Business News & Financial News

Pflimlin Etienne, President of the Mutual Credit, announced Monday he was resigning his post at the head of the French mutual bank.

"I decided, for personal reasons, to end my functions as president of the National Confederation of Credit Mutuel, and the Federation of Credit Mutuel Centre Est Europe," he wrote in a statement released to the press by Credit Mutuel.

The banking group, in its statement, said that Michael Lucas, the current CEO of the Credit Mutuel will replace Stephen Pflimlin as President from October 14.

Previously, a source close to the group's management confirmed to Reuters that information revealed by the newspaper Les Echos.

"Yes, there is a press release that starts tonight at 18 hours, but I think I'll try to move forward," said the source had told Reuters.

France and Britain have ruled out Friday to share the aircraft carriers in the near future but said they were ready to pool several defense equipment including the future A400M military transport aircraft assembled by EADS.

The Defence Minister Herve Morin, who received his British counterpart Liam Fox to Paris for a bilateral meeting devoted to the weapons programs of both countries, also stressed that the French and British companies were to cooperate more and that would make Paris and London joint proposals for NATO reform.

"We hope that our cooperation is in the background the ability (for France and Great Britain, ed) to make budgetary savings," he said during a brief press briefing.

France and Britain, both facing pressures on their finances, have decided to start saving measures, particularly in the defense sector.

"It is logical to examine the issues where we can share the assets rather than acting separately," explained Liam Fox."It's a purely pragmatic."

Herve Morin said, however, that France does not plan to share aircraft carrier with Britain at this time.

A source close to the Defense Ministry told Reuters that the technical characteristics of French and British aircraft made a pooling difficult but that nothing prevented the two armed boats to share logistics.

"The sharing of an aircraft carrier would not be realistic," confirmed Liam Fox.

Herve Morin assured that Paris and London had been exploring a range of issues of cooperation and mentioned as an example the tanker and the future A400M military transport aircraft, a program led by Airbus Military, a subsidiary of European aerospace and EADS Defence.

"We look very real, capacity by size, by industrial subject matter industry, we can do, either in cooperation, or we can decide who would lead us toward interdependence," he said.

"On the tanker (tankers), the maintenance in operational condition (OLS) of the A400M, the joint naval facilities, we can move towards greater pooling."

PROPOSALS

The contract for the A400M program delay of almost four years, must be revised so that some countries like Germany and Great Britain, dissatisfied with the delivery and anxious to reduce their expenses, considering scaling back their orders .

"On the A400M, it actually makes sense, then we have budgetary constraints, to achieve more together than separately and see where we can achieve economies of scale and use of shared assets," Liam Fox said.

Both ministers have not detailed how this sharing could take place.France has ordered 50 A400M while Great Britain could reduce its order for 25 aircraft to 22.

EADS has signed an agreement in March with the seven member countries of NATO to the origin of the A400M, which allows them to cancel up to 10 aircraft from the total 180 aircraft ordered.

Herve Morin also argues that he had discussed a reform of NATO with Liam Fox.

"France and Great Britain are the desire for a reform of the alliance with a reduction of bureaucracy, increased financial control, reduced staffs and physical footprints" he said before adding that France and Great Britain would submit proposals for savings in the next NATO summit in Lisbon in November.

The Minister also invited the French and British companies to enter into partnerships and alliances.

"We need to redefine a number of edges that we may not have the same research centers on both sides of the Channel '," he pleaded.

Safran will decide in the coming days to make a bid on Zodiac and, where appropriate, offer a significant premium to shareholders of the aerospace supplier, said Monday the Tribune, citing inside sources.

No hostile bid will be made, the newspaper said, while the offensive Saffron comes a month after an initial rejection of the leaders of the Zodiac.

"Considering that we have more than one in two chance, we'll go, if it has less than one in two chance, wait. This folder will always feel in six months a year," told the newspaper an internal source of saffron.

A spokesman declined to comment Safran information immediately.A spokesman declined to comment Zodiac.

Around 11:25, the action was progressing Zodiac 13.01% to 49 euros on the Paris Stock Exchange after reaching a high of 53.4 euros earlier in the morning.At the same time, Saffron retreated 1.66% to 19.01 euros.

Saffron is able to offer a premium of 30-40% compared to the current course, says the Tribune, the equivalent of the highest historic title in 2007, to 58 euros.

Safran is ready to bring the family shareholders of Zodiac in its capital, the newspaper said, which would dilute the share of the state, now a shareholder group to 30%.

Citing "multiple sources," the newspaper wrote that the family Domange shareholder Zodiac up 9.28%, is not ready to sell, unlike the Peugeot family (5% of capital) who would be willing to cede Units.

Safran will do this for an offer to allow shareholders to retain the family tax benefit they have obtained by signing a pact Dutreil "six years ago and through which they receive a tax exemption on capital of 75%.

In prior postings to the families, Safran said his project is an acquisition of Zodiac, but that it could be achieved by exchange of securities and merger in order to preserve the fiscal pact, The Tribune wrote.

The Japanese consumer prices fell in July for the 17th consecutive month on an annual basis, a sign that deflation remains entrenched in the archipelago and Nippon will be difficult to fight for the government.

Tokyo seeks the method that will curb the rising yen, which this week hit a high of 15 years against the dollar and a high of nine against the euro, threatening to bring down a recovery that based on exports.

But the strong yen is likely to complicate efforts by the Japanese government to fight deflation.

Japanese Prime Minister, Naoto Kan, said Friday that reporters would act when necessary on the issue of the strong yen and he would meet the Governor of the Bank of Japan Masaaki Shirakawa on his return from a trip to the abroad.

Naoto Kan also said that excessive currency fluctuations could threaten financial stability and hoped that the BoJ would take the appropriate measures in terms of monetary policy.

Decisions will be made August 31 on these issues.

The Interior Ministry announced Friday that consumer prices, which include fuel costs but not those of fresh products, fell 1.1% yoy in July according to the median forecast of the market. In June, they were down 1%.

"TWO OR THREE YEARS OF DEFLATION"

"Given the appreciation of the yen, exports will plunge and temporarily slow the economic recovery in Japan.Japan will remain in deflation for the next two or three years, "said Takeshi Minami, chief economist at Norinchukin Research Institue.

Investors are betting on an intervention by the Bank of Japan to ease monetary policy in the country.

"The BoJ could expand its refinancing tools next month, but the effect on interest rates in the short term will be limited.She needs to take bolder decisions to fight deflation and the rising yen, as increasing outright purchases of government bonds, although it is very unlikely to happen, "said Takeshi Minami.

Two other indicators released Friday offers a contrasting vision of the Japanese recovery.

The unemployment rate adjusted for seasonal variations fell 5.2% in July against 5.3% in June while the median forecast was 5.3%, according to figures from the Ministry of Internal Affairs.

Household spending has in turn increased by 1.1% in July over a year in real terms, less than the market forecast of an increase of 1.3%.

For a chart comparing the evolution of consumer prices in Japan, the United States and the euro area, click on link.reuters.com/pum57n

The spectacular mergers and acquisitions announced in recent weeks nourish hopes of a general resumption of trading but the French bankers polled by Reuters remain cautious optimism for the fall.

The hostile bid of nearly $ 40 billion launched the world's leading fertilizer Potash or the stock market battle for control of the data storage company 3PAR have been seen by some analysts as a sign announcing a possible new cycle.

"Such operations raise a little mercato" judge a banker, a comparison of sports in the same vein as the one launched during the World Cup soccer player Cristiano Ronaldo by: "The goals is like ketchup: when they arrive, they all come together. "

Announcements and takeover rumors are linked together with a consistent and disturbing intended target size in almost all sectors: automobiles Alfa Romeo, the Australian brewer Foster's with the bank with Nedbank of South Africa, insurance with the UK's Aviva or energy with Polish ENEA.

Figures gathered by Thomson Reuters for the French market is also impressive, even excluding the approximately $ 20 billion Sanofi-Aventis would be willing to spend on the U.S. Genzyme.

THE CONTEXT IS BEST

Transactions involving at least one French company are, at August 25, two times larger in value than in 2009 although it remains far from achieving the speculative frenzy in 2006.

On August 25, 2006, volumes amounted to 239 billion dollars, against 105 billion reached Wednesday.

"Generally, we can say that the context is better than the last two years and the probability of operations is improving, although significant uncertainties remain," Thierry J. Silver, Global Head of 'M & A activity at Societe Generale.

"There is no reason to believe that the major cross-border operations will slow.They are now once again well received by shareholders when the companies have demonstrated their ability to cope with the crisis, "said the banker.

The poor market performance since the beginning of the year is still a risk factor and observers recall that many transactions or IPOs had to be canceled after the crash loosened markets in the first quarter .

MOTION FRAGILE

"We are seeing a recovery in 2010, but this movement will remain fragile until the current uncertainty about valuations persist," the judge for his part in a research note Rivalland Jean-Claude, a lawyer with Allen & Overy in Paris.

The degradation of the sovereign rating of Ireland by Standard & Poor's has also recalled Tuesday that the euro zone was not yet out of the rut and the specter of a relapse of the U.S. economy is also a source of concern.

"The problems on the sovereign credit may resurface, CFOs remain cautious because they do not want to take full credit crunch, they must restructure their debts after a major operation," noted for its share Philip Caraman, a banker from UBS to Paris.

"As long as there is no more visible on sovereign risk, the volumes remain as low as three or four years," Judge said.

For Monique Cohen, managing partner of private equity firm Apax, one of the keys to continued activity is the continued financing of transactions by banks, a vital issue for the private equity industry.

"We can not consider access to the debt as an asset of the moment," she said, noting however that "no new restrictions on debt, many LBO (leveraged transactions) should be provided be in September.

To some bankers, corporate strategic imperatives also explain that they go ahead even if the timing is not ideal.

Some major transactions announced or expected to emerge this logic rather than a genuine recovery in overall mergers and acquisitions, they believe.

"In pharma we got to a point where the economy is good or bad, the problems must be addressed," said a banker based in London.

Large groups such as Sanofi-Aventis and not have enough new molecules for activity in the coming years and must grow through acquisitions.

Similarly, some companies must gain control of new technologies or new markets and therefore have to attack even when conditions are not ideal.

"It's a matter of life or death," Judge the same banker.

The Paris stock exchange resumed on Tuesday the path of decline, concerns about slowing global growth had returned to second place the ads on mergers and acquisitions cause a rebound in European equities Monday.

Around 9:10, the CAC 40 lost 0.95% to 3519.44 points.

Accor (+1.5%) is the only value of the CAC 40 in the green after the group announced the sale of walls 48 of its hotels in Europe, allowing it to exceed its debt reduction targets for 2010.

Lafarge (-3.9%) shows the largest decreases of ACC. Bank of America-Merrill Lynch lowered its recommendation from neutral to underperform.

London fell by 0.7% and Frankfurt 0.63%.The European indices, EuroStoxx 50 and 300 Eurofirst yield more than 0.9%.

The dollar is trading around 1.2642 per euro against 1.2635 late Monday.

A barrel of U.S. light crude lost 88 cents to 72.22 dollars.

Royal Bank of Scotland (RBS) has agreed to sell nearly 2.4 billion euros of its majority stake in its subsidiary WorldPay payment systems to two private equity funds, the latest step in its restructuring plan .

After Friday increased its quarterly results, RBS said it would sell 80% of its business Global Merchant Services, which oversees WorldPay to Advent International and Bain Capital in a transaction valuing the company up to 2.03 billion pounds (2.4 billion euros).

Advent and Bain were in exclusive talks for this operation since late July, had said last month a source close to the matter.Analysts had estimated the amount of the transaction between two and 2.5 billion pounds.

The two companies capital that they are looking to develop activities WorldPay and added that they could conclude other acquisitions.

RBS will however keep a stake of about 20% in WorldPay.The added value generated by this transaction would be approximately 850 million pounds and increase the solvency ratio "core Tier 1" bank by about 30 basis points, the bank said.

"A NEW IMPORTANT STEP"

RBS will receive an initial cash payment of £ 1.7 billion once the deal is finalized and could obtain additional 200 million depending on performance WorldPay.

"The sale of Global Merchant Services is a new milestone in the restructuring program the company," said chief financial officer, Bruce Van Saun, in a statement.

Around 4:45 p.m. GMT, RBS yielded 0.38%, to 51.8 pence in London Stock Exchange, outperforming the Stoxx 600 index, however, brings together the main European banking stocks, which retreated at the same time by 0.74%.

This occurs after the Wednesday of the sale of 318 branches RBS UK counterpart Santander for about 1.65 billion pounds.

Before announcing the sale of WorldPay, the bank reported Friday in an increased profit in the second quarter due to recovery of its loan portfolio and improved its net interest margin, while bad debts Ireland remain problematic.

Several European banks such as HSBC, BNP Paribas and Barclays, have reported strong results this week in favor of a reduction in expenses related to bad debts, but some investors are questioning their prospects.

"THE PERFORMANCE IS A LITTLE LIGHT GBM"

RBS, for its part reported an operating profit of 869 million pounds for the quarter ended June 30, after a profit of 713 million in the first quarter.

The retail banking and commercial banking at RBS have seen their net banking income increased during the quarter but the division of investment bank GBM has had difficult times with a 31% drop in GDP over the first quarter.

"The performance of the GBM is a bit light, but the plus side, the British retail banking seems to be doing well," said Joseph Dickerson, an analyst at London brokerage firm Execution.

RBS said it had seen no return of the investment bank in July, which is fueling fears that the sector does not meet the expectations throughout the year if the soft trend in May and June is confirmed.

"July is generally consistent with the trend of the previous two months," said Stephen Hester. "If customers, uncertain, remain on the sidelines, there is less money in the investment bank."

Impairment losses accounted for 2.49 billion pounds in the second quarter, against 2.68 billion in the first.Excluding the gain on the recovery of its own debt, the bank posted a net income of 250 million pounds, down from the first three months of the year.

Wall Street could fall this week in a market upturn phase, but will require a new set of quarterly results convincing to feed the stock market rally that started in U.S. last weekend.

The markets have been digesting macroeconomic statistics found disappointing and pessimistic comments from Federal Reserve Chairman Ben Bernanke on the U.S. economy, but the announcement of strong quarterly results by companies suggest a brighter future.

But this week, others are expected quarterly publications such as the oil company Chevron, DuPont chemist or the aircraft manufacturer Boeing.Good news would reassure investors.

Investors have had to readjust their forecasts for the economy with the latest statistics that portend a slowdown in the pace of recovery.

These data have also created divisions in the markets about the possibility of a new recession.If the concerns of a return to "W" began to fade among investors, publications positive would result in rising markets.

FIGURES OF THE GROWTH EXPECTED

"All indicators continue to signal growth, simply we are not moving as quickly as when we came out of the recession, which is totally logical," said Michael O'Rourke, chief market strategist at BTIG LLC, adding that the downward phase of the contract is completed.

He considers in particular that the beginning of July should be the low point of annual contracts.

Analysts hope to cheer the quarterly results this week after figures better than expected and forecast annual improvements announced last week by industry groups.

But the economy remains crucial. The series of publications macroeconomic expected this week will also be particularly monitored to determine the strength of the U.S. economic recovery.

The Fed should publish its Beige Book Wednesday on the economic conditions, while the figures for new home sales will launch the week Monday.

On Tuesday, it is the Standard & Poor's / Case Schiller home prices and consumer confidence, which will be followed, before investors only look the next day on orders of durable goods.

But it was the day Friday with the first estimate of gross domestic product (GDP) U.S. second quarter to be expected this week.

Lafarge said it had completed the sale of 11.2% of its business in Malaysia under the divestment program initiated by the world's number one cement.

The sale of this portion of Lafarge Cement Berhad, Malaysian (LMCB), the French giant holds indirectly through two subsidiaries, for a net amount of 141 million euros, Lafarge said in a statement.

Following this, the group will remain the principal shareholder of LMCB with a 51%, against 62.2% so far, and will retain management of the business.

Lafarge in May confirmed its target of selling 300 to 500 million euros of non-strategic assets throughout 2010.

In 2009, he has conducted more than 900 million euros from divestments as part of a package of measures to strengthen the company's financial response to the crisis, including reducing debt inflated between late 2007 and in late 2008 by acquiring the Egyptian Orascom.

The U.S. stocks have ended without major trend Wednesday as investors wondering about the tone set by the Fed in the minutes of the last meeting of its Monetary Policy Committee.

The Federal Reserve said that its members should be prepared to adopt new measures to support the economy if the environment deteriorates.

See Fed talk about slowing down and hear that she may have to provide more support and cash undoubtedly shaken the markets, "said Bruce Zaro, chief investment strategist for Delta Global Advisors.

The Dow Jones, which includes the thirty most important values of American industry, was up 0.04% to 10.366.72 points, the S & P 500 index fund managers, dropped 0.02% to 1095.17 points.

The Nasdaq's side showed signs of resistance, clinching 0.35% to 2224.84 points, thanks to technology, supported by better than expected results released Tuesday by Intel. The title of the Informatics Group closed up 1.67% to 21.36 dollars.

Investors have also learned the consequences of the publication of statistics showing that business inventories had risen less sharply than expected in the United States in May while sales fell for the first time since March 2009.

The S & P showing variations of values related to consumption has dropped 0.54%.Abercrombie & Fitch has lost 0.83% to 35.93 dollars while JCPenney yielded 0.86% to 22.99 dollars.

The bank has also been the subject of intense clearances pending the results of resistance testing is suffered by 91 European banks.

The KBW index of sectoral sector fell 1.61%.

A reversal of the trend, GlaxoSmithKline closed up 1.76% to 36.35 dollars after the positive vote from the Food and Drug Administration on a diabetic, developed by the laboratory.