International Herald Tribune – Blackstone Group, manager of the world’s largest leveraged-buyout fund, said Wednesday that second-quarter profit beat analysts’ estimates as gains from hedge funds offset a decline in private-equity takeovers.

Net economic income, a measure that excludes some compensation costs, fell 75 percent to $165.6 million, or 15 cents a share, from $655 million, or 58 cents, a year earlier, the New York-based Blackstone said. That exceeded the average estimate of 8 cents a share by 10 analysts in a Bloomberg survey. Revenue declined 63 percent to $353.7 million.

Blackstone’s fees from buying and selling companies have plunged as buyouts of more than $2 billion dried up and initial public offerings fell to their lowest in four years. Investors backed away from the debt used to finance LBOs in the fallout from the collapse of subprime-mortgage securities in the second half of last year.

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Bloomberg – Aozora Bank Ltd., the Japanese lender controlled by U.S. buyout fund Cerberus Capital Management LP, said first-quarter profit fell 75 percent as fees declined and returns on investments in hedge funds withered.

Net income dropped to 9.33 billion yen ($86.6 million) in the three months ended June 30 from 37 billion yen a year earlier, Aozora said in a statement today. The Tokyo-based bank left unchanged its full-year profit forecast of 44 billion yen.

Aozora’s stock slumped 18 percent during the quarter, the biggest decline of any Japanese bank, after a parent operating loss of 25 billion yen in the year ended March 31. Chief Executive Officer Federico Sacasa and other executives took pay cuts after annual profit plunged 93 percent, the bank said last month.

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