed Yousif, said in an interview on Sept. 29. Al Baraka, Faisal Islamic Bank of Egypt and National Bank for Development are the nation’s only Shariah- compliant financial institutions, May El Haggar, banking analyst at Cairo-based Naeem Holding, said yesterday.
Global assets held by financial institutions that comply with Shariah law may climb to $1.6 trillion in 2012 from about $1 trillion, the Islamic Financial Services Board said in April.
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Nasdaq Prepared to Consider Chi-X Europe Bid, CEO Says
Nasdaq OMX Group Inc., which runs seven Nordic and Baltic bourses and the second-largest U.S. equity exchange, is prepared to consider a takeover of Chi-X Europe Ltd., Chief Executive Officer Robert Greifeld said.
Last month, Chi-X Europe hired investment bank Lexicon Partners Ltd. as an adviser after an unidentified company made an approach to acquire the alternative trading venue, according to two people with knowledge of the situation. Bats Global Markets, which operates the third-largest U.S. equity market, made the approach, people familiar with the situation said on Aug. 24. Chi-X Europe only said it received an “enquiry” from an unidentified suitor.
Chi-X Europe started in March 2007 and was the first multilateral trading facility to challenge traditional European bourses by offering lower fees and faster trading. It also competes with Bats Europe, offering stocks listed by London Stock Exchange Group Plc, Deutsche Boerse AG, NYSE Euronext and SIX Swiss Exchange AG.
Barnier Says Hedge-Fund Talks to Continue This Week
Talks aimed at reaching an agreement on plans to regulate hedge-fund managers in Europe will continue on Oct. 14, after negotiations among lawmakers in Brussels ended yesterday without an accord.
This week will be “decisive” for discussions on plans to allow managers of hedge funds and private equity firms outside the European Union to access investors across the region with a single registration, known as a passport, Michel Barnier, the EU financial services commissioner, said in an e-mailed statement. A consensus is emerging on the principle of a passport and “an important role” for the European Securities and Markets Authority as a regulator for hedge-fund and private-equity managers, Barnier said in the statement.
The European Commission, the EU’s executive arm, proposed rules last year to regulate hedge-fund and private-equity managers, which would restrict bonuses and require investment strategies to be disclosed to regulators. Governments and lawmakers must agree on a final version of the measures before they can enter into force in the 27-nation EU.
Lawmakers at the European Parliament canceled a press conference yesterday after negotiations with national officials and the European Commission failed to yield an agreement.
Facebook, Zynga Impose Fees on Private Sales of Shares
Facebook Inc. and Zynga Game Network Inc. are charging fees of at least $2,500 for each sale of company shares, a move legal experts say discourages employees from putting equity in the hands of large numbers of outside owners before an initial public offering.
Some closely held companies attempt to keep the number of their shareholders low, since those with more than 500 are required by the U.S. Securities and Exchange Commission to disclose certain financial information.
Zynga, the maker of the most popular games played on social-networking sites, began imposing a fee of $4,500 for each private share transaction in August, and raised it to $6,000 per sale in September, according to company e-mails obtained by Bloomberg News.
Social networking leader Facebook has begun imposing a $2,500 fee, according to Greg Brogger, CEO of SharesPost Inc., which handles private-company stock sales. A Zynga representative said “Zynga charges a fee for the transfer of stock to cover some of the costs associated with arranging and overseeing sales of company stock.”
Internet startups that have yet to sell shares publicly are trying to rein in the frequent online trading of employee stock, which can carry high administrative costs and can make it difficult for management to control ownership. Having more than 500 shareholders entails financial disclosures that some companies prefer to keep private until they pursue an IPO.
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Brazil Regulator Rejects Sadia, Aracruz Proposals, Valor Says
Brazil’s securities regulator, known as CVM, rejected proposals from executives of Sadia SA and Aracruz Celulose SA to settle investigations into currency derivatives trading in 2008, Valor Economico reported, without saying where it got the information.
CVM will judge Aracruz’s case on Dec. 7. No date has been set for the Sadia judgment, the Sao Paulo-based newspaper said. Executives and former executives of the two companies offered to pay at least 4.8 million reais ($2.9 million) to end the probes, Valor said. The regulator is investigating derivatives operations that may have contributed to a loss of 2.6 billion reais at Sadia and 4.5 billion reais at Aracruz, Valor said.
Orgasynth, CEO Alves Fined by Regulator on Disclosures
Orgasynth SA and Chief Executive Officer Emmanuel Alves were fined a total of 150,000 euros ($208,300) for failing to give adequate information about the company’s finances, French markets regulator said yesterday.
The Paris-based chemical maker published statements in 2008 regarding the impact of the sale of its fine chemicals and colorants units that could have led “the public into error,” the Autorite des Marches Financier said in a statement on its website.
Calls to Orgasynth and Alves for comment weren’t immediately returned.
Italy Seeks to Conduct Antitrust Probe of Agricole-Intesa Deal
Credit Agricole SA’s purchase of 172 bank branches from Intesa Sanpaolo SpA should be reviewed locally, rather than by the European Commission, because it will only affect the local market, Italy’s antitrust regulator said.
The Italian regulator maintains it is in the best position to evaluate the deal because it recently had experience with similar transactions, an antitrust official, who declined to be identified citing agency policy, said by phone. The Commission said on its website yesterday that it will decide on the request by Nov. 10.
A spokeswoman at Credit Agricole in Paris declined to comment on the matter.
Slovak Regulator Rejects SPP’s Demand for Higher Gas Prices
The Slovak utility regulator rejected a request by Slovensky Plynarensky Priemysel AS, the country’s biggest gas company, to allow an increase in household prices as early as this year.
The Office for Network Industries rejected the demand for a 7 percent increase in average prices, the regulator’s spokesman Miroslav Luptak said in an e-mailed statement from the capital Bratislava yesterday, describing the request as “unjustified.”
Slovensky, or SPP, is 49 percent owned by E.ON Ruhrgas AG and GDF Suez SA; the Slovak government holds the rest.
Second Curve’s Brown Says FASB Won’t Adopt New Rule
Thomas Brown, chief executive officer of Second Curve Capital LLC, said in a radio interview yesterday that the Financial Accounting Standards Board will not adopt mark to market accounting for bank loan portfolios.
Brown talked with Bloomberg’s Ken Prewitt and Tom Keene on Bloomberg Radio’s “Bloomberg Surveillance.”
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Levitt Calls Congressional Staff Trading ‘Outrageous’
Arthur Levitt, former U.S. Securities and Exchange Commission chairman, said in a Bloomberg radio interview it is “outrageous” for congressional staffers to be profiting from stocks affected by legislation.
Levitt talked with Bloomberg’s Ken Prewitt and Tom Keene on Bloomberg Radio’s “Bloomberg Surveillance.”
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Fed’s Dudley Sees ‘Modest’ Impact of Rules on Margins
Federal Reserve Bank of New York President William Dudley said new rules increasing capital standards for banks will impose some costs on the financial system that are outweighed by benefits, including greater stability and long-term growth. He made the remarks yesterday in a speech in Washington to the Institute of International Bankers. “Careful review of this suggests that the adjustment to lending margins is going to be quite modest.”
Regulators have tightened capital requirements and standards such as liquidity rules after coming under political fire to curb banks’ risk-taking amid taxpayer bailouts. The Basel Committee on Banking Supervision in September reached an agreement for rules that more than double capital requirements.
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France’s Lagarde Says Naked Short Selling Needs Better Rules
Naked short selling should “no longer be acceptable,” French Finance Minister Christine Lagarde said, before clarifying her comments to say she wants the practice better regulated.
“On financial markets, more work needs to be done,” in regulating over-the-counter markets, Lagarde told journalists in Paris after speaking to a conference of stock-market officials.
During her speech, Lagarde said France wanted to impose measures to identify the parties involved in naked short sales.
To contact the editor responsible for this report: David E. Rovella at email@example.com.