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Daily News Roundup: Friday, 17th August 2018

Posted: 17th August 2018

BANKING

Public trust in banks still low, survey finds

Most Britons (66%) do not trust banks to work in the best interests of society, according to a poll of 2,250 adults by YouGov, on behalf of campaign group Positive Money, despite years of restructuring and compensation for misbehaviour. The survey saw 72% of respondents say banks should have faced more severe penalties for their role in the financial crisis. "The finance sector takes its responsibility to wider society extremely seriously and has undertaken significant reform in the last 10 years to ensure that the taxpayer should never need to bail out a bank again," a spokesman for UK Finance said.

Seven out of 10 people in UK now bank online

Office for National Statistics analysis shows that 69% of the UK population bank online, up from 35% in 2008, with users increasingly opting for smartphones and tablets over desktop and laptop computers.

HSBC raises rates for savers

HSBC is to increase interest rates on some savings accounts and variable rate mortgages in September. Following the Bank of England's decision to raise interest rates, HSBC will increase the rate on its loyalty ISAs by 0.1%, with rates on Help to Buy ISAs and saving accounts for children going up by 0.25%. Its flexible saver standard rate, of 0.05%, will rise to 0.15%.

Mortgage lenders target ‘silver borrowers’

The surge in retirement interest-only or “Rio” mortgages, following Financial Conduct Authority approval in March, is being led by building societies Bath and Tipton, Leeds Building Society and Hodge Lifetime.

Monzo poised to be fintech unicorn

Monzo is in line to become the latest European fintech "unicorn" after investors pumped $150m into the digital bank, with the firm set to be valued as high as $1.5bn.

TSB online banking sees fresh outage

TSB's online banking went down again on Thursday morning, though for just 30 minutes and the matter was quickly resolved. Customers took to social media to complain about the outage, while a spokesperson for the bank apologised for the issue.

PRIVATE EQUITY

Record year ahead for inbound insurance deals

Analysis by Unquote Data show that inbound UK private equity investment in insurance could have a record year in 2018. The year so far has seen 29 deals worth an estimated £7.4bn in aggregate value, a figure exceeding the 27 deals worth around £4.4bn seen for the whole of 2017. Europe saw 10 private equity insurance deals in July, up from the average of two transactions a month seen since January 2016.

Goldman agreed to support fund with ties to financier in spotlight after lawsuit

The FT reports that Goldman Sachs agreed to act as prime broker to a fund linked to a financier at the centre of a whistleblower complaint against the firm.

INTERNATIONAL

Hackers steal millions from bank in malware heist

Hackers have used malware to exploit cash machines in 28 countries to steal over £10m from Indian outfit Cosmos Bank. The malware used allowed the cyber criminals to approve transactions and access client accounts, with fake credit cards used to withdraw cash.

Dutch economy drives Rabobank profit rise, aims to help farmers

Dutch cooperative lender Rabobank has revealed a 12% rise in first-half net profit to €1.7bn on the back of a major cost-cutting drive and strong economic growth in the Netherlands. Rabobank said its overall loan portfolio grew 2% to €415.7bn, with increased lending to customers in its international Wholesale, Rural and Retail division to help agricultural customers hit by the unusually dry summer.

Fidelity targets Chinese savers with pensions deal

Fidelity International has partnered with ChinaAMC, one of the country’s largest fund managers, to launch a series of target-date funds, which typically invest more in equities to maximise returns.

AUTOMOTIVE

Volvo Cars to go ahead with Stockholm listing

Volvo will press ahead with an IPO later this year, reports the FT, with interest from potential investors suggesting parent group Geely will see its $30bn valuation met.

AVIATION

Air France-KLM set for union fight over new CEO

Amid concerns about Air France-KLM's ability to reform, the carrier is facing another fight with unions over the appointment of Air Canada COO Benjamin Smith as chief executive.

FINANCIAL SERVICES

Amazon could launch UK insurance comparison site

Amazon is reportedly negotiating with a number of leading insurers regarding the creation of a price comparison website in the UK, taking on operators such as GoCompare.com, Moneysupermarket.com and Confused.com. Kamran Hossain, analyst at RBC Capital Markets, said Amazon could undercut other price comparison sites by charging insurers less for leads through its own service.

Keep online pension project, Royal London boss urges

Royal London chief executive Phil Loney has urged the Government not to drop the online dashboard project, warning that it's a "key ingredient" to the new pensions landscape. "We're not looking for the Government to pay for it, but we need a commitment that they'll put the state pension details into the dashboard and we need them to compel all pension providers to take part," he said.

Schroders looks to continue family representation

Leonie Fane, the daughter of Bruno Schroder could be appointed to a non-executive role on the board of Schroders despite her lack of experience in financial services. Mr Schroder, who is the great-great-grandson of co-founder John Henry Schroder, could be replaced by his daughter when he steps down, according to reports.

HEALTHCARE

UK children’s care services providers agree deal at cheaper price

Children’s care service providers CareTech and Cambian Group have agreed a tie-up to create the UK’s second largest social care operator to meet the high-growth UK healthcare services market.

LEISURE & HOSPITALITY

Anti-laundering crackdown hits Rank Group's casinos

Rank chief executive John O’Reilly has blamed extra scrutiny his staff have to carry out on customers, resulting from the government’s anti-money laundering crackdown, for falling revenues. Total full-year sales at the firm, which owns the Grosvenor Casinos chain, fell 2.3% to £738m, while pre-tax profits dropped to £46.7m from £79.7m. Revenues at its Mecca division fell 2.6% to £208.1m, amid a pronounced fall in customer numbers.

REAL ESTATE

Countrywide accused over complex incentive scheme

Investors have been urged to vote against Countrywide’s new incentive scheme with advisory firm ISS describing it as “unnecessarily convoluted”. Countrywide is seeking shareholder approval to replace its long-term incentive plan (LTIP) with its “Absolute Growth Plan” for the next three years. Countrywide had failed to “justify the high quantum of the awards”, ISS said, adding that with the company’s market value at historic lows, shares could rise substantially.

RETAIL

Asda sees sales climb

Sales at Asda rose for the fifth consecutive quarter, with the supermarket reporting a 0.4% increase in like-for-like sales in the three months to the end of June. Removing the impact of Easter, which this year benefited the first quarter, sales grew 2.6%. The figures compare to a 1% rise in like-for-like sales during the first three months of the year. Online grocery sales grew 13 %, while its George brand saw sales grow by a quarter.

Kingfisher sales rise during warm weather

Kingfisher has reported a 1.6% rise in second-quarter like-for-like sales, boosted by the recent heatwave, with a 3.6% increase at its B&Q stores in the UK and Ireland offsetting a 1% decline in France. Screwfix saw a 5.5% increase in same store sales during the quarter. Kingfisher’s overall like-for-like sales rose to £3.26bn for Q2, and were up 4.2% across the UK and Ireland.

ECONOMY

Relief for retailers as sales rise

ONS figures show the recent heatwave and the World Cup boosted consumer spending last month, pushing up retail sales by 0.7%. This follows a 0.5% dip in June and exceeds analyst expectations of a 0.2% rise. July’s sales were up 3.5% on July 2017, while sales for the three months to July 2018 were the strongest since February 2015. Online sales accounted for 18.2% of sales last month – a proportion that marks a record high and a 15.3% increase on a year earlier.

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