Skip to Content
Skip to Main Menu

Daily News Roundup: Friday, 1st June 2018

Posted: 1st June 2018


FCA publishes high-cost credit review

Ahead of a wider review into retail banking, the Financial Conduct Authority's (FCA) new report on high-cost credit claims that the way that banks operate and charge for overdrafts needs “fundamental reform”. Proposed reforms include mobile alerts warning of potential overdraft charges, stopping the inclusion of overdrafts in the term ‘available funds’, requiring online tools to make costs of overdrafts clearer, introducing online tools to assess eligibility for overdrafts and making it clearer that overdrafts are credit or borrowing. FCA chief executive Andrew Bailey said: "Our immediate proposed changes will make overdraft costs more transparent and prevent people unintentionally dipping in to an overdraft in the first place. However, we believe more fundamental change is needed in the way banks charge customers for overdrafts."

HSBC looks to RBS for finance chief role

HSBC has approached outgoing Royal Bank of Scotland CFO Ewen Stevenson to replace Iain Mackay as its finance boss.

Barclays to invest in northern businesses

Barclays has set up a £500m fund to invest in northern businesses, with chief executive Jes Staley commenting: “It's vitally important businesses, civic leaders and government work to make the Northern Powerhouse a reality.”

Google advertisement ban criticised by Revolut

Revolut has criticised the ban on cryptocurrency advertising by firms such as Google and Microsoft, with the company’s head of mobile, Ed Cooper, stating: "Hopefully moving forward, a more balanced approach can be applied to both keep consumers safe, but also allow legitimate businesses to advertise their services and add value."

TSB letters sent to wrong customers

Following its much-publicised IT troubles, TSB has reportedly been sending personal letters to the wrong people. A spokesman commented: “We are working with our third party supplier to understand the root cause of the error and we'd like to apologise to anyone that may be impacted.”


Private equity firms toast Singaporean energy firm's UK entry

Sembcorp has bought into UK Power Reserve (UKPR), which generates low-carbon power to supply to the UK market and also runs large battery storage plants, for £216m. Private equity firms Inflexion and Equistone bought UKPR in 2015 and are celebrating strong returns from the sale.


Deutsche unit put on problem list

Deutsche Bank’s US subsidiary has been added to a list of financial institutions whose survival is under threat by the Federal Deposit Insurance Corporation. The lender commented: "Our principal US banking subsidiary has a very robust balance sheet, as disclosed in our annual and quarterly regulatory filings".

Insider trading charge for Goldman Sachs vice president

Woojae 'Steve' Jung, a 37-year-old Korean citizen and a vice president at Goldman Sachs Group, has been charged with insider trading by illegally using non-public information about several firms that were clients of the bank.

BoA staff quit

Three senior employees, along with several more junior ones, have left Bank of America's hedge fund arm after sexual harassment claims made against senior executive Omeed Malik saw him sacked.

Money laundering challenged by Nordic lenders

Sweden's Handelsbanken, Nordea and SEB, together with Denmark's Danske Bank and Norway's DNB, have set up joint anti-money laundering infrastructure.


IATA boss warns over airline profits

Alexandre de Juniac, head of the International Air Transport Association (IATA), has warned that increases in the price of oil are driving up costs​, meaning profits in the airline industry are unlikely to hit expectations. Juniac now anticipates lower than the $38.4bn in net profit he predicted for the industry previously.


Lloyd's of London staff relocated to Brussels ahead of Brexit

Lloyd's of London chairman Bruce Carnegie-Brown has said the firm chose Brussels as a base for a new subsidiary because it was “constructive” in helping it deal with new regulations. The company claimed its goal is to be positioned at the “heart of Europe” as it relocates around 40 of 600 workers from the City of London to Belgium. Mr Carnegie-Brown commented on Radio 4’s Today programme: “The proximity to London was extremely helpful, having the trains as well as the planes… and we wanted to be at the heart of Europe, and it would be hard to argue that Brussels is anywhere other than at the heart of Europe.”

State Street calls for board election reform

Asset management giant State Street has called for reform in how directors are elected to company boards across Europe. State Street held up the UK as an example of a country with good corporate governance practice, and said national corporate governance codes often improved practices at companies.

LGIM’s Zinkula to step down next year

Legal & General Investment Management CEO Mark Zinkula is to retire at the end of August 2019. Mr Zinkula has led the asset management company since March 2011.


Lebara distressed debt buyback pledge

Telecoms company Lebara has promised that, in exchange for more time to file audited results, it will buy back a portion of its distressed €350m bond.


House prices fell in May, Nationwide says

UK house prices fell 0.2% month-on-month, according to Nationwide, which has pegged annual house price growth at 2.4%, down from the 2.6% recorded in April and the third fall for house prices in the past four months. The lender said the average price of a property was £213,618 in May 2018, compared to £213,000 in April.

Regulatory changes unnerve landlords

Letting agents have said the number of buy-to-let landlords selling their properties is at its highest level in three years, with a "barrage of legislative changes" affecting the sector. David Cox, chief executive of Arla Propertymark, commented: “The barrage of legislative changes landlords have faced over the past few years, combined with political uncertainty, has meant the buy-to-let market is becoming increasingly unattractive to investors. Landlords are either hiking rents for tenants or choosing to exit the market altogether to avoid facing the increased costs incurred.”


Asda profits fall due to price cutting policy

A fall in 2017 profits has been reported at Asda, after the supermarket reduced prices to lure back shoppers who have switched to discount rivals Aldi and Lidl. Profits fell 13% to £735m, down from £845m the previous year.


Top Bank appointment causes outcry

The Treasury has appointed Jonathan Haskel, the only man on a shortlist of five candidates, to the Bank of England's interest-rate-setting committee. The Women's Equality party (WEP) said the decision did not fit with the Bank’s commitment to improving diversity, while Rachel Reeves, Labour MP for Leeds West and the chair of the business select committee, commented: "The fact that four women were shortlisted shows that there are plenty of capable and well-qualified women but yet again the top jobs seem to be reserved for men."

Consumer borrowing up

Household borrowing in April rose slightly, according to the Bank of England’s Money and Credit report, which pegged net lending for consumer credit at £1.8bn last month.


FirstGroup’s O’Toole resigns

Tim O'Toole, chief executive of FirstGroup, has resigned following poor results from the transport firm, with shares down 15% yesterday afternoon. Mr O’Toole commented: "Today's results clear the way for the new approach sought by our chairman and the board."

Close Menu