Lloyds launches £1bn share buyback programme
Lloyds Banking Group has launched its £1bn share buyback programme, entering into a deal with UBS to buy back the stock over the course of the next year and make trading decisions under the programme independently. “The sole purpose of the programme is to reduce the ordinary share capital of the company,” a spokesperson for Lloyds said.
UK banks reach year one after financial crisis
S&P Global Ratings has said that increasing profits at Britain’s biggest banks will protect them from Brexit-related economic and political upheaval, with this year set to be "year one" of a new post-crisis era. Led by S&P Global's primary credit analyst for the sector, Nigel Greenwood, analysts commented: "We now view it as more likely that earnings will prove to be a useful first line of defence in the event of economic weakness or political disruption."
Withdrawals from property event
Royal Bank of Scotland and its private wealth division Coutts have pulled out of Mipim, the world's biggest property event - even though it is the biggest real estate lender in the UK. Such events have come under increasing scrutiny following an exposé of the Presidents Club charity gala in January by the Financial Times, which claimed that hostesses were groped and harassed at London’s Dorchester hotel. Organisers of the event are reminding delegates of its code of conduct, confirming: “Under no circumstances does Mipim register prostitutes.”
Tesco Bank credit cards compromised
Tesco Bank has cancelled some of its customers' credit cards, after concerns that a number of accounts may have been compromised. The bank said that only a small number of its 3m credit card users would be affected, and apologised for the inconvenience.
Starling Bank uses tech to help customers
Starling Bank boss Anne Bowden believes it is time for banking to “start again” with a very different approach after the crisis of 2008, and describes how Starling operates more as a tech company, with the use of data and analytics to help customers control their personal finances.
New investment fund launched by ex-Uber CEO Travis Kalanick
Travis Kalanick, former CEO and co-founder of Uber, has announced the launch of a new investment fund called 10100. He said the fund would focus on large-scale job creation in real estate, e-commerce and innovations from countries such as China and India.
StanChart factors US tariffs into lending
Standard Chartered is already factoring in President Trump’s proposed trade tariffs into its lending decisions, according to chief financial officer Andy Halford. Mr Halford said the bank has been considering the effect Trump's plan to hike duties on steel to 25% and on aluminium to 10% could have on loans to sectors that might be affected. "I think it would be remiss of us not to be factoring it into lending decisions," he said
BMW profits rise by 26% on record sales, US tax reforms
Net profits at BMW jumped by 26% last year, from €6.9bn to €8.7bn, thanks to record sales, improved margins and a lower tax rate in the US.
Ryanair’s Jacobs says planes will keep flying through Brexit
Ryanair’s chief marketing officer Kenny Jacobs has said that its aircraft will not be grounded after the UK leaves the EU, but added the company still has concerns that “open skies” may not continue beyond 2020. He told the Independent: “We think good progress has been made in the past two months. The British Government has sent out their blueprint for transition and that’s got some positive signs for the industry. That means that until the end of December 2020, the status quo remains the same. What happens after that transition agreement from 1 January 2021 is less certain. The signals are more negative than we would like.”
Virgin Atlantic not worried about Brexit
Virgin Atlantic Airways’ CEO Craig Kreeger has said the company is “not at all” concerned that Brexit poses a threat to the Open Skies treaty under which European and American airlines have unrestricted access to trans-Atlantic routes. Mr Kreeger commented: “I’m very confident that we will find our way to a very nice solution for the US-UK bilateral.” This comes after claims that the US offered Britain a more limited aviation agreement than it has currently as a member of the European Union.
Rescue talk lifts Interserve
Shares in Interserve rose on growing speculation that the outsourcer is nearing agreement on a rescue refinancing with lenders, before an important deadline at the end of March. Shares rose more than 44% to close 25¾p higher at 83¾p. The contractor has been discussing a rescue plan with lenders, including HSBC, Barclays, Lloyds Banking Group and Royal Bank of Scotland.
EU rejects Brexit trade deal bid to include financial services
The European Union has rejected Chancellor Philip Hammond’s bid to include a section on financial services in a post-Brexit trade deal, noting that “life will be different” for banks in a post-Brexit landscape. Speaking in Dublin on Thursday, European Council president Donald Tusk commented: “To ensure a level playing field, to ensure the integrity of the single market, and to ensure financial stability, this is why we cannot offer the same in services as we can in goods. It’s also why FTAs don’t have detailed rules for financial services… I fully respect the Chancellor’s competence in defining what is in the UK’s interest but he must allow us to define what is in the EU’s interest”. Meanwhile, Labour Party finance spokesman John McDonnell said on Thursday that the UK should not favour financial services over other economic sectors as it negotiates future post-Brexit trading links with the EU. Mr McDonnell commented: “It is now clear that the government’s priorities are to win a deal for financial services first and then worry about the rest of the economy later.”
Aviva bond buyback hits small investors
Aviva has been accused of considering "very aggressive action" against retail investors after the company said it may buy back their bonds without paying a premium, becoming the second major UK financial institution to go against the will of many investors by taking such action. Bonds expert Mark Taber commented: "These preference shares are largely held by retail investors for pension income. They are stated and understood to be irredeemable so Aviva should not be looking for a legal loophole to cancel them on the cheap rather than treating holders fairly."
Poor performance puts ATS into the red
Results from Alliance Trust show that the company suffered a "poor financial performance" at its savings arm during last year, with the board moving to write down the fair value of Alliance Trust Savings (ATS) by £23.5m to £38m. ATS operating losses were £6.1m before exceptional expenses of more than £13m, compared with profits of £1.2m in 2016. Group chairman Lord Smith commented: "While the business has continued to attract additional assets and now has more than 110,000 customer accounts, ATS incurred a particularly high level of costs in 2017."
EU proposes fintech 'passports'
The European Commission has proposed fintech "passports" for the EU in a draft law that is part of wider efforts to boost growth in the sector. "An EU crowdfunding licence would help crowdfunding platforms scale up in Europe," said Valdis Dombrovskis, the EU's financial services commissioner. Given next year's parliamentary elections, law firm Linklaters said, any such law is unlikely to take effect before late 2022.
Swift says blockchain technology needs work
Swift, which handles over 50% of all high-value cross-border payments, has said blockchain technology needs to be improved before it can handle billion-dollar daily cross-border payments between banks.
UK offers Gibraltar post-Brexit finance access
The UK is negotiating for Gibraltar to enjoy continued barrier-free access to its finance markets after Brexit in March 2019. The EU however insists Madrid could stop a transitional deal or future trade relationship applying to Gibraltar unless there is a Spain-UK agreement.
Challenges to Botox threaten a market makeover
Revance and Mylan are developing a cheaper version of Botox in an attempt to compete with the popular cosmetic surgery treatment - which generated $3.17bn of revenues last year.
MEDIA AND ENTERTAINMENT
Good year for Axel Springer
Matthias Döpfner, Axel Springer chief executive, has said 2017 was the “best year in company history”, with record sales and a 41% increase in Springer’s share price.
Countrywide’s executive chairman Peter Long warned on Thursday that things would “get worse before they get better” as the estate agent axed its dividend and shares fell another 11p, or 13%, to 77.8p. The estate agent reported pre-tax losses of £212.1m against profits of £19.5m the year before, after one-off costs.
Maplin staff made redundant
Administrators to Maplin have made 63 staff at the collapsed electronics chain’s head offices redundant, with the fate of 2,500 more jobs still hanging in the balance. Employees at Maplin’s offices in London and Rotherham will be affected by the cull, with administrators also warning that a buyer has yet to be found for the chain.
Capital & Regional focuses on discounters
Capital & Regional has declared that Londoners shopping at discount stores at its retail centres will help to mitigate damage caused by high-profile retail collapses. Chief executive Lawrence Hutchings noted that the firm is “fully aware that recent occupier failures present some challenges to short-term results”.
With end of QE nearing, ECB drops stimulus pledge
The ECB has abandoned its promise to boost stimulus if conditions deteriorate, signalling a significant turning point in the monetary regime of the eurozone. Meanwhile, ECB president Mario Draghi sought to move the focus from this policy shift, criticising US president Donald Trump's tariffs on steel. Mr Draghi commented: "Unilateral decisions are dangerous. If you put tariffs against those who are your allies, one wonders who the enemies are".
Lack of funds for female entrepreneurs to be investigated
A day after 200 business leaders, entrepreneurs and MPs signed an open letter urging the Government to fund female entrepreneurship, the first "serious review" into the funding gap preventing women from becoming business leaders in Britain has been announced by the Treasury. Robert Jenrick, Exchequer Secretary to the Treasury, noted that a campaign in the Telegraph had highlighted the need to "shine a light on the challenges that women who want to set up a business face".