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Daily News Roundup: Friday, 18th February 2022

Posted: 18th February 2022


Banking Hub company to keep access to cash

A new company will help to make sure there are sufficient cash services available to the public across the UK, with the new entity to oversee the roll-out of cash provision facilities. The Cash Action Group, which is made up of major banks, the Post Office and other bodies, last year said that any community facing the closure of a core cash service will have its needs assessed by Link. If the ATM network deems a hub to be necessary, banks have committed to delivering one. The Cash Action Group is establishing a Banking Hub company to oversee this and has appointed Gareth Oakley, who joins from Lloyds Banking Group, as its chief executive and Amanda Bell, formerly from TSB, as delivery director. Natalie Ceeney, who chaired an access to cash review as well as the Cash Action Group, will head the company. She commented: “The fact that we’ve secured such talented leaders to take forward this work demonstrates the level of commitment the banks have to this project, and the opportunity that we have to make a real difference to communities.”

Standard Chartered boosts bonus pool as profit rebounds

Standard Chartered has reported its latest results and revealed that annual pre-tax profits rebounded from $1.6bn in 2020 to $3.3bn last year. It also announced a $750m share buyback and set out plans to cut annual expenses by $1.5bn as part of a broader goal to achieve double-digit returns by 2024. Standard Chartered also revealed that it is to hand out almost $1.4bn in staff bonuses, with its bonus pool expanding by 38% from $990m in 2020 to $1.37bn in 2021. The bank, which said most of its 81,000 staff are eligible for a bonus, also revealed an increase in executive pay. CEO Bill Winters will see his overall remuneration package increase by 19% to almost $4.7m, while finance chief Andy Halford has seen a 21% rise to around $3m. Mr Halford said that bonuses had been “unusually low” in 2020 and that the latest rise represented “a normalisation back to more typical levels”. With banks looking to retain and attract staff as competition for talent puts pressure on pay in the sector, Mr Winters said that skills in areas including wealth management, cybersecurity and system engineering were “very heavily in demand” and that competitive pressures were “pretty extreme”.


Commerzbank profit outdoes estimates

Commerzbank has seen better-than-expected fourth-quarter and annual net profit. The bank said profit for the year will exceed €1bn and said its net profit came in at €421m in the fourth quarter, versus a loss of €2.7bn a year ago. Analysts had on average expected a profit of €81m. Manfred Knof, chief executive, said its 2021 performance "increases our confidence that we will achieve our ambitious goals for 2024".


Airbus reinstates dividend as profits jump

Airbus has reinstated its dividend on the back of record annual profits. The aerospace group, which delivered 611 commercial aircraft last year, up from 566 the year before, saw a record net income of €4.2bn, bouncing back from a €1,1bn loss recorded in 2020. Revenues grew by 4% to €52.1bn, while adjusted operating profit jumped from €1.7bn to €4.9 bn. Its net cash rose from €4.3bn to €7.6bn. The firm has declared a dividend of €1.50 a share, its first pay-out for two years. Airbus CEO Guillaume Faury warned that the pandemic was “not yet behind us” and the company was still facing issues, but pointed toward a full recovery between 2023 and 2025.


CISI chief: ‘The FCA is always playing catch-up’

Simon Culhane, chief executive of the Chartered Institute for Securities and Investment, says the Financial Conduct Authority (FCA) is always “playing catch-up”, suggesting that a “lack of consistency” at the City watchdog is to blame. He warned that, like many other regulators, the FCA is always following innovation rather than taking a proactive approach. Mr Culhane told FT Adviser that regulators must “work in collaboration and involve the practitioners rather than just dictate.” “It has to be a common regulation otherwise you are forever destined to catch-up and it becomes antagonistic and it doesn't really work,” he added. Pointing to a lack of consistency “amongst the FCA people,” Mr Culhane said they “don't stay long enough and they don't understand the subject.” “If you talk to any group of CEOs in a room, they'll tell you that's the fundamental problem.”

Invesco to close fund with focus on Russia

Invesco has announced it will close its Emerging European fund, which has substantial investments in Russian companies, next month after deeming it no longer commercially viable. As tensions between Russia and Ukraine have risen, shares in Russian companies have plummeted. The fund lost a quarter of its value between November 11 and January 24, but has bounced back by 15% since then.


Hospitality sector calls for extended VAT aid

The hospitality sector has urged the Chancellor to extend VAT support beyond April, with industry body UKHospitality saying the pandemic had resulted in almost £115bn of lost sales for its businesses since March 2020. It warned that this means the sector is 43% down on what it would normally expect, adding that with inflation surging, the recovery is now at risk from "rising costs across the board.” UKHospitality has called on ministers to hold VAT at its current level of 12.5% in April when the tapering of the tax support is due to end. Chief executive Kate Nicholls said the pandemic has wreaked “utter devastation” on the sector, “with thousands of businesses closed, many on the brink of collapse, and countless jobs lost.” She added: “The last thing operators need - and which a lot of them simply wouldn't survive - is a VAT increase."


Demand for city-centre accommodation bounces back

Demand for city-centre properties is returning fast, according to new data, suggesting that many people in both England and Scotland are keen to move back closer to the office now that working from home is no longer required. During the start of the pandemic, rents of homes in London plunged to their lowest, whilst those of outside London soared as people flocked to the countryside in hopes of finding more space and cheaper deals. However, as per the latest data analysis from online search experts MediaVision, the trend now seems to be reversing. As people scramble to seek a home closer to their workplace, London and Edinburgh have come out on top with online search volumes for “rooms to rent London” up 98% compared to 2021 and “flats to rent Edinburgh” up 103.31%. Meanwhile, searches are down for “houses for sale in Cornwall” (down 46%), “houses for sale in Devon” (down 37%) and “houses for sale in Plymouth” (down 19%). Similarly, Scotland has also seen a decrease in searches for more rural properties, as “houses for sale” in rural and seaside areas such as West Lothian and Falkirk registered a drop of 29% and 27% respectively.


JD delays results so auditor can assess Footasylum sell-off

JD Sports' full-year results will be delayed to allow auditors more time to gauge the impact an enforced sell-off of Footasylum will have on the business. The sportswear retailer said the delay was to ensure that its auditor "has sufficient time to complete its global audit procedures and to allow the group to report on the outcome of the divestment of Footasylum with greater certainty". The Competition and Markets Authority last year ordered JD to sell Footasylum, which it bought in a £90m deal in 2019, over competition concerns. JD Sports' full-year results were scheduled for April 12.

Amazon agrees Visa credit card deal

Amazon will accept Visa credit cards across all of its sites after the businesses reached a global agreement. Amazon had threatened to stop the use of Visa credit cards in the UK due to the fees Visa charged to process payments. The retailer said that the cost of processing payments was "an obstacle" to providing the best prices for customers. However, Amazon and Visa have now struck a deal.


IMF: Supply chain crunch hurting the global economy

The International Monetary Fund (IMF) has warned that supply chain breakdowns that are contributing to soaring inflation are inflicting serious “harm” on the global recovery from the pandemic. The economic watchdog warned: “A large and sustained rise in costs due to bottlenecks can harm the recovery, both by lifting consumer prices and cutting into households’ purchasing power, and indirectly by leading central banks to tighten monetary policy sooner to prevent inflation expectations from shifting above target.”

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