Economy
Bank of America Corp in private equity spin off |
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| Economy | |
| Written by Roberta Murray | |
| Friday, 06 August 2010 | |
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Morning Business News, Friday 06 August: Bank of America Corp, RBS in profit, giant containment cap development.
Bank of America Corporation (NYSE:BAC) has spun off its private equity wing, BAML Capital Partners, in response to the regulatory reform bill that became law in July 2010. Ridgemont will manage a portfolio of about $1.5 billion or approximately 23% of BofA's private equity portfolio as of June 30, 2010. Since the enactment of the law, this is the first private equity business to have branched out from a bank. The Bank of America unit has invested over $3 billion in 140 companies since 1993. Now the principals of Ridgemont will continue to manage the legacy BAML Capital Partners portfolio on behalf of BofA. Ridgemont intends to raise a new private equity fund in the near future to focus on middle-market buy-out and growth equity investments of $25 million to $100 million. RBS back in profitRBS (LON:RBS) is today expected to announce the sale of the UK’s leading credit card payment processing business to private equity in a £2bn ($3.18bn) deal expected to generate an £800m to £900m book gain. People close to the transaction said RBS hoped to announce the sale of its Global Merchant Services arm to Advent International and Bain Capital with the bank’s first-half results today. Both sides were still negotiating the deal last night, however, the FT reports. European recoveryEurope is enjoying an unexpectedly strong economic rebound as financial market strains ease, the President of the European Central Bank said yesterday. In a cautiously optimistic assessment, Jean-Claude Trichet said some of the concerns surrounding the future of the eurozone this year have subsided as traders fret about the American economy. Eurozone data from the second quarter and last month have been firmer than the ECB had expected, Mr Trichet told a press conference after leaving interest rates unchanged at 1%., the Times reports. Giant containment capNorth Sea oil companies, including BP, are considering whether to build a giant cap to contain future oil spills like the Gulf of Mexico disaster in a move that could raise the cost of drilling. Oil & Gas UK, the North Sea industry body, yesterday asked engineers from Wood Group to look at whether it would be economically viable for British companies to build emergency containment systems for potential leaks, the Telegraph reports.
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