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Daily News Roundup: Friday, 8th October 2021

Posted: 8th October 2021

BANKING

City banks on a record hiring spree

London banking jobs are on course to smash pre-pandemic levels by 30%, according to Morgan McKinley. Over 5,000 new banking jobs were created in June, 5,300 in July and 5,700 in August. Hiring for risk and compliance teams  represented 12.8% of all vacancies in the sector. “Busy areas in compliance and risk include: compliance advisory, financial crime/AML, surveillance and monitoring and credit risk,” Ben Harris and Leo Bellometti at Morgan McKinley, said. “This has been caused by the easing of government lockdown measures, and in turn with banks initially having made cuts to their staff, they now need people to join their teams again.”

NatWest faces £340m fine after failing to spot money laundering

NatWest allowed a gold dealer to launder £365m through the bank over four years, a London court heard yesterday. The bank has admitted to three charges brought by the Financial Conduct Authority (FCA) for failing to properly monitor a customer between 2012 and 2016. The regulator has said that it will not pursue existing or past employees from the bank. NatWest said that it was “not anticipating” any other investigations. The FCA’s lawyer said the fine could be as much as £344m but analysts at Numis said they had pencilled in a £320m charge for NatWest.

Nationwide signs up to Deposit Unlock scheme

Nationwide has signed up to an initiative which gives homebuyers the chance to get a mortgage on a new-build with a 5% deposit. Neil Jefferson, managing director at the Home Builders Federation, commented: "With the [Help to Buy] scheme winding down from the middle of next year, Deposit Unlock will help households onto the housing ladder and give developers confidence to invest in new land and labour to build on the massive housing supply increases of recent years."

Investment inequality harms small business growth

The British Business Bank has found that a disparity in equity funding opportunities across the UK is holding small businesses back. The bank said that the UK’s uneven distribution of growth finance was not driven by a lack of high-growth potential businesses in certain areas, but by the absence of local investors.

Thousands of customers locked out of bank accounts

Lloyds Bank, Halifax and Bank of Scotland have all reported technical problems that have left customers unable to access their accounts. The majority of users are reporting that mobile banking is down for each of the banks, but many are experiencing difficulty accessing online banking and account balances too.

PRIVATE EQUITY

BlackRock grants major clients vote

BlackRock is to hand more voting power to clients in a move expected to reduce support for management decisions. The world’s largest investment manager typically casts votes at AGMs on behalf of investors in its funds but from next year certain institutional account holders will be able to vote themselves. Matt DiGuiseppe, vice president at corporate governance software firm Diligent, expects a reduction in support for a company’s management as a result of the  move, but Bruce Goldfarb, president of proxy solicitor Okapi Partners LLC, said: "I doubt many investors in BlackRock-managed products have policies that are too different from the well-crafted policies already set out by BlackRock and executed by its investment stewardship team.” The Times suggests the change may also be seen as enabling BlackRock to sidestep the most contentious decisions in areas such as climate change and shield itself from possible lawsuits from clients and pre-empt a crackdown by regulators.

INTERNATIONAL

Gensler accused of overstepping bounds with push to regulate platforms

Securities and Exchange Commission chairman Gary Gensler has been accused of overstepping his authority with his attempts to expand the SEC's role in regulating cryptocurrencies.

AVIATION

UK drops BA and Ryanair probe into Covid refunds for passengers

The Competition and Markets Authority has dropped its investigation into British Airways and Ryanair over refunds for passengers prevented from flying during the pandemic because of a lack of clarity in the law.

CONSTRUCTION

New infrastructure framework includes major construction firms

Galliford Try, Kier and Bam Construction are among firms which have been appointed to a new £1.6bn framework for public infrastructure, which will include projects such as schools, hospitals and community buildings.

FINANCIAL SERVICES

Morses hit by a flood of complaints

A rise in customer complaints has forced sub-prime lender Morses Club to lift the amount of money it has set aside to handle demands for compensation from borrowers who used its high-cost loans. Morses said in its half-year results yesterday that it had experienced a “continued increase” in demands for redress in the six months to August 28 and had increased its provision to cover unresolved complaints to £2.4m from £2m at the end of February. CEO Paul Smith claimed the wave of complaints were a “cycle of doom” that had been triggered by the Financial Ombudsman Service.

Zopa says IT problems are fixed

Peer-to-peer lender Zopa has got its systems operational again after a nine-day IT outage left customers struggling to withdraw their money and to see up-to-date statements. Zopa said the problems were caused by “unexpected system interruptions after resilience testing” but all products “are now live including investment accounts with full servicing options.”

UK financial firms ditch record number of clients in 2019/20

The Financial Conduct Authority’s latest financial crime monitor reveals that UK banks, asset managers and insurers ditched a record number of clients in 2019/2020 and reported an increased level of suspicious activity to law enforcement.

LEISURE & HOSPITALITY

Goldman Sachs to buy The Belfry

Goldman Sachs is to become the new owner of The Belfry, one of the world’s best-known golfing resorts, after beating fund manager Pimco to become the preferred bidder. The US bank will pay the current owners, KSL Capital Partners, a reported £140m for the Warwickshire hotel and golf courses.

MEDIA & ENTERTAINMENT

Sky launches Glass smart TV

Sky has launched a new smart TV called Glass which has built-in Sky services and apps. While the company will make a small margin on each Glass, the main aim is attracting customers who could not or did not want to install a satellite dish. Sky will offer monthly payment plans for the set and viewing packages while a wider plan to offer Sky Glass packages bundled with Sky's mobile and broadband service is also in the works.

REAL ESTATE

Average UK house prices hit record high in September

House prices rose at their fastest monthly pace since 2007 in September, according to the Halifax, with more than £4,400 added to the average price of a home. The monthly growth of 1.7% pushed the average price up to a record £267,587 with annual house price inflation now at 7.4%. “Looking at price changes over the past year, prices for flats are up just 6.1% , compared to 8.9% for semi-detached properties and 8.8% for detached. This translates into cash increases for detached properties of nearly £41,000 compared to just £6,640 for flats,” Russell Galley, managing director of Halifax, said.

RETAIL

Footfall falls at petrol crisis continues

Footfall at high streets, shopping centres and retail parks fell by 16.8% in September compared with the same month in 2019, before the pandemic hit. Figures show that shopping centres were worst affected with visits down by 35% versus 2019 levels. However, compared with August, footfall was up 1.2% driven by the higher number of visits before the petrol crisis ensued.

ECONOMY

New Bank of England chief economist warns of long-lasting inflation

The Bank of England’s new chief economist has admitted that high levels of UK inflation could persist for longer than expected. In his first public remarks since taking office last month, Huw Pill told MPs that “balance of risks is currently shifting towards great concerns about the inflation outlook, as the current strength of inflation looks set to prove more long-lasting than originally anticipated.” Andrew Goodwin, economist at consultancy Oxford Economics, said Pill has “placed himself on the hawkish side” of the Monetary Policy Committee, suggesting he could vote in favour of an early rise in interest rates. Pill’s comments come as a survey of more than 8,000 UK companies by the Office for National Statistics found 29% of firms reported a sharp rise in prices of materials, goods and services bought in the last two weeks – up from 21% of firms reporting unusually rapid growth in costs in May, and 14% in late December 2020.

Staff shortages push pay higher

A monthly survey by the Recruitment & Employment Confederation showed that recruiters were reporting the most intense pressures on pay for 24 years in September. Recruiters said that higher demand for staff, a high employment rate, fewer EU workers and a lack of confidence among employees to switch roles because of the pandemic contributed to a big fall in the number of candidates for job vacancies, driving increases in pay.

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