Proactive Investors -
- FTSE 100 makes bright start to the week
- Banks lead the recovery as relative calm returns
- First Citizens Bank buys most of SVB assets
Cineworld rises on reports of interest in eastern European and Israeli assets
Cineworld has pushed 6.4% higher so far on Monday. Over the weekend Sky News reported that US activist investment firm Elliott Management is planning to take over beleaguered cinema chain Cineworld Group PLC's operations outside of the UK and the US.
Citing "insiders", Sky News said that Elliott has tabled a bid for the Brentford, London-based firm's operations in eastern Europe and Israel.
Elliott had also explored a bid for the whole of Cineworld, but its most recent proposal excludes its UK and US operations, Sky said.
Exclusive: The feared activist investor Elliott Management is plotting a takeover of large chunks of the ailing London-listed cinema operator Cineworld; Elliott is bidding for the group’s assets in Eastern Europe and Israel, but not in the UK or US. https://t.co/pJXvUvel57— Mark Kleinman (@MarkKleinmanSky) March 25, 2023
A month ago, Cineworld said it has received non-binding proposals from a number of counterparties for some or all of its businesses, but the debt-ridden business expects any deal with its creditors will wipe out its shareholders.
"None of these proposals involves an all-cash bid for the entire business," the beleaguered cinema chain had confirmed.
Footsie rallies as banking stocks recover
The FTSE 100 regained its poise on Monday as relative calm returned to the banking sector following a volatile trading session on Friday.
At 8.15am London's lead index was up 60.98 points, or 0.8%, at 7,466.43 while the FTSE 250 jumped to 18,632.01, up 138.18 points, or 0.75%.
Banks led the recovery with Barclays up 3.1%, Standard Chartered rising 2%, Lloyds Banking Group PLC advancing 1.8% and HSBC Holdings firming 1.3%.
Deutsche Bank strategists stated "obviously matters in the banking sector will continue to set the pace this week."
They pointed out that, ”In an age of social media, misinformation can spread like wildfire so you're never sure where the next incredulous story is going to come from alongside the genuine issues.”
“Investors in financials have had their confidence knocked by recent events which has allowed those betting against the sector a free run,” they added.
But they also highlighted: “If anything some rampant misinformation and fear on Friday morning allowed for an examination of the facts and fundamentals of the large banks and buyers stepped back in with European banks well off the lows by the end of Friday's session with the US bank index turning positive (+0.42%) just before the US close.”
In other news in the banking sector First Citizens Bank is buying "all the deposits and loans" of Silicon Valley Bank, after it went bankrupt at the beginning of March, the Federal Deposit Insurance Corporation said.
The transaction covers US$119bn in deposits and US$72bn in assets.
“The 17 former branches of Silicon Valley Bridge Bank, National Association, will open as First–Citizens Bank & Trust Company on Monday, March 27, 2023.,” the US banking agency said in a statement.
Shares in AstraZeneca PLC rose 1.3% after it announced positive high-level results from its Neuro-TTRansform phase III trial for eplontersen.
The trial explored the treatment for use in hereditary transthyretin-mediated amyloid polyneuropathy.
"At 66 weeks, patients treated with eplontersen continued to demonstrate a statistically significant and clinically meaningful change from baseline versus an external placebo group," Astra said.
Eplontersen is an investigational medicine, which targets the reduction the production of transthyretin protein.
First Citizens Bank to buy US$72bn of SVB assets
The future of Silicon Valley Bank, has been resolved, at least for now. The bank which collapsed sparking the ongoing nerves in the financial sector has been sold.
First Citizens Bank will buy "all the deposits and loans" of Silicon Valley Bank, after it went bankrupt at the beginning of March, the Federal Deposit Insurance Corporation said.
The transaction covers US$119bn in deposits and US$72bn in assets.
“The 17 former branches of Silicon Valley Bridge Bank, National Association, will open as First–Citizens Bank & Trust Company on Monday, March 27, 2023.,” the US banking agency said in a statement.
Depositors of SVB will "automatically become depositors of First Citizens Bank", added the FDIC, which will continue to insure deposits.
SVB, the US' 16th biggest bank by assets and a key lender to startups in the country since the 1980s, collapsed after a sudden run on deposits, prompting regulators to seize control.
Along with the FDIC, the US Treasury and Federal Reserve had set out plans to ensure SVB customers would be able to access their deposits, while the Fed introduced a new lending tool for banks in an effort to prevent a repeat of SVB's quick demise.
The FDIC estimates the cost of the failure of Silicon Valley Bank to its Deposit Insurance Fund to be approximately US$20bn. The exact cost will be determined when the FDIC terminates the receivership.