Lai See

PUBLISHED : Wednesday, 16 December, 2009, 12:00am
UPDATED : Wednesday, 16 December, 2009, 12:00am

Cross-strait ties wash out Fubon's bad tidings

Local lenders are not out of the woods yet. Fubon Bank (Hong Kong) has just announced the first profit warning of the season.

The Taiwanese bank said yesterday it expected net profit to be substantially below that of last year. That doesn't sound good, because last year it dropped 78 per cent to HK$100 million.

Impairment is the culprit. The bank had to repurchase HK$313 million of Lehman Brothers minibonds and also had some unspecified impaired loans to be charged in the second half.

Last month, Fubon appointed a new chief executive, Thomas Liang Pei-hwa, to replace Lee Jin-yi, who had been in the post for more than five years.

However, the provision factor is being offset somewhat by warmer cross-strait relationships. Shares of Fubon are up 51 per cent so far this year, the same as the Hang Seng Index.

Served cold

Better late than never, as far as Sun Hung Kai Properties is concerned.

Yesterday, the firm released a list of more than 20 restaurants in its malls and hotels that have been recognised in the 2010 Michelin Guide to Hong Kong and Macau ... almost three weeks after the official list came out.

Among the 23 eateries, we noted 12 of them are not at locations directly run by SHKP. They include three from Four Seasons (including the only two three-star restaurants - Lung King Heen and Caprice French) and seven from IFC Mall, both of which are jointly owned with Henderson Land Development.

It also included two outlets from Elements, in which SHKP has a 20 per cent stake.

Compared with last year, SHKP had one fewer restaurant making it to the gourmet's list of honour at a time when Michelin has expanded its coverage this year to 205 restaurants, of which 78 were new entries.

But in the end, being slow off the mark doesn't matter, as the restaurants have been booked solid since the Michelin list came out.

Stanford's choice

Lloyd's underwriters have weathered everything including once-in-a-century hurricanes, but they are struggling with the human factor.

They have asked a judge for the chance to question jailed Texas financier Allen Stanford, who is claiming insurance to pay his defence costs.

Lloyd's are seeking to prove that Stanford (left) and his colleagues participated in a fraud that voided their directors' and officers' insurance coverage.

Stanford and four other people were indicted in June by a federal grand jury for allegedly running a US$7 billion fraud scheme centred on the sale of certificates of deposit through Antigua-based Stanford International Bank.

If the underwriters get Stanford in court, they might ask him to testify about his activities and knowledge of the alleged Ponzi scheme, said his lawyer Kent Schaffer.

Stanford had a right to avoid giving testimony that could be used against him at trial, said Schaffer. 'He shouldn't have to waive a constitutional right to get what he's entitled to under an insurance policy.'

This sounds like the ultimate corporate conundrum: To access the funds for your defence, you first have to tell the underwriters all, thereby losing your case.

Plenty of liquidity

If water is a symbol of money, Casino Oceanus can expect to be swimming in it.

The unexpected heavy rain in Macau yesterday forced the inauguration ceremony of the city's 34th casino to be held inside the multicoloured building that has been covered in the same material as Beijing's famous Olympic 'Water Cube'.

The rain not only captured the aquatic theme but also gave the guests plenty of reason to stay inside the latest casino belonging to Stanley Ho Hung-sun's SJM Holdings.

If that's not enough, the former New Yaohan department store building is right next to the Macau ferry terminal.

Midland mystery

Mystery surrounds the resignations of nearly half of Midland Realty's public relations department yesterday.

Four of the PR officers sent out nicely worded farewell messages to the media, triggering a frantic round of inquiries. However, Midland executives would say nothing other than that the resignations were for personal reasons and would not affect the company's operations.