HSBC set to cut 10,000 jobs
HSBC is preparing to cut up to 10,000 jobs as part of a cost-cutting measure under new interim chief executive Noel Quinn. It is unclear where the cuts will be made, but they will be in addition to 4,700 redundancies recently announced. Sources with knowledge of the matter told the FT: “We’ve known for years that we need to do something about our cost base, the largest component of which is people - now we are finally grasping the nettle.”
Tesco Bank lines up new chair
Sir John Kingman is reportedly being lined up to become chairman of Tesco Bank and will replace Graham Pimlott as chairman once the lender receives formal approval from watchdogs. Sir John, who is set to be appointed to the board of Tesco's banking arm as a non-executive director in October, oversaw the bailout of British banks in the financial crisis and then led the body responsible for the shareholdings. He had been considered by some as a potential successor to Mark Carney as governor of the Bank of England.
Hill seeks support to take Metro Bank private
Metro Bank founder Vernon Hill is believed to be seeking support to take the lender private. Mr Hill, who last week announced his intention to stand down as chairman, told potential backers that he would consider buying the lender off the stock market at its current depressed share price. Mr Hill owns 3.5% of the business, meaning he would potentially need to purchase as many as 96.5% of shares worth £336m from other investors. Ruth Sunderland in the Mail considers the climate for Metro Bank, suggesting that rumours that Mr Hill is trying to take Metro private will make the search for a new chairman harder.
Savers in bank rate saga
Saga has been criticised over an account it is offering with Goldman Sachs, with it found that the easy-access savings rate is lower than that savers can secure by going directly to the bank. Saga offers customers over 55 an account operated by Marcus, the online savings arm of Goldman Sachs, which pays 1.4% interest – while those who go straight to Marcus can get a rate of 1.45%. Saga's deal includes a bonus rate of 0.25% per cent for 12 months, while the Marcus account has a bonus rate of 0.1%, meaning that after a year Saga savers will get a rate 0.2% lower than Marcus customers.
Race to become UK digital banking leader hots up
Nicholas Megaw addresses digital banking competition, looking at fintechs like Revolut, Monzo, Starling Bank, Atom Bank and Tandem and the challenges they face in breaking the dominance of major lenders.
Investor turns to Tide
Japan's SBI, a spin-off from SoftBank, has invested £44m into challenger bank Tide. Existing investor Augmentum was also involved in a fundraising that values the lender at more than £200m.
Contactless crooks cashing in
A probe by the Daily Mail has found that a security loophole is allowing fraudsters to break the £30 spending limit for contactless bank cards. Banks and retailers are both allowing customers to cover a single bill of more than £60 by allowing customers to make several “tap and go” payments of £30 each.
Post Office in BoI deal
The Post Office has renewed a deal with Bank of Ireland to deliver banking services, extending their tie-up until at least 2026.
Barclays trio face court
Three former Barclays executives, including former Barclays Capital CEO Roger Jenkins, will appear in court today on charges of fraud connected with the bank's emergency fundraising during the financial crisis. The Serious Fraud Office claims Barclays secretly paid fees to Qatar to secure funding for its capital raising.
Private equity takeovers of listed companies hit jobs hardest, study finds
Research suggests private takeovers of US public companies hit workforce numbers, with employment down 13% over 2 years after a takeover and 16% when a unit is sold to a private equity group.
Brexit may delay Cobham deal
Advent's £4bn takeover of defence group Cobham could be delayed by political uncertainty and Brexit, analysts have warned. Berenberg analysts said it would be “naïve” to think that disruption around Brexit could not have an impact on the deal.
Petronas sets up VC fund
Malaysia's state energy firm Petronas has set up a $350m venture capital arm for industrial and energy investments.
ECB should let mediocre banks fail, says SocGen chief
Société Générale CEO Frédéric Oudéa has suggested the European Central Bank buying bank bonds would support failing rivals that should change their business models - and serve as an obstacle to consolidation.
Australia charges CBA unit over sales
The Australian Securities and Investments Commission has filed criminal charges against Commonwealth Bank of Australia’s life insurance arm, which it says unlawfully sold insurance policies through unsolicited telephone calls.
Equiteq has appointed Sohail Ahmed as its new managing director.
Court greenlights BA data breach legal action
Thousands of British Airways customers have been given the go ahead to bring compensation claims against the airline at the High Court over a data breach. The case relates to a cyber-attack BA suffered in 2018, which an investigation by the Information Commissioners Office found affected about 500,000 customers.
Regulator could ban insurance ‘loyalty penalty’
The Financial Conduct Authority (FCA) could ban insurers from moving policyholders on to more expensive policies when they renew deals, with a probe finding that around 6m customers were being overcharged by £1.2bn a year. The FCA found that customers who were initially offered “new business” discounts were regularly subject to rapid annual price increases, with the issue of “price walking” leading to criticism of the so-called “loyalty penalty”. Insurers were also accused of targeting “vulnerable” customers deemed less likely to shop around. “This market is not working well for all consumers,” said Christopher Woolard, executive director of strategy and competition at the watchdog.
Car loans may be on the road to a mis-selling scandal
The Sunday Telegraph reports that it may be the end of the road for cheap and easy car loans. Research by the paper suggests a “gathering storm” that comes as the Financial Conduct Authority prepares a clampdown on the market and Rachel Reeves, chair of the business, energy and industrial strategy committee, demands “far more transparency and greater scrutiny” of lending. Graham Hill, former director of the National Association of Commercial Finance Brokers, has suggested that claims managers are turning their attention to the motor industry as they look for the next PPI-type scandal.
Amigo finds a friend in FCA
The Financial Conduct Authority has allowed Amigo to have a free float of just 20% until October next year after the guarantor loans business saw the number of company shares in public hands fall below a required threshold, with the proportion of its stock which is free to trade on the market dropping below a 25% minimum limit. The limit is understood to have been breached due to a share sale by the company’s largest investor, as well as share purchases.
Nutmeg reveals widening losses
Online wealth manager Nutmeg has revealed operating losses expanded from £12.4m to £18.6m in 2018, even though turnover grew from £4.6m to £7.2m. However the firm has also seen a 30% rise in customers transferring from Hargreaves Lansdown since last year.
Morrissey leaves L&G
Dame Helena Morrissey, who is reportedly a potential candidate to be the next governor of the Bank of England, is leaving Legal & General, where she led its personal investment business, to pursue other projects.
Woodford fund value down 20% since May
Neil Woodford’s Equity Income Fund has shrunk 20% since the end of May, with the fund dipping to £2.93bn last week. Meanwhile, the Telegraph reports that the fund could remain closed for another six months.
Stamp duty take down by £745m since 2017/18
HMRC figures show that stamp duty receipts for residential housing transactions fell by £745m between 2017/18 and 2018/19, slipping from £9.07bn to £8.32bn in the first year-on-year drop seen since 2008/09.
Pound would see Brexit deal boost
A Reuters survey of economists suggests that the pound will experience a post-Brexit bounce if the UK leaves the EU with a deal, but will see further losses against the dollar if no deal is secured. The forecast suggests that sterling would rally if the UK and EU agree a deal and trade between $1.27 and $1.34, but could dip to between $1.10 and $1.19 in a no-deal scenario. Shaun Osborne at Scotiabank said: “A lot of bad news is priced into the pound so we would expect a relief rally to some extent, if a deal is reached.”
Uncertainty sees 11% drop in investment
Analysis by the National Bureau of Economic Research (NBER) suggests that Brexit uncertainty has seen business investment dip, with a decline of around 11% in the three years following the referendum. This, the report says, is equivalent to a £20bn hit to the economy. The NBER analysis also suggests Brexit-related issues have led to a 5% dip in productivity.
LSE debuts down 80%
The value of stock market debuts on the London Stock Exchange fell 80% to £300m in Q3, analysis shows, while overall European IPO values were steady – raising £3.4bn.