BANKING
Revolut granted licence to operate in Europe
Revolut has secured a European banking licence as it steps up preparations for a hard Brexit. The fintech company sought the licence partly to “hedge against any issues regarding Brexit”, according a source. The source added that Revolut intends to apply for a UK banking licence but has not yet officially done so, and will provide further information in the new year. Revolut secured the licence from the Bank of Lithuania and it was approved by the European Central Bank.
FRC consults on quality of bank audits
The Financial Reporting Council has launched a consultation on the auditing of banks and building societies which would see auditors required to have to apply a higher benchmark when looking at banks' risk assessment procedures and disclosures and would have to better audit management estimates in a bank's financial statements.
Remortgaging hits decade high
October saw Britain's highest levels of remortgaging in ten years, according to UK Finance data, with 50,500 new homeowner remortgages worth a total of £9.2bn completed in the month, up 23.2% compared with the same month a year earlier. Noting that many fixed rate mortgages were coming to an end, UK Finance’s director of mortgages Jackie Bennett said the numbers were driven by homeowners locking into attractive deals amid a competitive market.
TSB hit by further IT glitch
Just under 2m TSB customers were unable to carry out online banking transactions yesterday after maintenance work overran. The technical problems were the latest to hit TSB account holders this year after 1.9m customers were unable to use their accounts for several weeks back in April.
INTERNATIONAL
Unicaja and Liberbank in talks over potential tie-up
Spain's Unicaja has hired Italian investment bank Mediobanca to advise on a potential merger with Liberbank, which in turn is being advised by Deutsche Bank.
Credit Suisse plans at least SFr2bn in share buybacks
Credit Suisse has approved up to SFr2bn in share buybacks for 2019, with more to come in 2020. Its dividend is expected to rise by at least 5% a year. The FT’s Lex says the bank’s basic strategy appears sound but that more volatility is inevitable.
China’s Anbang steps up disposals with $2.4bn bank stake sale
Anbang Insurance has sold its 35% stake in Chinese bank Chengdu Rural Commercial Bank for Rmb16.8bn ($2.4bn).
AVIATION
Airlines forecast to enjoy longest run of profits
Amid continuing low oil prices, the International Air Transport Association has predicted that airlines globally will enjoy a tenth consecutive year of profitability in 2019.
CONSTRUCTION
UK outsourcer Amey up for sale to private equity
UK outsourcing group Amey is being lined up for a sale to a private equity firm. Owner Ferrovial is understood to be in talks with PAI Partners and Greybull Capital.
FINANCIAL SERVICES
L&G mulls sale of general insurance arm
Legal & General has hired Fenchurch Advisory Partners to sell its general insurance division. City sources said a deal could value the business at more than £300m. The L&G general insurance arm recorded a £37m operating profit in 2017, down 29% on the year before, a performance largely dictated by higher-than-expected non-weather-related household claims.
CMA calls for pensions advice improvements
The Competition and Markets Authority (CMA) has complained of a lack of competition in the pensions advice market and warned that pension trustees, many of whom buy fiduciary management services from their existing investment consultants, are not given sufficient information to help them choose advisers. The CMA called on the Pensions Regulator to issue new guidance to help trustees choose their advice services and for the government to broaden the scope of the Financial Conduct Authority to ensure greater oversight of the sector.
EU to grant derivatives traders emergency market access in no-deal Brexit
As European parties step up preparations for a no deal Brexit scenario, Brussels will grant EU derivatives traders 12 months to continue using UK market infrastructure before alternatives are arranged.
Move to boost UK pension fund investment in infrastructure
A Financial Conduct Authority consultation says it should be easier for pension funds to invest in infrastructure projects and British start-ups, reflecting Treasury hopes to boost nascent UK business.
Odey backs fintech start-up
Crispin Odey has backed UK-based fintech start-up Jumo with a $12.5m (£9.9m) funding injection through his firm Odey Asset Management. Jumo said it would use the investment to develop its platform, and to support market expansion and growth.
HEALTHCARE
Sale of Four Seasons to start next year
The sale of Four Seasons, Britain’s biggest care homes operator, is to get under way early next year as the company struggles under a £525m debt mountain. Chairman Martin Healy said: “This is a positive step towards restructuring the group's finances and providing the business with a sound financial structure that meets its long-term requirements.”
MANUFACTURING
Rolls-Royce asserts positive guidance
Rolls-Royce has asserted positive full-year profit and cashflow guidance for 2018, expecting operating profit to be £400m and cashflow of £450m. “This reflects supply chain challenges that are affecting the whole civil aero engine sector and also early stage production ramp-up challenges on our new Trent 7000 engine,” the firm said, noting that it had begun stockpiling supplies as a Brexit “contingency measure”.
MEDIA AND ENTERTAINMENT
Tencent Music lists at low end of IPO target
Tencent Music will raise $1.07bn from the pricing of its New York Stock Exchange listing - the low end of estimates. The streaming division of Chinese giant Tencent was valued at $21.3bn, still one of the largest tech debuts on Wall Street.
REAL ESTATE
Sellers sitting tight
The Royal Institution of Chartered Surveyors has said that Brexit worries are causing homebuyers and sellers to sit tight – with properties typically taking four months to sell. The organisation revealed that the number of properties listed at each branch fell to an average of 42 last month. Meanwhile, more estate agents reported a fall in sale prices in November than the previous month.
RETAIL
Dixons Carphone posts first-half £440m loss
Shares in Dixons Carphone fell 14%, after the company posted a loss of £440m for the six months to October 27th, down from £54m a year earlier. The company incurred charges of £490m, largely due to a write-down on the value of its Carphone Warehouse arm. Full-year costs surged to £190m, including a £17m hit from the cyber-attack revealed in June that saw 5.9m bank card details and 10m personal data records hacked last year. On an underlying basis, interim pre-tax profits dropped to £50m, from £73m a year earlier.
SPORT
Sky to end cycling sponsorship
Sky will end sponsorship of its cycling team at the end of next season. Team Sky is by far the richest outfit in the history of professional cycling - having been backed to the tune of £180m over the length of the partnership.
Eleven Sports at risk of closure
Eleven Sports is considering pulling the plug on its UK operation after failing to secure distribution via established pay-TV operators and amid concern over mounting losses.
ECONOMY
Britain's tax take at 30-year high
The UK’s tax burden is at a 30-year high as a share of GDP, according to the Organisation for Economic Co-operation and Development. Taxes amounted to one-third of GDP last year, the highest since 1988 and above average for the past 50 years, compared to the 34.2% average across the OECD’s 35-nation club of wealthy countries. Income taxes made up around £186bn of revenues for the Exchequer, around 9.1% of GDP. VAT brought in £139bn, while property taxes contributed £85bn.
London accelerates away from rest of the UK economy
ONS data shows London’s economy is moving farther away from the rest of the UK, growing more than four times as fast in 2017 than in the country’s poorest region.
OTHER
May survives confidence vote
Theresa May has won a vote of confidence in her leadership of the Conservative Party by 200 to 117. After securing 63% of the total vote, she is now immune from a leadership challenge for a year. Speaking shortly after the result was announced, Mrs May said she would be fighting for changes to her Brexit deal at an EU summit today. The PM said: “I am pleased to have received the backing of my colleagues in tonight's ballot. Whilst I am grateful for that support, a significant number of colleagues did cast a vote against me and I have listened to what they said.” Jacob Rees-Mogg, who led calls for the confidence vote, said it was a “terrible result for the PM” and called on her to resign.