RBS settles to end US probe
Royal Bank of Scotland has agreed a $4.9bn (£3.6bn) penalty with US regulators to end the long-running investigation into the sale of financial products, including toxic mortgage bonds, from 2005 to 2007. The bank said around $3.6bn of the penalty would be covered by money already set aside. The FT's Matthew Vincent notes that the settlement "clears the way for the government to sell more shares in the bank, and for the bank to meet its years-old promise of restoring its dividend."
Petitions lodged against branch closures
Inverness MP Drew Hendry has lodged petitions at Westminster against RBS branch closures, on behalf of residents of Grantown, Aviemore and Nairn. Mr Hendry commented: “Over the past few months, residents in Grantown, Nairn and Aviemore have collected lots of signatures against the bank closures showing the real depth of concern about these proposals. While digital banking may be the preferred way to bank for some, for many it isn't even an option. A cash-based business certainly can't deposit their takings via a mobile app and several businesses have already raised concerns about the alternatives on offer by RBS. It is very clear that folk remain concerned about the removal of these banking services and want us to keep up pressure on the bank and government.”
Bramson met Old Mutual boss over Barclays ambitions
Activist investor Edward Bramson met with Old Mutual Global Investors chief executive Richard Buxton last month, to try and gain support for his plans to shake up Barclays.
No punishment for Danske Bank
Denmark’s Financial Supervision Authority will not punish Danske Bank for enabling money laundering via its branch in Estonia, but the bank's executive board has been reprimanded for not investigating allegations made four years ago.
Penalty charges set to be introduced at Wells Fargo
Investors have been told that Wells Fargo expects to make less in future from overdraft fees and other penalty charges, as the firm seeks to rebuild its scandal-hit reputation.
Rolls Royce champions Britain for next SUV
Rolls-Royce’s next SUV will be made in Britain, said chief executive Torsten Muller-Otvos on the BBC's Today programme. He said that although the firm would like to continue manufacturing at its West Sussex plant, with 90% of its vehicles bought by overseas purchasers, he is “truly interested” in maintaining frictionless free trade in any Brexit deal.
Barratt reveals strong trading update
Bucking the trend, Barratt Developments has revealed that total forward sales are at record levels, up 2.5% to £3.286bn, from £3.205bn at the same period last year. The home builder expects to approve the purchase of more than 20,000 plots for the full year, compared to 18,497 in the 2017 financial year, while its net cash position at June 30 is expected to be better than previous guidance, at around £550m. Chief executive David Thomas said: "We have a healthy forward order book and a robust balance sheet".
Goldman tie-up with Apple for move into credit cards
Goldman Sachs is planning to launch a joint credit card with Apple in 2019, under the latter’s Apple Pay brand. The move comes as Goldman continues to diversify away from its core investment banking business.
Revolt at Direct Line
Nearly a quarter of Direct Line voting investors have rejected 2017 pay deals at the annual general meeting, after new chief finance officer Penny James's £657,000 base salary was revealed to be 38% more than her predecessor's.
AMP pay report rejected by shareholders
Amid an investor backlash over a scandal that has seen around A$4.5bn (US$3.4bn) wiped off its market value, more than 60% of AMP's shareholders have voted against its remuneration report.
LEISURE AND HOSPITALITY
Shares in On The Beach fall 16%
On The Beach shares fell 16% on reports that a 19% increase in revenue to £45.3m and a 9% increase in profit to £10.8m in the six months to 31 March 31 were below forecasts. Chief executive Simon Cooper commented: “Given the resilient and flexible nature of our business model, the board remains confident in delivering a full-year result in line with management's expectations, taking into account the impact of flight capacity constraints as a result of the Monarch failure and the accelerated investment to support international growth.”
MEDIA AND ENTERTAINMENT
ITV weathers advertising storm
ITV has turned in a strong performance amid the tough advertising climate, with growth in advertising and revenues from its production arm ITV Studios. Total advertising rose 3%, broadcast and online revenues climbed 3% to £526m, total external revenues grew 5% to £772m, while revenues at ITV Studios were up 11% to £382m.
BT to cut 13,000 jobs
In the latest attempt by BT chief executive Gavin Patterson to rebuild from an accounting scandal and multiple business pressures, Britain’s biggest telecoms group is to cut 13,000 managerial and back-office jobs and move to a smaller London base. Patterson said that radical action was absolutely critical to ensure BT could deliver the next-generation fibre and mobile networks Britain needed, adding: “We need to make ourselves more efficient, we need to create oxygen within the business.”
New Comcast offer plans break fee
A $2.5bn break fee will reportedly be included by Comcast in any new offer for 21st Century Fox’s entertainment assets, effective should any Comcast-Fox deal meet regulatory trouble.
First quarter sees mortgage arrears at new low
Lenders have reported that the number of homeowners in mortgage arrears fell to a record low in the first three months of this year, with 78,800 in arrears of 2.5% or more of the outstanding balance. This represents a fall of 8% on the year before.
House of Fraser reports loss
House of Fraser has reported a loss of £43.9m in 2017 as sales fell. C.banner, the department store’s potential new owner, said the loss reversed a pre-tax profit of £1.5m for the previous year, while sales fell 6.3% to £787.8m. It blamed Brexit, terror attacks and online for damaging the performance of the group, which owns 59 UK stores. C.banner, which has agreed to take a 51% stake in House of Fraser if the chain pushes through a turnaround plan, said it expected that the retailer “will be able to take advantage of its well-known brand to capture growth potential,” adding that after restructuring, “business operation, profitability and cash flow will further be improved.”
MPs look to rescue high streets
The Commons Housing, Communities and Local Government Committee has launched an inquiry into England’s ailing town centres as they face pressure from online shopping and the financial problems facing some of the biggest high street names. The MPs will try to determine how high streets will look by 2030, and what measures can be taken to revive their fortunes. The inquiry will also consider whether councils have the correct planning, licensing, tax-raising and other tools needed to help local areas.
Bank of England holds interest rates
The Bank of England has kept interest rates on hold at 0.5% and cut its growth forecast for this year to 1.4%, down from its previous forecast of 1.8% made in February. The Bank said the cut is almost entirely due to the disruption to the economy caused by March's bad weather but that it expects a rebound in the coming months as unemployment remains so low.
Final salary pension deficits cut by buoyant markets
According to pensions consultancy Mercer, deficits at firms listed on the FTSE 350 fell to £76bn at the end of 2017, from £84bn the previous year.