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Daily News Roundup: Thursday, 13th May 2021

Posted: 13th May 2021


More bankers relocating to EU

Investment banks have begun shifting more rainmakers out of London to financial centres across the EU, after the pandemic and uncertainty over Britain’s access to the bloc had slowed relocations. Morgan Stanley, Barclays and Goldman Sachs are among those moving senior bankers. Reuters says the lack of a breakthrough in talks over financial services post-Brexit has added to the impetus. Client-facing bankers in London are required to have a "chaperone" based inside the bloc whenever they speak to clients, spurring some to relocate to avoid the complication when sealing deals.

TSB branches offer safe space for domestic abuse victims

Victims of domestic abuse will now be able to walk into a TSB bank on the high-street and ask for help to escape their abusive partner. The new scheme, which is being implemented across almost 300 TSB branches across the UK from Wednesday, allows victims to speak to a trained staff member as well as contacting domestic abuse services or the police or a friend or relative in a private room.

Metro Bank chief's £500,000 bonus questioned

Metro Bank's decision to award its new chief executive a £500,000 bonus despite losing over £250m last year has been criticised by shareholders. ISS noted that "The structure of the bonus framework, especially under financial conditions, raises concerns, particularly as the weighting structure suggests that performance in one area is able to compensate for the outcomes from another element."

UK proposes new powers to fight soaring financial fraud

The UK Government’s draft online safety bill includes measures to clamp down on financial scams following lobbying from the banking trade body UK Finance.


SoftBank posts record profit

Softbank has reported a $45.9bn profit for the year to March 30, a notable rebound from its $8.8bn loss the previous year and a record for a Japanese company. The investment group said it had tripled the amount it had put into its second Vision Fund to $30bn after its gains.

Private equity group to acquire UDG Healthcare

Private equity group Clayton, Dubilier & Rice (CD&R) is to acquire London-listed UDG Healthcare for £2.6bn ($3.7bn). UDG Chairman Shane Cooke stated: "We believe that this is an attractive offer for UDG shareholders, which secures the delivery of future value for shareholders in cash today."


UniCredit CEO reorganises management at firm

UniCredit's new Chief Executive Andrea Orcel has reorganised the firm's management structure. He told staff that "I have spent the last few weeks speaking and listening to our people. I have heard your concerns about the complexity of our business... I have felt your frustration about some of the decisions that have been made; confusion about where ultimate responsibility lies; and the resulting lack of accountability." The Western Europe and Finance & Controls divisions have been removed, with Niccolo Ubertalli appointed as head of Italy.

Commerzbank reports Q1 profit

Commerzbank has announced a net profit of €133m in the three months to March, with the lender now expecting a slight increase in annual revenue rather than a minor decline. This comes after the firm announced earlier this week that it will team up with French-German rival Oddo BHF on equity brokerage and equity research.

ABN Amro announces Q1 net loss

ABN Amro has reported a net loss of €54m ($66m) for the first quarter, citing a large fine levied by Dutch prosecutors in connection with a criminal investigation into the bank's oversight of money laundering associated with its accounts.


Toyota optimistic about sales resurgence

Toyota has announced that it expects to return to profit and sales levels seen before the coronavirus pandemic this year, as the firm unveiled an $11bn budget to be spent on autonomous and carbon neutral technologies.


Tui hoping for summer holiday boost

Tour operator Tui has announced that with bookings for summer still almost a third below the same point in 2019, a resurgence in demand had been “clearly evident” recently. The firm's chief executive Fritz Joussen remarked: “The prospects for early summer 2021 make me optimistic for tourism and for Tui. They are significantly better than in the first pandemic year, 2020." This comes after the company reported an 89% fall in revenues to €732m in the first half of its financial year, compared to the same period a year earlier.

Crash leads to legal action against Air France and Airbus

Air France and Airbus are to stand trial in connection with the crash of Air France flight 447 from Rio de Janeiro to Paris on June 1 2009. French judges have ruled that the two groups should stand trial for “involuntary manslaughter." Both companies are to appeal the decision, with Air France stating that it “maintains that it did not commit any criminal fault in this accident, tragic as it was.”


Fish wars - France seeks to blackmail UK over City access

French officials are trying to stall the ratification of the memorandum of understanding between the EU and the UK regarding the approach to future financial services agreement in an attempt to force the UK to provide European fishermen access to UK waters. Clement Beaune, the French minister for European Affairs, previously warned that the EU would retaliate if licences to fish were not granted but Bank of England Governor Andrew Bailey has already predicted that the EU is weaponising equivalence to lock Britain into its system as a regulatory satellite.

Aon and Willis divest assets to ease approval of $30bn merger

Gallagher is to buy $3.6bn worth of assets from rivals Aon and Willis Towers Watson as the pair move to resolve EU competition questions regarding their $30bn merger.

BlackRock wins approval to run wealth business in China

BlackRock has announced that it is to begin operating a wealth management business in mainland China, with chief executive Larry Fink describing it as "a significant opportunity."


Compass Group to repay furlough cash

Catering firm Compass Group is to return furlough money to the UK Government, even as sales fell by around a third and operating profits by over three-quarters to £168m in the six months to March 31. Chief executive Dominic Blakemore remarked: “We are now a stronger, more agile business with new client propositions, improved digital capability and a more flexible cost structure. These factors, underpinned by a robust balance sheet, have created a strong platform from which the business will continue to recover and grow.”

Marston’s names new CEO

Marston’s CFO Andrew Andrea has been named successor to Ralph Findlay as chief executive of the group. Andrea stated: “Despite the challenges of the last year, I am confident that we have a great team of energised and engaged people to deliver our vision, and I look forward to working with them and the board to return the business to growth and optimise the future opportunities available to us.”


Court gives Virgin Active CVA the go ahead

Virgin Active's restructuring plan has been approved by the High Court allowing the company to terminate the leases of some poorly performing gyms and to pay less rent on other properties. Shareholders will inject £45m into the business while lenders are being asked to "amend and extend" its debt facilities. But Melanie Leech, CEO of the British Property Federation, said the judgement “demonstrates how the law is now allowing wealthy individuals and private equity backers to extract value from their businesses in good times but later claim insolvency, as simply a means to get out of their contractual obligations with property owners."


Premier League’s new £5bn TV deal set to benefit smaller clubs

In return for clearance to roll over its existing £5bn contract with Sky, BT and Amazon, the English Premier League has agreed to UK demands to provide more funding to lower division teams.


UK economy resilient during first quarter

Figures from the Office of National Statistics show the UK economy shrank by 1.5% in the first three months of 2021, but gathered speed in March as lockdown restrictions began to ease. The first-quarter contraction was caused by the third lockdown in January which led the size of the economy to shrink 2.5%. But in March, the UK’s GDP exceeded expectations and rose 2.1%, the fastest monthly growth rate since August last year. Chancellor Rishi Sunak welcomed the figures, saying the economy was showing “promising signs” after a “difficult start to this year”. The Bank of England now expects the economy to have recovered its pandemic losses by end of year, forecasting annual growth of 7.25%, the fastest rate since 1941. Ruth Gregory, senior UK economist at Capital Economics, commented: “The burst of growth in March shows that the recovery has been gathering momentum more quickly than we had thought.”

UK exports to Europe continue rapid recovery

Exports to the EU jumped a further 8.6% in March to hit pre-Brexit levels with car exports driving the second month of a rebound from January’s record plunge. But the ONS data also show imports from the EU remained depressed resulting in Britain importing more from non-EU countries in the first quarter for the first time on record. The ONS said: “It is too early to assess the extent to which this reflects short-term trade disruption or longer-term supply chain adjustments.” The UK’s trade deficit narrowed during the first quarter, shrinking by £8.4bn to just £1.4bn, reflecting a sharper decline in imports than exports.

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