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Next industrial revolution underway, says Nvidia – Industry roundup: 23 May

AI boom shows no sign of slowing, reports Nvidia

US tech multinational Nvidia has reported record quarterly revenue, reflecting growing corporate appetite for artificial intelligence (AI).

“The next industrial revolution has begun – companies and countries are partnering with Nvidia … to produce a new commodity: artificial intelligence,” said Jensen Huang, founder and CEO of Nvidia. He said the company would begin to see revenue from its next-generation AI chip, called Blackwell, later this year.

Nvidia reported revenue of US$26 billion for the first quarter of fiscal year 2025, up 18% from Q4 and up 262% from a year ago. Net profit was US$14.88 billion, up from US$2 billion a year before.

The AI chip maker, whose fortunes are regarded as a bellwether for the AI transformation under way, reported earnings per share were $5.98, up 21% from the previous quarter and up 629% from a year ago. Investors had expected revenue of US$24.65 billion and earnings per share of $5.59, according to reports.

In response, the share price rose in extended trading to over the $1,000 per-share threshold for the first time. The company also announced it would split its stock, currently trading at $962, 10-for-one on 7 June.

Nvidia, before becoming the top supplier to big companies building AI, was known primarily as a company making hardware for 3D gaming. Gaming revenue was up 18% during the quarter to US$2.65 billion, which it attributed to strong demand.

The company also sells chips for cars and chips for advanced graphics workstations, which remain much smaller than its data centre business. It reported US$427 million in professional visualisation sales, and US$329 million in automotive sales.

Tech giants Amazon, Google, Meta and Microsoft have all indicated that they plan to spend US$200 billion this year on chips and data centres needed to train and operate their AI systems. Apple has said it will announce its AI strategy next month. Nvidia is seen as the leading provider of chips best suited to powering AI.

The company has gained more than US$1.1 trillion in value this year alone. At the end of 2022, Nvidia was worth US$359 billion, which has since risen to an estimated US$2.33 trillion or just US$500 billion less than Apple and US$900 billion less than Microsoft.

The chipmaker’s earnings announcement “has become one of the most important events on the macro calendar”, according to Deutsche Bank strategist Henry Allen.


BNP Paribas seeks emission cuts from more clients

France’s BNP Paribas plans to expand its financing restrictions on high-carbon assets and will add three more industries to the list of sectors now facing limits.

The world’s largest ship finance bank, BNP Paribas is accelerating a drive to decarbonise its portfolio. In 2022, the group committed to decarbonising its portfolio in three key sectors: oil and gas, power generation and automotive. In 2023, new targets were set for the steel, aluminium and cement production sectors and the bank is now extending these to include aviation, shipping and commercial real estate.

The bank is “determined to align its credit portfolio with net zero trajectories and to support the economy in its transition to low-carbon,” it said in a statement.

BNP, which in February 2023 was the subject of a climate lawsuit, has more recently won favour with environmental activists for moving faster than its global peers in cracking down on fossil-fuel finance. Last week, the bank said it was no longer participating in conventional bond sales for the oil and gas sectors. Meanwhile, BNP has emerged as the world’s biggest underwriter of green bonds.

In its statement, BNP said it will target an 18% reduction in its portfolio emissions intensity for air transport compared with the 2022 baseline. For maritime transport, it requires a reduction of at least 23%, while the bank now aims for a decline of at least 31% for commercial property compared with 2022.

“BNP Paribas is committed to significantly reducing the greenhouse gas emission intensity of its financing to sectors with the highest emissions,” it said. 

BNP also said it is targeting a 70% reduction by 2030 in its financed emissions for the oil and gas sectors, which corresponds to a reduction to 8.2 million tons of CO2 by 2030 from 27.3 million at the end of September 2022.

Yellen warns German banks to toughen sanctions on Russia

US Treasury Secretary Janet Yellen has urged German bank executives to step up efforts to comply with sanctions against Russia and shut down efforts to circumvent them to avoid potential penalties themselves that would cut off dollar access.

Yellen said at the start of a meeting with bankers that the Treasury's new authority to hit banks with secondary sanctions if they aid Russian military-related transactions had helped to frustrate Russia's efforts to procure goods needed for its war in Ukraine, but more work was needed.

“Russia continues to procure sensitive goods and to expand its ability to domestically manufacture these goods. We must remain vigilant and be more ambitious,” Yellen said. “I urge all institutions here to take heightened compliance measures and to increase your focus on Russian evasion attempts,” Yellen said in prepared remarks ahead of the meeting in Frankfurt.

In an unusually direct warning, she told the executives to police sanctions compliance among their banks’ foreign branches and subsidiaries and reach out to foreign correspondent banking customers to do the same, especially in high-risk jurisdictions.

“Russia is desperate to obtain critical goods from advanced economies like Germany and the United States,” Yellen said. “We must remain vigilant to prevent the Kremlin’s ability to supply its defence industrial base, and to access our financial systems to do so.”

Yellen’s warning comes shortly after the US Treasury successfully pressed Austria’s Raiffeisen Bank, the biggest Western bank in Russia to abandon a deal involving a Russian tycoon.

Earlier this month, Raiffeisen Bank International (RBI) dropped a bid for a €1.5 billion (US$1.6 billion) industrial stake linked to Russian tycoon Oleg Deripaska after intense US pressure.


World Bank issues first international Swiss franc digital bond

The World Bank last week priced the first Swiss franc (CHF)-denominated digital bond issued by an international entity, which was settled using Swiss franc wholesale central bank digital currency (wCBDC) provided by the Swiss National Bank (SNB).

The bond issue was worth CHF200 million (US$220 million) and will last seven years, settling on 11 June and maturing in 2031. The World Bank said this was its largest Swiss franc-denominated bond issue since 2009.The digital bond is listed on the traditional SIX Swiss Exchange and also its digital asset arm, the blockchain-based SIX Digital Exchange. On SDX the bond will initially settle using the Swiss central bank’s wCBDC as part of the Project Helvetia initiative, in which the SNB has been collaborating with financial institutions to develop digital financial markets.

The bond’s subsequent coupon and redemption payments will be made using tokenized CHF on the SDX. SDX also connects to traditional settlement systems such as Euroclear and Clearstream allowing investors to hold the digital bond through their usual custodians.

The World Bank confirmed that the bond was placed mainly in Switzerland, with banks, bank treasuries and corporates representing the majority share of allocations at 60%, followed by asset managers, insurance companies and pension funds at 39%. The remainder was placed with central banks and official institutions. Commerzbank was the sole lead manager and is also the paying and issuer agent for the transaction.

David Newns, head SIX Digital Exchange, said in a statement: “Being able to settle wholesale transactions in tokenised central bank money is a critical, foundational requirement for the adoption of a blockchain based capital markets infrastructure.”

Zahid Mustafa, head of digital asset custody at State Street Digital, said on the panel that using wholesale CBDC for the World Bank bond was interesting. “These models give me hope, because it brings the asset and cash record on the same ledger,” Mustafa added.

Amar Amiani, head of the Goldman Sachs digital assets team in Europe, the Middle East and Africa (EMEA), said that bonds are furthest ahead in the tokenisation of real-world assets. “We are definitely at the point where we are seeing significant size and tenor being done,” he added, with the World Bank’s issuing on SDX platform providing further evidence of this.

Amiani continued that in the past 18 to 24 months the tokenization market has moved from proof of concept and small bond transactions to big size, the participation of a lot of investors and the ability to finance these positions in repo or securities lending transactions. “Digital bonds are continuing to lead the way and are progressing to become more mainstream,” Amiani added.


Qatar raises US$2.5 billion from inaugural green bond

Qatar has raised US$2.5 billion with its first dollar bonds in four years and a debut green deal, tapping into a booming global market for sustainable debt.

The green bonds were split between a US$1 billion five-year portion and a US$1.5 billion 10-year tranche. The shorter notes were priced with a spread of 30 basis points over US Treasuries, equating to a yield of 4.74%, down from initial guidance of 70 basis points.

The 10-year debt had a spread of 40 basis points and a yield of 4.82%.

Green bonds from the Middle East have gained traction in recent years, with investors showing appetite for offerings from the likes of Saudi Arabia’s wealth fund, Abu Dhabi’s main property company and the government of Sharjah.

Qatar is yet to announce a timeline for zeroing out its carbon emissions and is one of the world’s highest per capita emitters of planet-warming gases. Like other nations in the Gulf, it is a heavy user of energy for air conditioning and to desalinate water.

Yet it is spending billions of dollars to ramp up solar power. It also argues that gas is a fuel that will help with global climate goals as it is cleaner than oil or coal, although the industry is associated with methane leaks.

Qatar is one of the richest countries in the world and has a rating of AA or its equivalent — the third-highest possible — from all three major ratings companies. 

Its previoust Eurobond deal was in April 2020, when it raised US$10 billion after attracting US$45 billion of orders from investors.

The main banks arranging the latest deal were Crédit Agricole, HSBC Holdings, JPMorgan Chase and Qatar National Bank.


Six US cities identified as powerhouses of the global economy

Although reports of housing crises, worker exoduses, and slashed budgets might indicate the slow decline of US cities, six of them have been identified as leading “engines of the global economy”.

Research and advisory group Oxford Economics published its latest Global Cities Index this week, which showed New York, Los Angeles, San Jose, Seattle, San Francisco, and Dallas topped the index's economics category.

The index, which Oxford Economics produces annually, ranks the 1,000 largest cities in the world by five categories: economics, human capital, quality of life, environment, and governance.

Cities with busy financial centres are often viewed as prosperous, with New York, London, Singapore, and Hong Kong typically leading global rankings.

However, Oxford Economics assesses cities based on a range of factors that contribute to their overall economic vitality and their potential for sustained growth and development. Gross domestic product (GDP) growth, employment growth, economic stability, GDP per person, and economic diversity were all measured in addition to overall GDP size.

“The cities topping the Economics category are the engines of the global economy. In this category, American cities dominate,” states the report. New York excelled in the economics category with a perfect score of 100, followed closely by Los Angeles. San Jose, the largest city in Silicon Valley, came in third place and was highlighted as having the highest GDP per person globally.

Dallas was a more surprising entrant in the top 10. Oxford Economics ranked it sixth globally in its economics category. The Texas city has experienced the largest population increase of any US metro area in recent years. More than 175 companies have moved their headquarters there since 2010, making it one of the economic powerhouses of the South.

London, Paris, and Tokyo were the only non-US cities to make the top 10. They trail the US cities because of their lower levels of GDP per person, according to the report. Chicago also made it onto the economics list, ranking eighth after London.

Although US cities scored high in the economics category, they barely appeared in the top rankings for the other four categories: human capital, quality of life, governance, and environment. 

Cities in Europe, New Zealand, and Brazil were ranked higher on factors like income equality, life expectancy, air quality, civil liberties, and business environment. Nonetheless, the report said that "cities in North America are all clumped at the higher end of the rankings."

New York, San Jose, Seattle, Los Angeles, and San Francisco ranked in the top 10 of Oxford Economics' list of top cities by overall score, with New York coming out on top.


MercadoLibre in talks to apply for Mexico banking licence

Latin American e-commerce and fintech giant MercadoLibre is in talks with Mexico’s authorities to apply for a banking license that will allow it to expand the product range it offers in the country.

The company has begun discussions with the central bank, the banking regulator and the Finance Ministry as it seeks the license, said Osvaldo Gimenez, president of Mercado Pago, the company’s fintech unit. The formal process will begin in the coming months.

“The opportunity is phenomenal,” said Gimenez who compared Mexico’s potential with Brazil’s significant growth in banking access, electronic payments, and credit seen in Brazil over the past decade. MercadoLibre aims to play a pivotal role in this growth in Mexico by launching more products. The process of obtaining the license is expected to take 12 to 24 months. The company considered purchasing a banking license but decided against it.

Mexico has become a crucial market for financial services startups, with less than 50% of the population holding a bank account. Several fintech firms are seeking banking licenses to offer a comprehensive range of services. Argentina’s Ualá acquired a license by buying ABC Capital, UK fintech giant Revolut received a license in April, and Brazil’s Nubank has formally applied for one. Four other local companies are also in the process of obtaining licenses.

MercadoLibre currently operates in Mexico under a fintech licence known as IFPE, which allows it to provide various services, including a wallet app. A banking license would enable the company to receive payroll deposits, lift the cap on the amounts held, and expedite the approval and issuance of credit cards.


Stripe launches platform for UK small businesses

Stripe, the Irish-American financial and software services multinational has launched payment tools and financing options for small businesses in the UK. The firm has promised users faster and cheaper payments with the new platform. Stripe aims to address the challenge of securing funds that businesses in the region face.

Dubbed Stripe Capital, the new offering enables businesses to access financing to invest in growth, for instance, acquiring new equipment, hiring, or improving customer experience. On the platform, Stripe uses a business transaction history to assess eligibility. For eligible businesses, funds arrive the next business day, and repayment occurs as the business earns.

John Collison, Stripe’s co-founder, commented: “UK businesses are inventing and building, but getting access to capital at the right time is a rate limiter on their growth. The payment tools and financing options we’re launching will help money move around the economy faster and make it easier for businesses to invest when they see an opportunity to grow."

Later this year, there ae plans for platforms using Stripe Connect to begin offering financing directly to their users. According to Stripe, this enables businesses to access growth capital and platforms to unlock a new revenue stream.

The company is also opening a new office in London to house its team. This location facilitates collaboration with tech companies, financial institutions, and other key partners. With the new tools, Stripe expects to boost growth among businesses in the UK.


Vitesse’s platform for insurers raises US$93 million to fuel US expansion

UK fintech Vitesse has closed a US$93 million Series C round of funding led by investment giant KKR, which said it is making the investment through its Next Generation Technology Growth Fund III, a.US$3 billion fund it closed last year.

Founded out of London in 2013, Vitesse was established by Paul Townsend and Phil McGriskin, who had sold an e-commerce payments company called Envoy to WorldPay two years earlier.

Vitesse supplies insurance companies with an all-in-one treasury and payment management platform, replete with connections to a network of clearing systems designed to streamline international payments. The platform provides easy access to domestic banking services to remove friction from cross-border payments, as well as services like liquidity management, cash-flow forecasting, and real-time visibility into cash positions in a myriad of accounts and currencies.

Vitesse had raised an US$8.4 million Series A round in 2020, followed by a US$26 million Series B round two years later, With a further US$93 million in the bank, the company said its doubling down on its US expansion efforts, supported by the appointment of banking veteran Curt Hess, who will spearhead its growth stateside.

In addition to lead backer KKR, Vitesse’s Series C round saw participation from existing investors Hoxton Ventures, Octopus Ventures, and Hannover Digital Investments.


Mastercard to sponsor the Working Capital Awards

Mastercard has been named the new sponsor of the Working Capital Awards, a global programme that recognises the best examples of working capital management worldwide.

Brooke DiNatale, Senior Vice President of Global Treasury Solutions at Mastercard, will present the prestigious Gold Award for the best overall entry at the presentation dinner, which will be held at the historic Beurs van Berlage in Amsterdam on 4 November.

DiNatale commented, “We’re delighted to have the opportunity to partner with The Working Capital Forum to reward excellence in working capital management.

“Effective working capital management is essential for businesses of all sizes and across all industries – whether that’s accessing liquidity to fund growth or monetising excess cash on the balance sheet.

“The awards fit well with Mastercard’s commitment to enabling access to embedded B2B working capital tools for both card and account-to-account payment rails. We are working closely with our partners to integrate virtual card and supply chain finance capabilities directly into business processes, enabling frictionless access to liquidity for buyers and suppliers from the platforms that they already use.”

Entry to the Working Capital Awards is free of charge and open to any corporation in any of the nine categories, ranging from Best use of Supply Chain Finance to Best ESG Working Capital Initiative. Previous Gold Award winners have included Otto Group and Coca-Cola Europacific Partners.

Entries are evaluated by an independent panel of treasury and procurement leaders:

Fabian Schulenburg, Senior Product Manager Early Payment Programs, Otto Group
Paola Jimenez, Team Lead Treasury Analytics, Zalando
Llewelyn Mullooly, Head of Analytics, The Working Capital Forum
Mikko Vainikka, Vice President, Group Treasury, Metso
Julle Pederson, Director, EMIA Treasury, Bridgestone
Anabela Da Silva Castanheira, Director Business Credit EME/APA, AGCO Corp

The deadline for Awards entries is 31st July 2024. More information on how to enter, including a downloadable entry form, is available at

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