FINANCE
Knight Capital rescue plan
Knight Capital Group Inc, driven to the brink of bankruptcy by trading losses last week, has agreed to a US$400 million cash infusion through the sale of convertible securities, two people with direct knowledge of the matter said. Getco LLC, the automated trading firm backed by General Atlantic LLC; Blackstone Group LP and brokerages Stifel Nicolaus & Co and TD Ameritrade Holding Corp are investing, according to the people, who asked not to be named because the agreements are not public. Stephens Inc and Jefferies Group Inc are taking part and the securities will represent a 70 to 75 percent stake in the company, one of the people said. Knight, whose market-making unit executes about 10 percent of US shares, has been fighting for survival since a computer breakdown spewed orders through stock exchanges on Wednesday and led to a US$440 million loss. The mishap spurred calls in Congress for an examination of whether an increase in automation is damaging the integrity of the US equity market, the world’s largest with US$16.4 trillion in share value.
SPAIN
Bank deal for toxic debt
Economy Minister Luis de Guindos says the government is set to approve a new law creating an asset management agency, or “bad bank,” to deal with the toxic assets that have led many Spanish banks to seek an EU bailout. The toxic assets — expected to total 200 billion euros (US$244.9 billion) — will be segregated from the banks, and dealt with by the new agency. De Guindos said on Sunday in an interview with newspaper ABC that the law is up for approval on Aug. 24. The EU is to provide up to 100 billion euros for banks struggling from non-performing loans, foreclosed property and other unwanted assets resulting from the collapse of the country’s real estate market. Leading banks, such as Banco Santander SA, are not expected to need help.
ENERGY
Shell shifts giant cash base
Energy giant Royal Dutch Shell is to move some of its cash pile from European banks due to the eurozone debt crisis, the Times newspaper reported yesterday, citing the group’s chief financial officer. Chief finance officer Simon Henry told the daily that the Anglo-Dutch group was looking at putting some of its 12.13 billion euros in cash into US government bonds and banks. “There’s been a shift in our willingness to take credit risk in Europe,” Henry said. The Times said Shell was still required to keep some money in Europe to fund its operations.
NORTH KOREA
Army’s controls curtailed
Pyongyang has shut down a military-run company tasked with attracting foreign investment due to its poor performance, as the regime tries to rein in the army, a report said yesterday. Chosun Ilbo newspaper, citing a South Korean government source, said the Taepung International Investment Group — created in 2009 by approval of the powerful National Defence Commission — was recently closed down. “Taepung, when it first opened, had an ambitious goal to solicit foreign investment of US$10 billion in 2010 and US$120 billion within five years, but made little progress,” said the source quoted by Chosun. The shutdown was also intended to curb the military that had grown too powerful under the late ruler Kim Jong-il, it said.
Sweeping policy changes under US Secretary of Health and Human Services Robert F. Kennedy Jr are having a chilling effect on vaccine makers as anti-vaccine rhetoric has turned into concrete changes in inoculation schedules and recommendations, investors and executives said. The administration of US President Donald Trump has in the past year upended vaccine recommendations, with the country last month ending its longstanding guidance that all children receive inoculations against flu, hepatitis A and other diseases. The unprecedented changes have led to diminished vaccine usage, hurt the investment case for some biotechs, and created a drag that would likely dent revenues and
Macronix International Co (旺宏), the world’s biggest NOR flash memory supplier, yesterday said it would spend NT$22 billion (US$699.1 million) on capacity expansion this year to increase its production of mid-to-low-density memory chips as the world’s major memorychip suppliers are phasing out the market. The company said its planned capital expenditures are about 11 times higher than the NT$1.8 billion it spent on new facilities and equipment last year. A majority of this year’s outlay would be allocated to step up capacity of multi-level cell (MLC) NAND flash memory chips, which are used in embedded multimedia cards (eMMC), a managed
CULPRITS: Factors that affected the slip included falling global crude oil prices, wait-and-see consumer attitudes due to US tariffs and a different Lunar New Year holiday schedule Taiwan’s retail sales ended a nine-year growth streak last year, slipping 0.2 percent from a year earlier as uncertainty over US tariff policies affected demand for durable goods, data released on Friday by the Ministry of Economic Affairs showed. Last year’s retail sales totaled NT$4.84 trillion (US$153.27 billion), down about NT$9.5 billion, or 0.2 percent, from 2024. Despite the decline, the figure was still the second-highest annual sales total on record. Ministry statistics department deputy head Chen Yu-fang (陳玉芳) said sales of cars, motorcycles and related products, which accounted for 17.4 percent of total retail rales last year, fell NT$68.1 billion, or
In the wake of strong global demand for AI applications, Taiwan’s export-oriented economy accelerated with the composite index of economic indicators flashing the first “red” light in December for one year, indicating the economy is in booming mode, the National Development Council (NDC) said yesterday. Moreover, the index of leading indicators, which gauges the potential state of the economy over the next six months, also moved higher in December amid growing optimism over the outlook, the NDC said. In December, the index of economic indicators rose one point from a month earlier to 38, at the lower end of the “red” light.
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