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Daily News Roundup: Monday 26th March 2018

Posted: 26th March 2018


Barclays plans to fight off Bramson

Barclays has drawn up contingency plans to fend off any attacks from Edward Bramson, after the activist investor built up a 5% stake in the bank via Sherborne Investors. Barclays bosses are understood to have devised battle plans for any hostilities with advisers at Deutsche Bank and JP Morgan.

Gender pay gaps revealed

As the deadline for companies to publish their gender pay statistics grows closer, Sainsbury's Bank has revealed a median gender pay gap of 45.3%, the largest of all the high street banks that have so far submitted their figures. Elsewhere, male staff at JP Morgan’s investment bank in London are paid more than twice as much as female colleagues. A disclosure for JP Morgan Securities reveals that female staff earn an hourly rate 53% lower than men's on average, while bonus cheques are 64% lower.

Co-op hedge fund investors ‘supportive’

Chief executive of the Co-operative Bank Liam Coleman has said investors are "supportive" of the lender's current strategy. The bank reported narrower pre-tax losses of £140.3m, from £477.1m in 2016, after a company-wide cost-cutting campaign.

Bankers ‘a public good’ - Reynolds

Shadow City minister Jonathan Reynolds has said: "The difference, maybe, between me and Jeremy [Corbyn] is I think good financial services is a public good". This comes after Mr Corbyn last month said there was a need to address the finance sector's "destructive" influence over the real economy and "undemocratic" control over politics.


M&A deals grow to more than $1tn

Announced M&A volumes eclipsed $1tn last week, with takeovers agreed between private equity firm Blackstone and data provider Thomson Reuters, among others.


Rise in pay for executive team at Credit Suisse

Credit Suisse’s top executive team will be paid around SFr115m in 2018 under a new incentive plan. Kai Nargolwala, new chairman of the bank's compensation committee, said that the lender’s financial performance was the "primary basis" for the compensation proposals.

Expansion of investment banking eyed by Goldman

Goldman Sachs bankers are to try and sign up 1,000 more corporate clients around the world, chief executive Lloyd Blankfein has told investors in his annual letter.


Bonus debacle sees Persimmon charm City

Following criticism of a potential £100m payout to its chief executive, Persimmon has written to shareholders acknowledging that the 2012 long-term incentive plan had "overshadowed" the firm’s good performance.


Provident sued in card dispute

Provident Financial is embroiled in a legal dispute with leading shareholder Aberdeen Standard Investments over claims that the disclosure of a regulatory investigation into its credit card business was delayed. Aberdeen Standard alleges that Provident's "earlier public announcements were false or misleading or, alternatively, the delay in disclosing those matters publicly was dishonest pursuant to section 90A of the Financial Services and Markets Act 2000, and the company made actionable misstatements during those investor meetings".

European relocation for top financial firms

Over 20% of Britain's largest financial services firms are to move operations out of Britain because of Brexit. The City remains adamant that the loss of 'passporting' rights means companies will be forced to use new continental bases to service EU clients. Meanwhile, the City of London Corporation has urged the EU to offer a "mutual recognition" Brexit deal for the protection of financial services both in Britain and the European mainland.

Ombudsman must improve ahead of expansion

Nicky Morgan, chairwoman of the Treasury select committee, has said that the Financial Ombudsman Service must improve before it can take on more responsibilities. After Channel 4's Dispatches revealed that staff had claimed it was easier to side against consumers, the ombudsman says the documentary failed to "give a fair impression" of its work.

Investor anger halts Aviva preference share wipeout plan

Aviva has abandoned a plan to wipe out £450m of its preference shares at less than market value after the proposal was rejected by investors. Aviva acknowledged that it had received "strong feedback and criticism", with Mark Wilson, chief executive, commenting: "I am very aware that Aviva is in a position of trust with our customers and investors. To maintain that trust it is critical that we listen to and act on feedback."

Germany targeted by Vanguard and Raisin

Asset manager Vanguard has partnered with fintech company Raisin to sell its investment portfolio products, giving the former an opportunity to expand its presence in Germany.

RSA’s Hester takes home £5m

RSA chief executive Stephen Hester took home £4.9m last year after the insurer topped up his £987,000 salary with a £1m bonus and a £2.6m long-term incentive plan.


Funding of £40m for Pharmacy2u

Pharmacy2u, one of the UK’s largest online pharmacies, has won £40m of funds from private equity house G Square and other investors to expand its repeat prescription delivery service.

The Daily Telegraph, Business, Page: 6 City AM, Page: 11


500 jobs and 94 outlets lost at Prezzo

The Prezzo restaurant chain has agreed a restructuring plan that will see around 500 jobs lost and 94 outlets shut. A company voluntary arrangement was supported by 88% of creditors, including landlords. Jon Hendry-Pickup, Prezzo's chief executive, commented: "I would like to thank our creditors and landlords for supporting our transformation plan. While we continue to be profitable, the pressures on our industry have been well documented." Meanwhile, the UK's top 100 restaurant groups have seen profits fall 64% over the past 12 months, with a number of ‘casual dining’ branches entering into CVAs this year.

David Lloyd gyms in possible £1bn sale

Canadian investment house Brookfield is believed to be competing with several other bidders for the David Lloyd health club chain, which is expected to sell for more than £1bn. Private equity owner TDR Capital appointed NM Rothschild last year to find a buyer.


Carillion’s fall could spell end for Vaughan Engineering

Vaughan Engineering, which was subcontracted by Carillion to work on a school near Liverpool, is expected to make around 160 staff redundant at three offices in Edinburgh, Warrington and Newcastle.


$11.2bn float for Dropbox

Shares in file-sharing company Dropbox rose by as much as 50% on the Nasdaq exchange, closing at $28.48, to give the firm a market value of $11.2bn (£7.9bn), exceeding the $10bn it received at its last private funding round four years ago.

Naspers to sell $10bn Tencent stake

Naspers has said that it will sell Tencent stock worth more than $10bn, or 2% of the shares in Tencent, to fund other investments.


Mortgage struggle for buy-to-let landlords

Nearly two-thirds of landlords say it is now more difficult to get a mortgage, six months after the Bank of England's Prudential Regulatory Authority made its latest attempt to cool the buy-to-let market.


Next profits fall 8%

Fashion chain Next saw an 8% fall in annual profit, putting it in line for a third consecutive decline this year. Chief executive Lord Simon Wolfson commented: "In many ways 2017 was the most challenging year for 25 years. While uncomfortable, it has prompted us to take a fresh look at almost everything we do. The company goes into the coming year in good financial health."

Maplin jobs at risk

Some 2,500 Maplin workers’ jobs are at risk with hopes of finding a buyer fading as shops begin to shut over the coming weeks. It is believed that if no credible offer to purchase the group emerges very soon, store closures could be announced by next week.

House of Fraser banks call in accountants

House of Fraser’s lenders have called in accountants over rising fears that the retailer may struggle to operate as the high street crisis deepens.


Sky Bet enjoys Cheltenham windfall

Sky Bet saw more than 300 bets per second placed during the Cheltenham Festival, with chief executive Richard Flint hailing improvements to its website for attracting more custom.


Job switching points to improving economy

The Bank of England says a rise in the number of workers switching jobs is proof of the UK’s economic recovery. Almost 900,000 people moved from one job to another in the final three months of 2017, the highest number since 2004. The Bank’s Monetary Policy Committee said job-to-job flow rates and strengthening wage growth suggested that the labour market “remained tight.”

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