BANKING
HSBC appoints new head of global banking
HSBC has announced that Lisa McGeough, former executive vice president of Wells Fargo, is to become its new head of global banking in Europe. She will be tasked with addressing first line risk management, specifically credit, reputational, compliance and financial crime among other issues. Meanwhile, climate change activists have smashed windows at HSBC's Canary Wharf headquarters in an Earth Day demonstration. They claim HSBC has provided £81bn to fossil fuel firms since the Paris Climate Agreement was signed in 2016. A spokesman for the bank said: “We welcome meaningful dialogue on our climate strategy. However, we cannot condone vandalism or actions that put people and property at risk.”
Banks wary of 95% mortgage guarantee scheme
None of Britain’s main lenders are offering 95% mortgages on new build homes under the Government's new loan guarantee scheme, the Sun reports, with analysts pointing out that new build sellers are less likely to make gains than those selling second-hand properties, leaving banks wary of high LTV lending. The mortgages are available on properties worth up to £600,000, and home movers as well as first-time buyers can apply. But second-home and buy-to-let purchasers will not qualify. There are now just over 40 deals available on the scheme and the FT reports that fixed rate deals for five-years stand at around 4%.
Survey reveals influence of banks on environmental policies of firms
Research by law firm Addleshaw Goddard reveals that banks have a major influence in terms of driving green issues and changing the behaviour of businesses. Amanda Gray, a partner at the firm remarked: "These findings reveal that financiers are emerging as unlikely activists, putting sustainability at the heart of their strategies. This is a transition period, where businesses in all sectors need to move to a more sustainable future. All of the respondents said that by 2025, businesses that haven't got a sustainability plan in action by 2025 will have the tap turned off.”
Metro seeks higher yields from consumer finance lending
Metro Bank is looking to increase its consumer finance lending to £2bn hoping a shift into riskier but higher-yielding lending will help the loss-making bank return to profit. "In line with our transformation plan, we're accelerating initiatives to shift our asset mix to deliver higher risk-adjusted returns through consumer lending and specialist mortgages," a company spokesperson said.
PRIVATE EQUITY
Asset sales propel Blackstone to record profit in first quarter
Blackstone reported net income of $1.75bn in the first quarter – a dramatic turnround from the $1.07bn loss posted in the same period last year. The FT’s Lex considers the strategy of Blackstone and its rivals KKR and Apollo, with all three agreeing permanent capital is an attractive growth market going forward, even if fees are lower.
AlpInvest raises $3.5bn for new co-investment fund
Carlyle Group's AlpInvest Partners has raised $3.5bn for its eighth co-investment fund. AlpInvest Co-Investment Fund VIII will invest alongside private equity firms in businesses in consumer, industrials, healthcare, technology, financial and business services, mostly in North America, Europe, and Asia.
INTERNATIONAL
BBVA to cut staff and close branches
BBVA has announced plans to cut some 16% of the banking staff in its home market of Spain, representing 3,800 jobs, while 530 branches are to close down. This follows chairman Carlos Torres telling shareholders earlier this week that an upcoming restructuring plan was necessary to secure the lender’s future sustainability.
Bonuses for young UBS bankers to boost morale
UBS has introduced a new promotion bonus for junior investment bankers and will be boosting recruitment to help lessen the workload for junior staff. Programmes focused on physical and mental health will also be introduced as part of measures to improve work-life balance, according to a memo from global Banking co-heads Ros Lesperance and Javier Oficialdegui.
Spain to rein in top bankers' wages
Spain’s economy minister Nadia Calvino said on Thursday that the country’s government and central bank would seek to find ways to control the salaries of top bankers as the industry restructures and the economy emerges from the pandemic. "I think salaries and bonuses of banking executives must be aligned with the evolution of the industry and the economy as a whole," she told reporters.
Wells Fargo plans to shift Asian hub from Hong Kong to Singapore
Restructuring plans initiated by Wells Fargo will see the US bank move its Asian regional hub from Hong Kong to Singapore, which has become a beneficiary of tensions between Hong Kong and the CCP.
AUTOMOTIVE
Hyundai profits surge three-fold on pandemic rebound
Hyundai Motor has reported a near three-fold increase in first-quarter net profit, with one analyst noting: “It’s better product mix and lower costs have boosted earnings.”
Renault warns over car industry’s worsening global chip shortage
Renault has cautioned that disruption caused by a chip shortage crisis facing the car industry could last for months, as temporary plant closures were confirmed by Jaguar Land Rover. Thousands of JLR workers are to be stood down from Monday for an unknown amount of time.
AVIATION
BAE faces growing investor revolt over chief executive’s pay
Proposals to hand BAE Systems’ chief executive Charles Woodburn an extra £2m to stay are facing opposition from shareholders with the Investment Association giving a red-top alert to the award.
CONSTRUCTION
Morgan Sindall profits expected to beat estimates
Construction group Morgan Sindall has announced that this year’s profits would be “significantly ahead of its previous expectations,” with all divisions, including property maintenance, infrastructure development and housebuilding, enjoying a “positive” start to the year.
Taylor Wimpey chief says demand for homes highest in two decades
Pete Redfern, chief executive of Taylor Wimpey, has said he has more “confidence than at any time in the last 20 years” about underlying demand for new homes. The firm has built up a substantial land bank with 82,000 plots now under its ownership.
FINANCIAL SERVICES
EU in no rush to grant City renewed access to financial markets
Mairead McGuinness, the European Commissioner for financial services, has said that the EU is in “no rush” to grant the City of London renewed access to its financial markets post-Brexit. Speaking to an event held by the European Securities and Markets Authority, McGuinness said: “I know there probably is an appetite on the UK side for us to sit down and get going. We are certainly very keen to do that, but we’re not under pressure to do it.” She added: “There won’t be a moment, as there was with the trade agreement, where we are sitting down and announcing a big package. I see it more on a case-by-case basis.”
PensionBee calms nerves with trouble-free debut
PensionBee’s debut on the London Stock Exchange saw the company raise £55m from new shares which it will use to finance advertising and marketing campaigns and to develop its technology. The fintech firm owns an app that allows people to consolidate their pensions into a single investment plan.
AJ Bell reports rise in customer numbers
AJ Bell has reported a 32% year-on-year increase in customers to 346,797, with net inflows during the three months to the end of March totalling £1.5bn and gains from market movements adding £1.2bn to the firm’s assets.
Wirecard employees removed millions in cash using shopping bags
Employees of Wirecard removed millions of euros from the firm’s Munich headquarters over a period of years, former staff members have claimed as an investigation into the firm continues.
Ping An profits hit by property developer’s woes
Chinese insurer Ping An reported a 4.5% increase in net profits to Rmb27.2bn, while the firm’s retail customer base grew 1% over the past year to over 220m people.
Jack Ma’s Ant shrinks money market fund as Beijing cracks down
Ant Group’s money market fund was down 18% in the first three months of the year to Rmb972bn ($150bn) as users were encouraged to switch to other providers’ funds.
HEALTHCARE
Oxford Nanopore hires banks for London listing
UK life sciences company Oxford Nanopore has appointed Bank of America, Citi and JP Morgan as global coordinators for a London listing that is likely to value the company in excess of $3bn.
MANUFACTURING
CBI quarterly Industrial Trends survey published
The latest CBI quarterly Industrial Trends survey has been released, with Rain Newton-Smith, CBI chief economist, noting: “Manufacturers have reported the biggest increase in optimism in nearly 50 years in this month’s quarterly survey. Phased reopening has lifted the mood among firms, notably driving orders, employment, and investment plans.” Tom Crotty, group director at Ineos and chair of the CBI Manufacturing Council, added: “It’s hugely welcome to see manufacturers planning to invest more in their businesses following what has been an extraordinarily difficult period for the sector.”
MEDIA & ENTERTAINMENT
Informa announces £1bn loss
Conference organiser Informa has reported a £1.1bn pre-tax loss for last year, citing the “impact of COVID-19 on the long-term trading outlook for our physical events.” The firm forecast revenues of at least £1.7bn for the coming financial year.
ECONOMY
Hopes for consumption boom send GDP forecasts up
A monthly survey of independent economists by the Treasury suggests that growth this year could be as high as 5.7%, up from the 4.7% predicted in March. The Times notes that JP Morgan, Oxford Economics and Bloomberg Economics expect growth of 7% or more, which would be the quickest economic advance in the post-war era. Allan Monks, UK economist at JP Morgan, is the most optimistic of the City forecasters, projecting 7.4% growth this year. The Treasury’s analysis also showed investment expanding at 7.4% and joblessness peaking at 6.2%, down from 6.4% expected last month.