David Tepper, founder of Appaloosa Management, put out for bid $400 million of hybrids for HBOS PLC (HBOS), The Royal Bank of Scotland Group plc (NYSE:RBS) (LON:RBS) and Commerzbank, FOX Business Network’s (FBN) Charlie Gasparino reports. Gasparino goes on to report that this indicates he might be turning bearish on financials due to some headwinds surrounding trouble in Europe.
On the $400 million of hybrid bank securities Appaloosa founder David Tepper put out for bid:
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“What happened with Tepper this week, we hear this from sources that are in the bond market, that he went out – this is after he’s been very public that he’s bullish on financials, he likes Citigroup – he went out and put out for bid $400 million of hybrids for three companies, three financial companies – HBOS PLC, that’s the banking arm of Lloyds Banking Group PLC (LON:LLOY) (NYSE:LYG) of London, The Royal Bank of Scotland Group plc (NYSE:RBS) (LON:RBS) from what we understand, and Commerzbank AG (PINK:CRZBY) (ETR:CBK) (FRA:CBK). Pretty interesting, when you put these out for bid, it’s not like he sold a little here, sold a little there…he put out a bid, everyone knows it was him. He’s doing this just as he’s talking about financials.”
On whether the bid means he’s turning bearish on the financials:
“He may be turning a little bearish…The financials could have some headwinds here when you start talking about Europe, you know European problems starting to creep back…If you are worried about the countries, you have to worry about the banks because the banks, even here, hold some of that, what could be toxic stuff.”