Hong Kongs Inland Revenue Department no longer recognises or allows such structures to reduce the amount of taxable remuneration by an employee. While Gulliver had other reasons to establish his structure, it certainly was not improper in its context.
So besides the timing of the disclosure - alongside falling bank profits and allegations over its Swiss operation - there isnt much to say about Gullivers personal tax structure.
If American banks accommodated customised tax sheltering schemes for their senior officers - which they tend not to as a matter of practice - there would be a rash of bankers at all levels concocting an assortment of plans, thereby creating an administrative and payroll mess.
Gulliver stirred up further criticism by complaining the bank leaders were being held to higher standards than church or military leaders.
The real issue, however, is whether there should be a specific standard to which all bankers are held accountable. Should there be an absolute moral standard? Since bankers tax planning is now a subject of scrutiny, will they (and perhaps other industry executives) need to seek regulatory approval for personal wealth planning schemes? This could happen because regulators are already trying to control and limit bankers remuneration.
The questions from the British parliaments Treasury select committee to Gulliver and chairman Douglas Flint included: Are you a fat cat? Have you dodged taxes?
While that plays well for the media gallery and voters, there is no justification for anyone to complain about salaries. Complaints represent bitterness about pay that is bigger than most others.
The money laundering and tax evasion accusations levelled at HSBCs Swiss private bank relate to management from the past. And after the UBS settlement with the US government over advising American citizens on how to avoid taxes, it is not surprising other banks could have engaged in such activities. So the next dilemma is how other financial institutions will investigate their records and if and how they disclose any misconduct.
Although they appear reprehensible, problems from a banks past are no more heinous than an industrial company that is required to clean up a leaking toxic waste dump that it established decades ago. It should be approached and dealt with that level of phlegmatic objectivity.
After the financial crisis, commentators, regulators and government officials must stop clinging to their inclination towards moral and emotional outrage and focus on transforming the future role of banks and the business of financial risk taking.
Peter Guy is a financial writer and former international banker
Envestnet, a Chicago-based wealth management technology provider, reported adjusted net income from the fourth quarter of $0.23 per share, or $8.6 million, beating analyst predictions by $0.01 per share.
The company reported revenues in the quarter that ended Dec. 31 of $96.8 million, a 30 percent increase from the year-ago period. For the full year, revenues increased 44 percent to $348.7 million, and adjusted net income was $29.5 million, or $0.80 per share.
Assets under management and administration totaled $246.4 billion, a 38 percent increase from the end of 2013.
Envestnet also reported that it surpassed $700 billion in platform assets and served more than 40,000 advisors.
The report did not include the announcement to acquire Upside, a year-old tech company that has developed an automated, online financial planning and investment platform. Envestment announced the acquisition Thursday, and is expected to develop the platform into its own robo-advisor to complete with products from Wealthfront and Betterment.
Like many of you, I was at the Heckerling Institute on Estate Planning in Orlando, Fla. last month.
Two statements were made relating to divorce that inspire me to comment. The first was that a trust should be drafted to remove a spouse automatically in all capacities upon divorce. The second suggested that the spouse should be removed not just upon divorce, but upon the filing of a divorce action.
In recent years, Ive spoken a bit on the topic of planning for divorce and have had the opportunity to reflect on some of the realities of marriage and divorce and my own view of best practices. Ive personally seen and heard stories about situations in which a machete approach of treating a spouse as immediately deceased upon the filing of a divorce action has backfired and ultimately frustrated the settlors true wishes.
The reality is that marriage can be wonderful, but it can be hard. Some couples go through tough times in their relationship, from which they may not recover.
Approximately 50 percent of couples in America divorce, but the rates are lower for a couple when the wife has completed college. Only about 20 percent of women who complete college end up divorcing. Using education as a proxy for wealth, this can mean that rates for divorce for our affluent couples probably are much lower than national averages in most parts of the country.
Moreover, not all divorces are acrimonious. People divorce for many reasons. Divorced couples sometimes remain close and continue to raise their children together. Sometimes they want to provide for each other above and beyond whats required by the divorce order. Sometimes theyre divorced for some years and then remarry each other.
Even when theres acrimony, leaving the trust assets on the table during negotiations can enable the parties to make beneficial deals that can protect family business interests or other assets from division. If a spouse is immediately deemed predeceased and cut out of an instrument upon the filing of a divorce action, this limits flexibility.
Along the same lines, not all divorce filings lead to divorce. A number of filed divorce petitions are withdrawn each year. So if the instrument removes a spouse upon the filing of the action, there needs to be a method for restoring the spouse if the action is withdrawn and the couple decides to remain married.
[Business Wire] Over seventy percent of active individual investors describe themselves as interested in sustainable investing, and nearly two in three believe sustainable investing will become more prevalent over the next five years, according to a new survey published today by the Morgan Stanley Institute for Sustainable Investing.
Read more on this.
Morgan Stanley (MS), with a current market cap of $70.20B, began trading this morning at $35.99.
Today, shares have traded between $35.73 and $36.04 per share and has traded between $28.31 and $39.19 over the past 12 months.
MS shares are currently priced at 12.52x this years forecasted earnings, which makes them relatively inexpensive compared to the industrys 26.68x earnings multiple for the same period.
And for those looking to make a return holding the stock, the company pays shareholders $0.40 per share annually in dividends, yielding 1.10%.
Consensus earnings for the current quarter by the 22 sell-side analysts covering the stock is an estimate of $0.77 per share, which would be $0.09 better than the year-ago quarter and a $0.01 sequential decrease. What we find to be interesting is that the full-year EPS estimate of $2.88 is a $0.56 improvement when compared to the previous years annual results.
The quarterly earnings estimate is based on a consensus revenue forecast of the current quarter of $9.22 Billion. If realized, that would be a 4.77% increase over the year-ago quarter.
In terms of ratings, MKM Partners Initiated MS at Buy (Oct 2, 2014). Previously, Deutsche Bank downgraded MS from Buy to Hold.
Investors should keep in mind is that the average price target is $38.07, which is 5.78% above where the stock opened this morning.
Summary (NYSE:MS): Morgan Stanley, a financial holding company, provides various financial products and services to corporations, governments, financial institutions, and individuals worldwide. The companys Institutional Securities segment offers financial advisory services on mergers and acquisitions, divestitures, joint ventures, corporate restructurings, recapitalizations, spin-offs, exchange offers, leveraged buyouts, takeover defenses, and shareholder relations, as well as provides capital raising and corporate lending services. This segment is also engaged in sales, trading, financing, and market-making activities, including institutional equity, fixed income and commodities, research, and investment activities, as well as offers financing services, such as prime brokerage, consolidated clearance, settlement, custody, financing, and portfolio reporting services. Its Wealth Management segment provides brokerage and investment advisory services covering various types of investments comprising equities, options, futures, foreign currencies, precious metals, fixed income securities, mutual funds, structured products, alternative investments, unit investment trusts, managed futures, separately managed accounts, and mutual fund asset allocation programs. This segment also offers education savings programs, financial and wealth planning services, annuity and other insurance products, cash management services, trust and fiduciary services, retirement solutions, and credit and other lending products, as well as fixed income principal trading services. The companys Investment Management segment provides alternative investment products, such as hedge funds, private equity and real estate funds, and portable alpha strategies to institutional and intermediary channels, and high net worth clients, as well as is involved in real estate investing and merchant banking businesses. Morgan Stanley was founded in 1935 and is headquartered in New York, New York.