Author Archives: alvi

The Unseen Threat From Europe – the Premier League’s Dominance of European Football is in Danger

So, Manchester United look like they are going to win the Premier League title again. And with Chelsea dying a slow death in West London and Arsenal constantly shooting themselves in the foot, while Liverpool argue with their own manager, can anyone challenge them?

The Reds one-sided success (this year would make it 11 wins out of 17) in the English Premier League puts the league in danger of turning itself into an Eastern European backwater-type league where a single team is dominant for decades, as the rest of the country scratches around for scraps. The red herring this season is Aston Villa, who have broken into the top four, but is that because they have improved to meet the top four, or is it that the three below Man Utd are drifting down to meet them?

The fact that the top tier in the English league has an obvious second league of teams nowhere near good enough to challenge for anything other than mid-table obscurity, underline the crossroads English football appears to be at.

Of course, there’s the money. Last week it was announced that Sky accidentally blew Setanta out of the water and took five out of six Premier League TV packages by upping their bid to £1.4bn over three years. All good for clubs who can continue to throw money at players in a bid for the Holy Grail of football, a place in the top four .
But that money is only the base on which the big clubs are building their brands – and Man Utd’s success is such that they are in danger of getting too big for British football. A survey last year suggested that United had 333m fans worldwide compared with 75m in 2003. Clearly, success is paying off globally – one only has to look at the growing percentage of southeast Asian fans popping up at Old Trafford for visual evidence.

Man Utd’s dominance would not threaten “Brand Premier League” on its own: what the English leagues should be really worried about is that the rest of Europe appears to be getting its act together. As TV pays the bills, and global branding pays for the pretty dresses, any danger to Brand Premier on the world stage will be disastrous, particularly as the world lurches into a financial crisis.

The four big leagues (France, Italy, Spain and Germany) are in the midst of becoming more exciting by the week, with competition at the top and engaging action at the bottom, with a little quality, too. There finances appear to be improving rapidly, too. France’s Ligue 1 has seven teams vying for the title this year: perhaps because the team that has dominated for a decade, Lyon, has not had the global branding Man Utd has had. And the French leagues hit the jackpot in 2005 when a bidding war put the price of TV packages at £1.6bn – almost on a par with the Premier League.

Last year, the German Bundesliga took over the English Premiership’s mantle as the league making the most money out of shirt sponsorship: a small part of a club’s overall revenue but significant in that it suggests how bankable the league is in terms of marketability.
A year ago a rather doom-laden Spanish La Liga was looking at multiple bankruptcies as economists warned that clubs had radically overspent to keep up with Real Madrid and Barcelona. But the fact that Spain has two clubs bigger than Man Utd means that it will always be more competitive on a global market. It also has the advantage that there are more football-mad nations that speak Spanish than English-speaking nations.

The fate of Italian clubs, meanwhile, should serve as a warning for the money-bloated Premier League. For years they fed on bloated cheques from rich owners – often local companies done good or senior politicians or Italian oligarchs. Now it doesn’t look so good. Juventus has been dropped a league and since returned, while many other clubs suffered from wage bills hitting 85% of income. Now, there is some light at the end of the tunnel. Clubs like Napoli, which suffered from the previous wage profligacy (Maradona and Paul Gascoigne the highest profile luxuries), are back in the black and highflying in Serie A. Oh, and Italy still has four of the top 20 richest clubs in Europe.

Perhaps more importantly is the strong support in Italy for a salary cap which, if implemented, will drive Italian clubs back up to the top in Europe.

If the Premier League continues on its current path, three things could happen:

1) Of course, everything could work out fine, with the money levelling off as Brand Premier begins to help every club in the league. Competition becomes more intense, the world is hooked,

2) Man Utd continue to dominate and the fans slowly but surely switch off. United decides it doesn’t want to share the TV money so, as the only show in town, decides to break away from the TV package and sell itself. With little or no competition at home European action becomes more important. The spectre of a European super league raises its ugly head again.

3) Brand Premier goes the way of Italy: money breeds corruption, breeds alienation and eventually the English falls into a bitter sea of fear, court cases and recriminations. Millions worldwide switch back to a revitalized Serie A and La Liga and the old world order is duly re-established.

The Role Of Collateral Managers In Trade Finance

Collateral management firms are becoming increasingly important within trade finance. Collateral managers basically “look after” collateral on behalf of a lender financing goods. By using a collateral manager, the lender can make sure that goods, such as commodities, for example, are being controlled in such a way that if anything goes wrong with the loan, such as the borrower defaulting on payments, then the bank can get its hands on the goods which are the subject of the loan, and sell them to recover monies lent. Leading international collateral management companies serve a growing international market for structured trade finance, wherein money is lent based on the value of the underlying goods, rather than on the balance sheet of the borrower.

Notwithstanding the fact that most bankers, borrowers and warehousemen say they find collateral management “just too expensive’ their desire to use the services of collateral management companies is increasing. In the absence of totally secure physical commodity storage facilities and resulting from the risks in moving commodities about, banks are obliged to find other structures for protection against physical risks. The collateral management
agreement, or CMA, offered by a number of global firms, offers one such solution.

The CMA is a tripartite arrangement between the banker, the borrower and the collateral manager and it is important to remember the CMA is a bespoke agreement. This means it can be time-consuming and expensive. The CMA is designed uniquely for each transaction and the collateral manager will bargain for fees – for the transaction itself, and for participants in the commodity system. Elsewhere in this book you can read in detail about collateral management, but the key influence collateral managers have on the system is that they:

o Oblige an understanding, through their agreements, among borrowers
of the risks faced by lenders.

o Impose a system on warehouses to comply with rigorous standards
(particularly important in developing countries).

o Manage issues of quality and provide value-added services for
quality/other considerations.

o Define, through the CMA, complex issues such as commingling and lien
over commingled goods.

o Issue non-negotiable warehouse receipts

o Impose controls through the legal discipline of the CMA

o Impose controls on-the-ground discipline as the commodity moves
through the supply chain

o Provide insurance

Some collateral managers make a play of the role of their global insurance cover. There are smaller collateral management firms who depend on this cover, possibly because their balance sheets are not large enough to provide comfort for the bank in the event of a large-scale default. The most efficient collateral managers in the developing world are those who are able to offer local services, make local decisions and sign the CMA’s without
recourse to the HQ in Europe, or elsewhere.

Collateral management is an increasingly important tool in the armoury of any trade financier. The demand for collateral management is increasing and the use CMAs is becoming an important and regular tool for the structured trade financiers right across the planet.

For more information about collateral management, CMAs or structured trade finance, contact Dan Day-Robinson at Day Robinson International in the UK.

Property Investment: Spoiled for Choice in Europe’s Emerging Markets

You could be forgiven for thinking that property is the new dot.com. It seems that anybody with a few extra bucks to spare is trying to get in on the current boom. Pushed along by the many television programmes selling hot new property destinations, newspaper articles regularly highlighting the returns to be made in foreign property markets, and the abundant websites offering property all around the world, would be investors are rushing by the thousands into emerging markets accompanied only by the certainty of making a killer return.

Many of these are young people who, priced out of their home markets are eager to get a foot on the property ladder in cheaper markets abroad. Others are coming in off the back of property booms in their own country, particularly the British and Irish and increasingly, the Spanish.

But while investors may be dreaming of a property that will offer high rental yields and high capital growth at the same time, sourcing the right property markets in which to make that investment is vital to achieving solid returns. With so much attention being focused on emerging markets, it is difficult for the rookie investor to know exactly where the next revolution in property is going to be.

Bulgaria, for many, is the obvious choice. For the small time investor or holiday home buyer, Bulgaria offers an affordable entry point. Receiving massive attention from the media, it has become a hot bed of investor activity, particularly around the Black Sea Coast and the Ski resorts. With property prices far below the EU average and capital growth averaging 60-70% per year, it’s not surprising. Bulgaria’s growing reputation as a tourist destination is also in its favour and many speculate that the Bulgarian property market will mirror the trends that were seen in the Spanish property market, particularly after its entry to the EU.

Many predicted that the ‘Eastern Eight’ – the Czech Republic, Hungary, Poland, Estonia, Lithuania, Latvia, Slovenia and Slovakia, on entry to the EU would contribute to the biggest property boom Europe has experienced in at least the last 10 years. While investor interest in the new Europe countries is significant, particularly among the Irish, British and Germans, prices are not rising at alarming rates and to some extent over saturation of the market by investors has meant that rental yields are not as high as they might be. While the property market in some of these countries has taken off on the back of EU accession, others such as Slovakia are struggling to raise their profile when it comes international investors.

Investing in European emerging property markets brings the risk that comes with investing in any new territory. However, for those daring enough to take the risk, the returns are far higher than those achieved by investing in the more traditional markets such as France or Spain. Take Romania as an example. Moving into a markets such as Romania now would require a great deal of courage, particularly when the country is still battling organised crime and negative world opinion, but the chances are that ten years down the road, Romania’s small Black Sea coastline will take off in much the same way as Bulgaria’s has over the past five years. The rewards are always greater for those brave enough to go in early.

Dubai is another strong contender among investors interested in emerging markets. Dubai, for many, has the winning formula; sun, sand, glamour, spectacular developments, liberal tax regimes and reasonably priced property. Though Dubai’s property market is probably the most glamorous and sophisticated in the world, it is still possible to pick up a bargain property that is sure to yield high returns. A one bed roomed apartment just 20 minutes drive outside Dubai can still be bought for around £35,000. While rental yields have dropped from 8 – 9 % in the last year to a more realistic 6 – 7 %, these are still healthy returns compared to major Eastern European contenders. The major concern with Dubai is that currently it is largely a speculators market, with properties being bought and sold several times before the builders have even left. If speculators decided to pull out, it could lead to total collapse of the market. However, measures are being implemented to discourage speculation with banks lending only on the original cost of the property, leaving investors the task of seeking alternative finance for the premiums that can be incurred on transfer of properties.

It is worth bearing in mind that all property markets, not just those that are newly emerging, carry risks. The key to making a success of any investment is good research. Gathering as much information as possible and keeping up to date with market trends is vital to making an investment project go smoothly. This is even more relevant when buying property in foreign markets. Seek professional advice, work with reliable agents and always be willing to do your homework.

UK’s Finance and Business Courses

Undergraduate courses in the fields of Business and Finance are favored preferences and somewhat rightly so. They offer a major amount of intellectual training and a good solid foundation of business knowledge that can help future graduate students improve their future occupational prospects.

The ideal selections for these kinds of programs have access to a learning atmosphere that includes state-of-the-art facilities, a solid faculty with several years and even decades of expertise and a healthy network where you can develop your long term future profession, especially the ones that offers you access to further learning and work opportunities overseas.

Business and Finance courses straddle both the areas of Science and Humanities. Humanities-based degrees require a considerable load of written work, while Scientific based courses normally contain lots of practical exploration and evaluation.

Business courses offer a balanced mixture of debating, research, writing, presenting, and statistical evaluation as components of the coursework, training and exposing its undergraduates in a large range of skills. As such, its graduates can easily showcase problem solving abilities that are needed and highly valued by employers across different industries.

Additionally, there are many specializations within the areas of Business study: Accounting, Finance, Banking, Investment, Real Estate and Management. Most of these courses offer you in-depth knowledge and skills that will aid graduate students flourish and succeed in the extremely intricate and unique business world.

In the city of London, regarded as the world’s finance capital, is where the top schools for Business are located. They are recognized for tremendously rigorous courses with very tough entry prerequisites. Graduates of these courses shall be in high demand.

Those people lucky enough to graduate from a Business course in London typically have a great opportunity to select from different job offers soon after graduation, normally with the leading corporations and groups, or an association which has partnered with the university for placement.

Cass Business School is a leading provider of management and business education and learning in the united kingdom, and it is based right in the heart of London’s financial center.

Internationally recognized for our Masters program (MBA), we offer the largest curriculum for Specialist Masters programs (MSc) in Europe. Some of our undergraduate programs are rated as among the best in the United Kingdom. We have been rated as one of the UK’s Top 10 Business and Management Research schools. This means, at Cass Business School, we attract the best PhD pupils and teachers.