BANKING
Challenger banks in merger talks
OneSavings and Charter Court are in merger discussions, in a proposed deal that would create a £1.6bn competitor in the financial services industry. The challenger banks, both of which focus on savings and specialist mortgages, said the potential merger could give them “greater scale and resources to deploy on growth opportunities”. The planned all-share deal would give OneSavings’ shareholders 55% of the combined group, with the remaining 45% held by Charter Court’s owners. The Times suggests the success of any deal is likely to rest with Merian Global Investors and activist investor Elliott. Merian is OneSavings’ biggest shareholder, with a 15.2% stake. It also owns 18.5% of Charter Court, making it the second largest investor behind Elliott, which holds 31.6%.
NatWest pilots fingerprint payment
NatWest will begin trialling a "cutting edge" biometric fingerprint bank card in the coming weeks. Customers will use their fingerprint to verify payments of more than £30 - the current contactless card limit - without the need to enter a PIN at the till. In Scotland, the trial will involve RBS customers.
Banks could be hit over tax dodge scheme
The Mail on Sunday reports that large banks could face paying out up to £11bn for their roles in tax avoidance schemes, with lawyers and tax experts saying they are preparing to sue a number of lenders who created such schemes or offered loans to those who invested in them.
Tide turns to investors after award win
Small business lender Tide is aiming to raise £60m from investors. Along with Clearbank, the fintech firm secured a £60m award last month in a competition to win funds aimed at improving services for SMEs.
BoE tightens bank liquidity buffers before Brexit
Some UK lenders have been instructed by the Bank of England to triple their holdings of easy-to-sell assets in the run-up to Brexit to cope with any market meltdown.
Row over HSBC chief’s pension
HSBC chief executive John Flint is facing a row over part of his £4.58m pay packet, after some shareholders accused the bank of massaging the numbers to avoid breaking pay rules.
Raphaels winds down
The Sunday Times reports that private bank Raphaels is being wound down after more than 230 years after failing to find a buyer.
PRIVATE EQUITY
Mental health app raises £3m
Felix Partners has led a £3m funding round in a mental healthcare start-up. Unmind’s app provides clinically-backed tools, training and assessments to improve mental health in the workplace.
INTERNATIONAL
Banks move to prevent Brexit trading mayhem
Global banks have triggered emergency plans to stop EU companies hitting trading problems in the event of a no-deal Brexit this month. Banks say most of their large EU clients are underprepared and could be blocked from accessing trillions of pounds’ worth of crucial trading services in just a few weeks, with Morgan Stanley, Goldman Sachs, JP Morgan and Citigroup amongst those urging clients to sign new trading contracts with their offices in the EU to avoid serious disruption.
Deutsche starts merger talks with Commerzbank
Deutsche Bank’s board is to discuss merging with Commerzbank, which could create a major national champion worth €24bn (£20.7bn). The early-stage talks come after the German government indicated it would look favourably on a merger. Both banks have struggled to return to sustainable profitability since the global financial crisis of 2008.
Norway's $1trn fund to cut oil and gas investments
Norway's $1trn sovereign wealth fund is expected to sell about $7.5bn of its oil and gas holdings. The Norwegian oil fund, the world’s largest sovereign investor, owns $37bn of shares in oil companies such as BP, Shell and France's Total. The move is being positioned as a way to diversify the nation's wealth.
AUTOMOTIVE
Tesla secures Chinese backing for new factory
Tesla has secured loans worth £400m from four Chinese banks - China Construction Bank Corporation, Agricultural Bank of China, Industrial and Commercial Bank of China and Shanghai Pudong Development Bank - to fund a new “gigafactory” in Shanghai.
New board aims to soothe tensions at Renault, Nissan and Mitsubishi
Renault, Nissan and Mitsubishi intend to establish a new leadership structure for the alliance, with the recently appointed chairman of Renault, Jean-Dominique Senard, likely to lead a joint board.
CONSTRUCTION
Interserve facing crucial vote on rescue plan
Coltrane Asset Management has intensified its attack on Interserve by threatening to hold the outsourcer’s bosses personally liable for millions of pounds of losses. Coltrane is understood to have written to the company’s directors to warn them that it will take legal action for what it claims are disclosure failings and unfairly favouring lenders over shareholders. The warning comes ahead of a crucial shareholder vote on Friday. If shareholders reject its debt-for-equity-swap proposal, Interserve's lenders could apply for a pre-pack administration.
FINANCIAL SERVICES
FCA to launch new database of authorised firms
The Financial Conduct Authority has announced it will launch a new directory of authorised firms, with the City watchdog saying this will help protect consumers from unauthorised individuals by clearly identifying those who have been banned. The Telegraph says that the Financial Services Register is meant to provide reliable information on whether a firm is reputable, but this has been hampered by poor record keeping, errors and security flaws on the database. The new directory, on which the FCA opened consultation in April 2018, is designed to be more comprehensive and will enable firms to make their staff known to customers. It will launch in 2020 and run in tandem with the current register, which is set to be revamped.
City moves £900bn out of UK ahead of Brexit
A study by New Financial suggests asset managers and insurers have already moved nearly £1trn of assets out of the UK and to other European countries ahead of Brexit, with more likely to be shifted in coming months. The think-tank’s research shows that of the assets that have already been shifted, around £800bn have been moved by banks and investment banks; £65bn in funds have been relocated by asset managers; and £65bn in assets have been shifted by insurance companies.
FOS compensation limit more than doubled
The amount of compensation that can be claimed by consumers and businesses through the Financial Ombudsman Service is to more than double, the Financial Conduct Authority has announced. As of April 1, those who have lost out due to poor advice or service from financial firms will see the compensation limit raised from £150,000 to £350,000. The change, stemming from a proposal put forward in October 2018, will also see the cap for complaints made for events prior to April 1 but referred after April 1 raised to £160,000.
Calls for urgent investigation into Premier FX
The Financial Conduct Authority has been urged to prioritise an investigation into the failure of the currency exchange firm Premier FX, which has left hundreds of UK customers with significant losses. The company, which was regulated by the FCA for money transfer services, encouraged customers to keep funds for longer than a few days to benefit from currency movements - in effect acting as a deposit account but without the protection of the Financial Services Compensation Scheme.
NSF defends guarantor loans
Non-Standard Finance founder John van Kuffeler has defended guarantor loans, after the Financial Conduct Authority said that it was increasing scrutiny of the industry. The sub-prime lender, which is trying to buy Provident Financial for £1.3bn, reported a 61% increase in its net loan book in guarantor lending to £83.1m last year. Guarantor lending is its second biggest and fastest growing business and it wants to introduce the loans to Provident customers. Meanwhile, the Times reports that City advisers could earn more than £22m in fees if NSF succeeds with its bid for Provident.
Crypto investors aim to get rich quick
Investors in cryptocurrencies such as bitcoin tend to have a "get rich quick" attitude, according to a survey by the Financial Conduct Authority. Its first analysis of the cyptocurrency market found fewer than one in ten investors (8%) had conducted any meaningful research before buying and 16% had carried out none. About a third of investors had not checked the value of their holdings since buying.
Invesco blockchain ETF to launch on London Stock Exchange
Invesco is today launching the Invesco Elwood Global Blockchain ETF - an exchange traded fund focussed on companies with potential to generate earnings from blockchain.
Insurers seek rule change on green energy investments
The Association of British Insurers has called on the Prudential Regulation Authority to overhaul rules to make it easier to invest in green energy projects.
MANUFACTURING
RPC agrees to Berry takeover bid
Plastics packaging company RPC Group has ditched its support for a takeover by private equity in favour of a higher offer from Berry Global. Berry’s offer is 1.4% higher than the 782p-a-share offer from Apollo that RPC’s board had recommended in January.
REAL ESTATE
Mortgage arrears ‘to soar under a no-deal Brexit’
Kensington Mortgages has warned that the number of homeowners who fall behind on mortgage payments will jump by about a third if there is a no-deal Brexit. The specialist lender estimated that 70,296 borrowers would be more than three months in arrears on their repayments in three years’ time if Britain were to leave the EU without a deal and the Bank of England did not step in to prop up financial markets.
RETAIL
Orion builds up Intu stake
Orion Capital Managers has built a 4.1% stake in shopping centre owner Intu worth about £62m over the past few months, putting it in a position to take part in any future takeover.
ECONOMY
Third of Britons expect worse finances post-Brexit
More than a third of British adults think their financial circumstances will deteriorate after Brexit, according to a poll of voters. Some 93% of those surveyed expect the cost of food to go up, while another 27% believe their income could fall, according to the research by YouGov for Royal London. Overall, 63% of Remain voters believe that their personal finances will get worse after the UK leaves the EU, compared with 11% of those who voted Leave.