BANKING
Card fee warning
Lenders are raising the fees they charge consumers who use credit cards for cash withdrawals and transactions, while pre-paid cards and contactless watches being used for payments are also becoming subject to increasing charges. Meanwhile, the Bank of England has warned that a small number of lenders are vulnerable to sudden losses if customers on 0% interest credit card offers leave earlier or borrow less than expected.
Contactless card spending increases in popularity
New data released today reveals that spending with debit cards overtook cash for the first time last year. However, Stephen Jones, UK Finance chief executive, noted that "we're far from becoming a cash-free society".
Clydesdale’s £1.6bn takeover offer for Virgin Money to be accepted
A £1.6bn takeover offer for Virgin Money by the owner of Clydesdale and Yorkshire banks (CYBG) is expected to be accepted. CYBG had approached Virgin last month, with shares in the latter rising 14%, closing at 355p.
Banks struggle to protect elderly from fraudsters
The number of "courier fraud" scams, in which fraudsters impersonate police or figures of authority to convince the elderly to hand over their retirement savings, have doubled in a year, banks have said. Cashiers prevented £13.3m of courier fraud last year and helped lead to 129 arrests, yet campaigners say they are not doing enough to protect vulnerable savers.
New financial crisis warning sounded
UBS analysts have suggested that ring-fencing to protect consumers from investment banking risks may have had the effect of making British banks more likely to collapse, raising the chances of a "liquidity crisis" in Britain.
Private banks on the high street
High street banks are increasingly trying to make their services more attractive to savers with a higher net worth, who would usually use private banks, according to the FT.
PRIVATE EQUITY
New liquidator called for by Abraaj creditor
Auctus Fund, a creditor to Abraaj, has urged a full audit of the private equity firm with the appointment of an independent provisional liquidator.
Missoni bids for scale with stake sale
Italian state-backed private equity group FSI has acquired a 41.2% stake in Italian fashion house Missoni for €70m.
INTERNATIONAL
China Citic Bank aiming to triple Altyn assets
China Citic Bank is aiming to more than triple the assets of its newly acquired Kazakh unit, Altyn Bank, within three years, saying it can take advantage of growing trade under Beijing's Belt and Road project. China Citic board chairwoman Li Qingping said that the bank aims for Altyn Bank's assets to reach $4bn by 2021.
Beijing leans on lenders to back bonds of debt-hit HNA
Chinese officials have urged banks officials to "support" bonds issued by HNA as the finance-to-aviation conglomerate tries to relieve a debt burden it racked up during a spate of acquisitions.
Halcyon days recede as ECB and Fed step back
The US Federal Reserve's interest rate increase and the ECB’s announcing the end of its €2.4tn bond-buying programme has left investors revamping their portfolios to fit tightening global liquidity.
Wall Street banks team up in debt platform
A bond platform under development by Bank of America, Citigroup and JPMorgan has seen Goldman Sachs, Wells Fargo, BNP Paribas and Deutsche Bank sign up.
US bank shareholders in line for $170bn
Barclays research shows that shareholders in 22 of the biggest listed banks in the US are in line for almost $170bn in dividends and share buybacks over the coming year.
Report dismisses cryptocurrency risk
The Bank for International Settlements has warned that cryptocurrencies such as Bitcoin will not replace conventional money, partly because they can simply stop working and see their value wiped out completely.
FINANCIAL SERVICES
Finance giants eye eastern Europe
Lower corporate tax rates in eastern Europe could lure banking firms away from London amid Brexit uncertainty, according to the Telegraph. The news comes as Standard Chartered announced that it was setting up a new European hub in Poland, where the corporate tax rate is only 19%. In Hungary, the rate is only 9%, and in the Czech Republic the corporate rate is 19% with lower charges for investment companies, and a flat rate for personal taxes of just 15%.
Equitable Life sold for £1.8bn
Equitable Life is being sold to Life Company Consolidation Group for £1.8bn. The insurer was at the centre of a major UK financial scandal in 2000 after failing to put sufficient funds aside to pay for guaranteed payouts it promised on some of its pensions.
Finance industry must reflect investor values
Writing in the Sunday Telegraph, Standard Life Aberdeen co-chief Keith Skeoch says expectations about what the asset management industry can and should achieve are changing. He notes that as people become more actively involved in how they invest their money, they want their investments to reflect their own principles and values and to see those who invest on their behalf demonstrate a commitment to responsible stewardship.
Revolut expansion
The Sunday Times features an interview with Revolut founder Nikolay Storonsky, who discusses the firm’s planned expansion to the US and Australia, Singapore, Hong Kong and New Zealand.
Mifid II research costs to be investigated
The Financial Conduct Authority will begin reviewing Mifid II regulations, after concerns about inconsistencies in their interpretation and application were raised.
Wealth management industry could see AI deployment
Nearly 100% of wealth managers plan to deploy artificial intelligence technology within the next three years, with over half saying that firms which fail to embrace it will not survive.
Pension funds’ ability to shed fossil fuels holdings strengthened
Government proposals published today will strengthen the powers of managers of Britain's £1.5tn workplace pension schemes to divest from fossil fuels and invest instead in environmentally friendly alternatives.
LEISURE AND HOSPITALITY
Heathrow hotel row grows
Hotel tycoon Surinder Arora has issued a High Court claim against Heathrow Airport over his plans to erect a 2,077-space, nine-storey car park there. The airport has acknowledged the claim, stating: "We believe this is entirely without merit and will respond accordingly."
MANUFACTURING
East Yorkshire factory wins tube deal
Siemens Mobility has won a £1.5bn contract to build new Tube trains for London Underground. Transport for London (TfL) said the 94 trains for the Piccadilly Line service will be designed and built by the company at its planned £200m facility in Goole, East Yorkshire. The order is the first part of a plan by TfL to upgrade its deep Tube lines.
MEDIA AND ENTERTAINMENT
Domain jacking threatens technology businesses
Amazon, Microsoft and Apple and their customers are vulnerable to a "domain jacking" attack by hackers, thanks to inadequate cyber security measures allowing the hijacking of subdomains through which they can impersonate brand names.
Inmarsat raises national security questions
Following Inmarsat’s rejection of an offer from EchoStar, the government may be forced to consider whether the firm is a strategic national asset.
RETAIL
Tesco CEO: growth plans “back on track”
Tesco has posted its tenth consecutive quarter of rising sales, with like-for-like sales rising 2.1% in the 13 weeks to May 26, its fiscal first quarter. Comparable sales at Booker, the wholesaler acquired by the supermarket group at the end of last year, were up 14.3%, helping total group same-store sales to rise 1.8%.
Coca-Cola and Heinz join battle for Horlicks
Coca-Cola is considering a £3bn offer for Horlicks, after GlaxoSmithKline put the brand on the market. Kraft Heinz and Nestle have also held early talks regarding an acquisition of the malted milk drink, with sources claiming Morgan Stanley is advising GlaxoSmithKline on the sale.
ECONOMY
Economy faces slowest growth since 2009
The British Chambers of Commerce has warned that the UK economy is set for its weakest year of growth since 2009 as wage growth fails to translate into increased consumer spending.
Interest rates to remain at 0.5%
The Bank of England is expected to keep interest rates at 0.5% this week, but is facing a growing dilemma over when it will make the next increase amid mixed economic data and rising inflation fears.
OTHER
BoE wants 'folk wisdom' to break group think
The Bank of England is to run regional focus groups with members of the public from this autumn, in an effort to collect “folk wisdom” from ordinary people. The move is a response to concerns that policymakers too often fall into groupthink by relying on spreadsheets, London economists and business leaders.
CBI head aiming for diversity in the upper ranks
Incoming CBI President John Allan has backed companies to favour women and ethnic minorities over equally capable white men as a way of improving diversity in the upper ranks of business. In an interview with the Sunday Telegraph, Mr Allan said he was “quite a long way” from advocating positive discrimination that would mean less capable women and ethnic minorities are awarded senior roles.