Rumor Mill Puts Banks In A Tough Spot

In the world of financial stocks, fear and rumor have the upper hand.

Bank executives and regulators globally are facing a grueling test as the swift demise of Bear Stearns Cos. has left investors grasping at rumors, sending stocks gyrating at the slightest whiff of trouble. Yesterday, HBOS PLC, the United Kingdom's largest mortgage lender by gross lending, publicly denied that it had funding problems, as its stock took a wild ride.

Shares of securities firms Lehman Brothers Holdings Inc. and MF Global Ltd. also have been roller coasters in the past few days amid worries of a cash crunch.

At 8:30 a.m. in London yesterday, rumors spread that HBOS was short on cash. That prompted the Financial Services Authority, the U.K. markets regulator, to issue a highly unusual statement that it was investigating the possibility that traders were seeking to profit on investors' concerns, by spreading 'false rumors' about troubles at U.K. banks.

A Bank of England spokesman denounced as 'utter rubbish' that the central bank had met with U.K. banks about providing emergency funding.

After an 18% drop in the first 50 minutes of trading, HBOS shares recovered to end down 7.1% at 446.25 pence ($8.96) on the London Stock Exchange.

In the U.S., the downfall of Bear Stearns has prompted a Securities and Exchange Commission investigation of a spike in options contracts betting that the company's stock price would drop precipitously, according to a person familiar with the matter. Bear tried feverishly -- but unsuccessfully -- last week to reassureinvestors and customers of its prime-brokerage business, which makes loans and executes trades for hedge funds, that its financial footing was sound.

Regulators face a delicate task when dealing with rumors. Issuing public statements denying there is trouble could set a precedent. Saying nothing could be interpreted as a signal that the speculation is true.

The fears spawned by baseless rumors can nevertheless create 'a self-fulfilling prophecy,' especially at companies that rely on customer confidence, says Michael Gooch, chief executive of GFI Group Inc., a New York brokerage firm that arranges trades between investment banks. GFI saw its shares tumble as much as 50% Monday amid rumors of possible trading losses.

The company said the speculation was groundless because GFI just collects commissions and doesn't take any trading risks.

Also whipsawed by speculation has been MF Global, a brokerage firm catering to clients who use futures and options to take high-stakes bets on market moves. On Monday, the company denied that British billionaire Joseph Lewis, who stands to lose almost all of his investment of more than $1 billion in Bear Stearns, was either a big MF Global customer or a major shareholder. Another rumor: MF Global faced losses in repurchase securities, where big investment dealers swap cash and securities for short periods. That sent the stock down 65%.

MF said it doesn't borrow using the repurchase market. A spokesman for Mr. Lewis said he has 'absolutely nothing to do with MF Global.'

Despite issuing a letter to employees Tuesday and a news release yesterday, MF Global saw its shares slide 46% from their Friday closing price. Yesterday, the stock rose $1.19, or 15%, to $9.36 in 4 p.m. New York Stock Exchange composite trading.

'It is deeply disappointing and frustrating to have these types of rumors erode confidence in a company that is performing well,' Jeremy Skule, MF Global's vice president of investor relations, said in an interview.

At HBOS, analysts following the bank had issued reports expressing increasing concern that HBOS and other U.K. banks faced funding questions. Yesterday, HBOS spokesman Shane O'Riordain said the bank has ready access to large retail deposits and continues to access other borrowings. 'HBOS is one of the strongest financial institutions in the world,' Mr. O'Riordain said.

Within 20 minutes of the market's opening in London yesterday, HBOS fell 3.5%. A half-hour into trading, rumors began spreading among traders that HBOS was having cash problems, prompting media inquiries to HBOS, a person familiar with the matter said.

Mark Lovett, who manages funds at RCM Ltd.'s London office, said he heard the rumor from his trading desk. He says his reaction was: 'It's extraordinary. We are in pretty jittery times.' Mr. Lovett declined to discuss his holdings.

HBOS officials quickly began speaking with or phoning newswires and newspapers to say there were no liquidity problems. But the stock kept sliding. By 9:30 a.m., bank trading desks at London's Canary Wharf financial district were sorting through other rumors, too. Other bank stocks, such as Barclays PLC and HSBC Holdings PLC, fell, though not as sharply.

At about 10 a.m., the Bank of England phoned the FSA, where officials already had noticed the sharp price moves, people familiar with the situation said. At the central bank's office in the City, London's other financial district, Bank of England officials were fending off as untrue a rumor that Governor Mervyn King had canceled a trip to Asia. By 11 a.m., Bank of England officials decided to take the unusual step of making public statements saying they hadn't had emergency meetings with U.K. banks to discuss funding-and weren't planning to. The Bank's coming meeting with financial institutions was previously scheduled, the Bank said. By this time, the FSA and Bank of England feared that investors who profit when shares fall -- by borrowing shares and selling them and then buying replacement shares later at a lower price -- were behind the rumors.

At about lunchtime, SallyDewar, who oversees wholesale and institutional markets for the FSA, issued a statement denouncing 'a series of completely unfounded rumors about UK financial institutions in the London market over the last few days, sometimes accompanied by short-selling. We will not tolerate market participants taking advantage of the current market conditions to commit abuse by spreading false rumors and dealing on the back of them.'

眼下，传言和恐慌充斥着金融领域，大有一种山雨欲来风满楼的氛围。

贝尔斯登轰然倒下的消息让投资者在各种传言面前变得草木皆兵，稍有风吹草动，股市便有可能出现轩然大波。在这种局面下，全球银行业人士和监管机构都面临着严峻考验。周三，英国规模最大的抵押贷款银行HBOS PLC股价大幅震荡，该行随后公开否认出现了资金问题。

由于市场对现金问题倍感担忧，雷曼兄弟(Lehman Brothers Holdings)和MF Global Ltd.的股价过去几天也彷佛坐上了过山车。

周三早晨8点30分，伦敦有传言说，HBOS已出现资金短缺。英国金融服务管理局(Financial Services Authority)因此很快就一反常态地高调发表声明，称已在调查是否有交易员利用投资者的担忧心理传播针对英国银行的"虚假传言"以乘机渔利。

针对有关央行已和本土银行进行了接触，欲向后者提供紧急注资的传言，英国央行发言人谴责这纯属"一派胡言"。

HBOS股价在开始交易后50分钟内暴跌18%，不过收盘时跌幅收窄至7.1%，收盘报446.25便士，合8.96美元。

另据知情人士说，美国方面，鉴于贝尔斯登股价急速下挫，美国证券交易委员会(SEC)已开始调查贝尔斯登看跌期权规模急速膨胀一事。上周，贝尔斯登曾竭力安抚其大宗经纪业务的投资者和客户，希望让他们相信，其财务实力仍很健康。

监管机构现在面临着对付各种传言的棘手问题。发表公开声明否认遇到麻烦可能要创下先例，但什么也不说又可能被解读为是低头默认。

但是，纽约经纪公司GFI Group的迈克尔•古奇(Michael Gooch)说，因无端传言而生出恐慌可能会演化成一种"自我实现的预言"，对于那些高度依赖客户信任感的行业更是如此。GFI的股价周一大跌50%，有传言称该公司可能出现了交易损失。

这家公司表示，这传言完全是无稽之谈，因为GFI只是为投资银行提供服务的中间商，只收取佣金，它并不直接参与交易，因此不会有交易方面的风险。

被传言重击的还有为期货和期权投资者提供服务的MF Global。该公司周一否认了英国富豪约瑟夫•刘易斯(Joseph Lewis)是其客户乃至主要股东的说法。刘易斯在贝尔斯登超过10亿美元投资眼下即将化为乌有。不仅如此，还有传言说MF在股票回购上面临损失。这双重打击之下，MF股价当天重挫65%。

MF回应说，它从不通过回购市场融资。而刘易斯的发言人也说，跟MF Global绝对没有关系。

虽然MF Global向员工发了信，周二还发了新闻稿，但当天其股价仍较周五大跌46%，到周三才有所回升。

MF Global负责投资者关系的副总裁杰瑞米•斯考尔(Jeremy Skule)在接受采访时说，对一家经营很好的公司来说，遭遇这样的谣言真是太让人失望、太让人沮丧了。

跟踪HBOS的分析师此前曾发表报告，对该行及其他英国银行面临的资金问题表现出越来越严重的担忧。该行发言人西恩•奥瑞尔迪安(Shane O'Riordain)周三表示，该行有充裕的零售存款可以动用，并且还在使用其他融资渠道。他说，HBOS是世界上财务实力最强的机构之一。

周三伦敦股市开盘后20分钟的时候，HBOS下跌了3.5%。一位知情人士说，交易30分钟的时候，交易员中间开始有传言说，HBOS资金方面有问题。立刻有媒体询问HBOS此事。

RCM Ltd.驻伦敦基金经理马克•洛维特(Mark Lovett)说，他是在交易室听说这个传言的。他说他当时的反应就是：这太不同寻常了；大家都处在一个非常敏感躁动的时刻。洛维特拒绝透露他的持仓情况。

HBOS的管理人士迅速约见或致电新闻通讯社和报纸，声明公司根本没有流动性问题；但是该股的跌势丝毫没有得到缓解。截至上午9:30，位于伦敦金融中心Canary Wharf的各家银行交易室还充斥着各种传言。巴克莱银行(Barclays Bank PLC)及汇丰控股(HSBC Holdings)等银行的股票也未能幸免，只不过它们的跌幅较小。

知情人士透露，到了上午10时左右，英国央行给金融服务局去电，而那时该局的官员已经注意到了HBOS股价的急剧变化。在英国央行位于伦敦的办公室里，央行官员正忙于驳斥另一条不实传言，即行长默文•金(Mervyn King)已经取消了他的亚洲之行。到了11点，英国央行决定采取非常规手段，发表声明称他们没有和本国银行就融资问题召开紧急会议，而且也没有这样的打算；并表示央行和金融机构举行的会议都是事先就安排好的。此时金融服务局和英国央行开始担心是那些从HBOS股价大跌中猛赚了一笔的空头编导了这则谣言。

快到午餐时间，金融服务局负责批发及机构市场的莎丽•德沃(Sally Dewar)发表声明，对"过去几天针对伦敦金融交易机构的一系列毫无根据的传言"予以谴责。声明还指出："这些传言有时伴随着做空交易。金融服务局不能容忍市场参与者趁当前形势动荡，以散布谣言、幕后操纵的手段从中渔利。
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