Monday 21 May 2007

The battle over ABN Amro

There is heightened uncertainty in the air as the drama continues to unfold. Who will win the takeover battle? Barclays? RBS?
Fortis, RBS and Santander have submitted a proposal to acquire LaSalle (a subsidiary of ABN) when the proposed sale to Bank of America was put on hold.
Hugh Scott-Barrett has announced that he will step down as CFO. There are reports that customers are fleeing. Employees are uncertain about their future. It is believed that the retrenchment number will be close to 4500, with the technology group more probable to be highly affected. (An insider source revealed to me that ABN will pay a compensation worth of 2 years' pay to new employees if they are retrenched. I wonder if this is good news).

Barclays and RBS stock prices have fluctuated widely over the last 2 months, with the risk index increasing by 1.5 to 2 folds.
I am keen to grab hold of analyst reports on the predictive impact of this takeover. Any sources?

Consolidation in the financial industry has been going on for some time, following the trend from the US. As the financial landscape reshapes and giant conglomerates form, one wonders if there are efficiency gains or economies of scale and scope.
What are the consequences and future implications?

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