French Banks Seen Resisting Capital Crackdown

By Lionel Laurent

(Reuters) - French banks are likely to stand pat and resist the fresh wave of capital increases across the sector ahead of Europe-wide stress tests this year, helped by a protective regulator and benign borrowing costs.

In recent weeks, several banks including Italy's Intesa Sanpaolo and Germany's Commerzbank have announced plans to tap shareholders for fresh equity ahead of tougher incoming capital rules under the "Basel III" regime.

But French lenders such as BNP Paribas and Societe Generale -- which report first-quarter results on Wednesday and Thursday respectively -- are seen sticking to their guns and refusing to take part in the race for cash, thanks in part to the Bank of France's support.

"There is less need for the regulator to ask French banks to carry surplus capital (than in other countries)," said Yohan Salleron, fund manager at Mandarine Gestion, with 1 billion euros ($1.5 billion) under management. "Their business model is less risky ... and they have sizeable deposits."

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Flop Art: Warhol Dream Fund Turns To Nightmare

By Lionel Laurent

As the financial crisis loomed in late 2007, Federico Moccia was in an upbeat mood.

The 40-year-old ex-JPMorgan banker with a penchant for works by pop artist Andy Warhol had created a $600 million hedge fund and was preparing to move to Asia to woo the region's deep-pocketed investors.

After making a big impression on the Singapore art scene with his recent Warhol exhibition, Moccia was confident the brewing U.S. subprime mortgage meltdown could not dent his plan to stoke returns from his "Cannonball" fund with art and real estate investments.

"I had received a working permit from the Singapore authorities," recalls Italian-born Moccia, speaking from his London office. "The future was bright."

Moccia never got there.

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BNP Hedge Fund Unit Tightens Rules In Stormy Market

(This story had the dubious honour of being parodied by Michael Fowke's 'Money Is The Way' blog, which reads a bit like Ezra Pound channeling Jim Cramer.)

By Lionel Laurent

PARIS, April 13 (Reuters) - A $110 million hedge-fund portfolio part-advised by BNP Paribas subsidiary Fauchier Partners is to impose tougher rules on cash withdrawals by investors, after a volatile month for the hedge-fund industry.

The Fidam fund, whose main investment advisor is Cayman Islands-based Fides, will require three months' notice for redemptions instead of one from April 30, according to a letter seen by Reuters.

"The redemption notice period...will be extended to three months plus six calendar days prior to the relevant valuation day," Fidam's board wrote on March 30.

"The notice period may be waived at the discretion of the board of directors provided the relevant sub-fund has sufficient liquid assets to accommodate the redemptions and a fair treatment of all investors is assured."

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AXA CEO Insists Strategy Will Pay Off

By Lionel Laurent and Nina Sovich

PARIS, April 1 (Reuters) - AXA's chief executive Henri de Castries is facing growing questions about the French insurer's push into emerging markets and anaemic share price performance, but the 57-year-old former paratrooper says he is confident his strategy will win through.

Although AXA shares have strongly rebounded this year after a dismal performance in 2010, they trade at among the lowest price-to-book multiples in the sector and are plagued by perceptions that the group is ill-equipped for a post-crisis world.

In an interview with Reuters de Castries blamed the stock's underperformance on exposure to rock-bottom interest rates in Europe and the United States, as well as difficulties closing a long-running deal to buy out its Asia-Pacific operations.

But he said the group's 2015 turnaround plan and the closure of the AXA Asia-Pacific deal would close the valuation gap and prove that there is no need to adjust the strategy.

"It's clear that the sector has not been performing well and last year we have been performing worse than the sector," de Castries said.

"But it is in the process of being corrected because our actions are becoming more visible and because long-term interest rates are not the threat they were seen as being last year."

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