Bershidsky on Europe: Banker in Murder-Suicide
Here's today's look at some of the top stories on markets and politics in Europe.
Ukraine's richest man urges separatists to stand down.
Ukraine's richest man Rinat Akhmetov, whose fortune Bloomberg estimates at $11.8 billion, came out to talk to pro-Russians demanding secession from Ukraine in his home city of Donetsk. For Akhmetov, who usually operates behind the scenes, this was a highly unusual move, but the situation in the east and south of Ukraine had become so fraught that he had little choice. Akhmetov told the separatists that, as far as he was concerned, Donetsk was and would remain part of Ukraine but that he supported a greater degree of autonomy for the eastern regions. With the right amount of autonomy, that is exactly what Moscow wants: Swallowing up parts of continental Ukraine may be unpalatable to Russian President Vladimir Putin, but he needs influence on them to keep Ukraine within his orbit. Meanwhile, clashes continued in other Ukrainian cities such as Kharkov and Nikolaev, where 10 people were wounded in a shootout between separatists and Ukrainian nationalists. The Kiev authorities have limited ability to put down the protests, and they fear provoking Russia. It is hard to see how anything but negotiations between Russia, Ukraine, the EU and the U.S. can lead to a peaceful settlement.
EU deal on bank failures undermined .
The U.K. has voiced last-minute objections to an EU scheme for rescuing failing banks. They concern a seeming technicality: whether a central bank can extend liquidity when relying on a government guarantee, without triggering a haircut for a bank's bondholders. The U.K. believes this should be allowed, while other EU members, such as the Czech Republic and Denmark, are against it on the grounds that it would be the same as allowing taxpayer-funded bailouts again. For their part, France, Italy, Sweden and Portugal want even broader powers for governments to bail out banks. The European Parliament is opposed to their demands, favoring the agreed bail-in mechanism. The parliament is supposed to vote on the deal within days, but member states are busy renegotiating it. That raises the question whether the EU really needs the banking agreement that so many members find wanting for different reasons. Perhaps a much simpler framework would be a better fit.
"Russian Zuckerberg" sued by social network shareholder.
Pavel Durov, founder of Vkontakte, the Russian social network with 60 million daily users, has been sued by the private equity fund UCP, which owns 48 percent of the company. The funddemands that Durov give up his more recent product, the increasingly popular over-the-top messenger Telegram, to the social network because, it claims, the software was developed by Vkontakte programmers on company time. UCP also claims that Durov, as the network's chief executive, paid himself large bonuses and spent inordinate amounts of money on entertainment and charter flights. Durov, for his part, is suing UCP to overturn the deal in which it acquired Vkontakte shares. The squabbles between the founder and the shareholders, however, are having no effect on the social network's popularity: It is still full of pirated content, and young Russian users flock to it regardless of whether anyone runs it or not.
Turkish central bank governor defies Erdogan.
Erdem Basci, the Turkish central bank governor, on Monday rejected Prime Minister Recep Tayyip Erdogan's call for an interest rate reduction. "The timing of interest-rate cuts would be discussed by the Monetary Policy Committee," Basci said. "The central bank may take measured steps toward rate cuts in the future. But a big rate cut shouldn't be expected." Erdogan is said to have influenced the central bank's interest rate decisions in the past. Now, Basci is pointedly showing his independence. Despite Erdogan's convincing victory in local elections, in recent weeks he has been similarly challenged by Turkey's top court, which overruled his ban on Twitter, and even his long-time ally President Abdullah Gul spoke out against the ban. Erdogan's almost certain bid for the presidency this fall will not go unhindered: Irritation with his authoritarian tendencies is still strong within the elite, even though he clearly enjoys popular support.
Dutch banker killed wife, daughter and himself.
According to Dutch police, former ABN Amro Netherlands chief executive Jan Peter Schmittmann committed suicide after killing his wife and one of their daughters. He had been severely depressed. Police found a note in the house where the deaths took place. Schmittmann had run the large Dutch bank until its nationalization in the wake of the 2008 financial crisis and received an $11 million golden parachute, though the Dutch government fought it. The banker's death is the 12th high-profile suicide in the industry this year. Financiers have killed themselves in the U.S., London, Singapore, Hong Kong and now near Amsterdam. One cannot help but wonder if there isn't something fundamentally wrong with the industry: It's not even having one of its worst years, but outwardly successful people within it are taking their lives with increasing frequency.
This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.
Leonid Bershidsky writes on Russia, Europe and technology for Bloomberg View. Follow him on Twitter at @Bershidsky.
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