Bloomberg reports that US fund manager Legg Mason has put $1.2bn in cash and guarantees behind two money market funds which were coming under pressure due to investments in asset-backed commercial paper. Legg CEO 'Chip' Mason said in a statement that 'this action is consistent with our ongoing efforts to reduce the ABCP exposure in our liquidity funds in light of current stresses in the credit markets'.
The New York Post reports that Bank of America posted notices in its US offices last week that employees would no longer enjoy the benefits of free perks, including soup, crackers, flavoured teas, sugar-free hot chocolate and hand soap. After all, someone's got to pay for those asset write-downs.
The newspaper also says that, according to a US regulatory filing, Bear Stearns boss Jim Cayne sold $15.4m in stock in December at $89.01 a share (the stock was selling a $160 a share at the beginning of the year). Cayne still owns 5.6m shares in the firm, around 5%.
The Sunday Times reports that US pension fund Calpers has set a 6 month deadline for HSBC's management team to come out and articulate their plans for 'radical change'. The newspaper quotes Christy Wood, Calpers' global head of equities, who said that 'we want to see this unfold in the next few months. If they do not set it out before July 1, then there is a problem'.
Reuters reports that former shareholders of First Republic Bank are suing Merrill Lynch, claiming that the firm hide billions of subprime lending-related losses at the time the companies were merging. A deal was struck in January, and closed in September, the month before Merrill announced $8.4bn in write-downs. The shareholders claim that they lost around $250m after Merrill's shares fell following the write-downs.
The Financial Times reports that it was India's reserve bank that 'scuppered' UBS''s plans to acquire Standard Chartered's Indian fund management arm, in a deal worth $130m. The Times has said that the local media is reporting that India's Central Bank has concluded that UBS is not 'fit and proper' to run the unit, which manages around $3.5bn in assets - strange, since UBS already employs 1,500 staff in its investment bank over there.
Finally, Reuters reports that the Singapore Government, which now owns a 9% stake in UBS, has said that it doesn't want to take operational control of the firm, and it has confirmed that it has full confidence in the bank's current executive team.
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