BANKING
City should prepare for no-deal Brexit on financial services
Lord Hill, the former EU Financial Services Commissioner, has said there is a growing realisation that the UK should not wait for unlikely European Union access for financial services but get on with building a more competitive City of London. Lord Hill added: “The worst possible thing you can do is just sit there and hope the Europeans will come to our rescue. The politicians, the regulators and the market are now broadly aligned about the need to get on with constructing a more, nimble, competitive, dynamic regulatory future for the City.” Clare Cole, the Financial Conduct Authority’s Director of Market Oversight, said that Brexit created an opportunity for a bottom up review of primary market rules and the challenges the City faces. She said that FCA recommendations on changing listing rules will be put out to public consultation soon, adding there were other areas for potential reform like prospectuses and the bond market.
Talent may steer clear of banks if culture remains
The Evening Standard’s Simon English proposes that banks like Goldman Sachs could find it harder to attract talent if they don’t reduce work stresses. Last month young bankers at Goldman protested at “inhumane” working conditions – conditions that stem from a culture going back to 1985, argues, English. But now millennials have the internet and the opportunities to get rich that spring from it. With the pandemic evidently changing working arrangements permanently, English suggests that “perhaps we will see banks making it possible for folk who want to have a family and actually see them sometimes to build a career.” Otherwise a huge pool of talent will go elsewhere.
Santander branch closures confirmed
Some 111 Santander branches in the UK are to shut, with about 5,000 jobs at risk as a result. Adam Bishop, an executive at the bank, noted: “Branch usage by customers has fallen considerably over recent years and we have made the difficult decision to consolidate our presence in areas we have multiple branches relatively close together. The majority of the closing branches are within three miles of another branch and the furthest is five miles away.” This comes in the wake of an announcement by HSBC that 82 branches would close in the next year.
UK bank fraud hits new record
UK consumers lost a record £479m last year to scammers, with Katy Worobec, managing director of economic crime at UK Finance noting a “worrying rise in online and technology-enabled scams.”
Ulster Bank fined over tracker mortgage scandal
Ulster Bank has been fined €37.8m for its role in Ireland’s tracker mortgage scandal. The Central Bank of Ireland issued the penalty after finding that 5,940 people were denied tracker mortgages, resulting in “significant and widespread overcharging”.
INTERNATIONAL
ECB in digital currency update
The European Central Bank has said its planned digital version of the euro would not replace physical cash, with board member Fabio Panetta and official Ulrich Bindseil stating: “The ECB is by no means planning to use a digital euro to enforce interest rates that are significantly more negative. As long as there is cash, it will always be able to be held at an interest rate of 0%.” The two wrote that “We have to prevent European payment transactions from being dominated by providers outside Europe, such as global technology giants who will offer art currencies in the future.”
SEC begins delisting measures
The Securities and Exchange Commission (SEC) on Wednesday adopted measures under the Trump-era Holding Foreign Companies Accountable Act, which aims to remove Chinese companies from U.S. exchanges if they fail to comply with American auditing standards for three years in a row. Chinese companies also face losing their U.S. listings unless they can prove a foreign government entity does not control them. The move led to a slump in dual-listed tech firms such as such as Baidu, JD.com and NetEase.
SEC questions banks over their work with Spacs
The US Securities and Exchange Commission has begun questioning banks over their work with special purpose acquisition companies, with sources suggesting the inquiries could develop into a formal investigation.
Merger puts 8,000 jobs at risk
Caixabank may cut between 7,000 and 8,000 jobs after merging with smaller rival Spanish lender Bankia, with negotiations with labour unions expected to begin after Easter.
Credit Suisse spreads out lifestyle bonus
Credit Suisse will give more junior members of its capital markets and deal businesses a £14,500 "lifestyle" allowance in an attempt to maintain staff morale.
AUTOMOTIVE
SMMT calls for more to be done on fuel transition
The Society of Motor Manufacturers and Traders (SMMT) has called for more action on supporting consumer take-up of electric cars if the UK is to reach its 2050 climate goals.
Ford axes the Mondeo to focus on electric and SUVs
Ford is proceeding with plans to refocus its European line-up towards electric models and sport utility vehicles, as it announced plans to phase out its Mondeo model.
AVIATION
Airbus breaks US hold on Japanese satellite market
Airbus has announced its first sale to one of Japan’s leading telecoms services companies, with a satellite deal agreed between the aerospace firm and Sky Perfect JSAT.
FINANCIAL SERVICES
Seedrs and Crowdcube scrap merger plan
Crowdfunding platforms Seedrs and Crowdcube have scrapped merger plans after the Competition and Markets Authority said that “blocking the merger may be the only way of addressing competition concerns”. The regulator’s preliminary decision had been due to go to consultation, but Seedrs said that it “does not make sense to continue the battle”. Crowdcube said that the two businesses had made a “joint decision” to scrap the deal.
CMC Markets expects 2020 operating income to come in higher
CMC Markets has reported a strong performance in the final quarter of its financial year, with operating income for 2020 predicted to be higher than expected. The firm expects to report results for the year ended 31 March 2021 on 10th June.
Lloyd's of London brokers could ditch suit for first time
A trade body representing brokers has said Lloyd’s of London workers should no longer be required to wear suits. The London & International Insurance Brokers Association (LIIBA) said when the market returns to physical trading, there should be "an end to...long queues for brokers at Lloyd’s for simple policy endorsements, dress codes and any insistence on being full-time in the office".
Plus500 confirms new appointment
Former head of JP Morgan, Professor Jacob Frenkel, has been appointed new chairman at online trading platform Plus500. Plus500 chief executive David Zruia said: “Professor Frenkel’s significant experience and knowledge of the financial services sector will be a huge asset for Plus500, as we enter a new phase of development, evolving into a multi-asset fintech group over time.”
LEISURE & HOSPITALITY
Deliveroo IPO hit by investor concerns
Investors including Legal and General Investment Management, Aviva Investors, M&G and Aberdeen Standard have said they will not be participating in Deliveroo’s IPO following a study showing many Deliveroo drivers are paid below the minimum wage. Investors have also raised concerns over the proposed dual-class share structure and the company’s reliance on gig economy workers, which Rupert Krefting, head of corporate finance and stewardship at M&G, said presented “risks to the sustainability of its business model for long-term investors”.
MEDIA & ENTERTAINMENT
Cineworld raises debt amid record loss
Cineworld has reported a record $2.3bn (£1.7bn) operating loss for 2020. The firm’s deputy chief executive Israel Greidinger remarked: “At the end of the day, the most important thing is the cash flow of the company. Together with the money we have just raised… we have enough cash to take the company through even difficult scenarios with cinemas not opening until the end of the year - and we have announced we are opening. We are well geared for the months in front of us.”
Tech startup what3words secures investment
Ikea and ITV have announced their support for startup What3words, which uses a unique three-word code to help pinpoint addresses around the world. Ingka Group, the holding company behind the Swedish retailer, stated: “What3words has created an innovative solution to the problem of poor and inaccurate addressing, which is a problem in both developing and developed countries.” Meanwhile ITV is taking a stake in the firm valued at £2m in exchange for ad inventory, with a further £2m investment option.
S4 Capital releases results
S4 Capital reported a 19.4% increase in gross profit to £295m last year, with revenue up 15% to £343m. CEO Martin Sorrell stated: “The pandemic has accelerated adoption of digital transformation amongst consumers, across all media and within enterprises and, in turn, stimulated the demand from clients for digital marketing expertise. We believe 2021 and 2022 will be very strong years economically, as the world rebounds from the pandemic and spends and invests the huge pandemic-driven fiscal and monetary stimulus.”
RETAIL
Boohoo dumps hundreds of suppliers in wake of review
A full list of UK clothing manufacturers fashion firm Boohoo works with has been published revealing the company has cut ties with more than 400 suppliers since allegations factory staff were paid less than minimum wage first came to light.
OTHER
New £50 note to launch in UK
Mathematician Alan Turing is depicted on a new £50 banknote which will enter circulation in June. Bank of England Governor Andrew Bailey said in a statement on Thursday “There’s something of the character of a nation in its money,” as the design was revealed.