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Mar 27, 2012

Shaw Capital Management Factoring News: Japan Bans Mitsubishi from Contract Bids - Mitsubishi Corp. subsidiaries have been given suspension by the Japanese government in the wake of overcharging issues.

 

The contract bidding suspension came after the Ministry of Defense became alert that Mitsubishi has overcharged various government agencies in their cost of expenses.

 

Further details about the incident were not publicized and the company is still assessing the potential impact this ban will have on their company and their affiliates.

 

Mitsubishi Electric Corp has announced that their business subsidiaries and an affiliate company have all got a notice this week from the Ministry of Defense of Japan. The notice states their suspension from participating in government biddings.

 

After it was revealed on January that Mitsubishi has overcharged the ministry along with the JAXA (Japan Aerospace Exploration Agency and the Cabinet Satellite Intelligence Center, subsidiaries of Taiyo Musen, an equity affiliate and Mitsubishi Electric (which includes Mitsubishi Space Software, TOKKI Systems Corporation and Mitsubishi Precision) the involved firms have informed the MOD about the overcharges only today.

 

Through internal investigation, it was discovered that they have also charged more for the ministry by altering records of work across various orders.

 

The impact of this incident on Mitsubishi’s consolidated market performance still remains uncertain but the firm plans to announce what the public should be alert of as soon as the condition is understood better.

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Posted: Mar 27, 2012 1:56am
Mar 27, 2012

Shawcapfactoring - Holders of credit-default swaps on Greek bonds shouldn’t tear up their contracts after yesterday’s ruling against a payout.

 

The International Swaps & Derivatives Association said the swaps hadn’t been triggered by the European Central Bank’s exchange of Greek bonds for new securities exempt from losses taken by private investors. The group will now probably be asked to determine whether collective action clauses, or CACS, being used by Greece to impel investors to participate in a wider exchange of bonds that would trigger the swaps.

 

“They will have to enforce CACS,” said Alessandro Giansanti, a senior rates strategist at ING Groep NV in Amsterdam. “At that point the exchange will become coercive and that will be a restructuring event for CDS.”

 

The 130 billion-euro ($170 billion) bailout for Greece is testing the sanctity of the market for credit-default swaps and their effectiveness as a hedge against losses on government bonds. Policy makers including former ECB President Jean-Claude Trichet have opposed paying the contracts because they’re concerned that traders will be encouraged to bet against failing nations and worsen Europe’s debt crisis.

 

Contracts tied to the debt of Greece signal a 95 percent probability of default.

 

‘Crying Out’

Such thinking is misdirected, according to Nicholas Spiro, managing director of Spiro Sovereign Strategy in London. A settlement on Greek swaps may bolster confidence in the $258 billion sovereign insurance market and help boost the government bond market, he said. Efforts to circumvent a trigger risk undermining credit markets, Spiro said.

 

“The sovereign CDS market is crying out for an injection of confidence because we are by no means out of the woods,” Spiro said. “It’s very important, particularly in much larger bond markets like Italy and Spain, that investors’ hedges are perceived to be credible.”

 

European leaders agreed to provide capital faster for the planned permanent bailout fund in a concession to international pressure to strengthen the bloc’s defenses against the debt crisis. Euro governments might pay the first two annual installments into the 500 billion-euro fund this year and complete the capitalization in 2015, a year ahead of schedule. A decision will come later today.

 

Interest-Rate Swaps

Elsewhere in credit markets, Wells Fargo & Co. (WFC) sold $2.5 billion of debt at almost half the relative yield that JPMorgan Chase & Co. paid last month. The global speculative-grade default rate will rise to 2.8 percent by year-end from 1.8 percent at the close of 2011, Moody’s Investors Service said. The U.S. commercial paper market contracted to the lowest level in more than a year.

 

The two-year interest-rate swap spread, a measure of debt market stress, fell 0.4 basis point to 25.75 basis points. The gauge widens when investors seek the perceived safety of government securities and narrows when they favor assets such as corporate bonds.

 

The cost of protecting company debt from default in the U.S. declined, with the Markit CDX North America Investment Grade Index, which investors use to hedge against losses or to speculate on creditworthiness, decreasing 1.3 basis points to a mid-price of 92.7 basis points. The Markit iTraxx Europe Index of companies with investment-grade ratings rose 1.5 to 128.5, according to JPMorgan Chase & Co. at 10:30 a.m. in London.

 

Default Swaps Fall

The Markit iTraxx Australia index decreased 5 basis points to 137, Westpac Banking Corp. prices show. That’s on course for its lowest since Aug. 5, according to data provider CMA. The Markit iTraxx Asia index of 40 investment-grade borrowers outside Japan declined 4 basis points to 157.

 

The indexes typically fall as investor confidence improves and rise as it deteriorates. Credit-default swaps pay the buyer face value if a borrower fails to meet its obligations, less the value of the defaulted debt. A basis point equals $1,000 annually on a contract protecting $10 million of debt.

 

While Moody’s is forecasting a faster default rate, the estimate is below the 4.8 percent average since 1983, the New York-based ratings firm said in a report yesterday. Standard & Poor’s is forecasting a default rate of 3.3 percent by year-end, from 1.98 percent at the close of 2011, the ratings firm also reported yesterday.

 

Wells Fargo

Bonds of Wells Fargo were the most actively traded U.S. corporate securities by dealers yesterday, with 175 trades of $1 million or more, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

 

Wells Fargo issued 3.5 percent, 10-year notes that pay 150 basis points more than similar-maturity Treasuries, according to data compiled by Bloomberg. On Jan. 13, JPMorgan sold $3 billion of 4.5 percent notes, also due in 10 years, at a 270 basis-point spread, before issuing an additional $250 million of the debt five days later.

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Posted: Mar 27, 2012 1:48am
Mar 26, 2012

Shawcapfactoring - Three New York City pension funds have showered nearly $1 billion on three hedge funds.

The pensions for the Big Apple's police, firefighters and public employees awarded $350 million mandates to Brevan Howard Asset Management and D.E. Shaw Group. Brigade Capital Management will run $200 million.

The mandates at a stroke triple the pensions' hedge fund allocation, which now totals $1.35 billion. The plans, with a combined $70 billion in assets, have a $3 billion hedge fund target.

"We have put together a hedge-fund program that will help further diversify our portfolio and guard against volatility in the market," a spokesman for New York City Comptroller John Liu said.

Two other city pensions, for its teachers and educational administrators, have no hedge fund allocations at all.

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Posted: Mar 26, 2012 1:29am
Feb 16, 2012
Cochrane Shaw Capital Management Pty Ltd.: Private Company Information - BusinessWeek
COMPANY OVERVIEW
Cochrane Shaw Capital Management Pty Ltd. provides investment and securities advisory services to individuals, corporations, accounting firms, and legal practices in Australia. The company offers advice on shares, debentures, superannuation, life insurance, unit trusts, and master fund products, as well as ongoing review on their investment portfolio. Its services include financial planning and investment strategies, superannuation planning, retirement and pension planning, risk insurance management, estate planning, and taxation planning. Cochrane Shaw Capital Management Pty Ltd. was incorporated in 1969 and is based in Melbourne, Australia. As of December 24, 2010, Cochrane Shaw Capital Management Pty Ltd. operates as a subsidiary of Incito Group Ltd.
Suite 2
41 Railway Road
Blackburn
Melbourne, VIC 3130
Australia
Founded in 1969
Phone 61 3 9894 3788
Fax 61 3 9894 1015
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Posted: Feb 16, 2012 8:53pm

 

 
 
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