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Daily News Roundup: Monday, 9th September 2019

Posted: 9th September 2019


Banks accused of forging signatures

Anthony Stansfeld, police and crime commissioner for Thames Valley, claims that banks are forging signatures on legal documents, alleging that the Serious Fraud Office (SFO), the Financial Conduct Authority and the National Crime Agency have been sitting on “overwhelming” evidence of falsification of documents. He says signatures of bank officials and customers have been forged, with bank statements and other documentation “altered to the bank’s advantage”. He adds that while a “mass of irrefutable evidence for this has been with the SFO for eight months”, it has not acted. Julian Watts, founder of the Bank Signature Forgery Campaign, has collated what he claims is evidence showing widespread forgery by banks, with analysis by a handwriting expert cited.

Sainsbury’s plans bank review

Sainsbury's is expected to undertake a major overhaul of Sainsbury’s Bank and is understood to be examining options for its loss-making financial services arm, which could involve offloading its mortgage book. Last week Tesco sold its mortgage book to Lloyds for £3.8bn after saying it would abandon the market due to "challenging market conditions". Sainsbury’s Bank made a loss of £34m last year compared to a profit of £25m the year before.

Revolut leads Tech Track 100

The Sunday Times carries its Tech Track 100 supplement, which ranks Britain’s 100 private tech companies with the fastest-growing sales over their latest three years. Revolut, where sales have climbed 507.56%, tops the rankings. Meanwhile, Revolut has withdrawn its application for a banking licence in Luxembourg following scrutiny in the country's parliament of its compliance record.

Review call over mis-selling

Victim groups are pushing for complaints by business owners who say their companies collapsed due to loan mis-selling by CYBG's Clydesdale Bank and Yorkshire Bank to be examined in an independent judge-led review.

Banker in court over deleted messages

In a prosecution brought by the Financial Conduct Authority, former VTB banker Konstantin Vishnyak has been charged over claims he deleted WhatsApp messages he allegedly knew to be relevant to an insider-trading investigation. The case marks the first prosecution by the FCA in relation to a destruction of documents offence under the Financial Services and Markets Act 2000.

Court case to hear Standard Chartered Iran links

Standard Chartered faces a high-profile court battle that will detail allegations it helped facilitate deadly attacks on British and US troops by helping companies connected to Iran's Revolutionary Guard and enabling the state to sidestep sanctions.


PE firms eye Symantec

Permira and Advent International have made a combined approach to buy cyber security company Symantec Corp for more than $16bn. If the purchase comes to fruition, it could derail a deal that has seen chipmaker Broadcom agree to buy Symantec’s enterprise unit for $10.7bn.

MPs to scrutinise Cobham deal

MPs are set to look into the proposed takeover of British defence firm Cobham by Advent International. Commons Defence Select Committee chairman Julian Lewis said the committee will meet to address concerns about Advent’s commitment to defence projects as private equity firms tend not to own companies “for more than a few years”.


Spanish banks await mortgage pricing ruling

Spanish banks including Caixabank, Bankia, Santander and BBVA are awaiting a preliminary ruling from the European Court of Justice (ECJ) on whether they charged some customers too much for mortgages. The Court’s decision, which could eventually lead to lenders paying out billions of euros in compensation, centres on lenders that used Spain's mortgage price index as an alternative to the interbank rate Euribor to set mortgage rates. The ECJ's general advocate is expected to issue a non-binding statement on September 10, with a final decision expected towards the end of 2019 or early 2020.

Deutsche assesses supervisory board member’s suitability

Deutsche Bank's regulators are examining whether new supervisory board member Juerg Zeltner, a former UBS manager, is suitable for the job. They are reportedly assessing whether his position would be a conflict of interest because he is also the CEO of KBL European Private Bankers, a firm whose operations overlap with Deutsche's.

UBS and Banco do Brasil in JV talks

Brazilian state-controlled lender Banco do Brasil and UBS are reportedly in advanced talks about an investment banking joint venture. Sources have said that the banks could finalise a deal that would combine Banco do Brasil investment banking unit BB BI with UBS's Brazil division as soon as next month.

Goldman prepares to cut its partners down to size

Goldman Sachs chief executive David Solomon is looking to reduce the number of long-standing partners, with senior managers carrying out a review designed to maintain the status of its elite bankers.

ECB expected to announce stimulus measures as options run out

Economists expect the ECB to cut rates by up to 20 basis points on Thursday, to a record low of minus 0.6%, and announce new QE measures to ease the impact of negative rates on the Eurozone's banking industry. Mario Draghi leaves the ECB next month, succeeded by Christine Lagarde.

US banks set to lower forecasts as falling interest rates bite

JPMorgan Chase, Bank of America, Goldman Sachs, Wells Fargo, Citigroup and Morgan Stanley will all give updates on their outlooks this week with analysts expecting the guidance to be downward.


BA faces strike and falls in reputation rankings

A report by Alva, a reputation management company, says Qatar Airways has the most positive reputation among airlines, followed by Emirates, Etihad, Nippon and Qantas. The rankings proved uncomfortable reading for British Airways, which dropped to 55th of 65 airlines having placed 31st in 2016. This comes as BA pilots began a two-day strike in an ongoing dispute over pay and conditions..


Berkeley outlines profit targets

Berkeley has said London conditions remain “robust” but cautioned on Brexit-induced difficulties ahead. The housebuilder said pricing has remained stable in the capital and the South-East in the first four months of the financial year. Its forward sales order book remains above £1.8bn. The housebuilder also said it expects net cash for the half-year to be at a similar position to the full-year figure of £975m posted earlier this summer.


Labour could restrict City bonuses

Shadow Chancellor John McDonnell has warned that a Labour government could bar financial services companies from awarding bonuses to their bosses, saying they should voluntarily end bumper payouts or risk facing limits on what they are allowed to hand out. “If it continues and the City hasn’t learnt its lesson, we will take action - I’ll give them that warning now,” he said, adding: “If we have to take action, we will. People are offended by bonuses.” Mr McDonnell described bankers’ bonuses as “separate and distinct and isolated from the rest of the real-world economy,” suggesting that the matter is “a reflection of the grotesque levels of inequality that people now find so offensive.” The Telegraph notes official figures showing that the value of all bonuses paid in Britain hit a record £46.4bn in 2017, up 6.5% on 2016’s total.

Exchange CEO warns City over EU ‘bullying’

Jos Dijsselhof, chief executive at SIX Swiss Exchange, Switzerland’s largest stock exchange, has urged Britain to prepare retaliatory measures to protect the City and fight “bullying” from the EU, post-Brexit. With Switzerland and Brussels in a regulation dispute over equivalence rules and access to markets, Mr Dijsselhof warned: “There are risks of London losing business. The Government should be ready to act to protect the UK.” Mr Dijsselhof said equivalence is “one-sided” and has been used as a “hostage” by EU officials to bully Switzerland, adding: “If the EU decides they don’t like it any more, within three months it’s gone. That’s not a real partnership, the EU needs to come up with a different way of connecting with third-party countries.”

SJP to review staff incentives programme

The Sunday Telegraph reports that St. James’s Place is to undertake a review of its staff incentives programme. In a letter to partners, chief executive Andrew Croft said the review was part of a plan to “modernise” the company. According to the Telegraph, the review is likely to result in a ban on certain incentives.

Big US sustainable funds fail to support ESG shareholder proposals

Voting records filed with the US Securities and Exchange Commission suggest funds labelled sustainable by BlackRock, JPMorgan Asset Management and Vanguard have frequently sided with a company’s management and against ESG-focused shareholder proposals.

Wealth firms near merger

Wealth manager Tilney could this week seal a merger with Smith & Williamson that would create a group with £45bn of assets under management.

Adrian Montague to take top role at City lobby group

Aviva chairman Adrian Montague has been appointed to chair TheCityUK’s advisory council. Sir Adrian will succeed Prudential chairman Paul Manduca, who has led the advisory council for the past four years.

Royal Mint plans first stock exchange product with gold ETF

For the first time in its more than 1,100-year history the Royal Mint will offer a financial product that will trade on a stock exchange – a gold-backed ETF.


House prices up 0.3%

Figures from Halifax show that average UK house prices rose by 0.3% in August compared with July, hitting £233,541, with prices 1.8% up year-on-year. Over the three-month period covering June to August, prices rose 0.1% compared with the three months before. Meanwhile, Bank of England data reveals that mortgage approvals have grown slightly, climbing to 67,306 in July - a 1.2% increase on last year’s figures.


Arcadia posts hefty loss

Sir Philip Green’s retail empire Arcadia has revealed a large hole in its finances. The retailer’s holding company, Taveta Investments, reported a loss of £177.3m in its most recent annual figures filed to Companies House, this compared with profits of £53.5m a year earlier. The company also reported a 4.5% fall in turnover. If exceptional items and other one-off costs are stripped out the company made an operating profit of £78.1m, down from £124.1m a year earlier.

Footfall in decline as retail customers hold back

Retail footfall has continued to fall, according to the latest BRC survey, with the high street seeing a decline of 1.9% and shopping centres 2.2%. Only retail parks managed to attract more consumers, with footfall rising by 1%.


Stability in our financial system will continue after Brexit

Alex Brazier, the executive director for financial stability, strategy and risk at the Bank of England, says the UK’s financial system will remain stable after Brexit and that Britain’s banks would be resilient to whatever disruption might ensue while domestic companies which used financial services from European firms would be able to continue to do so. Separately, the Resolution Foundation has warned that in the event of a recession the Bank of England would have very little room for manoeuvre because rates are already at historic lows.

BoE survey: Inflation to hit 3.3%

The Bank of England’s (BoE) latest inflation attitudes survey shows that the public expects Brexit to push up the cost of living. August’s poll shows that respondents expect inflation of 3.3% in the coming year, up from 3.1% in May, with over half of people surveyed saying Britain’s exit from the EU will be the driving factor behind the increase.


Lyons fails to make BoE shortlist

The Times reports that former Standard Chartered chief economist Gerard Lyons, Boris Johnson's former economic adviser, has failed to make it on to the Treasury's final shortlist for the role of Bank of England Governor. While it is not known who has made the shortlist to replace Mark Carney, frontrunners include Financial Conduct Authority chief Andrew Bailey, Santander UK chairwoman Baroness Vadera, director of the London School of Economics Dame Minouche Shafik - a former Bank deputy governor - and Sir John Kingman, chairman of Legal & General.

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