Analysis of Lebanon peace deal

Good morning from the Financial Times. Today is Thursday, july second. And this is your FT newews briefing The US government might get a piece of an AI powerhouse, and UBS is dipping its toes in American banking services. Ukraine has pushed Russia onto its back foot, and even Vladimir Putin is starting to acknowledge it I'm Mark Filipino and here's the news you need to start your day OpenAI has discussed giving a five percent stake to the U.S. government. That's according to people familiar with the talks. The arrangement would involve other American AI companies handing over a similar stake, but it's not clear if those other companies would be willing to play ball The move could help openAI improve its relationship with the Trump administration, and would also be an attempt to address political blowback The American public and politicians have gotten more concerned about all the data centers being built and the impact AI could have on the job market. The idea is that the deal would share the wealth generated by AI with the public Open AI declined to comment on this, and the White House did not immediately respond to a request for comment UBS is expanding in the United States. The Swiss lender will start testing out everyday banking services for its employees in the US. The plan is to launch a full service bank for wealthy Americans by the middle of the next year That's according to people familiar with the matter, but UBS declined to comment These plans come as UBS and the Swiss government are still in a standoff over tougher capital requirements and a few years after UBS took over its main rival credit Swiss as part of a rescue deal. I have with meFTs, Switzerland and Austria correspondent Mercedes Rule. I'm Mercedes. Hello. So tell me a little bit more about what UBS is offering and planning to offer in the US UBS wants to become much more than just an investment manager in the US. So what UBS is doing is preparing to become a full service bank for Americans. So over the next few months, sources have told us it's going to start testing everyday banking products, checking accounts, saving accounts, other services with its own US employees before rolling them out to clients from the middle of the next year. And this is the first time UBS will be able to offer Americans both investment advice and everyday banking through the same business Did UBS say anything about why it's doing this So the problem that UBS has at the moment is that it's often not its client's main bank and they want to be the client's main bank. So not just the place where they invvest their money. So for example, at the moment, many wealthy UBS clients keep their investments with UBS, but they do their everyday banking with rivals like JP Morgan, Bank of America, or other US banks. And so that gives those competitors regular contact with those clients and more opportunities to win the rest of their business What UBS is hoping is that if it is managing both their investment and their day to day banking, those clients are going to be less likely to leave and UBS becomes much more profitable So you know, I mentioned this little spat that's going on between UBS and the Swiss government. How does this venture into the US play into that whole thing Sure, So UBS believes America is one of, if not the biggest opportunity for its future growth. The Swiss government wants the bank to hold a lot more capital against its overseas subsidiaries after the collapse of credit Siss The Swiss government argues these rules are needed because overseas operations have repeatedly caused problems for Swiss banks in the past. So this is why they want UBS to hold roughly more than twenty two billion more capital against its overseas subsidiaries. and the US accounts for the biggest share And of course, UBS says the extra capital could make it more expensive to grow in the very market it sees. as its future. So it's out an impasse. This is now in the hands of Swiss Parliament at the moment. There's not much anyone can do except watch that play out in Parliament later this year. In the meantime, UBS is bging ahead with its US plans. So Mercedes, I apologize if I may be looking a little bit too much into this, maybe I'm extrapolating a little bit too much, but there was speculation that UBS may leave Switzerland for the US as part of this capital requirements spat Is that what this is? this move into everyday banking for wealthy Americans I think strategically this is another step in UBS's transformation from predominantly kind of Swiss Bank into global wealth manager competing head on With Wall Street. What I think is fair to say is that the Credit Suz rescue transformed UBS's wealth management business in Europe and the Middle East and Asia, but it actually didn't do much for its US ambition. So when Sergio O Marti, the CEO unveiled the post Credit Suissz strategy in early twenty twenty four, addressing that US wealth business became quite a central objective But this was always part of the plan, regardless of what the Swiss government is forcing UBS to do. They always want it to grow in the US Mercedes Rule is the FFT, Switzerland, and Austria correspondent. Thanks so much, Mercedes. Thank you global AI race is driving record levels of mergers and acquisitions. compompanies made nearly three trillion dollars in deals from January to June this year. That's up almost fifty percent from the same period as last year Most transactions took place in the tech sector followed by energy, which we talked about a little earlier this week and industrials Deals this year have been higher in value, but there have been fewer of them The biggest deals came from companies that are racing to build data centers and expand their AI capabilities. and so far Most investors have shrugged off market volatility in order to have a stake in the game Ukraine's drone strikes on Russia have become hard to ignore, so hard that even Russian President Vladimir Putin admits they're, quote, causing problems The attacks have led to fuel shortages and there have also been civilian casualties Many Russians are getting angrier at a war that is now playing out in their territory. While Putin is now acknowledging the disruptions, he's also rejected any suggestion of pausing the strikes through a limited ceasefire Max Sedin covers Russia for the FT. He joins me now to talk about the growing tensions. Hi Max. Hey All right, so let's start with these drone strikes. When do they start causing problems in Putin's words So Ukraine has been trying to develop its own homegown drone capabilities really since the war started in twenty twenty two. but when you've really started to see them be As effective as they have been is in the last two months, when Ukraine not only has gotten better developing the drones, they switch what they've been targeting. So before that in March April, there were more strikes on oil export facilities. Now you are seeing them redirect their efforts to refineries. And this has been really successful in making ordinary Russians across the country f the effects of the war because by varying estimates, a quarter a third of Russia's refining capacity is offline. in more than a third of Russia's regions, there are various forms of fuel rationing now So this is a situation where Ukraine has really been able to bring the fight to Russia well beyond the front line more than they have at any point during the war So Putin recently said that Ukraine had offered a truce onn the long range strikes, Ukraine hasn't confirmed it, but Either way, Putin said he wouldn't go for it. Why not So the biggest sign that this has become too much of a problem for Putin to ignore is the fact that on Sunday, he made a big effort to be seen addressing it. He talked about it at the United Russia Party Congress, the main Kremlin partarty. He held a meeting with top officials on how to solve the fuel shortages problem, and he gave this very strange interview state television And that's significant because before that, the Kremlin had been doing what it usually does, which is try to disassociate Putin from any bad news that's happening at all. And Putin, when he was doing this, he was clearly trying to reassure Russians that you could also see that his real priorities winning the war on his own terms as maximalist as they ever have been was what was shining through. And he said that Ukraine had made some offer through some back channels to do a mutual suspension of long range strikes. and he immediately rejected that out of hand because he said that would just help help Ukraine's government led by President Volodymr Zelensky stay in power Max, how are Russians responding to what's going on right now. So this is really the first time that ordinary Russians have had to feel the impact of the war at anything like this scale. There' along of lines at gas stations and there's rationing they're out of various different kinds of fuels and also the widespread internet blackhouse. This is something that's been imposed by the security services. It's never really been adequately explained, but it's partly to keep the Ladon descent. It's partly to deal with the Ukrainian drones. It's partly because of worries that they have about vulnerabilities in Russian defenses to potential other things that Ukraine could do And so This is the first time that the Kremlin has not been able to convince ordinary Russians that the war isn't affecting their lives. You are still unlikely to see that really crystallize into some sort of popular uprising. There's no real opposition figure. The people can rally around. And so instead, what you're going to see is uncertainty and this kind of general malaise across the population Max Seden is the FT's Moscow Bureau Chief. Thanks Max Before we go, I wanted to flag this week's episode of theFT's Rockman Review podcast Chief Foreign Affairs commentator Gidon Rockman sat down with the FT's editor, Rulahalof to discuss the trilateral peace deal signed last week between Lebanon, Israel, and the United States This agreement is problematic on two fronts. First of all, it's not really possible to implement it because what the agreement says is that Israel will now withdraw from southern Lebanon if Hezbollah is disarmed or when Hezbollah is disarmed. The reality of Lebanon today is that the government will not be able to disarm Hezbollah. That's just the reality of Lebanon You can hear the entire episode of the Rockman Review by clicking the link in our show notes If This has been your daily FT News briefing, cheheck back tomorrow for the latest businessiness news