(BFW) StanChart Most Vulnerable to U.K. Banks’ 2015 Stress Test: CS

StanChart Most Vulnerable to U.K. Banks’ 2015 Stress Test: CS
2015-03-30 13:48:27.181 GMT


By Chris Malpass
(Bloomberg) -- Standard Chartered and to a lesser extent
HSBC are most vulnerable to 2015 stress tests that will
emphasize global and emerging market shocks, Credit Suisse says
in note.
* Stress test could provide working backdrop for StanChart’s
next CEO
* Previous stress test pushed StanChart’s CET1 ratio down
to 8.1% from 10.5%
* CS says StanChart has significantly de-risked since
* CS says StanChart has significantly de-risked since</li></ul>
* EARLIER: U.K. stress tests include China slump, oil-price
drop, FX swings
* EARLIER: BI says HSBC, StanChart restructuring may be in
cards as BOE focus turns


For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>

To contact the reporter on this story:
Chris Malpass in Berlin at +49-30-70010-6234 or
cmalpass@bloomberg.net
To contact the editor responsible for this story:
James Ludden at +44-20-3525-2645 or
jludden@bloomberg.net

>>> Looming tax law change could spur M&A activity for development-stage solar p

Deal Reporter

Looming tax law change could spur M&A activity for development-stage solar projects in US, industry sources say -

The scheduled step-down of the federal Investment Tax Credit (ITC) that supports financing of US solar construction is pushing many development-stage solar projects to consider selling over the next year, according to several industry executives and bankers.

Utility-scale projects should already be on the market, while commercial and industrial projects could come available at the end of 2015 or early 2016, according to Stanley Chin, CEO of Clean Focus. “We’re already starting to see it,” Chin said. His company focuses on co-development, investing in late-stage or early construction-stage projects, typically between one megawatt and five megawatts (MW).

According to industry executives interviewed by Mergermarket, the cost to acquire development-stage projects in North America can range from as little as three cents per watt to north of USD 1 per watt, based on the prevailing conditions and incentives of a specific market. Massachusetts, for example, has rolled out significant incentives and commands higher premiums, while those with low rates in power purchase agreements (PPAs), such as California, fall to the lower end.

Under current law, the ITC provides for a dollar-for-dollar reduction on income taxes for eligible expenses on solar projects. If the projects are in operation by the end of 2016 the credit is 30%; if a project comes online after that the credit is 10%. It is a double-whammy for developers, a banker said, because projects will be more expensive and there will be less opportunity for tax equity investors, who are able to claim the tax credits, which aren’t useful to operators of a project that just went online and is likely not generating much revenue at that point.

Developers who do not think they can complete construction of a project in time to receive the full credit will be the most logical targets, particularly smaller developers without track records or ample capital. The banker said valuations will depend a lot on how clear a path there is to a power purchase agreement (PPA) for the assets. Some development-stage projects are shovel-ready, while others are “not much more than land and an idea.”

Innovative Solar in Asheville, North Carolina, is actively marketing some 500 MW worth of projects, according to CEO John Green. He said the projects are all shovel-ready and pointed to several recently sold projects that quickly secured power purchase agreements with utilities such as Duke Energy (NYSE: DUK).

"The people buying now, they have to know what they are doing," Green said. "A utility-scale project takes a year to build and when you throw in the time to close and giving yourself a cushion at the end of next year just in case you have delays, these really need to be sold in the next few months to be pretty sure get the full ITC."

Beaumonth Solar is conducting a sales process, according to previous reports from this news service. Beaumont has 35MW of operating projects and a backlog of another 60MW, according to a source familiar with its plans.

8minutenergy renewables President Tom Buttgenbach, whose company buys utility-scale, development-stage projects, said it is not uncommon for developers to back out of projects because they feel timelines are too tight, often for reasons beyond the ITC step-down. 8minuteenergy bought out a partner on a solar project last year because the partner was skittish about having the project completed in the timeframe called in for in the PPA.

“Some of these projects out there, people really need to get moving on,” added Charlie Kuffner, COO of developer Clean Power Group. “It’s a lot like the 2008 rush” when solar tax credits were also threatened and a similar buying binge began. The credit was later extended through the end of 2016.

The urgency to build also comes as yieldcos — publicly traded companies holding renewable and other assets aiming to produce long-term steady cash-flow — are lowering the cost of capital for solar projects and providing paths for developers to monetize their projects quickly after completion.

“The yieldcos need to be fed and they have cheap capital to make projects happen,” a second banker said.

While the yieldcos would not directly buy development-stage assets, companies such as SunEdison, NRG and others that need to drop down assets can acquire developers with both producing assets and projects to put into their pipelines. Coronal Group, which does not have a yieldco but will consider such an exit in the future, according to President Ed Feo, acquired developer and operator Heliosage earlier this year for both its pipeline of development-stage projects and its operating assets.

Adam Boucher, CEO of solar thermal developer Promise Energy, said he expects that many commercial and industrial-scale solar developers are already making plans to raise capital to finance a building binge next year. Their funding will likely be a mix of sponsor equity, tax equity and debt at the project level.

Industry executives and bankers are hopeful that either the 30% credit will be extended past 2016, a provision will be added only requiring that construction of projects begin by the end of 2016 to qualify, or that the step-down is reduced. But there is widespread agreement that solar developers cannot afford to wait and see if changes will happen.

“I can’t see anything happening until close to the election next year, and November 2016 is obviously too late,” said the first industry banker. “I am seeing some nervousness among developers. We, bankers seem to be certain it’s here to stay, but what [the tax credits] will look like in a couple years is a big question.”

>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance: YOD -16.9%, CELP -7%, HNR -5.7%, PLT -2%, .

Select metals/mining stocks trading lower: PAAS -2.5%, GDX -2.1%, ABX -2%, GG -2%, EGO -1.6%, SLV -1.4%, NEM -1.3%, SLW -1.2%, GLD -1.2%, GOLD -1.1%, IAG -1%,

Other news: ADMP -30.8% (receives Complete Response Letter from FDA for its Epinephrine Pre-Filled Syringe NDA), BDSI -25.5% (announces that the primary efficacy endpoint in the Phase 3 clinical study of Clonidine Topical Gel compared to placebo for the treatment of painful diabetic neuropathy did not meet statistical significance), NVGN -6.4% (Novogen and Yale University release data on Cantrixil mode of action), BBEP -6.3% (announces $1 bln strategic investment by EIG Global Energy Partners; lowers common unit distribution), MYL -4.9% (announces the public offering of 35 mln ordinary shares held by subsidiaries of Abbott Laboratories (ABT), representing 31.8% of the shares owned by Abbot), NBG -2.4% (cont uncertainty in Greece)

Analyst comments: OIBR -3.9% (downgraded to Underperform from Sector Perform at RBC Capital Mkts), XLNX -2% (downgraded to Equal-Weight from Overweight at Morgan Stanley), LINE -2% (downgraded to Sell from Neutral at UBS), ALTR -0.5% (downgraded to Underperform from Outperform at Credit Agricole)

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance: NCFT +13.5%, ARCP +1%, NPD +0.5%

M&A news: ICEL +108.9% (to be acquired by Fujifilm for $ 16.50 per share), ASPX +41.5% (to be acquired by Teva Pharma (TEVA) for $101.00 per share), CTRX +25% (to be acquired by UnitedHealth Group's (UNH) OptumRx business for $61.50 per share in cash), NCFT +13.5% (agrees to be acquired by Fortune Brands (FBHS) for $25.50/share in cash), HPTX+7.3% (to be acquired by Horizon Pharma (HZNP) for $46.00 per share in cash or ~$1.1 bln on a fully diluted basis), MSG +5.9% (announces filing of Form 10 Registration Statement for separation of sports and entertainment business from media business; upgraded to Overweight from Equal-Weight at Morgan Stanley), UNH +4.1%

Select China related names trading higher: SHI +10.8%, SFUN +5.7%, EJ +5.4%, LEJU +4.9%, ZNH +3.2%, QIHU +1.7%, CTRP +1.7%, YY +1.4%, BIDU +0.8%

Other news: CNET +23.2% (has entered a service partner agreement with Baidu (BIDU) to cross-sell branded services and products), ZIOP +14.3% (ZIOPHARM and Intrexon Corporation (XON) announce a new global collaboration focused exclusively on novel chimeric antigen receptor T-cell (CAR-T) products with Merck Serono (MKGAY.PK)), XON+13.8%, LAYN +8.2% ( announces award of new contracts valued at ~$110 million), LBIO +7.1% (announces positive data from a TIL-Ipilimumab combination study in melanoma), DWA +6.2% (Home pulled in $54 mln at the box office in its opening weekend, well above estimates), CLDN +5.7% (Enterprise Partners Management discloses 8.3% passive stake in 13G filing), SYN +5.6% (announces it has initiated a Phase 2a clinical trial of SYN-004), NVAX +4.6% (presents new data from non-human primate Ebola challenge), MAGS +3.5% (announces award of $12 million in new orders), DEI +2.2% (to join the S&P MidCap 400), ESPR +1.6% (Visium Asset Management discloses 6.4% passive stake in 13G filing), JPM+1.4% (still checking), MDLZ +1.3% (may sell rights to Philadelphia cream cheese, according to SundayTimes), AA +1% (to curtail smelting capacity in Brazil; curtailment is expected to be complete by April 15, 2015)

Analyst comments: SMMT +4.4% (initiated with a Outperform at Oppenheimer), ADI +3.3% (upgraded to Overweight from Equal Weight at Barclays ), GPRO +2.8% (upgraded to Buy from Neutral at Dougherty & Company), RH +2.1% (upgraded to Buy from Neutral at Goldman), HTZ +2.1% (upgraded to Equal-Weight from Underweight at Morgan Stanley), ABGB+1.8% (upgraded to Neutral at Exane BNP Paribas), NKE +1.6% (upgraded to Outperform from Neutral at Robert W. Baird), CLR +1.5% (upgraded to Buy from Hold at Societe Generale), RIG +1.4% (upgraded to Neutral at Global Hunter), WU +1.2% (upgraded to Buy from Hold at Evercore ISI), ORCL +1.1% (upgraded to Outperform from Sector Perform at RBC Capital Mkts ), TIVO +1.1% (initiated with a Outperform at Macquarie), BRCM +1% (upgraded to Buy from Neutral at Nomura), FINL +1% (upgraded to Buy from Neutral at Monness Crespi & Hardt)

Wansquare : Hedge Funds : The New Frenchies that are performing.

The "Frenchies" are present in the ranking of 40 rising stars Financial News. Both graduates of ESSEC feature in the top. The year 2015 looks promising for hedge funds. According to Hedge Fund Resarch, the industry recorded a collection of $ 76.4 billion in 2014, bringing to a record 2,850 billion in total assets the sector. This trend is explained by low bond yields even negative and high-priced shares confirmed in the first two months of the year, with average growth of 1.66%. However, this good posted health did not allow the emergence of many talents including because of regulatory barriers and costs for new vehicles, according to the explanations that adorn the ranking published today and established by Financial News 40 rising stars in the industry. Top 2015, which hosts profiles of different formations, honors the French.

Among them: Adrien Brus, officiating since 2012 in Naya Management. Age 33 years, this "Frenchy" holds a degree in philosophy at the Sorbonne and graduated from ESSEC. The man's first steps in London where he started in 2005 as an analyst at Morgan Stanley before joining in 2008 Clayton Dubilier and Rice. Adrien Brus is one of founding partners Naya Management, a hedge of $ 2 billion in long / short equity strategy (which is to combine in
a portfolio considered buying a share sousévaluée and selling of Action considered overvalued).

Financial News ranking also gives pride to Antoine Forterre 32 years. A graduate of ESSEC joined the M & A team
Goldman Sachs in 2006. He joined Man in London in 2011, where he is responsible for the identification and execution of the group but also the management of its capital market activities and the implementation of strategic activities. In 2014, he played a key role in conquest of the United States, particularly with the acquisition of Numeric Investors, a quantitative management funds $ 14 billion based Boston and the resumption of Pine Grove, a New York hedge fun of $ 1 billion in assets under management.

The profiles in the top are different from each other. Headquarters example Nathalie Siddell, Marketing Director and Investor Relations at Balyasny Asset Management she joined in 2009 after a three-year experience at Pequot Capital for three years. At 34, this young woman graduated from the Swiss Institute of Public Relations and Marketing School and Polycom communication.

Is a distinct career Mullane those of brothers, Robert and David, both at Goldman Sachs Asset Management. The first 35, is managing director, the second, 39, is responsible for the portfolio solutions AIMS (Alternative Investments and Manager Selection). The British media also do not forget the stars, such as Malta Heininger Carmignac management Jeannine Danielm Amundi, Oliver Druce Société Générale Prime Services and Patrick Ghali Sussex Partners.

>>> US Early premarket gappers

Early premarket gappers
Gapping up: ICEL +107.2%, CNET +26.5%, CTRX +24.7%, EJ +10.1%, SFUN +7.9%, SYN +7.8%, LEJU +7.5%, HPTX +6.5%, ADI +3.9%, UNH +3.4%, RH +3.1%, MDLZ +2.5%, DOW +2.3%, GPRO +2.3%, DEI +2.2%, QIHU +1.7%, CTRP +1.7%, BIIB +1.7%, FEYE +1.5%, ALTR +1.4%, JPM +1.4%, SWKS +1.2%, NBG +0.8%

Gapping down: ADMP -29.5%, BDSI -28%, MYL -4.3%, CRH -2.5%, GDX -2.2%, BBEP -2.2%, LINE -2%, ARMH -1.8%, SLV -1.5%, ABX -1.5%, NEM -1.4%, VOD -1.4%, PAAS -1.4%, SLW -1.2%, GLD -1.2%, EGO -1%, IAG -1%, GOLD -0.8%, BHP -0.8%