Record Inflow into US MMFs
So far this year, more than $286bn has flowed into US money market funds, the biggest inflow since the Covid-19 crisis. The collapse of two regional US banks and the rescue of Credit Suisse (NYSE:CS) by banks has raised concerns about the safety of bank deposits. Goldman Sachs (NYSE:GS), JPMorgan Chase (NYSE:JP) and Fidelity (NYSE:FIS) are the biggest beneficiaries of this flow of investment, with Goldman Sachs seeing a 13% increase and inflows of nearly $52bn, JPMorgan receiving nearly $46bn and Fidelity recording inflows of almost $37bn.
First Citizens Bank to Purchase SVB
First Citizens Bank (NASDAQ:FCNCA) will purchase most of Silicon Valley Bank (NYSE:SVB), whose failure is expected to cost the Federal Deposit Insurance Corporation’s Deposit Insurance Fund about $20bn. The FDIC will transfer all deposits and loans to First Citizens, which will also manage SVB’s 17 branches. First Citizens has been one of the largest buyers of troubled banks in recent years and is the largest family-controlled bank in the United States.
Chairman of SBN Resigns
Ammar Alkhudairy, the Chairman of Saudi National Bank (Saudi:SR), has resigned for personal reasons, and the bank’s CEO, Saeed Al Ghamdi, has been appointed as his successor. Talal Al Khereiji will act as CEO in the interim. Alkhudairy’s TV interview earlier in March, in which he stated that SNB would not provide any more financial assistance to Credit Suisse (NYSE:CS), sent Credit Suisse’s share price plunging and ultimately led to its acquisition by UBS (NYSE:UBS).
Accounting Frauds Rises in the US
Manipulation of earnings from Corporate America is on the rise, according to a new study on accounting fraud using the M-Score. The M-Score uses a company’s financial statements to determine whether it is engaging in manipulation. Research conducted by Messod D. Beneish and several co-authors shows a disturbing pattern in historical data: the probability of manipulation rises rapidly in the quarters before the economy tips into recession.
SEC to Sue Coinbase
The Securities and Exchange Commission (SEC) notified Coinbase Global Inc (NASDAQ:COIN). of its intent to sue the firm for violating investor-protection laws. If an eventual lawsuit is successful, it could set a precedent for the future shape of the cryptocurrency exchange industry. Coinbase has taken an increasingly defiant stance, publicly criticizing the SEC and urging regulators to write new rules for crypto rather than enforce existing ones.
Accenture to Cut 19,000 Jobs
Accenture PLC (NYSE:ACN) is cutting approximately 19,000 jobs over the next 18 months, which amounts to 2.5% of its workforce. The move comes as the professional services company seeks to streamline its operations and reduce costs amid slowing IT spending. Most of the affected employees will be in nonbillable corporate roles, and the company expects its business-optimization plan to cost approximately $1.5bn, mostly from employee severance during the rest of the current fiscal year and fiscal 2024.
Alibaba’s Founder Visits China
Jack Ma, the founder of Alibaba (NYSE:BABA), has made a rare public visit to mainland China at a time when the Chinese government is attempting to restore its relationship with the technology industry. Alibaba has been facing increasing regulatory pressure from Beijing, including a record $2.8bn antitrust fine, and there have been concerns about the whereabouts of Ma, who had been out of the public eye for several months.
Twitter to Protect Source Code
Twitter has taken legal action to prevent a potentially damaging loss of its source code after parts of the code and other software were posted online. The social media company had the code removed from GitHub, a widely used repository for publishing open-source code. Twitter also sought a subpoena to force GitHub to reveal any information it knew about the person who disclosed the code. Source code is closely guarded to prevent hackers from gaining insights that could be used to attack the system.
Elon Musk Prices Twitter Less Than Half
Elon Musk has announced that Twitter Inc. employees will receive stock awards based on a roughly $20 billion valuation, which is less than half the $44 billion price he acquired the company for last year. He remains optimistic about the social media company’s future and sees a clear but difficult path to a >$250B valuation. Mr. Musk also said that Twitter is being reshaped so rapidly that it can be thought of as an inverse startup, with radical changes being necessary to avoid bankruptcy.
Hedge Funds Close Bets Against SMIT
Hedge funds have closed their bets against Baillie Gifford’s Scottish Mortgage Investment Trust (LSE:SMT) despite concerns over board governance and exposure to risky private companies. James Hanbury, who runs the Brook Absolute Return and Developed Markets funds at Odey Asset Management, is among investors who have scaled back their short positions on the technology-focused company. The Scottish Mortgage Investment Trust is one of the most popular investment funds in the UK, with £13.4bn of assets.
Brookfield to Take Over Origin Energy for $10.2B
A consortium led by Brookfield Asset Management Inc (NYSE:BAM) is close to finalizing a deal to take over Australian utility Origin Energy Ltd (MUN:ORL). for A$15.3 billion ($10.2 billion). The energy producer and retailer plans to complete the agreement with Brookfield and its venture partner EIG Global Energy Partners’ MidOcean Energy on Monday. The deal values Origin Energy’s shares at their earlier indicative offer of A$8.90 per share. The announcement of the deal is expected to be made within the coming days.