BANKING
RBS returns to profit
RBS has returned to profit for the first time in ten years with CEO Ross McEwan describing the milestone as "a really symbolic moment." The bank made an annual profit of £752m compared with a £6.95bn loss the year before. RBS also released details of its gender pay gap, which averaged out at 37%. The bank said: "Our gender pay gap reflects an under-representation of women at senior levels. That is not a satisfactory position and we know that we still have much to do to narrow the gap." Separately, RBS is working on reinstating its dividend later this year if a settlement with the US Department of Justice over mis-selling claims can be reached.
Metro Bank buys £523m of buy-to-let mortgages
Metro Bank has agreed to purchase a £523m portfolio of buy-to-let mortgages from US private equity group Cerberus. The portfolio is largely made up of properties in London and the south-east. Chief executive Craig Donaldson commented: “This high-quality loan portfolio further strengthens our high growth, organic business model, and complements our conservative risk appetite”.
£1bn a year from open banking to UK economy
Researchers at the Centre for Economics and Business believe that the UK economy could benefit from a digital revolution in banking services by more than £1bn a year. However, the Open Banking changes have also brought warnings from consumer groups Which? and Get Safe Online, who have cautioned that they could increase the risk of customers being scammed.
INTERNATIONAL
Investment banks consider partnership with The Nature Conservancy
With the first "debt for ocean" swap moving ahead in the Seychelles islands, firms including JP Morgan and Credit Suisse are in talks to join forces with The Nature Conservancy over future debt swap deals intended to support conservation efforts in vulnerable environments. Rob Weary of The Nature Conservancy noted that major lenders are increasingly interested in participating.
Sabadell aims for gains of 80%
Banco Sabadell aims to increase profitability by almost 80% over the next three years, encouraged by a rise in interest rates and steady growth in banking fees and lending income.
AUTOMOTIVE
Geely’s $9bn stake sees it become largest Daimler shareholder
Chinese carmaker Geely has paid around $9bn for close to 10% of Mercedes-Benz owner Daimler, becoming the company’s largest shareholder.
CONSTRUCTION
Persimmon cuts bonuses by £50m
Persimmon has reduced bonuses for three top bosses after a public outcry over its incentive plan which saw a £100m payout to chief executive Jeff Fairburn - believed to be the largest bonus ever for a UK-listed company. Mr Fairburn’s bonus has been cut from £100m to £75m, whilst finance director Mike Killoran will lose £24m and managing director Dave Jenkinson will see his bonus cut by £2m to £38m. Ashley Hamilton Claxton of Persimmon shareholder Royal London Asset Management said the investment firm was “pleased that in the end Persimmon’s board has listened to shareholder concerns on pay”. Martin Mortell, of shareholder advisory group Glass Lewis, said the decision was “better late than never”.
FINANCIAL SERVICES
Aviva to sell remaining Spanish businesses
Aviva has announced the £177.6m sale of its remaining Spanish businesses Cajamurcia Vida and Caja Granada Vida to the country’s state-owned lender Bankia. The company said in a statement: "Following the restructuring of the Spanish banking system, which started in 2010, and the subsequent consolidation among Aviva's banking partners, Aviva has taken steps to protect the value of its distribution agreements in Spain." CEO Mark Wilson commented: "This sale is a strong return for our shareholders. It means that over the past five years we have generated proceeds of £1.3bn from selling almost all of our Spanish operations. The transaction further simplifies Aviva, strengthens our already healthy capital position and is another example of our focus on attractive, growing markets where we have high quality franchises."
£500m rights issue explored by Provident
Provident Financial wants to raise as much as £500m to pay a series of forthcoming fines and improve the company’s balance sheet. It is believed that a rights issue could be unveiled alongside the firm's annual results this week. This comes amid regulatory investigations, with the Financial Conduct Authority examining Provident’s credit card and car finance arms.
New Isa launch from easyMoney
Sir Stelios Haji-Ioannou is to launch a financial services arm called easyMoney, with a new Isa the first of many planned products. The company claims that it can offer access to "far higher" returns than cash Isas from high street banks because investors have access to loans secured against UK property.
JP Morgan Cazenove loses 30 clients in 5 years
An analysis of Adviser Rankings data shows that JP Morgan Cazenove lost 30 UK clients during the five years to November 2017, as it faces challenges from smaller rivals. Peel Hunt, Numis Securities and Liberum added 60, 55 and 45 clients to their respective books over the period.
Asset management arm float for Deutsche Bank
Reports claim that Deutsche Bank will publish an "intention to float" document for its DWS asset management unit this week ahead of a March listing.
Worldpay and Visa charges row
Worldpay and Visa are facing complaints from cryptocurrency traders, with Coinbase users stating on online forum Reddit that they were unexpectedly charged on cards used to buy digital currency.
MEDIA & ENTERTAINMENT
TalkTalk board contributes to equity placing
Eight of TalkTalk's directors have contributed £40.8m to the company's equity placing, with the group raising £200m for the reduction of debt and for fibre optic investment.
REAL ESTATE
Rightmove sees 10% rise in profits
Rightmove saw a 10% increase in profits in 2017 as house-hunters viewed property on the portal more than 1.5bn times over the year. The firm reported pre-tax profits of £178m, while revenues increased 11% to £243.3m. The number of people listing homes on the platform climbed 2% over the year, reaching 20,427. “The UK public has once again moved with Rightmove, spending 11.7bn minutes on Rightmove platforms in 2017,” said chief executive Peter Brooks-Johnson. “Our clear market leadership coupled with the value of our products and data positions us well for the future,” he added.
RETAIL
Watchdogs on alert amid Arcadia sale rumours
Watchdogs including the Pensions Regulator are understood to be on alert amid rumours that Sir Philip Green is considering selling Arcadia Group. However, Sir Philip has vehemently dismissed the sale speculation as “malicious rumour-mongering”. Arcadia, which has a turnover of about £2bn each year, has a £565m pension deficit, which Sir Philip has promised to plug with £50m payments over the next decade.
New Look could close stores
New Look’s finance director is set to visit property owners this week, with the retailer seemingly set to seek rent reductions or store closures. New Look has reportedly written to landlords to say that Richard Collyer would be seeking meetings in the coming days. New Look has almost 600 stores in Britain, about 60 of which are thought to be under threat. The chain, which is owned by investment company Brait, is thought to be considering a CVA.
Poundworld faces restructuring
Discount retailer Poundworld is understood to have invited restructuring advisers to pitch for a turnaround role, having posted losses of £17.1m in the year to the end of last March.
ECONOMY
OBR expected to hike growth forecasts
The Office for Budget Responsibility is set to hike its forecasts for UK growth, just months after they were suddenly downgraded. In November, the OBR reined in expected productivity growth and warned that the deficit would rise in this financial year. But strong numbers in the intervening period mean economists now expect the watchdog to partially reverse its predictions.