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Abbott says shipped millions of cans of infant formula from Ireland

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© Reuters. FILE PHOTO: Abbott Laboratories logo is displayed on a screen at the New York Stock Exchange (NYSE) in New York City, U.S., October 18, 2021. REUTERS/Brendan McDermid/File Photo

(Reuters) -Abbott Laboratories said on Friday it has air shipped millions of cans of infant formula powder into the United States from its facility in Ireland to address shortages here as it tries to reopen its Michigan manufacturing plant.

The company said in a blog https://www.abbott.com/corpnewsroom/nutrition-health-and-wellness/abbott-update-on-powder-formula-recall.html it was shipping infant formula produced at its Cootehill, Ireland facility to be used by consumers eligible for the U.S. government’s Women, Infants and Children (WIC) nutrition assistance program for low-income families.

Abbott in February recalled some baby formulas, including certain Similac products, made at the Sturgis plant after complaints about bacterial infections in infants who had consumed the products. It is working with the U.S. Food and Drug Administration to reopen the plant.

The company said it has also been working with the U.S. Department of Agriculture (USDA) and WIC agencies. In states where Abbott has the WIC contract, it will pay rebates on competing products if Similac is not available through August.

In a May 13 letter to Abbott Chairman Robert Ford, USDA Secretary Thomas Vilsack asked for the policy to be put in place through August instead of month-by-month.

The company also said it has prioritized infant formula production at its facility at Columbus, Ohio, converting other liquid manufacturing lines into making Similac liquid ready-to-feed.

Lack of supply from Abbott has exacerbated a broad shortage of baby formula, which was been hit by supply chain snags and historic inflation rates.

U.S. President Joe Biden met on Thursday with executives from infant formula manufacturers and retailers, pressing them to do everything possible to get families access.

Separately, the U.S. Centers for Disease Control and Prevention (CDC) closed its investigation on Abbott’s infant formula, with no additional cases of infections, according to a notice on the FDA website.

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Rogue trader, euro zone crisis and war, Socgen’s CEO ends ‘bumpy’ ride at top

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© Reuters. FILE PHOTO: French bank Societe Generale Chief Executive Officer Frederic Oudea attends a news conference to present the company’s 2015 annual results La Defense near Paris, France, February 11, 2016. REUTERS/Benoit Tessier//File Photo

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By John O’Donnell and Julien Ponthus

FRANKFURT/LONDON (Reuters) -Societe Generale CEO Frederic Oudea, who navigated the French bank through a rogue trading scandal and the euro zone crisis, will leave next year, ending a tumultuous 15 years at the top.

The longest-serving chief executive of a major European bank, Oudea took charge at the height of the 2008 financial crisis as the bank grappled with the multi-billion-euro fallout of a rogue trading scandal.

A student of France’s elite Polytechnique engineering school and of the National Administration School, whose graduates include French presidents Jacques Chirac and Emmanuel Macron, Oudea started his career in the civil service before becoming one of the country’s best-known bankers.

He prepares to leave as the bank struggles with the aftermath of a pandemic and the economic uncertainty created by war in Ukraine.

“It’s been a very bumpy ride,” said Jerome Legras of Axiom Alternative Investments, who said some investors were frustrated by what they deem the bank’s modest progress.

In common with many European peers, the share price of Societe Generale (OTC:SCGLY) never recovered from the 2008 debt crisis and at about 24 euros ($25.24), is less than half of its level when Oudea became CEO.

2008 ROGUE TRADER SCANDAL

Oudea became Societe Generale’s finance chief in 2003 but long played a secondary role to Jean-Pierre Mustier, then head of Socgen’s investment bank and considered the likely future CEO.

The scandal in 2008 over a 4.9 billion euro loss triggered by trader Jerome Kerviel turned the tables in favour of Oudea, who became chief executive at the age of 44.

2009-2012 EUROZONE CRISIS

The euro zone debt crisis hit French banks in particular because they were heavily exposed to debt in Greece and other countries at the periphery of the euro zone. This triggered speculation, including that the French government could be forced to nationalise lenders.

In 2011, as Greece struggled to cope with debt repayments, jitters swept through Europe over the future of its banks.

France and its lenders were considered vulnerable. A flurry of media reports and speculation, including that Societe Generale even faced collapse, rocked its shares, putting Oudea to his toughest test.

Pressure abated on the industry when Mario Draghi, who was European Central Bank president at the time, pledged to do “whatever it takes” to back the euro.

2015 SALES

Oudea is credited with shoring up the bank’s capital base, its weakness after the 2008 crisis, selling some businesses and paring back its Eastern Europe arm.

The sale of the bank’s stake in Amundi in a 2015 multi-billion-euro stock-market listing granted Oudea a windfall. He later sold the exchange-traded funds specialist Lyxor to Amundi.

He made Boursorama the top French online bank while cutting branches through a merger with the Credit du Nord network.

Oudea’s arguably boldest move was at the start of this year when Societe Generale’s car leasing division ALD, which he floated in 2017, signed a 4.9 billion euros deal to buy Dutch rival LeasePlan.

Nonetheless, some remained underwhelmed by Oudea. “Investors felt there was a lack of a clear strategic goal,” said Legras.

The risks from trading continued to overshadow the bank. In early 2020, it posted a surprise first-quarter loss after a revenue wipeout at its equity trading division after market volatility caused by the pandemic.

The bank has since overhauled that division.

2018 LIBYA BRIBERY

The bank paid $1.3 billion in penalties for wrongdoing, including bribing Libyan officials, an episode for which Oudea apologised.

Between 2004 and 2009, Socgen paid more than $90 million in bribes through a Libyan broker to secure 14 investments by Libyan state-owned financial institutions, the U.S. Justice Department had said.

2022 RUSSIA DEPARTURE

Last month, Socgen became the first major Western bank to announce its departure from Russia, navigating a highly charged standoff between Russia and the European Union, which has been ratcheting up sanctions in response to Moscow’s invasion of Ukraine on Feb. 24.

Socgen announced it would sell its Rosbank business to Interros Capital, a company linked to Russian oligarch Vladimir Potanin, writing off roughly 3.1 billion euros.

Socgen was one of a handful of European banks with a significant presence in Russia and the sale was seen as a coup by investors despite the heavy cost because it drew a line under its involvement with Russia.

($1 = 0.9508 euros)

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Citi promotes Asia-based banker Valderrabano as global wealth COO

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© Reuters. FILE PHOTO: The Citigroup Inc (Citi) in Toronto, Ontario, Canada October 19, 2017. Picture taken October 19, 2017. REUTERS/Chris Helgren

By Selena Li

HONG KONG (Reuters) – Citi has appointed Valentin Valderrabano as its new chief operating officer (COO) for Citi Global Wealth, effective in July, according to an internal memo reviewed by Reuters.

Valderrabano, who reports to the bank’s global wealth head Jim O’Donnell, was most recently consumer business manager for Citibank Korea with nearly 20 years of experience at the bank.

He will replace Citi’s current COO Eduardo Martinez Campos, who will move to lead Citi Wealth Services and Strategic Investments.

The U.S. bank’s wealth business brought in $7.5 billion in revenue globally in 2021, running over $800 billion in client assets with more than 3,000 client advisers.

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Analysis-Rare double whammy hits investors: steep slumps for both stocks and bonds

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© Reuters. FILE PHOTO: A Wall Street sign outside the New York Stock Exchange in New York City, New York, U.S., October 2, 2020. REUTERS/Carlo Allegri/File Photo/File Photo/File Photo

By David Randall and John McCrank

NEW YORK (Reuters) – From meme-stock enthusiasts to retirees, this year’s steep dive for both stocks and U.S. Treasury prices has upended portfolios for individual investors who had enjoyed watching their wealth grow during the historic rally in financial assets early in the coronavirus pandemic in 2020.

Wall Street’s brutal tumble continued on Wednesday, with the worst one-day loss since June 2020 for the S&P 500 . The benchmark index is now down 17.5% from its peak at the start of the year, erasing $499 billion in market value. At one point the S&P was down nearly 20% and on the cusp of confirming a bear market.

Unlike many past market selloffs, this downturn has also slammed U.S. Treasuries prices, pushing up yields, as the Federal Reserve began to reverse the easy money policies that supported the economy during pandemic lockdowns.

Growing more pessimistic, retail traders sold $87 million in equities on net in the past week up to Tuesday, versus a one-year average of $3.3 billion in net buys, according to a note from JPMorgan (NYSE:JPM).

Normally, Treasuries have been considered among the world’s safest investments. But so far in 2022, the ICE (NYSE:ICE) BofA US Treasury Index is down 9.3%, the worst start to the year for Treasuries since 1830 according to Deutsche Bank (ETR:DBKGn). This has slammed investors who counted on the bond market for income and as a buffer against potential stock market losses.

“Most investors have never seen a market environment like this,” said Christine Benz, director of personal finance at Morningstar. “It could get worse before it gets better, and that will really test investors’ patience.”

Many high-flying growth and tech stocks soared during the pandemic, and their steep decline has rattled investors who had bet on them, hoping for the kind of eye-popping rallies seen early last year in GameStop (NYSE:GME) and other so-called meme stocks.

“What I’m seeing is the same thing everyone else is seeing who started 18-to-24 months ago, like, ‘oh, look at all of the green, going up, up, up,’ and then all of a sudden it’s like, ‘oh crud, what is happening?'”, said Alex Rutfield, 29, an engineer in the Boston suburbs who has invested over $50,000 in stocks and ETFs that include internet and robotics firms. He said the value of his portfolio has fallen back to around even.

DOUBLE WHAMMY

The dual selloffs in stocks and bonds have been particularly difficult on individual investors who counted on a mix of stocks and bonds to blunt declines in their portfolios, with stocks ideally rising amid economic optimism and bonds strengthening during turbulent times.

That strategy does not work when stocks and bonds fall in unison. The BlackRock (NYSE:BLK) 60/40 Target (NYSE:TGT) Allocation fund, which follows a standard portfolio technique of keeping 60% of its assets in equities and 40% in fixed income to limit risk, is down nearly 12% since the start of the year, its worst performance since it launched in 2006.

The bulk of the selling in both stocks and bonds has been coming from wealthier and older investors, who are reducing their overall risk exposure, mainly through the selling of mutual funds, according to data from Vanda (NASDAQ:VNDA) Research.

Bruce Bagley, 69, founder Santa Rosa Uniform & Career Apparel in Santa Rosa, California, said he has held the course so far in his portfolio, which is 55% stocks, 40% bonds, with the rest in cash, even though everything but his REIT investments have been falling.

“Where else are you going to put your money?” he said.

Investors who had large allocations to bonds, which make up some 20% of retirement accounts on average, according to Morningstar, have canceled vacation plans, are eating in more often, and have reconsidered assistance to other family members, said Melanie Nichols, a wealth advisor at WA Asset Management in Birmingham, Alabama.

“When you have one part of a portfolio that is providing all your income and now you see it down 10% that’s frightening,” she said. “People are not used to those returns because we don’t have those returns in the bond market very often.”

Other retirees are looking for other sources of income to try to rebuild their nest egg.

“You think you have enough to live off for years and now you don’t know if it will come back,” said one 73-year old former marketing executive in the Cleveland suburbs who had about 30% of her portfolio in bonds and said she was considering finding part-time work to help preserve her retirement savings.

“Clients who had larger allocations to bonds and who really did not want to experience volatility are feeling this, and it has been very destabilizing for those folks,” said John Cunnison, chief investment officer at Baker Boyer in Walla Walla, Washington.

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