Mortgage approvals up in September
The Bank of England (BoE) has reported that approvals of mortgages for house purchase increased to 91,500 last month from 85,500 a month earlier, with pent-up demand and the stamp duty holiday cited as reasons for the housing market boom. September’s total marks the highest level since 2007. Net mortgage borrowing in September was at £4.8bn, an increase from August’s figure of £3bn. Andrew Montlake, managing director of mortgage broker Coreco, warned that a surge in activity may soon draw to an end, saying: “The post-lockdown bull run is already over … Lenders have been pulling down the shutters due to ongoing struggles with capacity and concerns over rising unemployment levels, specifically the impact on house price growth.” The BoE data also shows that households increased deposits accumulated in bank accounts in September, with the total climbing by £6.8bn. It was also shown that Britons made net repayments of £600m in September.
Lloyds results beat estimates
Lloyds Banking Group has reported better-than-expected figures, with the £1bn in profit before tax in Q3 exceeding analysts' expectations of £588m. The bank saw mortgage lending climb by £3.5bn in the period, hitting its highest level since 2008. The bank put aside £301m in the third quarter to cover the cost of soured loans. It also said that it expects losses for this year to be at the lower end of its £4.5bn to £5.5bn range. The bank also announced that Robin Budenberg will become chairman in January, replacing Lord Blackwell. Considering Lloyds’ figures, Susannah Streeter of Hargreaves Lansdown commented: “The outlook is still highly uncertain and there was no mention of the return of the dividend. However, the group is heading into this stretch in a resilient position.”
StanChart profit hits $745m in Q3
Standard Chartered has reported an underlying pre-tax profit of $745m for Q3, a year-on-year dip of 40%, while operating income fell 12% year-on-year to $3.52bn. Charges on bad loans came in at $358m - significantly lower than the $611m recorded in the second quarter. The bank says it will consider resuming shareholder returns at its full-year results in February, with a “strong capital position” allowing it to do so.
BlackRock pushes for global ESG standards
BlackRock has called for a universal framework for environmental, social and governance disclosures to replace the “alphabet soup” of standards companies currently use, saying this would provide investors greater clarity.
Credit Suisse planning hires
Credit Suisse is planning to make further hires for its new investment banking advisory unit for wealthy clients, CFO David Mathers has revealed. He said former Bank of America investment banking chief Christian Meissner will lead a unit “that will step up the offer we have for large ultra-high net worth clients in the investment banking space.” Meanwhile, despite reporting a 38% fall in Q3 net income, Credit Suisse plans to renew dividend payments and begin a buyback programme in the coming months.
UK car production continues to slump
UK car production suffered its slowest September since 1995 as the coronavirus pandemic continued to batter demand, according to the Society of Motor Manufacturers and Traders. Just 114,732 vehicles rolled off production lines last month, down 5% on the same month last year.
United Airlines launches coronavirus testing
United Airlines is to offer every passenger over the age of two on flights between Newark and London Heathrow a test for coronavirus, with passengers who do not wish to take part put on another flight. This comes as the first pre-departure testing facility, for passengers flying to Hong Kong, launched at Heathrow Airport.
Airbus signals no more job cuts despite new rise in Covid cases
No additional job cuts are being planned at Airbus, the company has announced, as it delivered better than expected third-quarter results with an inflow of €642m.
JPMorgan investment for payments firm
Icon Solutions, which advises clients such as HSBC, Citigroup and Wells Fargo on digital payments systems, is to receive investment from JPMorgan Chase. Simon Wilson, Icon Solutions co-head of global payments solutions, remarked: "The banks are having to find ways of cutting costs, but with the competition out there they can’t afford to just slash and burn. They are forced to look at innovative ways to do things. It’s simply not sustainable to remain on the cost base with the old technology they have.”
Asset managers warned over ‘insufficient’ climate risk reporting
The Financial Stability Board’s Task Force on Climate-Related Financial Disclosures has warned that information asset managers provide clients about climate risks at companies they invest in “may not be sufficient”.
Financial agency calls for human rights to be included in sustainable investment policies
A report commissioned by Luxembourg for Finance and jointly conducted by Finance & Human Rights in Luxembourg and the Geneva Center for Business and Human Rights in Switzerland has called for human rights to form a core part of financial institutions’ sustainable investment policies.
LEISURE AND HOSPITALITY
Pizza Express to cuts further jobs
Pizza Express is to cut 1,300 more jobs due to the most recent restrictions imposed on the hospitality sector. It comes just weeks after the chain revealed it would shut 73 restaurants, putting up to 1,100 roles at risk. The latest job cuts will affect all 370 restaurants through a combination of voluntary and compulsory redundancies, although no restaurants are to be closed in the latest programme.
Odds are good for Rank revolt
Casino and bingo hall operator Rank faces a shareholder revolt over boardroom pay, with Sky News reporting that a number of large institutional investors are set to protest over the company's remuneration report and future pay policy.
MEDIA AND ENTERTAINMENT
Spotify beats own expectations as users increase
Over 320m people are now using streaming service Spotify every month, with the firm beating its own estimates by adding 21m monthly active users in the three months to the end of September. Revenue was at £1.79bn, some 14% higher year on year than in the year-earlier period.
WPP revenues fall less than expected
WPP has reported a 7.6% decrease in like-for-like revenues to £2.4bn in the three months to September, marking an improvement on the 15.1% fall recorded in Q2. Revenues for the first nine months of 2020 were down 11.5% to £8.6bn.
BT releases half-year results
BT has reported that profit for the half year was down 20% to £1.06bn, with a lack of live sport seeing revenue fall 8% to £10.6bn.
Samsung releases profit expectations for current quarter
Profits at Samsung are expected to fall in the current quarter, while the firm reported record revenues for the three months to the end of September, with operating profit up 59% to 12.35trn Korean won (£8.4bn), sales in its smartphone division up 50% and quarterly profits from the unit the highest they have been in six years.
GardaWorld bid dismissed by G4S management
G4S investors have been advised by management to ignore a £3bn hostile bid from GardaWorld. G4S chairman John Connolly said the suitor “lacks global scale and coverage and acquiring G4S at a discount to fair value would allow them to own a clear leader in global security - at your expense.”
City charter pushes business to bring through senior black executives
A number of advisory and law firms have backed the Charter for Black Talent in Finance and Professions, an initiative that seeks to increase representation of black people in senior positions.
Foxtons reports third-quarter results
Foxtons has reported that business improved “significantly” in the third quarter, with the estate agent chain seeing group revenue of £28.5m for the three months to September 30.
Profits soar at Amazon
Amazon has reported that sales rose 37% in the third quarter to $96.1bn (£74.3bn) as shoppers continue to move online due to the COVID-19 pandemic. Profits rose 200% from $2.1bn to $6.3bn, despite Amazon saying it had spent heavily on safety measures related to the virus.
IMF downgrades forecast for UK economy
The International Monetary Fund (IMF) has downgraded its forecast for the UK economy and predicted it will shrink by 10.4% in 2020. This marks a decline on the 9.8% hit to GDP that the IMF forecast two weeks ago. It said that the UK’s economic recovery is likely to be weaker than expected because of the second wave of coronavirus hitting Europe and ongoing Brexit uncertainty. The IMF warned that the coronavirus crisis could leave a legacy of “persistently higher unemployment”, and while IMF managing director Kristalina Georgieva praised the Government for spending heavily to support jobs, incomes and businesses, she urged Chancellor Rishi Sunak to roll out further spending to ease the impact of the pandemic, saying continuing government support is “essential” for the economy. The IMF’s longer-term forecast suggests the UK economy will see growth of 5.7% in 2021.