>>> Citigroup beats by $0.08, beats on revs

Citigroup beats by $0.08, beats on revs
  • Reports Q3 (Sep) earnings of $1.24 per share, $0.08 better than the Capital IQ Consensus of $1.16; revenues fell 4.8% year/year to $17.8 bln vs the $17.32 bln Capital IQ Consensus.
    • Expenses declined 2% y/y, slightly higher on a q/q basis.
    • RoE 6.8% down 20 bps form Q2
    • RoA was 0.83%, down 6 bps q/q
    • NIM was 2.86%, flat q/q
    • Tangible BVPS $64.71, +2% q/q
  • Citigroup's cost of credit in the third quarter 2016 was $1.7 billion, a 5% decrease as a lower provision for benefits and claims and a decrease in net credit losses were partially offset by a net loan loss reserve build of $176 million, largely driven by North America cards within Citicorp, compared to a net loan loss reserve release of $16 million in the prior year period.
  • Citigroup's loans were $638 billion as of quarter end, up 2% from the prior year period, and up 3% in constant dollars. In constant dollars, 7% growth in Citicorp loans was somewhat offset by continued declines in Citi Holdings, driven primarily by continued reductions in the North America mortgage portfolio.
  • North America Global Consumer Business revenues (Including COST business) of $5.2 billion increased 7%, with higher revenues in Citi-branded cards, Citi retail services and retail banking. Citi-branded cards revenues of $2.2 billion increased 15%, reflecting the addition of the Costco portfolio as well as modest organic growth driven by higher volumes. Citi retail services revenues of $1.6 billion increased 1%, as underlying portfolio growth was largely offset by the impact of previously-disclosed partnership program renewals as well as the absence of revenues from portfolio exits. Retail banking revenues increased 2% to $1.4 billion, on higher average loans and checking deposits.
  • Markets and Securities Services revenues of $4.5 billion increased 11%. Fixed Income Markets revenues of $3.5 billion increased 35%, driven by improvement in both rates and currencies and spread products. Equity Markets revenues of $663 million decreased 34%. The third quarter 2015 included the previously-disclosed reversal of a charge to revenues of approximately $140 million for valuation adjustments related to certain financing transactions. Excluding this adjustment, Equity Markets revenues decreased 23% driven by lower market activity as well as the comparison to strong performance in Asia in the prior year. Securities Services revenues of $536 million increased 4% and increased 6% in constant dollars, as increased client activity, higher deposit volumes and improved spreads more than offset the absence of revenues from divested businesses.

>>> US Early premarket gappers

Early premarket gappers

Gapping up: REED +12.9%, ENZ +12.4%, IPCI +10.3%, ARIA +6.4%, LEI +6%, SDRL +5.3%, FHN +5%, AEZS +4.9%, TEAR+4.8%, CTRV +3.7%, BCS +2.9%, AMD +2.9%, OAS +2.7%, UA +2.4%, UA +2.4%, WLL +2.3%, SBGL +2.2%, BBVA +2.1%,SAN +2.1%, DB +2%, ING +2%, MT +2%, JD +1.8%, VALE +1.8%, RIO +1.8%, FCX +1.8%, MS +1.6%, RDS.A +1.6%, BBL+1.6%, C +1.6%, BHP +1.5%, GS +1.4%, JPM +1.4%, HSBC +1.4%, TOT +1.4%, VMW +1.3%, HON +1.3%, AA +1.3%, BAC+1.1%, COG +0.9%, ATU +0.6%

Gapping down: SMSI -20.8%, HIVE -18.3%, NHTC -14.3%, OPTT -12.9%, BIOC -11.5%, EGLT -8.2%, LMRK -6.8%, INFY-6.3%, DFRG -4.4%, ONCS -4%, RSPP -3%, RSPP -3%, WMIH -2.8%, AU -1.8%, GOLD -1.8%, HPQ -1.7%, DPRX -1.4%, SYT-1.4%, GSK -0.9%, SKY -0.7%

FT : News from the slopes

News from the slopes
Far-flung adventures, five-star hotel launches and skiing with an Eagle


Eastern promise
Perhaps it is because Alpine off-piste routes are getting ever more crowded, perhaps because bragging rights are harder to win in the social-media age, but skiers are travelling ever further in search of virgin slopes and fresh tracks. This winter, there seems to be a growing consensus among tour operators: for adventure skiing, you should head east.

Mountain Tracks, for example, is launching a new trip to Georgia, offering the chance to make ski ascents of little-visited peaks in the Svaneti region, staying in farms and small village guesthouses (eight nights, from £1,895). Mountain Heaven’s bread-and-butter is smart chalet holidays to well-known resorts such as Meribel and Morzine but this season it is branching out to Iran. Its guided trips take in three resorts in the Alborz mountains, as well as sightseeing in Tehran (seven nights, from £1,100). Similarly, Snoworks’ instructors are normally found running classes in Courchevel and Tignes but in February will be leading a new ski-touring adventure in Kyrgyzstan. Guests will stay in a yurt camp at 2,700m in the Terskey Ala-Too mountains, and will be transferred to the slopes each day by snowmobile (10 nights, from £2,325).
However, trumping all those, both for sheer remoteness and the chance to make first descents, is Elemental Adventure’s trip to Russia’s Kuril Islands. This chain of 56 volcanic islands stretches 1,300km from the Kamchatka peninsula to Japan, separating the Pacific from the Sea of Okhotsk. Harsh weather conditions dictate that itineraries be left flexible, but Elemental Adventure’s trips start from Petropavlovsk, capital of Kamchatka, then travel south by MI8 helicopter. On a trip in April this year, the group landed on the uninhabited Makanrushi island, becoming the first to ever ski there. They went on to Onekotan, landing on the summit of a volcano before skiing into the crater, to be picked up by helicopter on the frozen lake at the bottom (around €11,500 per person, depending on group size and mileage flown).
Height of luxury
© Fabrice Rambert
In 1946, officials in the French region of Savoie set out a bold plan to reinvigorate the economy by transforming a grassy mountain plateau into the country’s first purpose-built resort. It turned out to be a lasting success: this winter the resort celebrates its 70th anniversary and is now home to no fewer than 20 five-star or palace hotels — more than anywhere in the country outside Paris. The latest to join that roster is the newly built Hotel Les Neiges, the first mountain hotel from the Barrière group. The 42 bedrooms, featuring lots of larch panelling, cashmere, velvet and fur, are the work of designer Nathalie Ryan, who spent a decade creating boutiques for Christian Dior. Prices start at €1,200 a night and soar to €18,000 for the biggest suite. Next door, the Aman Le Mélézin is also preparing for the anniversary, putting the finishing touches to an eight-month refurb (doubles start at €1,155).
Also five-star but a fraction of the price is the new Taj-I Mah, the first hotel of that rating to arrive in more down-to-earth Les Arcs (doubles from €260). Meanwhile in Val Thorens, the old Mercure hotel is being relaunched as the four-star Fahrenheit Seven, full of retro nods to the 1970s (doubles from €230). hotel-les-neiges.bebarriere.com; amanlemelezin.com; hotel-tajimah.com; fahrenheitseven.com
Olympic return
Former Olympian Eddie 'The Eagle' Edwards © Getty
Fresh from the success of the movie of his life, Eddie “the Eagle” Edwards is to lead a tour of some of British Columbia’s most celebrated resorts on a one-off trip in February. The week-long group trip includes the chance to ski alongside Edwards at Kicking Horse, Revelstoke and Lake Louise, and accompany him to the place where he found fame in 1988 — the Canadian Olympic Park in Calgary.
Departs February 25, from £2,595 per person, not including flights to Calgary; kickinghorsepowdertours.com
Wingsuits banned
© Alamy
Chamonix, Europe’s capital of extreme sports, has banned wingsuit flying after a spate of deaths. Eric Fournier, the town’s mayor, announced the ban earlier this month following the death of a Russian who crashed into a chalet after his parachute failed to open. This year has seen more than 20 wingsuit fatalities worldwide and five in Chamonix alone. In August, one wingsuit flyer in Switzerland was livestreaming his jump on Facebook when he crashed and died. Many blame the rise of new confidence-boosting suits, which encourage relatively inexperienced flyers to attempt risky manoeuvres.
New routes to the slopes
© Dreamstime
Swiss is to launch new flights this winter between London and Sion in the Valais, where the runway is less than 3km from the nearest ski lift. The slopes of Nendaz are 6km away, Crans-Montana and Verbier less than 16km. Swiss will operate the route only during the February peak, but is doing so as a trial and may increase the frequency in future. The Swiss air force is due to stop using the airport as a base by 2020, prompting it to refocus on passenger services. Meanwhile British Airways is launching flights from Stansted to Chambéry, France, and Delta will fly from Heathrow to Salt Lake City, close to resorts including Park City and Snowbird.

>>> German utilities to pay 23.6 bln euros into nuclear fund-draft law

German utilities to pay 23.6 bln euros into nuclear fund-draft law - Reuters News

14-OCT-2016 12:39:14

Utilities can pay in instalments -draft law
First rate must be 20 pct of total amount -draft
Shares in E.ON, RWE gain on news
Adds details on draft law, shares

BERLIN, Oct 14 (Reuters) - Germany's big utilities will begin paying 23.6 billion euros ($26.39 billion) into a fund on Jan. 1 to hand over liability for the storage of nuclear waste to the government, according to a draft law seen by Reuters on Friday.

The German cabinet is due to approve the draft law on Oct. 19, bringing to an end lengthy negotiations between Berlin and the country's four major energy groups -- E.ON EONGn.DE, RWE RWEG.DE, EnBW EBKG.DE and Vattenfall VATN.UL -- on a storage deal proposed by a government-appointed commission in April. (Full Story)

Utilities have been fighting to get a lower payment, arguing that they have been hammered by plunging power prices, a shift towards renewable energy and Germany's decision to end nuclear power by 2022 following Japan's Fukushima disaster five years ago.

The final sum is lower than a figure of 26 billion euros that was reported last month. (Full Story)

The agreed deal also brings some relief to utilities as the commission said last month every year of delay in implementation would cost utilities 4.6 percent in accrued interest. (Full Story)

Shares in E.ON EONGn.DE jumped 3.4 percent to trade at 6.82 euros per share, while RWE RWEG.DE surged 5.4 percent to 14.09 euros per share by 1005 GMT.

Under the plan, utilities are to transfer 23.6 billion euros to the state, along with responsibility and liability for storing their nuclear waste - the most complex and costly aspect of nuclear decommissioning.

They can opt to pay in instalments up until the end of 2026, with their first payment making up 20 percent of the total. If they decide to pay in instalments there will be an interest rate of 4.58 percent per year on the rest.

Those that opt to pay in instalments will have to provide collateral for what the owe, which could be via a bank guarantee, according to details of the draft law.
12:39:41 dunno if old

(BofA-ML) The Flow Show - Shorting the Long-End - Bond inflows Equity Outflows

Weekly flows: bond inflows ($2.6bn), equity outflows ($3.1bn) & precious metals
inflows ($0.4bn).

>>> Asset Class Flows
* Equities: $3.1bn outflows (outflows in 4 of past 5 weeks) ($5.5bn mutual fund outflows vs $2.4bn ETF inflows)
* Bonds: $2.6bn inflows (inflows in 14 of past 15 weeks)
* Precious metals: $0.4bn inflows (3 straight weeks)

>>> Equity Flows
* Japan: first outflows in 6 weeks (chunky $2.8bn – largest in 6 months)
* EM: $2.5bn inflows (largest in 8 weeks) (inflows in 14 of past 15 weeks)
* Europe: $1.1bn outflows (record 36 straight weeks of outflows)
* US: $2.3bn outflows (outflows in 5 of past 6 weeks)
* By sector: largest outflows from REITs in 8 months ($0.6bn); chunky inflows to financials ($0.5bn) and tech ($0.5bn)

>>> Fixed Income Flows
* 11 straight weeks of inflows to bank loan funds ($0.4bn)
* 18 straight weeks of TIPS inflows ($0.6bn)
* 15 straight weeks of inflows to EM debt funds ($0.9bn)
* $0.6bn inflows to HY bond funds (3 straight weeks)
* $2.3bn inflows to IG bond funds (inflows in 31 of past 32 weeks)
* First outflows from munis in 57 weeks (albeit tiny $48mn)
* 14 straight weeks of outflows from Govt/Tsy funds ($2.3bn)

(Exane) Pound and UK M&A

the plunge in the Sterling may indeed help reshuffling the local M&A cards !

Why revisiting the Forex / M&A relationship now ?
Because :
• The amplifying selloff in the Pound is having particularly subtle effects :
- it has sent the Footsie Index to an all-time high on 10 October
- but it is also directly disrupting corporate earnings trends ,creating a sharp contrast between Forex winners and losers
• The camp of these losers currently regroups companies :
- which in recent month have often been mentioned as potential bid targets
the “usual suspects”
- whose theoretical acquisition price has been substantially deflated by the depression of the Sterling
the case of Aveva has just been reviewed in this recent Focus :
SPECIAL SITUATION FOCUS: SCHNEIDER for AVEVA ? Things come in threes, as the saying goes ..
• The fresh example of the AB Inbev – SABMiller transaction demonstrates that the Forex factor may have a decisive influence on offer outcomes
the surge in the Pound-denominated price of ABI inflated the demand for ABI certificates ,which consequently deflated the distribution to Altria and Santo Domingo Family
4 lists of “usual suspects”
• The note combines Exane BNPP’s updated M&A Targets list with those of companies :
- facing short-term expiries of sensitive bidding restrictions
- mentioned ,more or less frequently ,in the specialized Bloomberg columns
• Within these lists ,one may for instance :
- notice that the market is paying a rising attention to the Imagination and Sky cases
- remind that ICE will become soon re-entitled to potentially approach the LSE
- underscore the local cheapness of the Aveva
- point out that ICAP has just replaced Pennon in our in-house UK High Conviction list
both are members of our in-house M&A Targets list