BANKING
McDonnell to unveil plan for £2.5bn nationalised bank
The shadow chancellor is to unveil plans to create a new nationalised bank built from post office branches. The new “Post Bank” would be given £2.5bn by a Jeremy Corbyn-led government to save the high street and protect face-to-face banking. John McDonnell said: “Poor access to local bank branches hurts our town centres and local communities, particularly affecting elderly and more vulnerable customers, as well as damaging the ability of local small businesses to invest.” In addition to creating the banking network, Labour would put the brakes on government plans to sell its remaining stake in RBS. Mr McDonnell said that a Labour government would retain its share so that profits could be ploughed into its branch network.
Barclays alerts Fed over Bramson stake
Barclays has alerted the Federal Reserve and Bank of England over activist investor Edward Bramson’s bid for a place on the bank’s board. Sources claim that Barclays has sounded the alarm over the structure of Bramson’s stake in it, which allows him to invest in the company while being protected if the shares fall below a certain level. Meanwhile, the Mail on Sunday reports that Neuberger Berman has taken a short position in the bank. The US hedge fund has also ramped up its short positions in Lloyds and RBS, which are now worth £360,000 and £420,000 respectively. Figures from short-selling data firm Breakout Point suggests that Neuberger Berman’s bets against UK banks in total stands at £1.1m.
MPs call for inquiry into signatures
MPs have called on the Treasury Select Committee to open an immediate inquiry into the alleged forgery of signatures in bank court documents. They also want Lloyds Banking Group CEO António Horta-Osório to be questioned over how the bank treats customers who say they have found evidence of systemic fraud. The all-party group on fair business banking says Lloyds appears to be repeating the same conduct it displayed towards customers who uncovered the HBOS Reading fraud, seeking to silence them. Lloyds has denied there is evidence of systemic fraud and said it “does not recognise the issue” as set out by the group of MPs.
Newcastle BS pledges to open branches
Newcastle Building Society has become the latest financial institution to support the high street, pledging to open a new branch in Barnard Castle. CEO Andrew Haigh said: “We believe passionately in the importance of the high street to local communities. Banks are constantly closing their doors in towns and cities we operate in, leaving many people and small firms with limited places to do everyday financial transactions.”
Challenger banks winning battle for easy access accounts
Research by Moneyfacts has found that newer challenger banks and building societies are winning the battle for the best easy-access account rates. Virgin Money, Kent Reliance, Marcus by Goldman Sachs, Yorkshire Building Society, Tesco Bank, Sainsbury's Bank and Ford Money are among the best providers with someone with £10,000 to invest.
Football fans face loan struggle
Football fans looking to renew their season tickets using instalment loans could face difficulties after Raphaels ceased providing finance to Zebra, one of the biggest providers of football season tickets. Zebra has now sought alternative funding, which it has yet to secure. Zebra added that it has put its staff on redundancy notice.
Banks have created fraudsters’ paradise
Writing in the Times, Edward Lucas argues that banks have created a fraudsters’ paradise because of their neglect of online security. He suggests that banks are blithe about fraud because stopping it would cost money. He suggests a levy should be introduced: £1 paid by each bank for every £1 its customers report lost to fraud. This, he contends, would focus their minds on skewering scammers.
PRIVATE EQUITY
Bain heads warns over private equity debt levels
Jonathan Lavine, co-managing partner at Bain Capital, has warned that private equity groups are taking on too much debt in the competition to win deals, raising fears of a crash.
INTERNATIONAL
Wells Fargo launches hunt for a ‘saviour CEO’
The FT looks at the potential candidates to replace Tim Sloan as chief executive of Wells Fargo. The options are said to include Marianne Lake, CFO at JP Morgan.
Citigroup’s consumer division on course to miss 2020 targets
According to the FT, Citigroup’s consumer division is on course to miss its 2020 financial targets, adding to investor concerns about the bank’s direction.
Deutsche Bank executive looks to ease investor fears over deal
Stefan Hoops, Deutsche Bank’s head of global transaction banking, has sought to ease fears that a merger between the German bank and Commerzbank would harm clients and hit revenues.
Bank of Italy appoints insider to key role
The Bank of Italy has named Fabio Panetta as its director-general. The move comes follows criticism of the bank from Italy’s populist government over its independence.
AVIATION
Tui warns that Boeing grounding will hurt earnings
Travel firm Tui has warned that the grounding of Boeing 737 Max planes could cost it up to €300m (£258m). Tui has a fleet of about 150 aircraft, including 15 of the grounded Boeing models. A further eight 737 Max planes are due for delivery by the end of May. Market watchers said Tui’s announcement was unlikely to be the last and the impact for airlines that need to cover a greater number of grounded jets would be more acute.
Heathrow ordered to rein in runway costs
The aviation watchdog has said that it plans to add a new condition to Heathrow Airport’s licence to ensure that it builds its £14bn third runway efficiently. Heathrow said it was "perfectly relaxed" about the addition of the clause.
CONSTRUCTION
MPs delay HS2 decision over costs
The Sunday Telegraph reveals that MPs have delayed signing off on the first half of funds for the High Speed 2 rail project amid ongoing concerns about costs. The delay means HS2 Ltd, the government-owned firm in charge of the project, cannot sign major contracts for the construction of phase one lines, stretching from London to Birmingham.
FINANCIAL SERVICES
Compensation unlikely for LCF investors
Thousands of first-time investors who lost their savings through investment with London Capital & Finance are unlikely to qualify for compensation. Nearly 12,000 people put more than £230m into the firm which collapsed in January. The Financial Services Compensation Scheme acknowledged that the investors had lost money "through no fault of their own". However, it said “there were no grounds for offering compensation”.
FCA bans binary options trading
The FCA is banning the sale of binary options to retail customers from tomorrow amid fears the high-risk trading is costing punters £17m a year. The FCA described the options as “gambling products dressed up as financial instruments.” An announcement to restrict a similar type of derivative known as contracts for difference could come as early as next month.
Fineco to launch UK fund supermarket
Italian bank Fineco is to launch a fund supermarket aimed at British investors. The firm will start with two branded funds next month before building up its range. Paolo Di Grazia, deputy general manager of Fineco, said that offering Isas and other types of investment funds will help it to win new clients and boost business across the group.
FCA removes 1,000 firms from flawed register
The FCA has removed 1,000 companies from the watchdog's register of legitimate firms after Telegraph Money uncovered a flaw that allows unregulated companies to appear on the list.
No-deal Brexit causes sales headaches for asset managers
A no-deal Brexit could force asset managers to send sales staff to EU entities or enlist chaperones for interactions with EU clients.
Half of UK fund groups say gender pay gap is widening
The FT examines figures from asset management groups which show that the gender pay gap is widening.
HEALTHCARE
AstraZeneca agrees cancer drug deal
AstraZeneca is to pay up to £5.3bn to Japan’s Daiichi Sankyo to develop and sell a next-generation cancer treatment.
REAL ESTATE
UK house price growth subdued in March
House prices are lower in England compared with a year ago - the first annual fall in property values since 2012, according to the Nationwide. In the first three months of the year, prices in England were down 0.7% from the same period in 2018. The average house price rose to £213,102 in March from £211,304 in February. Analysts said that international buyers were being deterred by Brexit uncertainty.
February mortgage approvals declined
Mortgage approvals for house purchases fell to 64,300 in February from 66,800 in January, and below the average of the previous six months of 65,500, new Bank of England data has revealed. Individuals’ net borrowing through mortgages was weaker in February at £3.5bn, compared to £3.7bn in January. It was also below the £3.8bn average of the past six months.
Demand for London office buildings falls as staff are packed in
Figures from Seaforth Land, a London property investor have shown that total demand for London office buildings has dropped over the past three years.
RETAIL
Dunkerton gains support for Superdry return
Investec Asset Management and Schroders are backing the return of Superdry co-founder Julian Dunkerton to the board, going against the recommendation of proxy voting agency ISS. The retailer’s current leadership has been opposing Dunkerton’s return with CEO Euan Sutherland saying the move would be “extremely damaging”.
ECONOMY
Consumer confidence underpins growth
Despite growing uncertainty over Brexit, consumer confidence remains steady, with Britons spending more than they earned for a record ninth consecutive quarter at the end of last year, according to figures from the ONS. Consumer spending offset falling business investment as disposable real income edged up 1% over 2018 while December’s wage growth of 1.4% also helped to push up Britain’s savings ratio. But there were signs households have been borrowing heavily or dipping into their savings to sustain spending, leading to concerns over the sustainability of economic growth.
OTHER
“Blue Monday” for small firms
The Federation of Small Businesses has deemed today “blue Monday” as new costs and tax reporting requirements kick in for SMEs. While some firms in England will benefit from cuts in business rates, other changes will mean additional costs. These include new rules on accounting under the Making Tax Digital programme and auto-enrolment pension rules. Mike Cherry, national chairman of the FSB, said: “Overall, this is a package of changes that increases the costs of running a small business. For the first time since 2010, we saw a contraction in the size of the UK business community last year. All ministers and policymakers need to take note and avoid bringing in new measures that would exacerbate this loss in 2019.”