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Daily News Roundup: Monday, 15th October 2018

Posted: 15th October 2018


RBS chief: Much less chance of scandals after rethink

Royal Bank of Scotland chief executive Ross McEwan has described the company’s efforts to "rethink the business" and take customers into consideration in "every change we make". Referring to the possibility of future scandals affecting the lender, he stated: "Can I say this will never happen again? I'm sorry, I can't”. He went on to say however: "We did a very bad job. But today our organisation is very focused on the customer and we did put things in place and had the conversations before we made those changes, and so I think there's a much lesser chance." He also warned that turmoil within the government has left Britain "sleepwalking" towards a no-deal Brexit, and that this would cause severe disruption to the financial industry. Meanwhile, the FT reports on how Mr McEwan is moving to restore RBS’ reputation.

High street banks told to assess no-deal exposure

Officials at the Treasury have joined Bank of England regulators in urging banks to assess their exposure to UK sectors seen to be at-risk from a no-deal Brexit. A City source has told the Telegraph that companies assessed to be most at risk of cash flow or credit problems include those reliant on overseas supply chains or just-in-time­ delivery. Those exposed to foreign currency risks have also been identified as potentially hazardous for banks.

RBS announces first dividend since bailout

Shareholders in Royal Bank of Scotland (RBS) shared £240m in dividends last week as the lender made its first payout in almost 10 years. Chief executive Ross McEwan said: "I'm pleased to be able to pay a dividend to our shareholders; a small return after their many years of patience and a testament to the hard work of everyone at this bank.” He went on: “This is another important milestone in our turnaround, almost ten years to the day that RBS was rescued by the British taxpayer."

Banks criticised over fraud prevention

Figures from banking trade body UK Finance reveal that fraudsters took £145m in the first six months of this year, but just £31m was handed back to victims by banks. Gareth Shaw, of Which?, remarked: "Two years on from our supercomplaint and banks have only done the bare minimum to tackle bank transfer fraud, dragging their heels while preventive measures and reimbursement models could have been adopted sooner.” Meanwhile, the Treasury committee is to interrogate banks and regulators including the Financial Conduct Authority (FCA) about what they are doing to stop scams, as the number of fraudsters who are opening accounts to receive stolen money increases.

TSB requests balanced gender shortlist for CEO replacement

TSB is demanding that at least half the candidates shortlisted to replace former chief executive Paul Pester are women. According to the Sunday Telegraph, the bank told City headhunter Odgers Berndtson that it wants an equal gender split, something it requests for shortlists elsewhere in the company.

Call for chancellor to attract investment by ending bank levy

UK Finance chief Stephen Jones has written to Chancellor Philip Hammond asking him to "consider whether a point might be reached at which the bank levy can be said to have fulfilled its purpose", with Brexit moving the country towards a new UK-EU relationship.

Mastercard to challenge Visa

City AM features a report on the growth in popularity of Mastercard debit cards, with Mark Barnett, president for the UK, Ireland, the Nordics and Baltics, saying the firm is seeking ways of "getting at that everyday spend".

Ticketmaster data breach leads to new bank cards being issued

Lloyds Bank, Halifax and Bank of Scotland customers are having new credit cards issued after a security breach at the Ticketmaster firm compromised their data.


Banks sell €1.3bn high-yield debt for CVC-Recordati deal

Lenders that underwrote private equity group CVC's acquisition of a €3bn-plus stake in the pharmaceutical business of the Italian Recordati family have successfully placed the debt backing the deal.

Blackstone to buy UK events company NEC

Blackstone is to buy NEC Group for £800m, expecting to triple the events firm’s earnings from £70m to £200m during the next five years.

CapVest may buy Youngs for £200m

Young's Seafood could be sold for as much as £200m to Irish private equity firm CapVest. A group of other private equity firms, including Lion Capital and Bain, put it on the market earlier this year.


Brexit jobs move to Frankfurt

Goldman Sachs and Standard Chartered are reportedly expanding the number of staff moving to Frankfurt by April 2019. This comes as the Futures Industry Association (FIA) warns that the British financial sector could see further movement of jobs to the Continent and other disruption in the event of failure to reach a deal on the regulation of £41trn in derivatives. Simon Puleston Jones, head of Europe at the FIA, remarked: “If by the time we’re tucking into our Christmas turkey an agreement hasn’t gone through the UK Parliament, the first thing banks will do on returning to the office on 2 Jan is execute contingency plans”.

Santander HQ bid by Reubens

Billionaire investors David and Simon Reuben are bidding for Santander's €3bn (£2.6bn) Madrid headquarters after years of legal wrangling between property speculators over the site.

Wells Fargo unveils results

Wells Fargo has unveiled a rise in quarterly revenue, with a profit of $2.8bn in the third quarter, up by around 50% compared with 2017.


Construction sector sees lending decline

Lenders are reducing funding to construction firms more than at any point in the last seven years, with Brexit uncertainty thought to be partly responsible for fears of a downturn.


BoE puts bank executives on notice regarding climate

The Bank of England’s Prudential Regulation Authority is to caution banks and insurers that they must improve preparations for long-term climate change risks. Separately, amid increasing concerns about trade wars and possible Brexit-related market turmoil, Bank of England governor Mark Carney has issued a warning against the "weaponisation" of financial assets.

Russia life business to be offloaded by Munich Re

Russia's Rosgosstrakh will acquire the Russian-based life insurance subsidiary of Munich Re, Ergo Life, with Alexei Rudenko, former chief executive of Sberbank Life Insurance, tipped to run the new company.

Merger leads to £15m loss for UK Finance

In its first six months following a merger of six financial services trade groups, UK Finance made a £15m loss. Directors said they were "satisfied" the firm had sufficient liquidity to remain a going concern.

BlackRock and Wespath team up for low-carbon investments

As fund management groups seek out opportunities in the move to sustainable energy use, BlackRock and US client Wespath are to work on investing in the low-carbon economy.

Women use technology to bridge gender investment gap

Research by wealth manager Fidelity International shows that more women are investing through using smartphone apps and easy-to-understand online wealth managers.

Lloyds investment contract awarded to BlackRock

BlackRock has been awarded a £30bn share of a Lloyds Banking Group contract to be invested using the US firm’s various index strategies.

Prudential appointment

Barry Stowe, boss of Prudential's North American arm, is to retire at the end of the year and will be replaced by Michael Falcon of JPMorgan.


SoftBank prepares for record IPO of mobile business

In a move which could challenge Alibaba's as the largest ever listing, SoftBank is expected to name Goldman Sachs, Nomura and Deutsche Bank as lead underwriters for the initial public offering of its Japanese mobile telecoms operations.

ITV headquarters sale to benefit pensioners

After ITV announced the sale of its head office in London last week, it is expected that part of the proceeds could be used to bolster its pension fund.

BT appointment

Morten Nilsson has been appointed chief executive of the BT Pension Scheme’s £50.7bn investment management and advisory arm.


US real estate giant CoStar buys UK commercial property portal

Realla, a UK start-up that provides a portal service for commercial properties has been bought by CoStar, with plans to increase investment in the firm and expand it into Europe.


Hamleys reports £12m loss

Hamleys recorded a loss before tax of £11.9m for the year to December 2017, down from a £2.6m profit the year before, while revenues were down 3% to £66m. Chief executive Ralph Cunningham said a decline in consumer confidence and uncertainty brought about by Brexit had contributed to “one of the most challenging years in UK retail history.”

Sports Direct snaps up Frasers building

Sports Direct has agreed a £95m deal to buy the 350,000sq ft Frasers building in Glasgow from Glasgow City Council. The retailer says the store will continue to operate as Frasers, while also pledging investment that will “further elevate and enhance this iconic department store”.


Hammond: 'Brexit deal dividend' would deliver economic boost

Britain could see an economic boost if it successfully negotiates a Brexit deal with the European Union, the chancellor has said. Philip Hammond told the BBC that there has been a "measurable change of pace" in talks, adding to the sense of optimism that a deal could be imminent. He said there were still hurdles, but the "process" was much more positive.


Loan compensation firm Debt Hacker launches

A new free-to-use service to help consumers claim compensation from payday lenders has been launched online. Consumer campaigner Alan Campbell has funded the Debt Hacker service.

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