Money Management Executive Latest News

When governments in emerging markets borrowed money in dollars a decade ago, they risked sharp repayment rates when the value of their home currencies decreased. That resulted in a host of problems: large tax increases, cuts in government budgets, higher interest rates and corporate bankruptcies, The Wall Street Journal reports. Thailand, Indonesia, Korea, Russia and Brazil were some of the areas hardest hit.

Initial public offerings are occurring at rate that hasn’t been seen since the robust days of 1999 and 2000, according to BusinessWeek Online.

Investors with $5 million or more to invest are increasingly moving their money overseas, for fear that the U.S. is losing its competitive edge, Dow Jones reports, citing U.S. Trust’s 2007 Survey of Affluent Americans. On average, these investors expect to gain 9.66% abroad, versus 8.85% in the U.S.

National Bank of Canada and BNP Paribas announced Wednesday that they have formed a joint venture that will offer hedge fund managed accounts to retail and institutional investors. BNP is acquiring a stake in the bank’s subsidiary, Innocap Investment Management, which specializes in hedge fund managed accounts.

Rupert Murdoch’s $5 billion bid to acquire Dow Jones, a 65% premium over the company’s current market cap, sent shares soaring nearly 55%, TheStreet.com reports.

Tom Bailey, who founded Janus Capital and who stepped down as CEO in 2002, is now relinquishing his seat on the board since he has reached 72, the mandatory age for retirement at the firm, Rocky Mountain News reports.

Citigroup announced last Wednesday that it will acquire BISYS Group for $1.45 billion in cash and divest its retirement and insurance services units to J.C. Flowers, a private equity firm, for $650 million. Citigroup will keep BISYS’ fund and alternative investment units so that it can expand its services to hedge funds, mutual funds and private equity firms.

A.G. Edwards will pay the Securities and Exchange Commission $3.86 million to settle charges that it failed to supervise brokers who used deceptive means to engage in mutual fund market timing. The fine includes a civil penalty of $1.5 million and $2.36 million in disgorgement and interest.

Morningstar, which already has aggressively expanded its coverage of hedge funds’ performance in the past year from 3,500 funds to 6,000, plans to grow that coverage even further, Reuters reports, citing comments by Morningstar Director of Hedge Funds Ryan Tagal.As more investors add these instruments to their portfolios, the demand for information about them will increase, Tagal noted. He would not specify, however, by how much Morningstar plans to grow that business.

With the government looking into improving disclosure of fees in 401(k) plans and expected to issue new guidelines before the end of the year, Mercer Human Resource Consulting is recommending that plan sponsors address the issue early on.