2025-01-13 17:30

Honolulu accuses oil firms of misleading public Various US jurisdictions have sued oil firms Honolulu seeks unspecified monetary damages WASHINGTON, Jan 13 (Reuters) - The U.S. Supreme Court declined on Monday to hear a bid by Sunoco (SUN.N) , opens new tab and other oil companies to scuttle a lawsuit by Honolulu accusing them of misleading the public for decades about the dangers of climate change induced by the burning of fossil fuels. The justices turned away an appeal by the oil companies of a decision by Hawaii's top court allowing the suit, which alleged violations of state law, to proceed. Other defendants in the lawsuit include Exxon Mobil (XOM.N) , opens new tab, BP (BP.L) , opens new tab, Shell (SHEL.L) , opens new tab, ConocoPhillips (COP.N) , opens new tab, BHP Group (BHP.AX) , opens new tab, Marathon Petroleum and Chevron (CVX.N) , opens new tab. The suit was filed in 2020 by the city and county of Honolulu and the Honolulu Board of Water Supply, a semi-autonomous city agency. The plaintiffs said misleading statements made by the companies about the impact of their fossil fuel products paved the way for property and infrastructure damage caused by human-induced climate change. The plaintiffs have sought unspecified monetary damages. Honolulu is located on Hawaii's Oahu island. The lawsuit said that heat waves linked to climate change have stressed the city's electrical grid, and that a wastewater treatment plant would need to be retrofitted against sea level rise at a cost of hundreds of millions of dollars, among other harms. Ben Sullivan, an official at the City and County of Honolulu's Office of Climate Change, Sustainability and Resiliency, hailed the Supreme Court's action. "This is a significant day for the people of Honolulu and the rule of law. This landmark decision upholds our right to enforce Hawaii laws in Hawaii courts, ensuring the protection of Hawaii taxpayers and communities from the immense costs and consequences of the climate crisis caused by the defendants' misconduct," Sullivan said. Honolulu is among various U.S. jurisdictions to have filed suits seeking monetary damages from companies that extract, produce, distribute or sell fossil fuels, arguing that their activities contribute to emissions of carbon dioxide and other so-called greenhouse gases linked to climate change. "Defendants have known for more than 50 years that greenhouse gas pollution from their fossil fuel products would have a significant adverse impact on the Earth's climate and sea levels," the Honolulu lawsuit stated. Instead of warning the public about the known consequences of using their products or working to minimize associated damage, the companies "concealed the dangers, promoted false and misleading information, sought to undermine public support for greenhouse gas regulation, and engaged in massive campaigns to promote the ever-increasing use of their products at ever-greater volumes," the lawsuit added. Among other consequences of this conduct, the lawsuit said, the average sea level will rise substantially along the Honolulu Pacific coastline, causing flooding, erosion and beach loss, and extreme weather affecting the region will become more frequent. The companies urged a trial judge to dismiss the suit, arguing that the claims made under state law were preempted, or blocked, by federal law because those Hawaii statutes sought to regulate interstate emissions or commerce, powers reserved for the federal government. Hawaii Circuit Court Judge Jeffrey Crabtree denied that request. The Hawaii Supreme Court in October 2023 upheld the judge's ruling, prompting the oil companies to appeal to the justices. The defendants had tried to move the case to federal court but were rebuffed by the U.S. Supreme Court in April 2023. Sign up here. https://www.reuters.com/sustainability/climate-energy/us-supreme-court-rejects-bid-by-oil-companiesshell-toss-honolulus-climate-suit-2025-01-13/

2025-01-13 16:38

Tether plans physical headquarters in El Salvador CEO, co-founders plan to live in the country El Salvador seeking to become a hub for digital currency trading Regulators concerned about booming stablecoin market DUBAI, Jan 13 (Reuters) - Cryptocurrency firm Tether plans to move its headquarters to El Salvador, its chief executive said, as the founders of the world's biggest stablecoin look to capitalize on the Central American country's bid to become a hub for crypto trading. Tether has emerged as a dominant force in the booming market for stablecoins, which are designed to maintain a constant value by being pegged to traditional currencies and offer users a way to move money between cryptocurrencies without exposure to price swings. CEO Paolo Ardoino told Reuters that Tether would relocate to El Salvador after the cryptocurrency recently obtained a license there as a digital asset service provider. Ardoino and his fellow managers and cofounders of Tether will also move their residences to El Salvador, he said. Previously, the company was incorporated in the British Virgin Islands. "This move to El Salvador will be the first time we're going to have also a physical headquarters," he said. But not all of the company's 100-plus employees will move there, he said, adding that many of the staff work remotely. The company plans to hire 100 Salvadorans over the next several years, he said. The booming market for stablecoins has worried regulators concerned that growing stablecoin reserves expose the broader financial system to bigger risks, because they act as a bridge between the crypto universe and mainstream financial markets. Tether has faced questions around its reserves and does not fully disclose where they are held or in what form. The firm says the vast majority of its stablecoin is backed by traditional currency reserves held with Wall Street brokerage Cantor Fitzgerald, whose CEO, Howard Lutnick, has been nominated to head the U.S. Commerce Department under President-elect Donald Trump. "So we have some liquidity on other banks, but the vast, vast majority of the T-Bills are in Cantor," Ardoino said. BOOSTING MONITORING OF TOKENS The company said last year it was increasing monitoring of how its tokens are used to combat illicit finance. Asked whether Tether had considered alternative locations for its headquarters, Ardoino said it lacked a license to operate in the European Union and had ruled out the United States for now. It was "quite premature" to predict possible changes that might be implemented under Trump, he said. Trump's victory in the November U.S. election sparked a record rise in cryptocurrency prices. The Republican has vowed to introduce a friendlier regulatory environment for crypto and said he planned to create a U.S. bitcoin strategic reserve. El Salvador is seeking to become a hub for digital currency trading, and three years ago President Nayib Bukele made it the first country to establish bitcoin as legal tender, alongside the dollar. "Welcome home," Bukele wrote on social media platform X in response to Tether's announcement. In a separate post on Monday, Bukele asked the CEO of Rumble (RUM.O) , opens new tab, Chris Pavlovski, to consider moving the headquarters of the video-sharing platform to El Salvador. Days earlier, the company announced a cloud services agreement with Bukele's government. Tether's eponymous dollar-pegged token (USDT) accounts for roughly two-thirds of the $212 billion worth of stablecoins in circulation, according to CoinGecko data. The overall market has grown around 45% over the last year, the data shows. Sign up here. https://www.reuters.com/technology/crypto-firm-tether-its-founders-finalising-move-el-salvador-2025-01-13/

2025-01-13 16:05

Reeves seeking to slow selloff in UK assets UK government hit by rising bond yields over past week Sterling has fallen to lowest since Nov 2023 Few clear options for Reeves and Starmer in short term U.S. politics and economy driving global markets LONDON, Jan 13 (Reuters) - Britain's finance minister Rachel Reeves and Prime Minister Keir Starmer are seeking to stem a market slump, but for now what happens next to rising government borrowing costs and the falling pound is largely beyond their control. Donald Trump and U.S. economic data are likely to have a bigger influence on whether this month's UK selloff proves to be a blip or the start of a crisis for Starmer's government, elected last July. Reeves, visiting China at the weekend, said her targets for fixing the public finances - which have been hit by the rise in borrowing costs - were non-negotiable and "we will take actions to ensure that we meet those fiscal rules". Early on Monday, 30-year gilt yields hit a new post-1998 high and sterling fell to its lowest since November 2023. Asked about the market situation, Starmer told reporters his team would be "ruthless" about repairing the budget. The government has blamed previous Conservative governments for damaging the economy and public finances after the shocks of Brexit and the mini-budget crisis under former Prime Minister Liz Truss in 2022. But Reeves has limited options to change the tone in markets. If Britain's budget forecasters say on March 26 that Reeves is off-course to meet her fiscal rules, she could announce future spending cuts to get them back on track. She already plans a lot of spending restraint, however, and the prospect of more pain would anger many of the governing centre-left Labour Party's members and voters. The option of more tax hikes seems to be off the table with firms cutting hiring after Reeves hit them with higher social security contributions in her October budget. "It's a tough balancing act with no easy solutions," Hetal Mehta, head of economic research at St. James's Place, said. Reeves is due to make an economic growth speech in the coming weeks before setting out a detailed plan in a two-year Spending Review expected in June. Measures announced so far for speeding up the economy are only expected to have a meaningful impact in the 2030s. TRUMP TAKES OVER Reeves' next full budget is due in October or November, by which time the global economic picture could be very different. U.S. President-elect Trump's promise to impose additional tariffs on imports is widely expected to push up U.S. inflation and investors are pricing in only one interest rate cut by the U.S. Federal Reserve in 2025. With British gilts often moving in line with U.S. Treasuries, the chance of yields falling sharply look slim if Trump goes through with his tariff plan. Then there is Britain's reliance on what former Bank of England Governor Mark Carney called "the kindness of strangers" to offset its large current account deficit, the second-biggest in the Group of Seven after the United States. Sanjay Raja, Deutsche Bank's chief UK economist, said many of those strangers are proving more fickle than in the past, with pension and insurance funds - which often need to hold bonds long-term for regulatory reasons - taking only 20% of sales of new government debt, down from 75% two decades ago. Foreign ownership is up, meanwhile, largely due to the rise of hedge funds. "This, in our view, explains to some extent why gilt volatility has also picked up significantly in recent years, as more foreign ownership has made the gilt market more volatile," Raja wrote in a note to clients on Friday. Also beyond the Reeves' control are Bank of England interest rate decisions. Investors currently see a roughly 75% chance of two quarter-point BoE rate cuts in 2025, fewer than the almost four expected from the European Central Bank. A much stronger-than-expected U.S. payrolls report on Friday - which suggested little need for the Fed to speed up its rate cuts - took a whole U.S. cent off the value of the pound. Some analysts believe the BoE might see the rise in market borrowing costs as slowing the economy, strengthening the case for faster rate cuts. But inflation, wage deals and inflation expectations remain too high for comfort for the BoE. Ben Zaranko, a senior research economist at the Institute for Fiscal Studies think tank, said Reeves would probably avoid rushing out short-term measures to settle financial markets that could be seen as a sign of panic within the government. "I'm not convinced she needs to do anything big to change the mood," Zaranko said. "But it clearly makes her life difficult going into the spring and the summer." Mehta at St James's Place said the big unknown for Reeves remained the outlook for the world economy. "Growth is definitely the thing in the short, medium and long term," she said. "That is the bigger headache. You have to hope the global picture ends dragging the UK up." Sign up here. https://www.reuters.com/world/uk/uks-reeves-struggles-find-ways-out-market-slump-2025-01-13/

2025-01-13 15:46

NEW YORK, Jan 13 (Reuters) - A unit of Bank of Montreal (BMO.TO) , opens new tab agreed to pay $40.7 million to settle U.S. Securities and Exchange Commission charges that it failed to supervise employees who misled investors about the attractiveness of mortgage-backed bonds the bank was selling. The settlement announced by the SEC on Monday includes a $19 million civil fine. It resolves charges that BMO Capital Markets employees used offering sheets and metrics that inaccurately described collateral backing more than $3 billion of so-called Agency CMO bonds from Dec. 2020 to May 2023. Agency CMO bonds are backed by pools of residential mortgages, and issued by Fannie Mae, Freddie Mac and Ginnie Mae. They are considered low risk because of guarantees of principal and interest payments or other government support. The SEC said BMO structured some bonds with a sliver, often just $1,000, of mortgages with higher interest rates, in a way that suggested the bonds were backed by large amounts of the mortgages, making them more appealing to investors. BMO did not admit or deny wrongdoing in agreeing to settle. Its payment includes the $19 million fine, $19.42 million of disgorgement and $2.24 million of interest. BMO also agreed to a censure. In a statement, it said: "We hold ourselves to the highest standards of fair and ethical conduct, and continuously review and enhance our controls and supervisory framework. We're pleased to have this matter behind us." According to the regulator, BMO bankers spoke about changing the bonds' "cosmetics" to boost sales. Outsiders noticed, with one market participant complaining to a BMO banker in June 2022 that the bank was "not selling what is advertised," the SEC said. Sign up here. https://www.reuters.com/business/finance/bmo-unit-pay-407-million-us-sec-settlement-over-misleading-bond-sales-2025-01-13/

2025-01-13 12:55

Jan 13 (Reuters) - Barrick Gold (ABX.TO) , opens new tab on Monday recommended that its shareholders reject an unsolicited offer by TRC Capital Investment to buy about 0.29% of the miner's common stock. The gold miner said it had received notice of an unsolicited mini-tender offer made by TRC Capital to purchase up to 5 million of Barrick's common shares, adding that it was at a below-market price of C$21.35 apiece. TRC Capital has made several similar unsolicited mini-tender offers for shares of other public companies including Occidental Petroleum (OXY.N) , opens new tab and Johnson & Johnson (JNJ.N) , opens new tab. A mini tender is an offer to purchase no more than 5% of a company's shares. Sign up here. https://www.reuters.com/markets/commodities/barrick-gold-recommends-shareholders-reject-mini-tender-offer-by-trc-capital-2025-01-13/

2025-01-13 12:45

Venture Global launches 2025's first blockbuster US IPO LNG exporter seeks as much as $2.3 bln in New York IPO Set to be one of the biggest US energy listings ever Venture Global has vaulted into the top ranks of LNG exporters Jan 13 (Reuters) - Venture Global is targeting up to $110.38 billion valuation in its U.S. initial public offering, the liquefied natural gas exporter said on Monday, setting the stage for 2025's first blockbuster stock market flotation. The Arlington, Virginia-based company is seeking to raise up to $2.30 billion by offering 50 million shares priced between $40 and $46 each. Reuters exclusively reported on Saturday that Venture Global was set to formally pitch the highly anticipated IPO to investors this week. The IPO comes amid growing global LNG demand as the world shifts towards renewable energy and countries seek a cleaner alternative to coal and oil. The United States, a major LNG supplier to Europe and Asia, has emerged as the world's largest exporter of the superchilled gas, thanks to its abundant natural gas reserves and the development of LNG terminals along the Gulf Coast. President-elect Donald Trump's incoming administration is widely expected to bring an end to Biden administration's pause on LNG export approvals. Venture Global currently has five LNG projects in various stages of development near the Gulf of Mexico in Louisiana. The company has raised roughly $54 billion of capital for its projects and generated about $19.6 billion in gross proceeds from LNG sales as of Sept. 30. A $2.30 bln IPO would be among the biggest energy listings ever in New York and the largest in more than a decade. Conoco's $4.4 billion offering in 1998 was the biggest energy New York IPO ever by a U.S.-based company, followed by Kinder Morgan's (KMI.N) , opens new tab $3.3 billion flotation in 2011, according to data compiled by LSEG. METEORIC RISE Venture Global was founded in 2013 by two industry outsiders - former investment banker Michael Sabel and financial lawyer Robert Pender. Since then, Venture Global has rapidly grown into one of the biggest U.S. LNG exporters, competing with names such as Cheniere Energy (LNG.N) , opens new tab, Freeport LNG, and Sempra (SRE.N) , opens new tab. The company began generating proceeds in 2022 when its first facility, Calcasieu Pass, started producing the superchilled gas. Plaquemines, its second facility, began producing the superchilled gas last month, becoming the first new U.S. LNG plant to start operations since 2022. Once fully operational, Plaquemines will be among the world's biggest LNG facilities. Sabel and Pender will continue to control over 50% of the voting power after the offering. Goldman Sachs, J.P. Morgan and BofA Securities are the lead underwriters. Venture Global will be listed on the New York Stock Exchange under the symbol "VG". Sign up here. https://www.reuters.com/business/energy/lng-exporter-venture-global-seeks-up-110-bln-valuation-us-ipo-2025-01-13/