TheChek News Flow

DAX:

MDAX:

SDAX:

Net profit more than doubled from a year earlier

SK Hynix 000660 4.80%increase; green up pointing triangle, the main supplier of high-bandwidth-memory products to Nvidia, delivered record quarterly earnings as robust artificial-intelligence investments by big global tech companies continued to fuel demand for its advanced AI chips.

The South Korean memory-chip maker attributed the stellar third-quarter performance to brisk shipments of higher-end HBM3E products and higher prices for DRAM chips, including high-capacity double data rate 5 products, used in data servers for AI training and mobile devices. Analysts have said they expect the AI boom, which requires high-performance chips, to continue well into next year.

Surging demand for enterprise solid-state drives also helped improve earnings at the company’s NAND chip business.

SK Hynix executives said on a postearnings call that its HBM and other memory-chip products are almost sold out for 2026 due to surging AI-driven demand. “The company’s HBM supply will remain tight in 2027,” said Ki Tae Kim, head of the HBM sales and marketing department.

The company was ahead of rival HBM manufacturers in supplying 12-layer HBM3E products, which currently dominate the premium segment of the AI-chip market, and is poised to repeat that feat with the next-generation memory product.

SK Hynix said Wednesday that it completed discussions with key customers about next year’s HBM supply. It said HBM4 shipments would start in the fourth quarter of 2025, with a full-scale sales expansion due in 2026.

Net profit more than doubled from a year earlier to a record 12.598 trillion won, equivalent to $8.80 billion, for the three months ended September, SK Hynix said. That topped a previous high set in the first quarter of this year and beat market views. Analysts had expected a bottom line of 8.491 trillion won, according to a FactSet consensus estimate.

It also posted record revenue and operating profit for the quarter. The top line climbed 39% to 24.449 trillion won. Operating profit exceeded 10 trillion won for the first time, jumping 62% to 11.383 trillion won.

Shares in SK Hynix rose as much as 6.0% in morning trading after the results. The stock has more than tripled this year, driven by investor enthusiasm about AI.

The rally in tech stocks has raised concerns about an AI bubble forming, however, as companies pour billions of dollars into advancing AI infrastructure. Some analysts say the AI-fueled chip boom could persist for the next few years, which should continue to buoy earnings at SK Hynix.

HSBC analysts Ricky Seo and Hankil Chang said growing use of AI applications will prompt cloud computing service providers to increase investments in data centers, driving both DRAM and NAND chip prices higher over the next one to two years. In a research note ahead of the earnings release, they said SK Hynix’s operating profit could reach 15 trillion won in the final quarter and hit 67 trillion won for 2026.

Nomura analysts led by C.W. Chung gave a similarly upbeat outlook, saying recently that “an unprecedented supercycle” in the memory-chip market is approaching, with big U.S. tech companies’ substantial AI-fueled investments likely to continue into 2027 and 2028.

Research director M.S. Hwang of Counterpoint Research earlier this week said the HBM market is likely to grow sharply, reaching $43 billion by 2027, providing strong earnings leverage for memory manufacturers like SK Hynix. He sees DRAM and NAND chip prices rising 15%-20% in the fourth quarter, suggesting strong earnings guidance from the company.

Edwin Heathcote has a first look at the apartments in New York’s charismatic, slender-prowed triangle of a landmark

Shortly before he died in 1946, the photographer Alfred Stieglitz remembered taking a shot of one of one of New York ‘s most famous structures, in 1903. “I suddenly saw the Flatiron Building as I had never seen it before,” he said. “It looked, from where I stood, as if it were moving towards me like the bow of a monster ocean steamer, a picture of the new America which was in the making.”

There had been snow and Stieglitz’s photo showed this looming, enigmatic edifice as a standalone object emerging from the white landscape, the dark silhouette of a tree blocking out part of the building. The following year his friend Edward Steichen also took a photo of the building, originally created as the headquarters for the construction firm Fuller Company. Moody, atmospheric and in colour, the picture made it look like a “nocturne” by Whistler; alongside the boughs of a tree, coachmen were in top hats. A print of this image became the second most expensive photo ever sold; it hammered down for $11.84mn at Christie’s in 2022.

This charismatic extruded door wedge of a tower has become an indispensable element of Manhattan’s iconography and self-image. And now, slice-of-pie-shaped apartments are available to buy. One of the smaller of the 38 apartments, with three bedrooms, can be bought for a little less than the price of that photo.

The building, which for all its life has accommodated a mix of commercial uses, is succumbing, as are so many of Manhattan’s most characteristic structures (from the Woolworth Building and One Wall Street to 100 Barclay Street), to residential conversion.

. . . and Edward Steichen’s take from 1904, a print of which became the second most expensive photo ever sold, at $11.84mn at Christie’s in 2022 © The Metropolitan Museum of Art

When it opened, the Flatiron’s 22 storeys of steel skeleton dressed in ornate limestone and terracotta cladding were nothing like how we would come to imagine skyscrapers, with their stepped setbacks. It was more like an extruded triangle in a sugar paste confection of classical, beaux arts ornament; people would come to simply stare up. The building had its own power plant too, a harbinger of modernity. In the basement there was a 1,500-seat restaurant. It had one of the first bars to welcome women on their own and, from 1911, the city’s first jazz bar outside Harlem to allow black musicians to play, bringing ragtime to the rest of the city. The Taverne Louis, meanwhile, was among the rare establishments to welcome gay men. The bacchanalia was crushed by prohibition.

The Flatiron was the vision of Daniel Burnham, a Chicago architect and pioneer of skyscrapers who designed, among other things, the sublime Reliance Building (1890-95), the vast World’s Columbian Exposition of 1893, and London’s Selfridges (1909). Its steel-framed structure meant that its walls did not need to be load-bearing, leaving more space inside, even at the slender prow.

“The word ‘iconic’ is so overused these days but here, at least, it is completely appropriate,” says architect and historian Robert AM Stern. “It defines the pivot between Downtown and Uptown Manhattan. And it looks in its setting exactly as it did more than a century ago.”

Intriguingly, for a building that seems so much to define its city, “it is symbolic of New York but it’s not really a New York building, it’s a Chicago building,” says Carol Willis, director of the city’s Skyscraper Museum. “And not just because of its architect, Burnham, but because of its form, its tripartite shape, with a base, shaft and cornice, like Chicago buildings. But if Chicago buildings have the look of a [inflated] Renaissance palazzo, what makes this different is the site, which is very New York. That triangle. It means that the building becomes more of a column than a palazzo, it’s so slender.”

William Sofield, of Studio Sofield, is designing all the interiors at the Flatiron. The studio’s clients include Tom Ford, Madonna and Mary-Kate Olsen, as well as the Soho Grand Hotel and Core private members’ club, but this is in a different league. He is clearly deeply in love with the building. Showing me bits and pieces from the original architecture in his Bleecker Street penthouse studio (which, perfectly, is in the only New York building designed by the greatest Chicago architect of them all, Louis Sullivan), Sofield pores over old photos, drawings and pieces of hardware.

“The reason for that shape is that Broadway is on the diagonal,” he says. “It was an old Native American trail so embedded in Manhattan that no one thought to change it.” He also shows me old menus from the restaurant (most of the wines are German) and a few pieces of the hundreds of artefacts found in the basement and the walls, a social taxonomy of building byproducts including pulleys, mouldings, shoes and tools.

Later that morning I am given an exclusive glimpse as we walk together through a bustling construction site as the apartments rapidly take shape. At the peak of its construction, the Flatiron rose by one storey every week. Now, progress is slower. But steady. I’m taken up in a construction lift on the outside of the building and walk into an astonishing space; a room that tapers to almost nothing at its end; the tight curve of that famous prow. The view up Fifth Avenue is breathtaking; the essence of Manhattan. With one side overlooking Madison Square Park, it is also a strangely green view for a neighbourhood that is otherwise anything but.

The developers have saved and revived the original detail and elegance, such as a long-defunct revolving door in the lobby © Renders by Visualisation One

There are 38 apartments in the building, with two on most floors, but there are also two entire-floor apartments (priced around $50mn each). Nothing here is cheap. The slim floor pan means there are windows and views galore, with none of the claustrophobia you find in new-build towers with their large floor-plates and dark centres. It turns out that the slim slice of pie is a very good shape for living.

Two of the apartments end in small round balconies, which will surely be some of the most sought-after and intimate spaces in the city, the whole energy of Broadway squeezed between two chunky, ribbed columns into a little circular locus.

“In 1966, a year after the Landmarks Commission was formed,” Willis tells me, “the Flatiron was landmarked. It was a no-brainer. But most of the other buildings were municipal, owned by the city, so no one cared that much. But this was commercial. That was different. It preceded the landmarking of the Empire State Building by 30 years.”

However, until recently, the Flatiron had not been much loved inside. A series of reconstructions had left it with a generic commercial interior. “It had been mutilated by dropped ceilings and strip lights and it had become a warren of small rooms,” Sofield says.

He is attempting to re-enchant the Flatiron with some of its original detail and elegance. The street-level spaces will become residents’ lobbies and retail spaces; more like they might have been when it opened. A long-defunct revolving door at that prominent corner is being remade so the Flatiron can be entered from the most logical point. He has recycled bits of the old building; balustrades are revived as washbasin legs and there are new hand-clipped mosaic floors (each apartment has its number before the threshold). “Where there is evidence of what came before, we’ve tried to recreate it,” he says.

It has been an epic task. Daniel Brodsky, managing partner of building owners The Brodsky Organization, tells me: “There’s always hesitation taking on a landmark building like this. But there’s also an advantage. It has an incredibly special character that makes it worth the pain. Every design decision needs Landmarks to approve it; [architects] Beyer Blinder Belle worked for two years just getting approvals. But when you finish you have something very unique.”

We’re sitting in the project office looking over at the Flatiron. Brodsky points across the way and says: “That’s Jeff Bezos over there, he put four apartments together for $150mn. There’s a group of wealthy people who want to be in a convenient place; good transportation, the best restaurants in the city, the park . . . it’s a very easy place to live. You’re surrounded by coolness.”

A couple of decades ago you would not have said that. The neighbourhoods reinvented as Flatiron and NoMad (North of Madison) were shabby, the streets a dirty grid of wholesalers and shuttered stores. When the Flatiron was built, this was the heart of the Ladies’ Mile, the deluxe shopping stretch along Broadway. But it was also, at various times, a toyshop neighbourhood, and a hub of photo processing labs and camera stores (hence, in part, Steiglitz and Steichen), as well as the city’s original Tin Pan Alley. “The neighbourhood was totally debased by the 1980s,” sociologist Sharon Zukin tells me. “There were a few hotels housing homeless people, and a long run of wig stores. You wouldn’t really have a reason to go there.”

Rough-textured concrete building with irregularly shaped window openings and an overhanging beam on the upper left corner.

But “it became one of the first loft living neighbourhoods in the city, even though everyone always thinks of SoHo,” continues Zukin, who wrote her pioneering book Loft Living in 1983. “Then it became one of the city’s first tech districts with start-ups and [venture capital funds]. I was a little surprised the Flatiron wasn’t turned into a huge tech building.” Probably it was just too low tech. White hot when it opened, with hydraulic elevators and a 21st-storey viewing deck, it had become defunct.

Twenty years ago the idea of spending $50mn on an apartment in this neighbourhood would have sounded insane (even talking into account rapid inflation). To many, of course, it still does, but for those who can afford it: what price can you put on living in one of the most recognisable buildings in New York? When Alfred Stieglitz’s father asked him why he had photographed this “hideous building”, the photographer replied: “That is the new America. It is to America what the Parthenon is to Greece.”

The president’s comments come after his allies promoted the idea of another term

President Trump acknowledged that the Constitution prohibits him from seeking a third term, following weeks of speculation among some of his allies.

“If you read it, it’s pretty clear. I’m not allowed to run. It’s too bad,” Trump said to reporters on Air Force One en route to South Korea, the last swing of his three-country Asia tour.

His remarks early Wednesday local time came after he recently said he would “love” to campaign for a third term as president, while noting the move “wouldn’t be right” since there are others he thinks would be suitable to run for president in 2028 instead. Trump has mentioned Secretary of State Marco Rubio and Vice President JD Vance as strong potential contenders to be his successors.

Trump’s remarks arrive after some allies have promoted the idea of him running for a third term, even producing red 2028 Trump hats.

Former Trump White House chief strategist Steve Bannon has previously said there is a “plan” in place for Trump to secure a third term in 2028, despite the 22nd amendment of the U.S. Constitution barring anyone from becoming president a third time. That amendment, passed by Congress in 1947 and ratified in 1951, followed former President Franklin D. Roosevelt’s record fourth term. It stipulates that no president could be elected to more than two four-year terms, hewing to President George Washington’s example.

Rep. Andy Ogles (R., Tenn.,) has introduced a bill that seeks a constitutional amendment which would allow Trump to run for a third term. The Republicans for National Renewal, a nonprofit advocacy group, has launched a campaign called the Third Term Project, which urges people to encourage Republican lawmakers to support Ogles’s bill, according to the group’s grassroots director Shane Trejo, who is helping lead the effort. Ogles is the only sponsor of his bill.

Trejo told The Wall Street Journal earlier on Tuesday the group’s policy team is writing a white paper that makes the case for why third terms for presidents might be necessary. “It might be time to consider the potential benefits of allowing truly exceptional leaders to stay in office long enough for consequential nation-building goals to be properly seen through,” excerpts of the white paper say. Trejo said the group plans to distribute the paper to Republican lawmakers.

The organization is also planning a December party on the sidelines of Turning Point USA’s America Fest in Phoenix to promote the Third Term Project.

Trump made his comments en route to South Korea, where he will meet Wednesday with the country’s president and other Asian political and business leaders. The next day he will host the most important meeting of his weeklong Asian swing, with Chinese leader Xi Jinping at Busan’s international airport.

South Korean chipmaker points to difficulty in meeting demand as it posts record profits

SK Hynix said it had already sold next year’s production of semiconductors as the leading supplier of advanced memory chips to Nvidia posted record profits on the back of an artificial intelligence boom.

Operating profit in the third quarter jumped 62 per cent year on year to a record Won11.4tn ($8bn), in line with analyst forecasts compiled by LSEG SmartEstimate. Revenue rose 39 per cent to Won22.4tn, driven by surging demand for memory chips used in AI data centres, the company said on Wednesday.

The South Korean chipmaker said in a statement that demand for its cutting-edge high-bandwidth memory (HBM) chips used in AI hardware would continue to outstrip supply as use of AI applications broadened.

Inventory for dynamic random-access memory (Dram) chips, which enable short-term data storage when a device is being used, was also “extremely tight”, said Kim Kyu-hyun, head of Dram marketing.

“Our Dram, Nand as well as HBM capacity [for next year] has been sold out,” said Kim, referring to SK Hynix’s main memory products. “Customers are buying even conventional memory chips for 2026 in advance.”

Optimism for SK Hynix’s business outlook intensified after the company, along with rival Samsung Electronics, signed a preliminary agreement with OpenAI this month to supply semiconductors for the ChatGPT maker’s $500bn Stargate data centre project.

SK Hynix said its estimate for demand from the project was more than double the industry’s current HBM capacity and that it would set up a production system to meet OpenAI’s demand.

The chipmaker said it had completed HBM supply negotiations with other key customers for next year and would “substantially increase” capital expenditure as a result. It will begin supplying its most advanced HBM4 chips in the fourth quarter of this year.

“HBM demand continues to increase rapidly, so it will be difficult for supply to meet demand any time soon,” said Kim Ki-tae, head of HBM sales and marketing.

SK Hynix makes up more than half of the global HBM market, while Samsung accounts for just over a quarter, with US-based Micron, the other leading company in the sector, according to consultancy TrendForce.

The company’s competitive edge in HBM has helped triple its share price this year, making SK Hynix one of South Korea’s best-performing stocks. Its shares rose 4 per cent on Wednesday.

The OpenAI logo is displayed on a mobile phone screen in front of a laptop showing red digital graphics with numbers.

SK Hynix said the AI market’s shift to inference — the process by which applications such as chatbots produce responses — had increased demand for high-performance AI server chips.

“We project AI inference memory demand to expand not only in the US but also in China as Chinese hyperscalers are expected to push for AI inference investment,” Citi analysts said in a recent report.

Samsung is expected to post its biggest quarterly profit in three years when it reports on Thursday.

“With AI as the major driver, we’re expecting the HBM market to continue growing steeply over the next few years to around $43bn by 2027, giving strong earnings leverage to memory manufacturers like SK,” said MS Hwang, research director at Counterpoint Research.

Ardagh’s $10bn restructuring allows creditors to command big premiums for ‘when issued’ bonds

Ardagh’s looming restructuring is adding fuel to a busy European market for debt that doesn’t yet exist, as hedge funds make bumper paper profits selling hypothetical bonds at large premiums.

Hundreds of millions of dollars of debt that would be issued after a proposed restructuring at the Luxembourg-based maker of glass and metal drinks containers has changed hands in recent months at prices as high as 110 cents on the dollar, according to people familiar with the matter.

Trading in Ardagh debt on a “when issued” basis comes after months in which new debt from Altice France, the European arm of Patrick Drahi’s heavily indebted telecoms empire, was sold to investors before it was issued upon completion of the restructuring.

The burgeoning market in such debt is a sign of the aggressive tactics employed by creditors of conglomerates that were built up in the era of cheap money. As businesses have been forced to restructure by higher interest rates, creditors have clubbed together in co-operation agreements to secure favourable terms.

These include not only writing down debt in exchange for some equity but also providing new and expensive debt to companies once they emerge from a restructuring. Some creditors have sought to profit early while staying in the driver’s seat, by selling their rights to the new bonds before they come into existence.

“In a restructuring, obviously the company is not in the world’s strongest position, which means that lenders, whose consent may be needed, can push things harder . . . there’s often only a limited amount the company can do about the pricing [of the new debt],” said Richard Tett, a restructuring partner at law firm Freshfields. “It’s definitely becoming more common.”

The interest rate on new debt is priced in accordance with the company’s financial health before the restructuring but is issued by a “bright, new, post-restructuring capital structure and is generally senior ranking”, often making it worth paying a premium for, Tett added.

Ardagh announced its restructuring deal in July after more than a year of negotiations with creditors owed more than $10bn. The deal has yet to be sanctioned but has support from the vast majority of creditors.

Founder Paul Coulson, who built Ardagh from a small Dublin bottling plant through two decades of debt-fuelled acquisitions, would cede control under the restructuring to a group of bondholders. Shareholders would receive $300mn, of which just over $100mn would go to Coulson.

The group’s riskiest $1.7bn of so-called payment-in-kind bonds would be fully written off in exchange for a 7.5 per cent stake in the business. The remaining equity would be passed to Ardagh’s unsecured bondholders, including London’s Arini Capital Management — founded by former Credit Suisse trader Hamza Lemssouguer — and US-based Canyon Partners, as part of a debt-for-equity swap.

Existing bondholders would also provide $1.5bn of new funding to the group, while a loan that Apollo Global Management provided last year would be repaid in full.

Those existing creditors have already been able to offload hundreds of millions of dollars in the yet-to-be-issued bonds to investors willing to pay over the odds, attracted by an interest rate of 9.5 per cent on debt that would be issued by a company with much lower leverage than before the restructuring.

“Co-op agreements make it impossible to trade old [credit] facilities between groups,” said one bond investor who has been trading Ardagh’s potential new debt. “‘When issued’ offers a way to get around that . . .[but buyers] have to have conviction that the deal will go through.”

Although credit investors have bought large amounts of Ardagh’s debt on the basis that the restructuring will go ahead, dissenting creditors Deutsche Bank and hedge fund Carronade Capital are opposing the deal. If for any reason the transaction does not go through, the sales will have to be unwound.

Earlier this year, some traders were quoting Thames Water’s then- proposed €3bn in emergency financing, that was to be provided by senior creditors including hedge funds Elliott and Silver Point, at 112 per cent of face value while the new debt issuance was still being challenged in court. It has since been waved through.

Contracts worth up to €900mn put Helsing and Stark on track to help buttress Nato’s eastern flank against Russia

Germany plans to award a contract for kamikaze drones to defence start-ups Helsing and Stark as it seeks to boost defences against Russia as well as fuel competition in the defence sector. 

The two German start-ups and the country’s largest contractor Rheinmetall will receive a share of the contract, worth close to €300mn each, according to three people familiar with the matter. 

Formal agreements have yet to be signed, but if the contracts are approved by the German parliament’s budget committee, they are likely to be the biggest deals won by the two young start-ups.

Under the agreement, the three companies will agree to provide up to 12,000 drones, according to one of the people familiar with the discussions, although only part of that number will be delivered up front.

They are expected to be supplied to a new German brigade stationed in Lithuania with the aim of defending Nato’s eastern flank against Russia. 

Officials hope that dividing the tender between the three companies will encourage innovation, according to people familiar with the situation.

“They’re doing it to keep the competition alive and make sure they get the best system,” one of the people said.

The deal comes as European nations seek to beef up their capacity for drone warfare, both by embracing defensive technologies to protect against drone incursions and also offensive drones for striking enemy targets.

Investment in Europe’s defence technology start-ups has surged since Russia’s full-scale invasion of Ukraine, with venture capital firms piling into military businesses.

Helsing, backed by Spotify founder Daniel Ek, is Europe’s most valuable defence start-up with a valuation of €12bn. 

Over the past year it has announced plans to supply 6,000 strike drones for Ukraine, bought German aircraft manufacturer Grob and unveiled plans to manufacture underwater surveillance systems in the UK.

Stark, founded just 15 months ago, is backed by investors including US tech billionaire Peter Thiel and Silicon Valley’s Sequoia Capital. The start-up has a team in Ukraine engaged in testing and development and in July it announced it would open a factory in the English town of Swindon.

Plans to award part of the contract to the tanks and artillery giant Rheinmetall, which has already won tens of billions of euros of government contracts, took some defence executives by surprise.

Though the company has partnerships with the US drone-maker Anduril and the Israeli company UVision, until recently it did not have its own in-house armed drone.

The Düsseldorf-based Rheinmetall offered to supply the German military with an armed drone called the FV-014, which it unveiled publicly in September, according to two people familiar with the matter. Also known as Raider, the FV-014 can carry a 5kg payload and has a range of 100km, according to the company.

Stark will provide its Virtus armed drone and Helsing its HX-2.

Rheinmetall has “managed to find a way in,” said one German defence industry executive.

Helsing, Stark, Rheinmetall and the German procurement office all declined to comment.

FTSE 100 group confirms it has held discussions with potential partners over pension-risk transfer unit fundraising

Phoenix Group is in talks to raise more than £1bn from private capital firms as it seeks to expand its pension-risk transfer business and win a bigger share of an increasingly competitive and lucrative part of the insurance market.

The UK’s largest savings and retirement business had held talks with firms including Blackstone, Sixth Street and KKR about a possible deal that would enable it to bid for more and larger buyouts of pension pots, according to people familiar with the matter.

A final transaction could lead to Phoenix partnering with an asset manager to source and manage some assets, the people added. The new funds will allow the insurer to compete for more pension liabilities and the assets backing them.

The potential deal comes as Phoenix has been undertaking a strategic shift to manage more annuity-backed assets internally, while building up its team managing listed and private investments. Last month, it said it would pull £20bn from Aberdeen Group to manage in house.

Phoenix confirmed that it was in initial talks over “a potential third-party partnership to accelerate the growth” of its PRT business. It added that talks were at an early stage and there was no certainty of an agreement.

The FTSE 100 pensions provider has been seeking to bulk up in the UK’s pension buyout market. It had also sought to acquire billions of pounds of pension liabilities from Ford in a £4.6bn deal that was ultimately won by rival Legal & General this week. 

The UK’s PRT market, in which companies pay insurers to take on their financial obligations to retirees, has also attracted private capital groups including Brookfield and Apollo. In July, Apollo-backed insurer Athora struck a £5.7bn deal to acquire the Pension Insurance Corporation. 

The fundraising aims to give Phoenix more firepower to originate private credit and infrastructure — particularly in North America — and package those assets so that they meet solvency rules for UK insurers, according to people familiar with the deal.

It could also give Phoenix more of an edge as it bids for larger pension pots, a segment of the market that has been dominated by L&G, PIC and Rothesay, the insurer founded by Goldman Sachs.

Phoenix’s Standard Life completed its largest transaction to date in August, a £1.9bn buy-in for members of Marsh McLennan’s UK pension fund.

UK companies were expected to offload more than £40bn in pension obligations this year, according to specialist consultancy LCP.

Blackstone, KKR and Sixth Street declined to comment.

BNP Paribas is the latest bank to take a hit from fraud, and as financial conditions shift, it will not be the last

For those who worry about the fragility of the financial system, there is something oddly reassuring about fraud. If banks are going to face unexpected costs for loans going bad, it’s better that they are the result of a few “cockroaches”, as JPMorgan boss Jamie Dimon characterised them recently, than a broad, corrosive deterioration in credit conditions.

By that token, recent sightings should be irksome, rather than systemically concerning. The latest scuttled out from BNP Paribas, which took a €190mn charge over a fraud related to receivables financing. Regional US banks Zions and Western Alliance also recently claimed they had been defrauded, and authorities are investigating possible knavery around the collapses of auto-loan company Tricolor and car-parts maker First Brands.

But what happens if fraud does become an endemic part of the system? Certainly, the conditions that enable corporate grift are getting more favourable. Those are pressure, opportunity and rationalisation — the three points of what criminologist Donald Cressey in the 1950s called a “fraud triangle”.

For an idea of the pressure company managers might be under, thanks to high interest rates, tariffs and other kinds of uncertainty, look no further than corporate insolvencies. Those in Europe and the US are rising. In the UK, the level has lingered around a 30-year high for the past two years.

Opportunity is increasing too. Private credit firms are falling over themselves to allocate capital; banks are fighting to provide them with investment opportunities. Financial history shows all too well that in times of exuberance, standards tend to slip. Technology also brings more ways to defraud, fake documentation and bamboozle consumers and counterparties.

The real bogeyman is rationalisation — the “everybody does it” defence. There too, it’s hard to believe that the conditions aren’t worsening. In a decade-old study, participants in a dice-rolling game proved more likely to lie about their score in countries with a higher prevalence of rule violations. Wealth hardly engenders honesty: a Californian study found drivers of fancier cars more likely to enter a four-way junction when it isn’t their turn.

If Cressey was right, the US should be on particularly high alert. Alongside rising economic pressure and slipping lending standards, it isn’t hard to see how the cavalier approach of the Trump administration to conflicts of interest and enrichment of insiders might support rationalisation. On top of that, the deep cuts to anti-scam regulators like the Securities and Exchange Commission may reduce deterrents.

So if the corners of the fraud triangle really are getting sharper, what then? Companies, lenders and investors will have to spend more to raise their defences. But given the fertile conditions for corporate misbehaviour, the troubling conclusion is that cockroaches creeping into view today will turn out to be nothing compared with those yet to hatch.