Financial Business Review: UBS Cuts IT Costs, JPMorgan’s New Benchmark Bond
UBS (NYSE:UBS) will sharply cut its yearly information tech costs from 3.6 billion francs, or $3.8 billion, to 2.4 billion francs by 2015 in a plan that could impact thousands of jobs worldwide, according to TagesAnzeiger on Saturday. The firm currently employs 8,200 tech workers, of which 3,200 are in Switzerland.
ING Groep (NYSE:ING) is in talks with the government of The Netherlands and the European Commission about repaying the final €4.5 billion of state aid it received following the 2008 financial crisis. The firm obtained €10 billion in total, and is currently divesting assets around the globe to raise the cash needed to reimburse the bailout, and also to comply with EU conditions for accepting it.
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JPMorgan Chase & Co. (NYSE:JPM), which is currently the largest U.S. bank, intends to sell three-year debt in a benchmark bond offering as soon as Monday. The company may sell three-year, fixed-rate notes to yield around 80 basis points more than similar-maturity Treasuries and floating-rate securities to yield about 69 basis points in excess of the three-month Libor, says a person familiar with the offering, but who wishes not to be identified, as terms aren’t set. A benchmark offering is usually at a minimum of $500 million.
The selloff in mortgage real estate investment trusts continues Friday’s trend, with almost the entire sector losing ground again Monday. The top decliner today was CYS Investments (NYSE:CYS), after being downgraded to Hold at Wunderlich. The cause of the sector slide is being adduced to declining interest margins, along with mortgage refinance activity (prepays) increasing.