International Business News

The rating agency Fitch has placed on negative watch Thursday's long-term ratings of BNP Paribas (AA-) and Credit Agricole (AA-) as part of its periodic evaluation of European institutions.

The credit rating of long-term Credit Mutuel (AA-) was also placed on negative watch, but that of the Societe Generale (A +) was confirmed.

The notes of sustainability ("Viability rating") of BNP Paribas (AA-), Credit Agricole (AA-) and Societe Generale (A +) are also placed on negative watch.

Fitch said that the negative phase of monitoring should be short, and that if cuts in long-term notes were determined, they could not exceed one notch, the minimum level of major French banks are "A +".

In the case of Societe Generale and BNP, Fitch notes that the business model of universal banking world they have chosen seems "particularly sensitive to increased challenges which face the financial markets."

"These challenges result from a myriad of changes in the regulatory and economic developments, especially in the euro area," said Fitch.

Also as part of its review of banks, Fitch has also downgraded the Swiss bank UBS to "A +" to "A".

Those of Barclays, Credit Suisse, Deutsche Bank are also placed on negative watch, just as the U.S., the Bank of America, Morgan Stanley and Goldman Sachs.

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UBS has announced that the two co-directors of its business activities had resigned Wednesday, and that other employees could suffer the same fate after massive loss recorded last month by the bank due to unauthorized transactions.

Francois Gouws and Yassine Bouhara resigned in assuming full responsibility for the management of business activities, UBS said.

"In addition, appropriate disciplinary procedures will be taken against individuals other activities as a result of actions indicent," said the Swiss bank.

A source reported that eight other employees were involved in these proceedings.

Mike Stewart, who has just joined UBS from Merrill Lynch Bank of America, will become the only leader of the bank's equities business, a position he held previously at BofA.

Air France, which opened its first Sunday "based province" in Marseille, comes directly hunt on the lands of the companies' low-cost "as Ryanair or Easyjet broken at prices of 13 destinations.

The first flight "new formula" of the French company took off Sunday at 9:35 of the tarmac from Marseille to Istanbul.Passengers paid 80 euros each way.

In total, Air France thus opens 13 new routes from Marseille-Provence – three in France (Mulhouse, Biarritz, Brest) and ten abroad (Athens, Copenhagen, Düsseldorf, Eindhoven, Milan, Moscow, Prague, Beirut, Casablanca and Istanbul).

"We create a mini-Marseille airline with its aircraft and personnel," said the CEO of Air France-KLM, Pierre-Henri Gourgeon, during his visit Thursday to Marseille airport for the official launch of the first "base province" of the French company.

After Marseille, which is the "size test", Air France plans to open bases in spring 2012 in Nice and Toulouse and Bordeaux.

To regain market share against the pressure of the TGV and low-cost airlines, which continue to gain ground on short and medium haul, the French company has set up an optimization of resources and a new organization negotiated with pilots and crews.

TEN AIRBUS based in Marseille

A total of ten Airbus A319 and A320 are now based at the airport in Marseille. Depending on the destination, they will perform at least two trips a day between 06:00 and 23:00.

On a voluntary basis, 120 pilots and 220 flight attendants were assigned to these new lines.The ground staff was also strengthened.

This device should allow the airline to tighten the price (50 euros for domestic flights to 110 euros one way on Moscow) maintaining the benefits typically offered by the French company on its other flights as the choice of place , newspapers and snacks on board or free luggage.

"This development meets one of the main expectations of our customers travel quickly at competitive prices," said the president of the Marseille-Provence airport, Jean-François Brando.

In five years, the airport Provence has surfed the wave of low-cost, doubling the number of scheduled airlines direct: 51 in 2006, 104 in 2011.

The opening of the first low-cost airport in Europe in 2006 allowed him to record a steady growth in passenger traffic, reaching 7.5 million passengers in 2010.

"With more than 150 companies and 5,000 employees on the platform, the airport is one of the leading employers in the area and generates more than three billion euros in economic benefits for the territory Marseille Provence," concludes Jean-François Brando.

The government target of 2% growth for 2011 in France will be difficult to achieve because of poor economic health of the United States said Monday the president of French employers Laurence Parisot.

"It's difficult simply because the United States are not going well, this is one of the main economic engines of the planet. This is something that seems very difficult to achieve," she said of France 2.

The president of MEDEF was speaking after the publication of statistics showing that French growth was zero in the second quarter, which suggests that the figure for the year would be around 1.4% or below , according to economists.

Laurence Parisot, however, wants to be optimistic."Growth is something that is earned every day through work, innovation, boldness, creativity. If we do not show discouragement, we can continue to get these points of growth," she said.

Wall Street closed up nearly 4% Thursday's meeting, the figures better than expected U.S. employment combined with the strong performance of Cisco allowed to eclipse the fears of the day concerning the debt crisis in the euro area.

The New York Stock Exchange finished up 3.95% Thursday, the Dow Jones Industrial winning 30 points to 11143.31 423.37 points.

The S & P-500, wider, took 51.88 points, or 4.63% to 1172.64 points.

The Nasdaq Composite Index was up 111.63 points for his side (4.69%) to 2492.68 points.

The day before, heavy speculation about the systemic risk posed by the French banks and rumors of deterioration in the sovereign rating of France had the Dow Jones plunged 4.62% to a low of nearly a year, after a volatile session.

The U.S. Index Standard & Poor's 500 benchmark fund managers, lost alone more than 710 billion dollars of capitalization this week after clearing 850 billion the previous week.

The decline of greater than expected weekly jobless (395 000 against 400.000 expected) has brought relief to markets, while another statistic published simultaneously showed an unexpected widening of the trade deficit the United States, its highest level since October 2008, due to a decline in exports and imports indicating a slowdown in global demand.

Values, Cisco has jumped by more than 15.95% after announcing on Wednesday after-hours trading better than expected quarterly results.

The food group Sara Lee fell after reporting a decline in sales volumes, sealed by price increases to offset the rising costs of raw materials.

The title of Sara Lee has lost 1.27% after dropping to 7.6% during the session.

AOL has finally announced a program to repurchase up to $ 250 million, with the intention to revive investor confidence in its action, which fell 32% in two days.

After the announcement, soared as 22%. It closed up 12.23%.

JCDecaux announced Friday a lower growth of its sales in the second quarter, hit by the difficulties of the countries of southern Europe and the bases of comparison difficult.

World number one outdoor advertising company in front of the U.S. Clear Channel Outdoor has said it expects a stabilization in the third quarter, with growth of the same order as the previous three months.

The French in the second quarter generated a turnover of 634.7 million euros, representing organic growth of 4.3% from 7.8% in the first three months of the year.

This figure, higher than the 4% target announced by the group, however, appears below market expectations which projected 4.6%, according to estimates by nine analysts.

Referring comparison bases demanding (11.3% in the second quarter of 2010), the group warned that its economy is slowing in the second quarter as its competitors Omnicom and Publicis have seen their growth accelerate over the period.

In the first half, JCDecaux has posted a turnover of 1.17 billion, in line with market expectations, representing organic growth of 5.8%.

The action has opened up 1.4% to 19.47 euros.It was down 15.4% since the beginning of the year against a decline of 8.3% of the European sector index.

DISPLAY AT THE PENALTY

"While concerns remain about the economic outlook in the short term, we are confident in our ability to generate solid growth in our business," it said in a statement Jean-Francois Decaux, CEO and Co-CEO .

JCDecaux has signed a significant increase in revenues in the Asia-Pacific and "Rest of the World" (respectively 19.8% and 31.4%) which was however overshadowed by a slowdown in the UK and France and persistent problems in Southern Europe.

The group's operating margin stood at 260 million for a rate of 22.2%, unchanged from the first half of 2010.The market expected a slight improvement with a margin of 268 million for a rate of 22.8%.

The margin was mainly impacted by the activity of display that saw the decline in sales accelerated in the second quarter to -4.9% after -2.1% over the first three months of the years.

The transport division, however, maintained a high growth rate, signing an increase of 16.9% in the first half, while the furniture, the first division in terms of revenues, rose a moderate 2.4% .

JCDecaux has reduced its debt to 264.2 million against 358.8 million at end-December and has a cash flow of 106.9 million euros.

The group has openly expressed interest in CBS Outdoor, a subsidiary of the American CBS, in order to strengthen its presence in the United States.

"So far, nothing has changed", however, said Jean-Charles Decaux, co-CEO of BFM Business.

The oil company Royal Dutch Shell posted Thursday a sharp rise in net profit in the second quarter, driven by new projects which he hopes to increase its production over the next few years.

Its net profit to current costs jumped 77% to $ 8.0 billion (5.57 billion), supported prices of oil and asset sales more than offset lower production.

Its oil and gas production has in fact declined by 2% to 3.05 million barrels of oil equivalent per day, due to the sale of deposits and reduced gas demand caused by an exceptionally mild climate in spring.

Excluding sales, production, however, rose 2%, indicating that recent major investments by Shell are already beginning to bear fruit.

In the first half of the year, the group launched three new projects, one in two Canadian oil sands and gas plants in Qatar, which required an investment of $ 30 million.

Excluding items, the result shows an increase of 56% to 6.55 billion, just below the average forecast of eight analysts polled by Reuters (6.70 billion).

The CEO of Shell said it was concentrating on organic growth of the group and neither envisaged the acquisition of its rival BP or any buyback.

BP reported Tuesday a profit below expectations in the second quarter, while the market awaits the giant Exxon Mobil to display in the day a 50% jump in net underneath.

Around 9:30 GMT, action abandoned Shell 0.84% ​​to 2,246 pence.

Major international banks have offered to European leaders a "menu of options" to allow more private creditors to participate in a second aid package to Greece, said Tuesday the president of the French Banking Federation (FBF ).

Echoing the position of German banks, François Perol, who is also president of BPCE (People's Bank, Savings Bank) has also estimated that the project of a tax credit to participate in the bailout of Greece was not the solution.

"We stopped for a month to make proposals to governments," said François Perol during a press conference. "First there was the proposal of French banks.There is now a broader proposal emanating from the IIF (Institute of International Finance, Ed) and includes a wider menu of options. "

The chairman of the FBF has not wanted to give more details on the proposals but said discussions were continuing while a summit of heads of state and government of the euro zone on Greece on Thursday.

French banks had proposed rescheduling the end of June ("rollover") voluntary debt Greek but the rating agency Standard & Poor's determined that this proposal would mean a selective default. (And)

"These proposals (the IFIs) are structured (…) they are on the table of the Council of European governments," he said François Perol."There are ongoing discussions."

"It's not for me to advertise the proposals in the press," he added.

FBF, however, indicated that to obtain the widest possible creditors of Greece, it was necessary to select several options.

"We were told that private sector involvement should be done in a voluntary," he said.

"If it is a voluntary framework, we need investors, according to their positions, have an interest in future operations that are proposed."

"LEADING MARKETS"

A two-day summit of European leaders and as investor concerns about a contagion of debt to other countries in the euro area remain high, government officials and banks are still struggling to find an area of agreement on new aid to Greece.

Asked about plans for a tax credit, François Perol held that a tax was not the right answer to problems facing Greece.

"It does not seem that this is the solution for Greece", said the chairman of the FBF.

For French banks, it is now up to politicians to make decisions as quickly as possible.

"It belongs to the European authorities to decide together, speaking with one voice and talking at once, what their strategy (…) for the euro," stressed François Perol. "This is not a technical matter, it is a political issue."

"The markets need to be guided. It's the political authorities to guide them."

L'Oreal said Tuesday sales rose only 0.9% restricted to the second quarter due to lower sales in North America and Eastern Europe.

The world of cosmetics, owner of L'Oréal Paris, Garnier, Lancome, Armani and Yves Saint Laurent Beauté, saw its sales totaling 4.99 billion euros.

On a comparable basis, sales growth was 4.6%, marking time compared to 5.8% in the first quarter, and falling well below expectations of analysts on average expected organic growth included between 5.5% and 6.0%.

The group, which does not give a forecast for the full year, confirms just be confident in its ability to outperform the global market for cosmetics in 2011 and advance sales as its results.

In April, it estimated global growth of the market between 3% and 4%.

L'Oreal has enjoyed a very strong dynamic of its luxury products division (+9.5% on a comparable basis), while sales of consumer products have signed up 4.0% and those of professional products (for hair salons) were limited to 1.2%, as are the products of "cosmetic active", sold in pharmacies and drug stores.

Emerging markets (35% of sales) have once again taken up (8.6%), but with a marked against performance-Eastern Europe, where sales fell by 5 , 4% on a comparable basis.

In North America, sales rose 4.4% on a comparable basis, while they have gleaned only 1.2% in Western Europe, which accounts for 37% of revenues and more than 50% of operating profit of the group, a weakness which raises questions about the evolution of margins.

A European bank of six could fail resistance testing, said on Tuesday the euro area sources familiar with the matter.

These results, including the European Central Bank (ECB) that they hope will persuade investors that the EU is finally clear about its banking problems, should encourage those states reluctant to support their banks can not finance themselves .

According to sources interviewed, the EBA (EBA) is expected to announce in the coming weeks between 10 and 15 of the 91 banks that have spent the stress tests have failed.These include Greek banks, German, Portuguese and Spanish.

Last year, seven banks had not validated the previous resistance tests, deemed insufficiently demanding. Thus the Irish banks had they succeeded, just weeks before being rescued from shipwreck by the Irish State.

The 2011 tests sought to determine whether the European institutions had the capital needed to cope with severe economic shocks scenarios with consequences such as loans.They also measured the impact of an impairment of securities held by banks, including those issued by Greece.

European banks must have a capital ratio of "hard" greater than 5% to pass the new tests that simulate the resistance of a recession two years, as part of an operation to reassure taxpayers and improve the image sector.

CREDIBILITY SOUGHT

"How should banks fail? I would say between ten and 15," said a source from the ECB, which developed the test in conjunction with the EBA.

According to another source, EBA hopes that the number of failed approach that level to prove that these tests seriously.However, the number of failed banks should not be higher because the BEA does not want to cause panic in the markets, which could aggravate the budget crisis in Europe.

"To demonstrate that these tests are credible, the EBA will show that the number of failures is significant but not substantial," said a source. "A figure of around ten seems adequate."

A spokesman of the EBA said that the tests were still ongoing and declined to comment on speculation about the results. The results of these tests should be announced on July 13 to coincide with a meeting of finance ministers.

TEST POLICY

These tests also have a political stature.While the ABE and the ECB want to expose the flaws of some banks, national regulators want their side to prevent the occurrence of their banks on the list, because it shows their incompetence in not having themselves discovered these faults.

"All national regulators will fight for none of their banks on the list," said a source. "It is a mark of incompetence."

The EBA, however, try not to concentrate the pressure only on the most fragile countries such as Spain, not to create an aversion to international creditors of these countries and their banks.

"They will avoid bringing out an epicenter," said a source. "If it was Spain, it would be very bad news.Failure of German banks to stress tests would be much less risky. "

First scheduled for late June publication of the results was delayed because some countries, including Germany, had submitted data too optimistic in ABE, which has asked to review their copy.

Pending the official results in the finance ministries of European countries, we are preparing now to take action to support banks that have not passed the tests.