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The Morning Ledger: Companies Weigh Moving Billions Ahead of Brexit |
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German rail operator Deutsche Bahn is among the companies evaluating their London-based financial instruments. PHOTO: JOHN MACDOUGALL/AGENCE FRANCE-PRESSE/GETTY IMAGES
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Good day. European companies could be forced to move financial instruments out of the U.K. and into the European Union following Britain's exit from the EU, CFO Journal's Nina Trentmann reports.
Relocation costs: Loans, securities and derivatives totaling approximately €2.4 trillion ($2.7 trillion) might have to be shifted to EU-based bank entities if Britain becomes a so-called third country after a hard Brexit, according to estimates by consulting firm Boston Consulting Group U.K. LLP. About 68% of all trading in the City of London is done on behalf of clients, including corporates, from EU-member states, BCG said.
[Continues below...]
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Grey area: Negotiators for the U.K. and the EU are still working on a separation agreement that would set the terms of Britain’s departure from the bloc and clarify the rules for financial services in the future. Lacking that, treasurers, lawyers and advisers are struggling to come up with definitive answers about whether financial instruments will have to be altered.
Photo finish: Deutsche Bahn AG, the German rail operator, has derivatives worth €5.5 billion, some of which are booked through London. The company has not made any changes yet, but is considering its options, said Wolfgang Bohner, head of the firm’s finance and treasury department.
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U.S. industrial production data for September are due out at 9:15 a.m. E.T. Economists surveyed by the WSJ expect factory output to tick up 0.2%, after a 0.4% increase clocked in August.
BlackRock Inc., CSX Corp., Domino's Pizza Inc., Goldman Sachs Group Inc., Johnson & Johnson and Netflix Inc. are among the companies scheduled to report earnings today.
The International Revenue Service holds a public hearing on proposed rules for a new 20% deduction for pass-through businesses that don't pay standard corporate taxes, such as partnerships and S corporations.
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Bankruptcy Filing Shifts Spotlight to Sears’s Pension Plans |
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Sears Holdings Corp.’s decision to seek bankruptcy protection has brought new scrutiny to its underfunded pension plans. The company's two pension plans had a funding hole of $1.5 billion of the end of 2017.
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It is unclear whether the retailer has the means to pay the 90,000 workers and retirees who stand to benefit from them—and if not, the government may have to step in.
Sears’s bankruptcy includes a tangle of arrangements that put liens on the company’s intellectual property as protection against spurning its pension debts, and illustrates how much contributions to the plans have weighed on the company’s operations.
The company on Monday said it faces “catastrophic consequences” if it can’t repair its unraveling supply chain and keep merchandise flowing to stores and warehouses.
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Employees work on a Porsche SUV inside the car maker’s factory in Leipzig, Germany. PHOTO: KRISZTIAN BOCSI/BLOOMBRER NEWS
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Porsche AG, the sports car maker owned by Volkswagen AG, reined in its finance chief Lutz Meschke after he fueled speculation that the company was discussing a potential listing of a super luxury group combining Porsche, Lamborghini, Bugatti and Bentley that could value the group at up to €70 billion ($81 billion).
Google Chief Executive Sundar Pichai defended his company’s plan to explore a search engine tailored for users in China despite concerns that this would force the Alphabet Inc. unit to comply with the country’s strict internet censors.
The United Steelworkers union and U.S. Steel Corp. struck a tentative agreement for a new labor contract covering at least 14,000 workers, breaking a three-year wage freeze.
Brewers including Anheuser-Busch InBev SA, Molson Coors Brewing Co. and Carlsberg A/S are taking steps to maintain supplies of barley, the main crop used in beer, amid climate change. A new study suggests their preparations might not be enough.
Bank of America Corp.’s third-quarter profit rose 32% as higher interest rates and last year’s corporate tax cut continued to lift bank earnings.
Sacha Romanovitch, the first woman to run a big accountancy firm in Britain, is stepping down as chief executive of Grant Thornton U.K. LLP, reports the BBC. The move comes after Ms. Romanovitch was criticized in an internal memo.
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A worker stands at the assembly line of the Audi TT at the plant in Gyor, west of Budapest, in November 2014. PHOTO: REUTERS
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German prosecutors have issued an €800 million ($925.8 million) fine against Audi AG concluding regulatory offence proceedings over the car maker’s diesel cars, reports Reuters.
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The U.S. Consumer Financial Protection Bureau plans to explain what it considers to be “abusive” practices by companies selling financial services, a move aimed at giving a clearer idea of what behavior would get companies into trouble under new government enforcement powers.
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The U.S. pharmaceutical industry’s main trade group said that major drugmakers would voluntarily include price-related information in television ads, a move signaling resistance to a Trump administration plan to require that the list price be included for most drugs in television ads.
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U.S. sanctions have driven the price of oil and the ruble apart—leaving Russia with expensive crude and a cheaper currency, a combination that is helping its economy.
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Higher interest costs and increased funding for the military contributed to the U.S. deficit in fiscal 2018. PHOTO: BRIAN SNYDER/REUTERS
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The U.S. government deficit increased 17% in fiscal 2018 amid higher government spending—including rising interest costs on the debt and increased funding for the military—and flat revenues following last year’s tax cut.
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Global business investment flows fell sharply in the first six months of the year, as U.S. companies repatriated profits in response to changes in the country’s tax law, a United Nations agency said Monday.
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U.S. retail sales rose 0.1% in September from the prior month, less than the 0.7% increase economists predicted.
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U.S. oil exports to China have slowed to a trickle amid the trade spat between Washington and Beijing, in an abrupt reversal that is upending global crude trade flows and forcing American producers to find new buyers.
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The European Union’s statistics agency reported a 2.1% rebound in goods exports during August, after a decline in July, MarketWatch reports.
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WageWorks Inc., the San Mateo, Calif., employee benefits administration company, named Ismail Dawood as CFO, a role he has held on an interim basis since April 9.
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He succeeds Kimberly L. Wilford, who resigned in April following the company's disclosure that it needed to restate financial results after an audit found material weaknesses in its reporting.
Before joining WageWorks, Mr. Dawood served as the CFO of Santander Consumer USA Holdings Inc. He also worked as CFO of the investment services division of The Bank of New York Mellon Corp., among other roles.
Mr. Dawood will be paid an annual base salary of $400,000 and will be eligible for a cash bonus at a target amount of 75% of that base salary. He will also receive a $100,000 one-time cash signing bonus and various equity grants, WageWorks said in a filing.
Sixt SE, a Pullach, Germany-based car rental company, appointed Jörg Bremer as CFO, effective Nov. 1. He succeeds Julian zu Putlitz who will leave Sixt to pursue other opportunities.
Mr. Bremer previously worked in various positions at Brose Fahrzeugteile GmbH & Co. KG, most recently as CFO of Brose's Business Division Drives unit. Compensation details were not disclosed.
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