Russia makes record bank bail-out

1 July 2011 Last updated at 22:04 GMT The bank's erstwhile head, Andrei Borodin, has fled the country Russia's fifth largest bank, Bank of Moscow, has been given the biggest bail-out in Russian history.

The $14bn rescue came after another bank, VTB, gained control through a hostile bid, only to uncover bad loans valued at $9bn - a third of the bank's assets.

Bank of Moscow's former head, Andrei Borodin, has fled the country, and a warrant has been issued for his arrest.

The bank was used by ex-Moscow Mayor Yuri Luzhkov to fund property projects.

'Fraudulent lending'

Mr Luzhkov was sacked by Russian President Dmitry Medvedev last year.

In a statement issued in London, Mr Borodin said he was shocked at the size of the bail-out, and claimed that VTB's takeover of the bank was politically motivated.

VTB, for its part, accused Bank of Moscow of committing "fraudulent lending" under Mr Borodin's control, while Russian Finance Minister Alexei Kudrin has called for a criminal investigation.

Under the rescue deal, the Russian central bank will provide a 295bn rouble ($10.6bn) 10-year loan at a negligible interest rate to Bank of Moscow.

Meanwhile, VTB will invest a further 100bn roubles to recapitalise the bank - taking its ownership share from 46% to 75%, enough to qualify for state aid.

VTB, Russia's second-biggest lender, had itself to be rescued by the Russian state to the tune of $6.4bn during the financial crisis.

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Fuller's makes good start to year

10 June 2011 Last updated at 07:09 GMT Fuller's said beer volumes were 2% higher Brewer and pub operator Fuller, Smith & Turner has reported a rise in full year profit and says it has made a good start to the new financial year.

Pre-tax profit for the year to 2 April 2011 rose 16% to ?31m.

Total beer sales rose 2%, while revenues increased 16% to ?241.9m.

London-based Fuller's said the first nine weeks of financial year had been "unusual", with trading benefiting from the royal wedding, five bank holidays and "generally very good weather".

Like-for-like sales in its managed pubs grew by 6.8% in the nine weeks to 4 June 2011, compared with a year earlier.

Fuller's has 162 pubs which it directly manages and 196 tenanted inns, in which landlords rent the pub and get their supplies from Fuller's.

The group added that it had acquired four new pubs in that time and a major brewery investment was under way.

But looking ahead, group chairman Michael Turner sounded a note of caution.

"With wages in the UK running behind inflation, our customers' incomes are being squeezed and we will have to work hard in the current year and beyond to earn their custom," he said.

The dry weather at the moment would have an impact on barley prices but he said was not overly concerned.

"Barley prices go up and down with the seasons. Clearly there's a drought on at the moment which may make life a little bit harder," he told the BBC.

"But we actually buy our barley about three years ahead, which makes it easier for the farmer to predict his future income and also for us with our purchases."

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MGM China share sale makes $1.5bn

27 May 2011 Last updated at 06:02 GMT The share sale will give MGM full control of its operations in the Chinese territory MGM China has raised $1.5bn (?912m) through a share flotation in Hong Kong, as investors look to grab a slice of Macau's gambling boom.

The company priced its stock at HK$15.34 per share, the top end of its expected range.

Gambling revenues in Macau have been rising turning it into the world's biggest gambling market.

MGM China is one of the only six companies that have a licence to operate casinos in Macau.

The company is a joint venture between MGM Resorts International, which owns some of the biggest casinos in the US and Pansy Ho, the daughter of casino mogul Stanley Ho, the largest casino operator in Macau.

Rising profile

The biggest beneficiary of the share sale is expected to be Ms Ho.

According to the previous arrangement, MGM and Ms Ho owned an equal 50% stake in the company.

However, according to an agreement between the two in April, Ms Ho will sell 21% of her stock, hence pocketing most of the cash from the sale.

According to some estimates, this may see her net worth swell to as much as $5bn, propelling her over her father, Stanley Ho, who's fortune is estimated to be around $3bn.

MGM's stake in the company will increase to 51% after the share sale.

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