Fixed income

As of today, all the polls are suggesting that Macron and Le Pen are likely to oppose each other in the second and final round of the presidential vote. The key to victory may come down to a single factor Рvoter turnout in the second round. Assuming that turnout is along the lines of historical standards (about 80%), Marine Le Pen needs to win 18m voices. Polls currently suggest she will win 12m. And yet, the scenario of a very low turnout must be kept on the table, especially if Fran̤ois Fillon makes it through to the second round. Aversion against Fillon is such among leftist voters that they could be tempted to turn in a blank ballot or not vote at all.

Credit Suisse, which set up a European hub in Dublin creating 100 jobs last year to service hedge fund clients, may apply for a full banking licence in Ireland as it prepares to move jobs out of London following the UK’s decision to quit the European Union, according to sources.

Credit Suisse received regulatory approval in December 2015 to operate as a direct branch of the group’s Zurich headquarters, becoming the first and only bank to date to avail of a change in Irish law in 2013 that allowed non-EU banks to set up a branch in Ireland.
Frankfurt, Luxembourg, Paris and Brussels are among the main locations competing with Dublin to lure financial services activity from London in the wake of the Brexit referendum last June. However, despite the triggering of Article 50 last month, it is understood that Credit Suisse has, as yet, no preferred location.

Credit Suisse chief executive Tidjane Thiam and the bank’s board of directors have offered to cut their own bonuses by 40% ahead of its annual meeting. They also proposed to keep total board pay at the same level as 2015 and 2016.

The move follows pressure from Swiss lawmakers and the bank’s shareholders to address excessive executive pay. Glass Lewis & Co and Geneva-based Ethos, which advises major Swiss pension funds that may represent up to 5 per cent of the bank’s market capitalisation, also criticised the bonuses. The pair had opposed executive and director compensation packages last year, as well, without success. Still, at that meeting, almost one in five shareholders voted to reject the proposed packages.

Facebook Messenger now has over 1.2 billion monthly active users, with the platform adding 200 million users in just eight months.

The milestone, announced ahead of Facebook’s annual conference for software developers next week by head of Messenger David Marcus, is key to Facebook’s push to own more of people’s time and wallets on mobile devices as the arms race with Google and other competitors escalates.

The Barry Callebaut Group, the world’s leading manufacturer of high-quality chocolate and cocoa products, saw sales volume growth picking up to +3.5% in the second quarter (first quarter -0.4%), leading to a topline growth for the first six months of fiscal year 2016/17 of +1.4% to 946,782 tons. This contrasts with the -2.1% decline of the global chocolate confectionery market during the same period (Nielsen, Aug 2016-Jan 2017).

"Markets are difficult everywhere, particularly in confectionery in the United States," Chief Executive Antoine de Saint-Affrique told reporters on a call on Wednesday, adding he expected to see an improvement in Europe this year and expected the good momentum for the company to continue.

The German Business Climate Index released on March 27 hit the record high since mid-2011. Does that mean that German companies are, in general, indifferent to the existing political uncertainties, such as the US President Donald Trump’s protectionist policy, the upcoming elections in Germany and France and hot disputes about the two-speed Europe idea?

I would not say that they are completely indifferent. The Business Climate Index did show an initial reaction to the Brexit referendum decision back in the middle of 2016; however, despite the political uncertainties, the overall global demand picture has actually brightened up over the last six to nine months. Indeed, this is something the German economy benefits very much from due to the importance of its export industry. And the fact that we have seen the Euro weakening over the last year or so helped additionally. This is the result of the US reserves tightening up, while the ECB is not prepared to change its monetary policy yet.

Toshiba on Tuesday warned its survival was at risk as the struggling Japanese industrial giant reported a loss of $4.8 billion in long-overdue financial results.

The company, a colossus of corporate Japan with 188,000 employees globally, had been threatened with expulsion from the Tokyo Stock Exchange unless it met the extended deadline of Tuesday to file its accounts.

Finally, the integration of the Swiss business of Banca Svizzera Italiana (BSI) into EFG Bank has been completed. From this moment, the majority of the customer relationships and employees of BSI are transferred, as EFG referred in a media release. The combined business will now be launched on the market under the name EFG.

EFG International said it completed the legal integration of "substantially all" of BSI SA’s Swiss business into EFG Bank AG, a 100 percent subsidiary of EFG International. The remaining BSI entities in Luxembourg and Monaco are expected to be integrated in the course of the second quarter of 2017, EFG said.