BANKING
Credit Suisse sells debt
Credit Suisse Group AG agreed to sell distressed debt assets for US$1.27 billion to an arm of private-equity firm TPG. The portfolio being sold to TSSP, a credit and special situations business, includes 270 instruments related to about 170 companies globally, Credit Suisse and TSSP said in a statement on Tuesday. The transaction will results in an extra charge of about US$100 million for Credit Suisse, to be reflected in first-quarter results due on Tuesday next week, the statement said. That is in addition to US$99 million of distressed credit writedowns already announced.
EUROZONE
PMI hints at waning growth
A closely monitored survey is pointing to waning growth in the 19-country eurozone at the start of the second quarter of the year. Financial information company Markit yesterday said that its purchasing managers index — a broad gauge of business activity — across the region fell modestly to 53 in April from 53.1 the previous month. Though above the 50 threshold indicating expansion, the reading has fallen from the start of the year. The eurozone is in a “low gear,” Markit says.
INDONESIA
Growth rate slows
The nation’s growth rate was slower than forecast in the first quarter, official data showed yesterday, in a blow to President Joko Widodo’s efforts to boost the economy. The economy grew 4.92 percent year-on-year from January to March, the official statistics agency said. This was slightly below economists’ forecasts and compared to 5.04 percent in the final quarter of last year. The economy grew 4.79 percent last year.
SHIPPING
Maersk Q1 profits plunge
Danish shipping and oil group A.P. Moller-Maersk yesterday said that first-quarter underlying profit plunged to US$224 million from US$1.5 billion a year earlier, with all sectors showing a drop in performance except drilling and tanker shipping services. Hit by low oil prices and freight rates, the world’s largest shipping company said revenue fell almost 20 percent from a year earlier to US$8.5 billion. Chief executive Nils Smedegaard Andersen said that market conditions remained “challenging,” but maintained that the group was continuing to adjust its cost base to the new conditions.
MANUFACTURING
Siemens Q1 net profit drops
Siemens AG, maker of heavy industrial equipment including power stations and trains, saw net profit fall in the most recent quarter due to large one-time gains in the year earlier period. However, the company’s earnings beat analyst estimates and it reported a strong rise in new orders. Net profit fell to 1.5 billion euros (US$1.7 billion) in the January-March quarter from 3.9 billion euros in the same quarter last year. Revenue grew 5 percent to 19.0 billion euros.
BANKING
Societe General profit up
Societe Generale SA reported an unexpected increase in first-quarter profit, boosted by consumer banking, and announced plans to deepen cost cuts at its investment bank. Net income rose to 924 million euros from 868 million euros a year earlier, the Paris-based bank said yesterday. That beat the 765 million euro average estimate of six analysts in a Bloomberg survey. Societe Generale booked a 218 million euro gain after the EU antitrust regulator slashed a 2013 penalty for rigging interest rates.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to