As Europeans return from August vacations, Greece is at the top of the to-do list. Athens needs another bailout; the Germans may be wary, but are they willing to risk a Grexit? Some hedge funds are nibbling at Greek debt, increasingly optimistic of further European assistance. Another way to bet on Europe: Buy a castle.
General Motors sold out of G.M.A.C., its financing arm in, in 2005, borrowed $17.2 billion from the Treasury at the height of the financial crisis, changed its name to Ally Financial (and yes, sponsored Adam Davidson’s Marketplace). Now Ally is spinning off Residential Capital, its mortgage lender, through bankruptcy proceedings, and Steven M. Davidoff sees Ally’s debt to the government as hindering risk-taking.
The Wall Street Journal sees the Obama administration’s involvement in Carlyle Group’s deal to buy a Pennsylvania refinery at odds with the Obama campaign’s attacks on the private equity industry.
Regions Financial, the Alabama-based lender that repaid $3.5 billion in bailout funds to the U.S. Treasury in April, is the subject of a grand jury investigation, The Journal reports. The rub: the lender’s relationship with a recruiting firm that wined and dined Regions’ execs and borrowed money from the bank.
The Journal also sees some buy-out firms struggling to raise funds, Wilbur Ross among them.
A Vietnamese banker was arrested, and markets swooned.
The first recipient of the Security and Exchange Commission’s whistle-blower program received $50,000, or one-third of the funds recovered due to the individual’s case. The payee stands to gain more as the SEC continues to recover funds.
The Justice Department and Federal Reserve are probing Royal Bank of Scotland for possibly violating sanctions against Iran, sources told Bloomberg. Long-arm-of-the-Lawsky and the New York State Department of Financial Services are staying out of this one, apparently.
With a lull in the Libor action, Iran sanctions becoming old hat, Reuters digs into the other, other British banking scandal: interest rate swaps. Lenders such as RBS and HSBC have provisioned funds against lawsuits charging banks mis-sold swaps to small businesses in the run-up to the financial crisis.