Finance sector hits ‘peak uncertainty’ over Brexit
London Stock Exchange chief David Schwimmer has said the financial services sector is in a “period of peak uncertainty” due to a lack of clarity over Brexit. His comments come as the European Commission says that assessments of whether to grant market access for UK banks and other financial firms will not be completed in time for January. Mr Schwimmer said: “It looks like the EU will make sure there is a cost to Brexit, but it’s really important for global business to be able to participate in the biggest markets,” he said. “Less fragmentation and more co-operation and continuity of service are in everyone’s interest.”
Financial sector workers work better remotely
New research has found that financial services employees report feeling more productive and well while working remotely. Avoiding the commute was listed by 66% as the main benefit to the current situation, while 60% of respondents believed the ability to meet in person was the most important benefit of working in an office. Some 78% of those surveyed agreed that their employers were prepared for their staff to continue working remotely in the long term.
ECB flags more stimulus ahead as financial conditions tighten
The European Central Bank has indicated that it is getting ready to inject more stimulus into the economy with its chief economist citing "worrying" signs that conditions for banks and small businesses are tightening.
Spanish banks seek firmer footing with round of mergers
Spanish banks have kicked off a round of consolidation after European and national regulators called on the sector to prepare for a rise in bad loans next year.
Amigo Loans confirms fall in H1 revenues
Amigo Loans has reported a 36.5% decline in first half revenues amid “material uncertainty” about its future operations. The London-based subprime lender cited concerns related to the coronavirus pandemic, as well as complaint volumes and an ongoing regulatory investigation, as revenues fell to £92.3m over the six months to end-September, while a pre-tax loss of £62.6m was recorded. Chief Executive Gary Jennison remarked: “It’s undoubtedly been a difficult period for Amigo but as a team we have made significant progress towards quantifying and addressing the challenges we face.”
Aviva reports inflows of £1.2bn amid pandemic
Aviva has reported third-party net fund inflows of £1.2bn as the firm maintained its interim dividend amid the coronavirus crisis. After the company’s board declared a 7p per share interim dividend, to be paid in January 2021, the group stated: “This level of dividend is sustainable and resilient in times of stress, and is covered by the capital and cash generated from the core markets of the UK, Ireland and Canada. Future dividends per share are expected to grow by low to mid-single digits over time.”
Aberdeen Standard targets women-led hedge funds with new strategy
Aberdeen Standard Investments is set to launch a fund investing only in hedge funds run by women following demands from investors for improved diversity, which is said by some to lead to better returns.
Online shopping surge boost for Klarna
Swedish online lender and payments provider Klarna has said transactions using its buy-now, pay-later platform have soared 43% as consumers have spent more online during the pandemic.
LEISURE & HOSPITALITY
Pub chains reveal scale of pandemic effects
Following a £123m loss for 2019, pub chain Mitchells & Butlers has announced that 1,300 jobs are to be lost this year, citing store closures and reduced levels of activity due to the coronavirus crisis. Meanwhile brewery and pub chain Fuller’s reported a £22m loss before tax in the six months to 26 September, with £45.6m in revenue for the six months, a decrease from £167.1m during the year-earlier period.
Disney plans further reduction in workforce
Walt Disney has announced plans to lay off a total of 32,000 workers by March, about 4,000 more employees than the 28,000 job cuts announced in September. Most of the job losses will come in the company’s theme-park ranks, where thousands of workers have already been furloughed or laid off.
Britvic reports fall in adjusted earnings
Soft drink firm Britvic has reported a near 22% fall in adjusted earnings before interest and taxes for the 12 months ended September 30 to £165.8m, down from £214.1m in the year earlier period.
Dyson pledges new investment into AI, robotics and batteries
Dyson is to invest an extra £2.75bn on developing new products over the next five years, with a focus on AI, robotics and energy storage.
MEDIA & ENTERTAINMENT
TikTok deadline extended in US
Social media firm TikTok has been granted an extension to an order forcing it to sell its US operations, with parent company Bytedance receiving a further 15 days to resolve concerns about national security. The Chinese firm has filed a legal petition challenging the validity of President Trump’s executive order, while also succeeding in overturning a ruling from the US commerce department that would effectively have seen the TikTok app banned in the US.
Successful Hong Kong IPO for Evergrande Property
Evergrande Property Services Group has reportedly raised $1.8bn in its major Hong Kong stock market float, with the sale at HK$8.80 per share around a 5% increase on a private funding round earlier this year, which saw shares issued at HK$8.375. Evergrande is now valued at HK$95.06bn.
Sir Brian Leveson appointed by Boohoo to oversee shakeup
Boohoo has appointed Sir Brian Leveson to supervise efforts to overhaul the fashion retailer’s supply chain after a report confirmed there were unacceptable working conditions at supplier companies. Boohoo has brought in Sir Brian to scrutinise its efforts to bring “long-lasting and meaningful change” to its supply chain.
Resolution Foundation foresees prolonged income squeeze
The Resolution Foundation has predicted that the coronavirus crisis will see Britain’s 15-year squeeze on household incomes prolonged, with pay cut by £1,200 annually within the next four years. Torsten Bell, chief executive of the think tank, stated: “The pandemic is just the latest of three ‘once-in-a-lifetime’ economic shocks the UK experienced in a little over a decade, following the financial crisis and Brexit. The result is an unprecedented 15-year living standards squeeze.” The organisation said that most fiscal support in the wake of the crisis will need to be raised from tax rises, noting: “While the priority now is to support the economy, the permanent damage to the public finances will mean tax rises in the future.”
Johnson appoints banker as No 10 chief
Boris Johnson has hired Dan Rosenfield as his new chief of staff. Rosenfield is a former Treasury official turned banker who served as principal private secretary to Alistair Darling and George Osborne.