Top UBS shareholder pins rebound hopes on private wealth

LONDON (Reuters) - UBS's wealth management business will help it bounce back from a $1.5 billion rap for rigging interest rates, one of its largest investors said, although fears of costly civil lawsuits could cast a pall over its shares for some time.
Paras Anand, European equities head at Fidelity Worldwide Investment, said legal action sparked by the Libor scandal posed an unpredictable threat to the bank's near-term earnings, even if its core private banking franchise escaped permanent harm.
"The big unknown factor is the civil litigation that could follow on as a result of this...That is one thing at the back of our minds that we have to be cognizant of," Anand said in an interview with Reuters.
"The issue for shareholders is the challenge of pricing that risk in. The potential costs are too unquantifiable and indeed, it's unclear as to whether they will actually manifest or not."
Switzerland's largest bank was hit with the fine on Wednesday after admitting to fraud, paying bribes to brokers and "pervasive" manipulation of global benchmark interest rates by dozens of its staff.
UBS shares were trading 1.3 percent higher at 9:01 a.m. ET, as investors looked forward to the end of a scandal-filled chapter in the bank's history and a renewed focus on managing cash on behalf of rich clients, rather than so-called 'casino' investment banking.
"There's clearly been a backlash against big faceless financial entities but a private bank has big personal relationships with its customers ... These kinds of institutions are surprisingly resilient," Anand said.
"We have seen some awful scandals in businesses much weaker than UBS and they manage to survive," he added.
Fidelity owns around 45 million shares in UBS, equivalent to around 1.2 percent of the bank, and is its fifth largest institutional owner excluding sovereign wealth funds, according to Thomson Reuters data.
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Drugs group Lundbeck's shares hit by profit warning

COPENHAGEN (Reuters) - Shares in Danish drugs firm Lundbeck fell to their lowest level in over 12 years on Wednesday after it cut its profits forecast for the next two years as European sales slow and spending on new products rise to combat generic competition.
The company has already warned that earnings would stall until 2015 due to cheap generic competition for its existing drugs, meaning new products will be vital for future earnings.
But Chief Executive Ulf Wiinberg said on Wednesday that the negative impact on revenue from healthcare reforms in Europe had also been bigger than expected in the last two years and that slowing European sales and generic competition were hurting.
As a result the company said operating profits would fall further than previously forecast in 2014 as it increases investments in its late-stage drugs development pipeline and product launches.
Lundbeck is working to find new drugs to replace lost revenue from products coming off patent protection such as its antidepressant Cipralex, which is sold as Lexapro in the United States and Japan, and Alzheimer's drug Ebixa.
Wiinberg said 2014 would be the company's peak investment year for the new products pipeline, offering it a solid foundation for growth starting in 2015.
"You only get one chance to launch a product and we have to do it well," Wiinberg said at a briefing for investors.
He was commenting after the company warned in a statement that it now expects revenue in 2014 of about 14 billion Danish crowns ($2.5 billion) and an operating profit of between just 0.5 billion and 1 billion crowns.
Analysts have on average been forecasting a profit of over 2.5 billion crowns for 2014 on turnover of over 14.7 billion crowns, according to Thomson Reuters I/B/E/S Estimates.
Two years ago Lundbeck predicted its annual revenues over the period 2012-2014 would exceed 14 billion crowns a year while earnings before interest and tax (EBIT) would exceed 2 billion crowns a year.
Next years' revenue is now forecast to be in the range of 14.1 billion and 14.7 billion crowns to produce an operating profit of 1.6 billion to 2.1 billion crowns, with no change to the company's forecast for 2012.
Analysts' forecasts for this year are for operating profit to drop 41 percent to 1.99 billion crowns on revenue down 8 percent at 14.7 billion crowns, while for 2013 they predict a profit of 2.26 billion crowns on revenue of 14.5 billion crowns.
Lundbeck's shares were trading down 17 percent at 79.90 crowns at 12.44 p.m. British time, dropping below 80 crowns for the first time since April 2000.
"In the short term, earnings are under pressure," Sydbank analyst Soren Hansen said.
Lundbeck said that it expects a dividend payout ratio of about 35 percent of net profits in the 2012-14 period. Last year it paid 3.49 crowns on basic earnings per share of 11.64 crowns, a payout ratio of 30 percent.
Analysts have been predicting a 27-30 percent cut this year to 2.53-2.28 crowns, according to Thomson Reuters StarMine data.
But a number of analysts doubt that revenue from new products will be enough to secure revenue growth in 2015, compensating for lost revenue from Cipralex, Lexapro and Ebixa which together accounted for about 70 percent of group revenue in 2011.
Lundbeck is working on new products such as antidepressant Brintellix in Europe and the United States for launch at the end of next year or start of 2014, as well as alcohol dependency treatment Selincro in Europe in mid 2013.
"It is difficult to see revenue from the smaller products compensating for the large products," said Hansen.
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New Mauritius Hotels posts 25 pct drop in full-year profit

PORT LOUIS (Reuters) - Luxury hotels group New Mauritius Hotels (NMH) reported a 25 percent fall in full-year pretax profit, citing higher finance costs and fewer tourists, and forecast a 15 percent drop in first-quarter earnings.
Ranked among the Indian Ocean island's most-traded stocks, NMH said on Wednesday that pretax profit for the year to September 30 fell to 603 million Indian rupees, with earnings per share down 20 percent at 3.60 rupees.
The hotels group said that it won't pay a dividend this year, given the difficult conditions in the local tourism industry. Last year it paid a dividend of 2.50 rupees per share.
Shares in the group, which owns eight hotels in Mauritius and one in the Seychelles, closed unchanged at 52 rupees before its results were released.
Tourism, a traditional cornerstone of the Mauritius economy, has been forecast to account for 7.9 percent of domestic product in 2012, down from 8.4 percent last year. The downturn in tourism has been caused largely by economic turmoil in the euro zone - the sector's key source market.
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Hugo Chavez's allies re-elect legislative chief

CARACAS, Venezuela (AP) — Allies of cancer-stricken President Hugo Chavez on Saturday chose to keep the same National Assembly president — a man who could be in line to step in as a caretaker leader in some circumstances.
The vote to retain Diosdado Cabello as legislative leader signaled the ruling party's desire to stress unity and continuity amid growing signs the government plans to postpone Chavez's inauguration for a new term while he fights a severe respiratory infection nearly a month after cancer surgery in Cuba.
The opposition and some legal experts have argued that if Chavez is unable to be sworn in as scheduled on Thursday, the president of the National Assembly should take over on an interim basis.
Cabello's selection quashed speculation about possible political reshuffling in the midst of Chavez's health crisis, and it came as Vice President Nicolas Maduro joined other allies in suggesting that Chavez could remain president and take the oath of office before the Supreme Court later on if he isn't fit to be sworn in on the scheduled date.
"It strikes me that the government has decided to put things on hold, to wait and see what happens with Chavez's health and other political factors, and figure out the best way to insure continuity," said Michael Shifter, president of the Inter-American Dialogue think tank in Washington. "Maduro and Cabello are clearly the key players within Chavismo today, each heading separate factions, but for the time being the idea is to reaffirm both and project a sense of unity."
Cabello, a former military officer who is widely considered to wield influence in the military, was re-elected by a show of hands by Chavez's allies, who hold a majority of the 165 congressional seats.
Pro-Chavez party leaders ignored calls to include opposition lawmakers among the legislative leadership, and opposition lawmaker Ismael Garcia said the choices represented "intolerance." None of the opposition lawmakers supported the new legislative leaders.
Hundreds of Chavez's supporters gathered outside the National Assembly to show their support, some holding flags and pictures of the president.
The Venezuelan Constitution says the presidential oath should be taken Jan. 10 before the National Assembly. It also says that if the president is unable to be sworn in before the Assembly, he may take the oath before the Supreme Court, and some legal experts in addition to Chavez allies have noted that the sentence referring to the court does not mention a date.
"When, it doesn't say. Where, it doesn't say either," Cabello told supporters after the session. Apparently alluding to possible protests by opponents over the issue of delaying the inauguration, Cabello told supporters: "The people have to be alert on the street so that there is no show."
Without giving details, Cabello urged them to "defend the revolution."
Maduro argued that Chavez, as a re-elected president, remains in his post after Jan. 10 regardless of whether he has taken the oath of office on that date. "When he can, he will be sworn in," Maduro said.
The latest remarks by the two most powerful men in Chavez's party sent the strongest signals yet that the government wants to delay the 58-year-old president's inauguration.
Former Supreme Court magistrate Roman Duque Corredor disagreed with Maduro, saying that "the constitution doesn't allow an extension" of a presidential term.
"An extension of a term can't be discussed," Duque said told The Associated Press a phone interview. "What would be right is to definitively determine what the president's state of health is." He said the Supreme Court should designate a board of doctors to determine whether Chavez's condition prevents him from continuing to exercise his duties temporarily or permanently.
If Chavez dies or is declared incapacitated, the constitution says that a new election should be called and held within 30 days, and Chavez has said Maduro should be the candidate. There have been no public signs of friction between the vice president and Cabello, who appeared side-by-side waving to supporters after the session and vowed to remain united.
"Come here, Nicolas. You're by brother, friend. They don't understand that," Cabello said, hugging Maduro before the crowd. Referring to government opponents, he said: "They're terrified of that, unity."
But opposition lawmaker Julio Borges said the government's choices of legislative leaders pointed to an arrangement aimed at containing an internal "rupture."
Borges told reporters that he believes there is a behind-the-scenes "fight" in the president's party to avoid Cabello assuming powers temporarily if Chavez is unable to be sworn in on schedule. The lawmaker asserted that there are serious tensions between those who support a "model that's kidnapped from Havana" and a military-aligned wing in Chavez's movement.
Cabello sought to cut off such speculation, saying: "We will never betray the will of the Venezuelan people. We will never betray the orders and instructions of Commander Chavez."
The National Assembly president also dismissed the possibility of dialogue with Chavez's opponents, saying: "There is no conciliation possible with that perverse right."
Both Maduro and Cabello have reasons for presenting a united front, political analyst Vladimir Villegas said.
"They have the responsibility to keep Chavismo united because the division of Chavismo would be the ruin of both of them. For that reason, they're going to do everything possible to stay united," Villegas said.
If the government delays the swearing-in and Chavez's condition improves, the president and his allies could have more time to plan an orderly transition and prepare for a new presidential election.
Opposition leaders have argued the constitution is clear that the inauguration should occur Thursday, and one presidential term ends and another begins. They have demanded more information about Chavez's condition and have said that if Chavez can't make it back to Caracas by Thursday, the president of the National Assembly should take over provisionally.
If such a change were to occur, it might not lead to any perceptible policy shifts because Cabello is a longtime Chavez ally who vows to uphold his socialist-oriented Bolivarian Revolution movement. But the latest comments by pro-Chavez leaders indicate they intend to avoid any such changes in the presidency, at least for now.
"We're experiencing political stability," Soto Rojas said as he announced the choices of legislative leaders put forward by Chavez's United Socialist Party of Venezuela. Referring to Chavez, the former legislative leader said: "Onward, Comandante."
Shifter said the government's stance has left opposition on the defensive, with its only tactic being to insist that Jan. 10 is the established date.
"The opposition's strong objections to the government's plan are unlikely to get much political traction," Shifter said. "What the government is doing may be of dubious constitutionality but it fits a familiar pattern under Chavez's rule and will probably have minimal political costs."
Chavez was re-elected in October to another six-year term, and two months later announced that his pelvic cancer had returned. Chavez said before the operation that if his illness prevented him from remaining president, Maduro should be his party's candidate to replace him in a new election.
Chavez hasn't spoken publicly or been seen since before his Dec. 11 operation, his fourth cancer-related surgery since June 2011 for an undisclosed type of pelvic cancer. The government revealed this week that Chavez is fighting a severe lung infection and receiving treatment for "respiratory deficiency."
That account raised the possibility that he might be breathing with the assistance of a machine. But the government did not address that question or details of the president's treatment, and independent medical experts consulted by the AP said the statements indicated a potentially dangerous turn in Chavez's condition, but said it's unclear whether he is attached to a ventilator.
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US family builds Haiti orphanage for daughter

PORT-AU-PRINCE, Haiti (AP) — An American family who lost their daughter in a massive earthquake in Haiti three years ago has finished building an orphanage in her memory.
The parents of Britney Gengel, Leonard and Cherylann, led about 150 family and friends, including U.S. Rep. James P. McGovern, D-Worcester, in a solemn ceremony Saturday at the Be Like Brit orphanage in the coastal town of Grand Goave.
"It was a beautiful ceremony and had a great dedication," said Leonard Gengel, 52, of Rutland, Massachusetts.
The brick-and-mortar homage cost about $1.8 million to build, all raised through donations. The 19,000-square-foot (nearly 1,800-square-meter) facility has seismically resistant walls and a medical clinic.
Built in the shape of a letter "B," the orphanage will house 33 boys and 33 girls, representing the number of days Britney's body lay under the rubble.
Gengel was a 19-year-old sophomore at Lynn University in Boca Raton, Florida, who had gone to Haiti to hand out meals for a Christian charity. She died when the hotel where she was staying, the Montana, collapsed.
On Saturday, Haiti will mark the 3rd anniversary of the earthquake that officials say killed more than 300,000 people and displaced more than a million others. The disaster is regarded as one of the worst natural disasters in modern history.
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Venezuela looks for missing plane with Missoni CEO

CARACAS, Venezuela (AP) — The search for a missing plane carrying Italian fashion executive Vittorio Missoni and five other people has entered its third straight day on Sunday with no signs of the aircraft.
Venezuela's government said authorities would not call off the search involving the National Civil Aviation Institute, Coast Guard and Navy until they find the BN-2 Islander plane that disappeared off South American country's coast and all of those who were on board.
"All the authorities involved in these tasks are not reducing the intensity of the search until they locate the plane as well as its crew and passengers," the government said in a written statement. It said search teams are using a plane and two helicopters as well as several coast guard vessels and 29 divers.
The small, twin-engine plane was reported missing hours after taking off Friday from Los Roques, a string of islands and islets popular among tourists for their white beaches and coral reefs.
The plane was carrying the CEO of Italy's iconic Missoni fashion house, his wife, two Italian friends and two Venezuelan crew members.
Officials from Venezuela's civil aviation agency have said that authorities declared an alert after the plane didn't make contact with the control tower at the Caracas airport or with the tower in Los Roques. The plane took off at 11:39 a.m. on Friday and had been expected to arrive at Caracas' Simon Bolivar International Airport 42 minutes later, according to officials.
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Health officials tell Greece to act fast to control HIV

London (Reuters) - A spiraling outbreak of HIV in debt-stricken Greece could run out of control unless urgent action is taken, European health officials said on Friday.
The European Centre for Disease Prevention and Control (ECDC) said infections with the AIDS-causing virus among drug users and other high-risk groups were rising fast, and that a failure to act would mean far higher costs in future.
ECDC director Marc Sprenger was in Athens on Friday visiting hospitals and needle exchanges. He said he would tell officials that free syringes and methadone programs must be stepped up, and testing and treatment for the human immunodeficiency virus made available to all.
"Immediate concerted action is needed in order to curb and eventually stop the current outbreak," he told Reuters as the ECDC published a report on Greece's HIV problem.
Since 2009, recession in Greece has reduced economic output by a fifth and sent unemployment to a record high.
The healthcare system is under extreme pressure, making it harder for the poor, unemployed or homeless to get treatment.
The ECDC said it was unclear how much Greece's debt crisis is contributing to the HIV outbreak, but it was evidently having "a significant social and health impact". There were fears in Athens that "HIV treatment services have reached a ceiling" because of a leap in case numbers in 2012.
While Greece has only 7.4 HIV infections per 100,000 people, compared to 10 per 100,000 in Britain or 27.3 in Estonia, rates have soared since 2011 in high-risk groups such as drug users.
From 2007 to 2010, there were only 10 to 15 cases a year of HIV infection in injecting drug users.
But during 2011, there were 256 such cases - or 27 percent of the total. Another 314 drug use HIV cases were reported between January and August 2012, bringing the total HIV cases for the year to August to 768.
Combination drugs can give patients with HIV near-normal life expectancy, but the drugs must be taken for life, and cost 10,000 to 22,000 euros ($13,000 to $28,500) a year.
"If a scale-up (in prevention and testing) is not achieved, it's likely that HIV transmission among people who inject drugs in Athens will continue and even accelerate - and could eventually spread," Sprenger said.
"The cost of prevention ... will be significantly less than the provision of treatment to those who become infected."
The ECDC said waiting times for methadone programs in Athens were more than seven years in August 2010, and only around seven syringes a year were given to each drug user.
Efforts by authorities to address this have now brought waiting lists down below four years and increased the number of syringes to 15 a year in 2011 and an expected 45 in 2012, but this is well below the international standard of 200 needles.
Rates of other health problems such as depression and suicide have been rising in Greece, which is also battling the re-emergence of mosquito-borne diseases such West Nile Virus and malaria.
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Health officials warn of spiraling HIV in Athens

ATHENS, Greece (AP) — Health officials warn that the Greek capital is seeing an alarming increase in new HIV infections, particularly among intravenous drug users, as the country struggles through a protracted financial crisis in which funding has been slashed for health care and drug treatment programs.
Officials said while there were about 10-14 new HIV infections per year among Athens drug users from 2008 to 2010, that number shot up to 206 new cases last year and 487 new cases by October this year — a 35-fold increase.
Epidemiology and preventive medicine professor Angelos Hatzakis described the situation as a "big and rapidly developing epidemic in Athens."
Marc Sprenger, director of the European Center for Disease Prevention and Control, said the situation must be dealt with quickly to prevent it from spiraling further.
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J&J says it won't enforce AIDS drug patent in Africa

LONDON (Reuters) - Generic manufacturers are to be given a free rein to make cheap copies of Johnson & Johnson's HIV/AIDS drug Prezista for sale in Africa and other poor countries.
U.S. healthcare group J&J said on Thursday it would not enforce patents, provided generic firms made high-quality versions of the drug - known generically as darunavir - for sub-Saharan Africa and Least Developed Countries.
Prezista is a relatively new drug used when patients develop resistance to older antiretrovirals. The need for it was expected to grow rapidly as more patients in Africa stop responding to existing therapies.
Pharmaceuticals head Paul Stoffels said he expected Indian drugmakers, in particular, to take advantage of the patent move, adding that competition among different companies should drive prices down further.
J&J has an existing deal with South African group Aspen Pharmacare, which makes Prezista at a discounted price of $2.22 per day for Africa - a fraction of the western market price.
Its decision to act unilaterally on Prezista patents will, however, disappoint those calling for J&J to share intellectual property rights in the new Medicines Patent Pool, which aims to streamline generic production by pooling patents.
"We have chosen to go direct ... we think that is the best way," Stoffels said in an interview.
"We want to reserve the right to reinforce patents if people are not providing the right quality of product, for example by bringing products to market that under-dose."
International drugmakers are under growing pressure to make medicines more affordable in poor countries, after being attacked for not doing enough in the past.
J&J ranked second in a new analysis of how companies are performing in providing access to medicines - an improvement of seven places from two years earlier, following its purchase of Crucell, which makes vaccines for the developing world.
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Oracle 2Q earnings rise 18 pct as tech spending up

SAN FRANCISCO (AP) — Oracle says its latest quarterly earnings rose 18 percent as companies splurged on more software and other technology toward the end of the year.
The results announced Tuesday are an improvement from Oracle's previous quarter, when the company's revenue dipped slightly from a year earlier.
The latest quarter spanned September through November. That makes Oracle the first technology bellwether to provide insights into corporate spending since the Nov. 6 re-election of President Obama and negotiations to avoid the so-called fiscal cliff began to heat up.
Oracle Corp. earned $2.6 billion, or 53 cents per share, in its fiscal second quarter. That compares with net income of $2.2 billion, or 43 cents per share, last year.
Revenue increased 3 percent to $9.1 billion.
Oracle is based in Redwood Shores, Calif.
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