1. KPMG Slammed With £21M Fine for Audit Failures
2. China’s Central Huijin Boosts Stakes in Big Banks
3. Birkenstock’s IPO Flops in Worst $1B+ Debut in Two Years
4. U.S. CPI Rises 0.4% in September
5. Manhattan Apartment Rents Finally Drop
6. U.S. Blue-Chip Bond Issuance Surpasses $1 Trillion
7. AccorInvest to Sell €2B in Hotels to Repay Debt
1. KPMG Slammed With £21M Fine for Audit Failures
The UK’s Financial Reporting Council (FRC) announced that KPMG committed numerous serious violations during its audit of construction and facilities firm Carillion Plc — even breaching basic auditing principles.
Carillion collapsed in 2018 after the UK government declined to intervene, resulting in 3,000 job losses and leaving £2 billion owed to 30,000 suppliers and contractors.
KPMG CEO Jon Holt admitted the regulator’s findings were “painful” and called the audit “very poor.” KPMG has been fined a record £21 million.
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2. China’s Central Huijin Boosts Stakes in Big Banks
According to filings released Wednesday, China’s sovereign wealth fund Central Huijin Investment has purchased $65 million worth of shares in the country’s largest banks, with plans to continue buying over the next six months.
The purchase marks the largest of its kind since 2015, signaling regulators’ growing concern over the economy.
Economists and hedge funds are increasingly recommending direct government intervention and the establishment of a stabilization fund to support the stock market.
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3. Birkenstock’s IPO Flops in Worst $1B+ Debut in Two Years
German footwear brand Birkenstock fell 12.6% in its U.S. IPO on Wednesday, marking the worst debut among U.S.
IPOs raising more than $1 billion in the past two years.
Birkenstock is the fourth major IPO in the past month.
Its $46 offering price was mid-range, and the company sold 10.8 million shares, while private equity firm L Catterton offloaded 21.5 million shares.
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4. U.S. CPI Rises 0.4% in September
U.S. CPI rose 0.4% in September, driven largely by energy costs, while core CPI (excluding food and energy) rose 0.3%, according to the Bureau of Labor Statistics.
Some Fed officials now suggest the central bank might pause rate hikes at the upcoming November 1 meeting, meaning interest rates may stay unchanged for the remainder of the year.
Housing, auto insurance, and sports tickets saw significant price increases.
Used car prices recorded their steepest drop of the year, and motorcycle parts hit an all-time low.
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5. Manhattan Apartment Rents Finally Drop
Data from Douglas Elliman Real Estate shows Manhattan’s median rent for new leases fell 1.1% in September to $4,350 — down from July and August’s record highs.
Vacancy rates rose to 3.07%, the highest since August 2021 and back to pre-pandemic norms. Listings increased 40% from a year earlier.
Jonathan Miller, president of Miller Samuel, said future rent changes are likely to be minor in either direction.
The number of new leases signed dropped 1.9% YoY, signaling easing rental competition.
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6. U.S. Blue-Chip Bond Issuance Surpasses $1 Trillion
As of Wednesday, U.S. investment-grade bond issuance for the year topped $1 trillion — slightly behind last year’s pace.
PGIM Fixed Income expects another $200 billion in issuance this year. Major M&A deals, including Pfizer’s $31 billion acquisition of Seagen and Amgen’s $24 billion Horizon Therapeutics deal, helped fuel issuance.
Roughly $1.3 trillion of blue-chip corporate debt is set to mature between 2024 and 2028.
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7. AccorInvest to Sell €2B in Hotels to Repay Debt
Sources say AccorInvest Group — one of the world’s largest hotel owners — plans to sell properties across Europe and Latin America to raise €2 billion for debt repayment.
Managing over 750 hotels, AccorInvest is working with Société Générale to sell assets in Paris and five Ibis hotels in the UK.
The firm also hopes to renegotiate €4 billion in debt due in 2025.
In 2021, Rothschild helped the company restructure €4.5 billion in liabilities.
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This content is sourced from Financial Times, Bloomberg, and The Real Deal, among other financial news outlets.