BANKING
Banks should justify closure programme
Two thirds of bank branches have closed in the past 30 years and a fifth of households are now almost two miles from their nearest location, according to a report from consumer organisation Which? From a total of 20,583 branches in 1988, only 7,586 remain, Which? calculated. The organisation pointed out that not all banking services are currently available at the Post Office and that banks often demand that customers call into a branch for antifraud checks, or to discuss important legal documents. Ceri Stanaway, Which? Money Editor, said: “Millions of people are struggling to access the vital financial services and cash that they need.” Mike Cherry, of the Federation of Small Businesses, added: “Bank branches are vital to a lot of small business owners.” Meanwhile, a survey by TSB found 68% of small business believe their needs are being overlooked by banks in favour of larger, more profitable companies.
Banking sector cautiously backs Brexit agreement
Theresa May’s Brexit withdrawal treaty has been cautiously welcomed by Britain’s banking sector, although some firms are pushing ahead with job moves and expansion in other EU states until a formal agreement is signed. Banks, including Barclays, HSBC, Goldman Sachs and JP Morgan, are unlikely to halt implementing their Brexit contingency plans without further clarity. Barclays is planning to expand its Dublin office by 150 to 200 staff that will include new hires and UK job moves. Catherine McGuinness, policy chair at the City of London Corporation, was relatively optimistic, saying the framework does offer some “welcome clarity” as firms wait for the text to be finalised. John McFarlane, chairman of Barclays, said the Brexit draft withdrawal agreement marks “constructive progress” and “presents a pragmatic and workable solution”.
Regulators call banks over market turbulence
Britain’s biggest banks were summoned yesterday for a call with City regulators over market turbulence after Government Brexit resignations sent the pound and stocks tumbling. It is understood major UK banks were asked for their feedback on the market reaction to the shock resignations. A spokesman for the Financial Conduct Authority said: “As you would expect, in this type of situation, we have regular contact with firms and will continue to engage with them.” RBS led falls in the banking sector, down 6%, with Lloyds Banking Group 5% lower and Barclays down 4%.
Banks urged to support misconduct inquiry
Kevin Hollinrake MP, the co-chair of the All-Party Parliamentary Group on Fair Business Banking (APPG), has called on bank bosses to support plans for a public inquiry into misconduct in the financial services sector. In a letter to the CEOs of all banks in the UK that offer commercial lending, Mr Hollinrake urges them to support the APPG's proposals for a public inquiry to offer "truth, reconciliation and restitution" for the past victims of bank misconduct.
HSBC and CIC in investment talks
HSBC and the China Investment Corporation (CIC) are in talks to create a £1bn fund which will be used to invest in British companies that have links with China. Charterhouse Capital Partners is in talks with both parties to manage the fund. City AM understands that the fund will be structured in a similar way to partnerships struck by CIC elsewhere in the world, such as the $5bn (£3.9bn) US fund set up with Goldman Sachs last year for investment in high-tech manufacturing and infrastructure.
Solid performance from Close Brothers
Close Brothers has said that it had made a "solid start" to its financial year, despite disclosing a £300m fall in client assets. The merchant bank’s loan book increased by 1.9% in the three months to October 31 to £7.4bn, while impairment charges remained low. Falling markets led to a drop in total client assets from £12.2bn at the end of July to £11.9bn by the end of October.
Investec posts rise in profits, boosted by banking unit
Anglo-South African banking group Investec has posted a 14% rise in statutory operating profit, to £359.3m, in for the six months to September 30, with a strong asset management performance.
Chalmers withdraws from RBS finance race
William Chalmers, co-head of the global financial institutions group at Morgan Stanley, has withdrawn from the race to become the next CFO at RBS. He was reportedly the leading external candidate for the role.
PRIVATE EQUITY
3i boss cautious about new investments
Simon Burrows, the CEO of private equity firm 3i, told investors that growing market uncertainty left him cautious about new investments and said the company will hold onto investments for longer if necessary. Shares in the company fell more than 6% on Thursday as opposition to Theresa May’s Brexit deal intensified.
London leads the way in AI investment
New figures from Pitchbook have shown that investment in London’s AI sector from venture capital firms has soared by more than 200% between 2015 and 2017. Pitchbook added that London-based companies have raised more than 65% of the UK’s total £1.27bn in AI funding in the last five years. The figures also showed that more than 25% of London AI companies have at least one female founder, compared with 17% of global start-ups.
INTERNATIONAL
EU bank stress tests should be redesigned, says watchdog head
Andrea Ernia, the outgoing head of the European Banking Authority, has questioned the value of its stress tests of lenders’ balance sheets, saying they need to be redesigned.
Estonia urges greater European action on money laundering
Estonia’s PM Juri Ratas has called for a European body to combat money laundering in the wake of the Danske Bank scandal.
AUTOMOTIVE
Aston Martin sees strong China demand
Aston Martin is expecting full-year sales to be at the top end of a 6200 to 6400 range after revealing that total wholesale units of cars sold almost doubled to 1776 for the third quarter on the back of surging demand in China. In its maiden results as a listed company, Aston Martin said revenue rose 81% to £282.4m, from £156.4m in the third quarter of 2017.
Ford talks to rivals over investment in driverless vehicles
Argo AI, Ford's autonomous vehicle unit, is in talks with several major rivals about pooling resources to invest in self-driving cars. Softbank and Honda have already partnered with General Motors.
FINANCIAL SERVICES
Intermediate Capital scoops up €6.1bn of new mandates
Intermediate Capital Group, the alternative asset management firm, has scooped up a record €6.1bn of new mandates in its first half, adding that all of its funds were on course to meet or exceed their expected rates of return.
Swiss watchdog launches inquiry into suspected Apple pay boycott
Switzerland's Weko competition regulator is probing whether banks have unofficially boycotted Apply Pay and other mobile payments platforms. UBS and Credit Suisse are among those under investigation.
Wonga assets worth a fraction of estimates
The assets of defunct payday lender Wonga are worth less than half the £70m estimated when it collapsed in August, administrators have said.
Bitcoin falls to year-low
Bitcoin's market capitalisation has fallen below the $100bn (£78bn) mark for the first time in over a year, down by as much as 9% to $5324. Other cryptocurrencies fell much harder, following a relatively stable recent period.
HEALTHCARE
Spire owner moves to patch up Swiss business
Mediclinic International, the biggest shareholder in Spire Healthcare, has said it will open more outpatient surgery units and cut costs in its Hirslanden business in response to regulatory changes in Switzerland's healthcare market.
LEISURE AND HOSPITALITY
Cineworld riding musicals renaissance
Cineworld UK has hoovered up the ticket stubs after punters flocked to see productions like Mamma Mia! and Bohemian Rhapsody, with revenues at its UK box office up 6.4% in the year to November. Cineworld, which posted an 11.6% rise in total group revenue in the period, also said that its acquisition of US cinema chain Regal was progressing well.
MANUFACTURING
Airbus says Brexit draft agreement a ‘welcome step forward’
Airbus boss Tom Enders has welcomed the draft Brexit withdrawal agreement but called for further clarity and the “removal of uncertainty” as soon as possible to aid business.
REAL ESTATE
Great Portland announces bumper share buyback
Great Portland Estates is set to repurchase 42m of its own shares over the next 12 months in a bumper £200m share buyback - at the mercy of a favourable Brexit agreement. Though revenue fell 22% to £50.8m, profit before tax almost doubled on 2017, to £40.4m, in the first half of the year ending September.
RETAIL
UK retail sales decline as consumers tighten belts
UK retail sales fell for the second consecutive month in October, the ONS has reported, down 0.5% after a mild autumn hit sales of winter clothes – missing expectations from economists that they would rise 0.2%. Non-food sales fell 1.3%, with a 1% decline in clothing sales. They were also down at household goods stores, by 3%, following a particularly strong August and September. For the three months to October, retail sales rose 0.4%, significantly down on the 2.3% increase recorded for the three months to July.
OTHER
PM remains determined on Brexit
Theresa May has dismissed speculation that she could be ousted as PM over her Brexit agreement, saying: “I am going to see this through”. Despite a series of ministers resigning and talk of a no-confidence vote, the PM vowed to get the deal signed off in Brussels and to put it to MPs. Mrs May told a news conference: “I believe with every fibre in my being that the course I’ve set out is the right one for our country and for all our people.” She warned that Britain would embark on “a path of deep and grave uncertainty” if it abandoned the withdrawal deal it had agreed with the EU this week. She was speaking after the Brexit Secretary Dominic Raab resigned yesterday over what he called “fatal flaws” in the draft Brexit agreement with the EU. Mr Raab said he could not support the deal because the regulatory regime proposed for Northern Ireland presented a “very real threat” to the integrity of the UK. He also said he could not support an indefinite backstop arrangement, in which the EU would hold a veto over the UK’s ability to exit. The work and pensions secretary Esther McVey also quit, having made it clear that was she was unhappy with Mrs May’s Brexit plans.