Japan official wants Fukushima operator Tepco to be liquidated

An aerial view shows Tokyo Electric Power Co. (TEPCO)'s tsunami-crippled Fukushima Daiichi nuclear power plant and its contaminated water storage tanks (bottom) in Fukushima, in this photo taken by Kyodo August 20, 2013.

Credit: Reuters/Kyodo

By Aaron Sheldrick and Mari Saito

TOKYO | Wed Aug 28, 2013 8:24am EDT

TOKYO (Reuters) - The operator of Japan's wrecked Fukushima nuclear station, Tokyo Electric Power Co, should be liquidated, as its failure to learn from its mistakes fuels insecurity, says the governor of a prefecture hosting another of the utility's atomic plants.

Tepco was nationalized last year and receives public funds to pay compensation to the 160,000 people who had to flee their homes after a 2011 earthquake and tsunami caused three reactor meltdowns in the worst nuclear disaster since Chernobyl in 1986.

Hirohiko Izumida, governor of Niigata prefecture north of Tokyo, has been arguing for two years that the utility should not be allowed to restart its Kashiwazaki Kariwa station, the world's biggest nuclear plant, unless it gives a fuller account of the Fukushima meltdowns.

Izumida, himself a former energy official, is now upping the ante, saying he believes Tepco's focus on getting the plant's reactors started to save fuel costs of about $1 billion every month overlooks safety concerns.

"There should be some procedures considered to bring about the liquidation of Tepco, because right now short-term funding concerns are taking priority over resolving the problems," Izumida told foreign reporters at a briefing in Tokyo.

The utility's recent admission, following months of denial, that the plant was leaking radioactive substances into the Pacific Ocean showed Tepco had not heeded the lessons of the disaster, Izumida said.

"I feel very insecure about the fact that a company that cannot learn from its past mistakes would operate a nuclear power plant," said Izumida, a former senior official in the Ministry of Economy, Trade and Industry that oversees the energy sector.

Restarting Kashiwazaki was also a central plank of the government's bailout of Tepco, in which 1 trillion yen ($10.29 billion) of capital was injected into the utility last year. Tepco also got a commitment from its banks to lend it another 1 trillion yen, based on getting the reactors operating again.

Tepco's plan to seek regulators' permission to restart was halted when Izumida voiced his opposition in July.

INES RATING

Japan's Nuclear Regulation Authority (NRA) on Wednesday officially raised the severity rating of a new leak of radioactive water at Fukushima to Level 3 on an international scale for such incidents.

The move raises the scale of what was Japan's first warning on the International Nuclear and Radiological Event Scale (INES) since the Fukushima meltdowns in 2011. Those meltdowns were classified as Level 7, the highest INES rating.

Tepco said last week that 300 tonnes of highly radioactive water leaked from a storage tank at the facility, apart from leaks into the ocean confirmed by the utility in July, prompting an initial INES rating of Level 1, the second lowest.

The government has said it will get more involved in resolving the plant's growing problems with contaminated water and seek the advice of foreign experts.

Tepco was not capable of resolving the situation, the governor of Fukushima prefecture said on Wednesday.

"There is no risk management at Tepco and they are no longer capable of dealing with this on its own," Governor Yuhei Sato told the chief of the regulator at a public meeting.

"The government must present specific plans on how to resolve the water problems and put together measures as soon as possible," he told NRA Chairman Shunichi Tanaka.

The NRA chief told reporters Tepco had failed to act on the regulator's warnings to improve monitoring of water tanks at the plant and keep detailed records of inspections.

"I think it has become clear that they are lacking the technical knowledge" to deal with the problems, Tanaka said.

Elsewhere, Taiwan had sent back to Japan by July 15 bulk transport containers contaminated by radiation from the Fukushima nuclear plant, the island's Atomic Energy Council said on Wednesday.

As many as 226 containers from Japan, mostly carrying waste plastics, had shown contamination in excess of the standard level of 0.2 microsieverts per hour, and 211 were decontaminated before entering Taiwan, the Council said. ($1=97.20 Japanese yen)

(Additional reporting by Leng Cheng and Cheng Guo)

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Nestle chairman says wants to keep all options open on L'Oreal

A logo is seen over the entrance of Cosmetics company L'Oreal building in Paris, August 16, 2013.

Credit: Reuters/Christian Hartmann

ZURICH | Wed Aug 28, 2013 7:28am EDT

ZURICH (Reuters) - Nestle (NESN.VX) wants to keep its options open for its stake in cosmetics firm L'Oreal (OREP.PA) and will not extend a purchase contract with France's Bettencourt family, the food group's chairman told a Swiss newspaper.

The Swiss company owns a 29.5 percent stake in L'Oreal and the expiry of a 10-year right of first refusal agreement with the Bettencourt family in April 2014 would make it easier for Nestle to sell.

"The right of first refusal will not be extended, that is quite clear," Peter Brabeck told the Handelszeitung newspaper in an excerpt of an interview published on its website on Wednesday.

He didn't elaborate on Nestle plans, but said the company wants to keep "all options on the table," including maintaining the status quo.

Uncertainty surrounding the stake has weighed on Nestle' s share price ahead of the expiry. The company did not immediately respond to request for comment on the interview.

Last week the Bettencourt family said it had no plans to sell its 30.5 percent of L'Oreal's capital.

Shares in Nestle were down 0.6 percent at 61.45 Swiss francs by 1059 GMT, broadly in line with the European food and beverage sector index .SX3P.

(Reporting by Caroline Copley; Editing by Louise Heavens)

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EU wants one definition of bad loans for bank tests: source

A statue symbolising European unity is seen outside the European Parliament in Brussels July 8, 2013.

Credit: Reuters/Yves Herman

By Laura Noonan and Eva Taylor

LONDON/FRANKFURT | Fri Aug 16, 2013 7:15am EDT

LONDON/FRANKFURT (Reuters) - Banks across the European Union will be asked to use a single definition for bad loans in the upcoming review of their loan books, a senior EU regulatory source told Reuters, making it harder for banks to conceal the state of their businesses behind local conventions.

The European Central Bank (ECB) hopes to begin work on an asset quality review of major banks in the seventeen euro zone countries later this year.

The review will take a detailed look at whether they've set aside enough cash to deal with debts unlikely to be repaid, so the ECB can stand over the state of the banks' before it becomes their official supervisor in late 2014.

National supervisors elsewhere in the EU will conduct a similar review for the non-euro zone countries. Both reviews, which will be co-ordinated by pan-EU regulator the European Banking Authority, will focus on 'problem categories' of loans in individual countries, looking at areas like shipping, commercial real estate and mortgages in some markets.

A senior EBA source told Reuters a key feature of the asset quality review will be harmonizing the way banks categorize loans. EU supervisors use a host of different ways to classify troubled or non performing loans, making it difficult to compare across jurisdictions.

The EBA recently carried out a consultation on a single definition to be used across the EU and is working on firming up that definition by September, so it can be applied in the assets quality reviews.

"We'll be asking everyone to use those single definitions," said a senior EBA source.

In a note published on August 14, Moody's Analytics said harmonized NPL definitions would "set the foundations for a new European standard for stress testing".

"These standards will also give the ECB's supervisory role much greater credibility when the banking sector and investors need it most," the note from Moody's Analytics managing director Alessio Balduini added.

An ECB spokeswoman there had not been a final decision on the treatment of non-performing loans.

The 2011 version of the stress tests, which relied entirely on national supervisors' submissions and definitions, was widely criticized for finding that Europe's 70 largest banks collectively needed just 106 billion euros ($140.62 billion).

The EBA is keen to ensure this round of stress tests has more credibility, and sees consistency of definitions and transparency of information as a key way of ensuring this.

UNDER PRESSURE

The stress tests are more forward-looking, and examine how banks would cope with future scenarios like a collapse in economic growth, a rise in interest rates or another credit crunch that made it far harder for them to access funding, essentially answering a different question.

Rather than having a pass/fail mark, like previous tests, the 2014 version will rank banks against various yardsticks.

Those could include examining their coverage ratios, or how many cents banks have set aside to cover potential losses for every euro of bad loans, a senior EBA source said.

The EBA is also encouraging more transparency in the way banks judge the riskiness of their portfolio, a key input into the capital ratios.

To further this, the stress test could include benchmarks showing how conservative or aggressive banks' risk weighted assets treatments are, the source said.

(Reporting By Laura Noonan, Editing by Thomas Atkins)

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EU wants one definition of bad loans for bank tests: source

A statue symbolising European unity is seen outside the European Parliament in Brussels July 8, 2013.

Credit: Reuters/Yves Herman

By Laura Noonan and Eva Taylor

LONDON/FRANKFURT | Fri Aug 16, 2013 7:15am EDT

LONDON/FRANKFURT (Reuters) - Banks across the European Union will be asked to use a single definition for bad loans in the upcoming review of their loan books, a senior EU regulatory source told Reuters, making it harder for banks to conceal the state of their businesses behind local conventions.

The European Central Bank (ECB) hopes to begin work on an asset quality review of major banks in the seventeen euro zone countries later this year.

The review will take a detailed look at whether they've set aside enough cash to deal with debts unlikely to be repaid, so the ECB can stand over the state of the banks' before it becomes their official supervisor in late 2014.

National supervisors elsewhere in the EU will conduct a similar review for the non-euro zone countries. Both reviews, which will be co-ordinated by pan-EU regulator the European Banking Authority, will focus on 'problem categories' of loans in individual countries, looking at areas like shipping, commercial real estate and mortgages in some markets.

A senior EBA source told Reuters a key feature of the asset quality review will be harmonizing the way banks categorize loans. EU supervisors use a host of different ways to classify troubled or non performing loans, making it difficult to compare across jurisdictions.

The EBA recently carried out a consultation on a single definition to be used across the EU and is working on firming up that definition by September, so it can be applied in the assets quality reviews.

"We'll be asking everyone to use those single definitions," said a senior EBA source.

In a note published on August 14, Moody's Analytics said harmonized NPL definitions would "set the foundations for a new European standard for stress testing".

"These standards will also give the ECB's supervisory role much greater credibility when the banking sector and investors need it most," the note from Moody's Analytics managing director Alessio Balduini added.

An ECB spokeswoman there had not been a final decision on the treatment of non-performing loans.

The 2011 version of the stress tests, which relied entirely on national supervisors' submissions and definitions, was widely criticized for finding that Europe's 70 largest banks collectively needed just 106 billion euros ($140.62 billion).

The EBA is keen to ensure this round of stress tests has more credibility, and sees consistency of definitions and transparency of information as a key way of ensuring this.

UNDER PRESSURE

The stress tests are more forward-looking, and examine how banks would cope with future scenarios like a collapse in economic growth, a rise in interest rates or another credit crunch that made it far harder for them to access funding, essentially answering a different question.

Rather than having a pass/fail mark, like previous tests, the 2014 version will rank banks against various yardsticks.

Those could include examining their coverage ratios, or how many cents banks have set aside to cover potential losses for every euro of bad loans, a senior EBA source said.

The EBA is also encouraging more transparency in the way banks judge the riskiness of their portfolio, a key input into the capital ratios.

To further this, the stress test could include benchmarks showing how conservative or aggressive banks' risk weighted assets treatments are, the source said.

(Reporting By Laura Noonan, Editing by Thomas Atkins)

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France wants mandate for EU-US trade talks published

PARIS (Reuters) - France called on Monday for the European Commission to make public its mandate to negotiate EU-U.S. free-trade talks, citing what it said was an atmosphere of mistrust over efforts to forge a landmark pact.

The U.S. and EU launched the negotiations earlier this month despite European concerns about U.S. spying that had threatened to delay the start after nearly two years of preparation. France moreover only agreed to the talks after securing assurances that its entertainment industry would be ringfenced.

"The first week of discussions on a transatlantic partnership agreement closed in a climate of doubt," Trade Minister Nicole Bricq wrote in French newspaper Liberation.

"The U.S. once again showed its splendid ambivalence. It is a country where everything seems possible and whose dynamism and energy we French envy. At the same time it is a prickly power incapable of resisting the temptations its supremacy gives it."

Stressing the need for transparency in the talks, Bricq said she had asked EU Trade Commissioner Karel De Gucht to break with usual procedure and make the EU's negotiation mandate public.

"It doesn't contain any secrets. It's a political statement that calls for an agreement that respects our values and interests. It deserves to be debated," she said.

The Commission's mandates to negotiate international trade deals are not made public because it could weaken the EU's hand by revealing its limits to Washington and U.S. lobbies. That said, unofficial leaks of the mandate are common.

"If the talks with United States are for a partnership, and if we are working as equals, then our practices need to change so that we speak the same language," she said.

Bricq also said the Commission should regularly inform the European Parliament of the progress of the talks. At present, the Commission must do so at the end of each round.

The first round of talks, which took place in Washington from July 8 to July 12, mainly set the stage for more substantive negotiations in the weeks and months ahead as the two sides strive to reach a deal by late 2014.

(Reporting by Leigh Thomas; editing by Mark John)

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Majority of Siemens board wants to oust CEO: sources

MUNICH (Reuters) - A majority of Siemens supervisory board members are in favor of voting out Chief Executive Peter Loescher, two people familiar with the matter told Reuters on Saturday.

The majority of the 20-member board wants current finance chief Joe Kaeser named as Loescher's successor, the sources said following emergency meetings of board members two days after Siemens abandoned a 2014 profit margin target.

Siemens declined to comment on the matter.

A bellwether of Germany's economy whose products range from gas turbines to fast trains and hearing aids, Siemens is suffering from the stuttering global demand that saw German exports fall the most since late 2009 in May.

Loescher has been aiming to boost Siemens' profitability by cutting costs and focusing on the company's most successful businesses, but he has lost credibility by overpromising and underdelivering on the company's finances.

This week, Siemens issued its sixth profit warning since Loescher took office in 2007, saying in a very brief statement that it no longer expected to boost its core operating profit margin to at least 12 percent from 9.5 percent by 2014.

(Reporting by Jens Hack.; Writing by Maria Sheahan. Editing by Andreas Cremer.)

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