Finance & Economics

Skadden on Revisiting Share Repurchases in Volatile Times

By David Goldschmidt, Mike Zeidel, Laura Kaufmann Belkhayat, Yossi Vebman and Sebastian Sanchez Rivera April 12, 2022 by renholding

In light of the recent increased volatility in the global financial markets,¹ a number of companies have raised questions regarding the desirability of repurchasing shares at reduced market prices. This alert addresses questions surrounding share repurchases that companies should …

When Biden Met Crypto: Thoughts on the President’s Executive Order

By Hadar Y. Jabotinsky and Roee Sarel April 1, 2022 by renholding

On March 9, 2022, President Biden signed an executive order (“the Order”) requiring federal agencies to submit reports on how cryptocurrencies relate to various issues, including money laundering, investor protection, international cooperation, central bank digital currencies (“CBDC”), and systemic risk. …

ISS on Addressing the Looming Water Crisis in Investment Portfolios

By Cosima Reiff, Erina Molina and Erin Wood April 1, 2022 by renholding

Water means life. More than half of our bodies consist of water, and it is an indispensable resource for production of food and other goods. It is fundamental for societies and ecosystems alike. While water covers approximately 70 percent of

…

New Department of Labor Investment Rules Could Be Big Win for Everyone but Labor

By David H. Webber March 28, 2022 by renholding

Few constituencies benefited more from the election of Joe Biden than the socially-responsible investor community, which saw the most-hostile presidential administration replaced by the most supportive.[1] The point is best illustrated by the departure of Labor Secretary Eugene Scalia, …

Sullivan & Cromwell Discusses Federal LIBOR Transition Legislation

By Jordan Wish, Rodge Cohen and Ben Weiner March 21, 2022 by renholding

On March 15, 2022, President Biden signed into law the “Consolidated Appropriations Act, 2022,” which enjoyed significant bipartisan support and contains, as Division U, the “Adjustable Interest Rate (LIBOR) Act” (the “LIBOR Act”).[1]  The LIBOR Act provides a uniform …

Debevoise Discusses Russia, Sanctions, and Digital Assets

By Satish M. Kini, Aseel M. Rabie, Robert T. Dura, Jonathan Steinberg and Amy Aixi Zhang March 9, 2022 by renholding

In response to ongoing Russian military action in Ukraine, U.S. authorities have imposed several tranches of new sanctions against Russia, particularly against Russia’s financial industry, including its major banks and the Central Bank of Russia. On February 26, President …

SPACs and PIPEs as Efficient Tools for Corporate Growth

By Frank Fagan and Saul Levmore March 8, 2022 by renholding

A SPAC can be understood as an alternative to an IPO, with investors using a large investor, a PIPE, to find out whether the SPAC founder has really chosen a good target or is simply rushing to get a big …

How Firms’ Simultaneous Release of Information Affects Market Feedback

By Mustafa Ahci, Tim Martens and Christoph J. Sextroh February 24, 2022 by renholding

Can managers obtain more useful feedback from capital markets by disclosing pieces of information separately and at different times instead of bundling the information and releasing it at once? It is well known that capital markets’ response to firms’ announcements …

An Academic Critique of the SEC’s GameStop Report

By Joshua Mitts, Robert H. Battalio, Jonathan Brogaard, Matthew D. Cain, Lawrence R. Glosten and Brent Kochuba February 22, 2022 by renholding

On October 18, 2021, SEC staff released a long-awaited report on equity and options trading in connection with the meteoritic rise of GameStop’s share price in January 2021.  The staff report addressed several issues surrounding the GameStop episode, but one …

Strategically Staying Small: Regulatory Avoidance and the Community Reinvestment Act

By Jacelly Cespedes, Jordan Nickerson and Carlos Parra February 18, 2022 by renholding

Banks operate in one of the nation’s most heavily regulated industries, where policy intervention aims for wide-ranging goals that include limiting risk, protecting consumers, and ensuring fair treatment of individuals through equal access to credit. The Community Reinvestment Act (CRA), …

The Breakdown of the Public–Private Divide in Securities Law

By George S. Georgiev February 14, 2022 by renholding

Securities law in the United States has traditionally been designed around a set of lines – the “public–private divide” – which separate public companies, public capital, and public markets from private companies, private capital, and private markets. Until the early …

ISS Reviews ESG Equity Indices in 2021

By Hernando Cortina January 28, 2022 by renholding

With some exceptions, 2021 was a generally strong year for equity markets around the world. Impressively, passive ESG products such as ETFs garnered significant inflows of over $150 billion dollars and saw asset under management growth of over 80% globally.

…

Fintech SPACs Have Been Swimming Naked – and the Tide Is Going Out  

By Todd H. Baker January 27, 2022 by renholding

Acorns Grow Inc., the financial technology and investing startup, said last week that it was abandoning its $2.2 billion merger with SPAC Pioneer Merger Corp., putting itself on the hook for a $17.5 million termination fee. Coming almost eight months …

It’s Time to Regulate Stablecoins as Deposits and Require Their Issuers to Be FDIC-Insured Banks

By Arthur E. Wilmarth, Jr. January 17, 2022 by renholding

In November 2021, the President’s Working Group on Financial Markets (PWG) issued a report analyzing the rapid expansion and growing risks of the stablecoin market.[1]  Stablecoins are digital assets that claim to maintain a “stable” value with reference to …

Financing Sustainable Entrepreneurship

By Paul P. Momtaz and Sasan Mansouri January 13, 2022 by renholding

At least since BlackRock boss Larry Fink’s annual letter to CEOs in 2019, investing in ESG assets has become a major topic among both retail and institutional investors. In a new article, we address the question of how economically attractive …

How Rating Agencies’ Market Power Affects Credit Rating Standards

By Mingyi Hung, Pepa Kraft, Shiheng Wang and Gwen Yu January 6, 2022 by renholding

Global credit rating agencies (CRAs) like S&P and Moody’s are important gatekeepers for the debt market. The demand for their ratings has increased at an unprecedented rate in the past two decades due to an extraordinary growth in cross-border debt …

ISS Discusses Increase in Fund Flows for 2021

By Christopher Davis January 4, 2022 by renholding

Back to normal doesn’t mean what it used to. Following a year like no other, demand came roaring out the gate in 2021. While the pace of new demand has slowed somewhat in recent months amidst concern of new COVID

…

Paul Weiss Discusses LIBOR Transition and SOFR Alternative

By Jane O’Brien, Manuel Frey, Jessica Carey, Amy Barton and Hilary Christian December 24, 2021 by renholding

As previously reported, the LIBOR settings for one-week and two-month USD LIBOR tenors will cease being representative after December 31, 2021.^[1] This cessation is expect to have less of an impact because these tenors are not as widely used

…

How Optimistic Earnings Forecasts Are Kept in Check

By Zachary Kaplan, Xiumin Martin and Yifang Xie December 21, 2021 by renholding

Consensus earnings estimates, prominently quoted at major media outlets such as CNBC, Bloomberg, and the Wall Street Journal, play an important role in capital markets by providing investors with a proxy for earnings expectations.  The common belief is that they …

China Experiments with Cross-Border Payments of Central Bank Digital Currencies

By Lerong Lu and Alice Lingsheng Zhang December 17, 2021 by renholding

According to the Financial Stability Board (FSB), there is a consensus among major economies, such as the G20, to enhance cross-border payments.[1] Providing faster, cheaper, and more transparent and inclusive cross-border payment services would be beneficial for citizens, businesses, …