Many top UK bankers had special tax status
More than a fifth of the UK’s best-paid bankers have claimed a status that means they can avoid paying tax on their foreign wealth, according to researchers from the London School of Economics (LSE) and the University of Warwick who say finance and insurance is the most popular industry for people registered overseas for tax purposes. The research paper also suggests that tightening rules for “non-domiciled” people didn’t precipitate the widescale departure of foreign talent from the UK. “The non-dom regime is used mainly by the very rich, who get tax breaks not available to ordinary taxpayers,” said Andy Summers, assistant professor at LSE’s Law Department. “This giveaway could be costing the Treasury significant revenue and deserves more scrutiny at a time when everyone else is facing tax rises.”
Scale of Covid loan fraud leaves UK struggling to reclaim billions
The sheer volume of Covid loan fraud and the UK’s lack of capacity to pursue the criminals involved means many fraudsters will escape prosecution, experts say, while relatively little will be recovered.
US banks may slow stock buybacks as bond yields rise
US banks are beginning to see capital decline as a result of a fall in the value of bonds triggered by rising interest rates. For the largest lenders this will mean less excess capital to fund share buybacks. Fewer buybacks mean less growth in earnings per share, which puts more pressure on stock prices, says bank analyst Charles Peabody of Portales Partners. "You're going to see a lot lower buybacks than you did last year in the US banking system.”
Banks push for clarity to avoid ‘over-compliance’ with sanctions
European banks are seeking guidance on sanctions amid concerns about “over-compliance” and a "misalignment" with equivalent measures imposed by the US and UK. Bank of Spain Director General for Supervision Mercedes Olano comments: "For internationally active banks it's a puzzle because sanctions are not the same in Europe as in the US or in Britain or Japan.”
US brings foreign banks into intelligence-sharing fold
US federal agencies are sharing intelligence with foreign banks as part of moves to protect against cyber-attacks conducted in retaliation for the economic sanctions imposed on Russia.
Government wants to speed up shift away from petrol
The Government is working on new legally binding targets to speed up the shift away from petrol and diesel. The Department for Transport has proposed a requirement that half of all new cars should be fully electric-powered by 2028. This would rise to 80% in 2030. By 2035, no new hybrid or petrol vehicles will be allowed to be sold. The Society of Motor Manufacturers and Traders said that new rules “must encourage consumers to purchase, not just compel manufacturers to produce”.
FCA raises fees to pay for quicker response to predatory firms
The Financial Conduct Authority is to increase the authorisation fees paid by Britain’s small finance firms in a move the regulator claimed would help speed up the policing of the industry. The minimum authorisation fee for most firms will go up from £1,151 next year to £1,750 after a near-freeze lasting ten years, and then to £2,200 in 2023/24. The UK’s small consumer credit brokers will see their fees lifted from £106 to £750 by 2023/24 and most others will see at least a doubling of the levy. The latest fee proposals were published alongside a three-year strategy in which chief executive Nikhil Rathi pledged to make the regulator more assertive and quicker in stamping out wrongdoing and consumer harm. The FCA said it will hire 80 extra staff to help it more rapidly close down authorised firms doing harm to the public and draft new rules to cover crypto assets, including so-called stablecoins backed with traditional assets.
BoE fintech head leaves for crypto startup
Varun Paul, head of the Bank of England's fintech hub, has left the role after just over a year to join crypto startup Fireblocks. He will take up an unspecified role at Fireblocks, a digital asset custodian valued at $8bn. Since launching in 2018, Fireblocks has amassed $45bn of customer assets under custody. In January the company raised $550m in a round which drew participation from CapitalG, a venture capital firm owned by Google's parent company Alphabet.
LEISURE & HOSPITALITY
888 secures William Hill at discount price
888 Holdings has secured a price cut on the acquisition of William Hill from Caesars Entertainment due to global economic turmoil and regulatory issues. The gaming group, which agreed a £2.2bn deal for William Hill in September, said the enterprise value of the deal was being reduced to between £1.95bn and £2.05bn. The amount it has to pay on completion of the deal has been reduced by £250m to £584.9m, with the payment of up to £100m being deferred until 2024, dependent on the level of adjusted earnings achieved by the enlarged group.
House prices continue to rise
The price of the average home in the UK has risen by £43,577 since the start of the first lockdown two years ago, according to the Halifax. The lender, part of Lloyds Banking Group, said the 18.2% rise took the cost of a typical home to £282,753. There was a 21% rise in the price of detached homes compared with a 11% rise in flat prices over the same period. Prices rose by 11% over the year to March, the Halifax said. Rival lender, the Nationwide, recorded a 14% rise in property values over the same 12 months - the fastest annual growth for 17 years. However, a range of forecasters - including the Office for Budget Responsibility - expect the speed of increase to slow in the next few years.
Workspace bustles as small businesses return
London-focused commercial landlord Workspace has reported that like-for-like occupancy levels had risen by 3% to 89.6% in its fourth quarter to the end of March, edging closer to pre-Covid levels as small and medium-sized companies return to the workplace. Graham Clemett, chief executive, said in an update: “Our strong performance in the fourth quarter demonstrates further evidence that whilst [small and medium-sized companies have always appreciated flexible working, they also place enormous value on working together.”
Footfall increases, but tough road ahead
Footfall across the UK continued to improve last month, although it remains over 15% down on the same period three years ago. British Retail Consortium chief executive, Helen Dickinson, said: "As the first full month without restrictions in England and Northern Ireland, consumers were able to shop with a greater sense of normality, spurred on by some spring sunshine." But she cautioned: "The impact on retail footfall and sales across stores and online is yet to be seen, but as belts continue to tighten and prices rise, it will be a difficult road ahead."
Demand for workers continues to rise
The latest survey by the Recruitment and Employment Confederation reveals vacancies increased for the 14th month in a row in March and at the quickest rate since last September. Neil Carberry, chief executive of the REC, said: “ Starting salaries for permanent staff are growing at a new record pace, partially due to demand for staff accelerating and partially as firms increase pay for all staff in the face of rising prices.” He added that “record Covid infection levels are also pushing up demand for temporary workers, particularly in blue-collar and hospitality sectors, underpinning the ability of temps to seek higher rates”.