The Star Online: Business

Nestle top gainer, Kenanga ups stock to Outperform
Former boss says sorry for role in HBOS catastrophe
Swiss anti-graft law in the cold

Nestle top gainer, Kenanga ups stock to Outperform

Posted: 04 Dec 2012 06:02 PM PST

KUALA LUMPUR: Shares of Nestle Malaysia advanced on Wednesday as investors' appetite for consumer stocks remained firm while Kenanga Investment Research raised its outlook to an "Outperform".

At 9.48am, Nestle was up RM1.44 to RM62.44. There were 2,900 shares done.

The FBM KLCI rose 4.25 points to 1,611.86. Turnover was 118.54 million shares valued at RM76.30mil. There were 162 gainers, 97 losers and 192 counters unchanged.

Kenanga Research said due to the challenging economy outlook ahead, it continues to hold to itsr strong conviction stance on defensive and yield stocks such as Nestle.

"This is especially so in the case of the latter, which has seen its share price falling sharply by 13% after our downgrade in early November.

"The price fall offer opportunities now to buy back the stock again at lower prices. We believe a Buy-on-Weakness strategy is hence appropriate on Nestle at this juncture given that it still has a relatively good dividend yield and fundamentals," it said.

Kenanga Research maintained the target price at RM72.10 based on an unchanged price-to-earnings ratio (PER) of 33.4 times (+3 standard deviation above its five-year average PER level of 22.2 times).

The research house said given a still total return of about 21%, it upgraded its rating on the stock to an Outperform from a Market Perform.

Former boss says sorry for role in HBOS catastrophe

Posted: 04 Dec 2012 05:57 PM PST

LONDON: A former chief executive of HBOS apologised for the first time on Monday for his role in the high-risk lending strategy that pushed the British bank close to collapse during the financial crisis.

Knighted by the Queen in 2006 for services to the financial sector, James Crosby admitted to a committee of British members of parliament that incompetent corporate lending brought HBOS to its knees two years later.

"I was horrified and deeply upset by what happened," Crosby told the joint committee of Britain's Parliamentary Commission on Banking Standards. "I am apologising. I played a major part in building a business that subsequently failed."

The parliamentary committee is looking into what its members described as the "HBOS catastrophe" and what lessons can be learnt to prevent future bank failures.

Once Britain's biggest mortgage provider, HBOS had to be rescued by rival Lloyds and propped up with an £11.5bil (US$18.43bil) taxpayer bailout when the financial crisis laid bare its disastrous exposure to property in Britain and Ireland.

"I have no doubt that my reputation and my achievements will never again be seen in the same light," said Crosby, who sat alone during over two hours of questioning.

"I am too closely associated with the problems of HBOS."

Crosby, who stood down as HBOS CEO in 2006, admitted that he would be unlikely to get regulatory approval to run a financial services company if he applied to British authorities now. He has no plans to do so. Reuters

Swiss anti-graft law in the cold

Posted: 04 Dec 2012 05:53 PM PST

Wednesday December 5, 2012

GENEVA: The Swiss cabinet has rejected a motion that would force mining companies and private commodity trading houses to declare payments made to resource-rich countries.

The decision puts the traditionally neutral country at odds with the United States and the European Union, both of which are pursuing tough new rules for oil, gas and mining companies aimed at reducing corruption.

The Swiss government said it dismissed the motion, backed by a group of 30 mostly leftwing politicians, because it went beyond measures passed by other Western countries by including the activities of private traders such as Vitol and Gunvor.

Geneva alone is responsible for over a third of daily crude oil volumes and about 35% of grains.

"The cabinet believes that the scope of the European and US transparency measures is not sufficiently clear and that commodity trading outside of the country of origin is unlikely to be included. We therefore reject the motion," the government said in a statement on Monday. Reuters

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Selasa, 4 Disember 2012