Google to start offering personal current accounts
Google is teaming up with Citi to launch a digital bank account called Cache in the US next year, which if successful could lead to a similar product being launched in the UK. Caesar Sengupta, Google's general manager of payments, said the company intended to “partner deeply with banks and the financial system”. He said Google will leave the process of handling money in current account apps to traditional banks, meaning it will not need a banking licence and is likely to avoid heavy regulation. The new Cache digital banking app will be accessed through Google Pay which allows users to store their card details in a "digital wallet" in order to make payments in a store, online or through an app. The move into online retail banking by Google is likely to be seen as a direct threat to British players such as Monzo and Revolut, the Telegraph says.
Hundreds of communities left with no access to cash
New research by consumer group Which? has found that individuals and small businesses in more than 250 communities across the UK have limited access to cash. The study shows that 130 postcodes, with a combined population of more than 115,000 people, do not have access to a cash machine, while 36 of these locations do not have a bank branch or post office either. Which? said that "an increasing number of people are being forced to pay just to access their cash" and it warned that the most deprived areas were suffering the biggest rises in fee-charging machines. Which? said the Government's Payment Systems Regulator should require banks to pay reasonable fees to cashpoint operators to ensure they are economically viable. UK Finance said it is supporting an initiative by LINK to install new ATMs in communities that flag up a need.
OSB increases loan book
OneSavings Bank (OSB) and Charter Court Financial have said they expect to report bigger loan portfolios for the full year, as both the lenders’ loan books grew in their first set of results after completing their merger. OSB said that lending franchises of both banks were performing “very well”. The lender has focused on providing mortgage credit to professional landlords and tightened lending criteria, which has shielded it from major impact of Brexit. The bank said its annual net interest margin, a key measure of profitability, would roughly be flat compared to last year, while Charter Court expects it to be slightly lower than the first half. The bank said its annual net interest margin would roughly be flat compared to last year, while Charter Court expects it to be slightly lower than the first half.
HSBC to allow gambling block
HSBC has announced that it will allow customers to decide whether to exclude themselves from all gambling transactions in a bid to help tackle problem spenders.
Investor makes £55m bid for Eddie Stobart
Douglas Bay Capital Fund has made a £55m bid for a controlling 51% stake in trucking firm Eddie Stobart. Logistics firm Wincanton and Andrew Tinkler, former chief executive of sister company Stobart Group, have also expressed interest.
Apollo Global to acquire Tech Data
Apollo Global Management is to acquire information technology equipment distributor Tech Data for $5.4bn, with Tech Data shareholders to receive $130 per share in cash. Shares in the firm were last up 4.4% at $130.91 in premarket trading.
Advent plans Rubix float
Advent International has reportedly hired advisers to prepare a stock market debut for Rubix Group, a distributor of industrial repair kits, that could give it a value of more than £2.5bn.
Japanese lender MUFG reports 6.3% slump in H1 net profit
Mitsubishi UFJ Financial Group Inc (MUFG) has reported a 6.3% fall in net profit for the six months through September, with net profit of 609.9bn yen ($5.6bn) in the period, compared to 650.7bn yen a year earlier. Net operating profit was up 11.1% mainly due to an increase in trading profit.
Ermotti concerned over scale of European banks
UBS CEO Sergio Ermotti has said European banks will need to consolidate to survive. Speaking at an event in Zurich, Mr Ermotti said: "The question for Swiss and European banks no longer is 'too big to fail', but 'too small to survive'."
Brexit leaves UK missing out on auto investment
Elon Musk has said he decided to locate a new Tesla factory and design centre in Germany rather than Britain because Brexit made the UK “too risky”. Professor David Bailey, an automotive industry expert at Birmingham University, tells the Telegraph the move was unsurprising given how “Brexit uncertainty has stymied investment in the automotive industry, which is down by over 80% in the last three years.”
Wizz Air plans London expansion
Jozsef Varadi, co-founder of Hungarian carrier Wizz Air, has said the low cost flyer will expand in its key London market after announcing net profit was €371.5m for the six months to 30 September, representing a 26.2% year-on-year rise. Revenue was up 21.7% to €1.67bn, with Mr Varadi saying he expects profit growth to increase by over 20% during the winter.
Taylor Wimpey reports strong second half demand
Strong demand for new homes has been reported by construction firm Taylor Wimpey for the second half of the year, with the firm noting that customer caution increased in the London and the South East. Taylor Wimpey said it expects to end the year with a net cash balance of approximately £500m, compared to £644.1m a year earlier.
Woodford fund investors predicted to lose at least £1bn
A leaked report commissioned by Link Fund Solutions and conducted by private equity firm PJT Park Hill shows that investors in Neil Woodford’s Equity Income Fund are likely to lose at least 32.5% of their money when the fund is liquidated, wiping £1bn off the fund, with a worst-case scenario suggesting that values could fall by as much as 42.6%. Given the heavy losses, Adrian Lowcock, head of personal investing at Willis Owen, questioned whether Link has acted in the best interests of investors by closing down the fund. The Times’ Patrick Hosking points out that the FCA pressured Woodford to hire Link in the first place, “yet is now both investigating it and also relying on it to produce the least-worst outcomes for investors. Some awkward conflicts there.”
British Land property values decline
British Land has reported a 10.7% fall in the value of its retail estate to £4.8bn for the six months to September 30, as difficult High Street conditions persist. The total value of the landlord’s property portfolio was down 4.3% to £11.bn, with pre-tax losses at £440m.
September house prices fall more in London than elsewhere
The latest data from the ONS has revealed that house prices in London saw the biggest decline in September in the UK, falling 0.4% year on year that month, with an average increase in house prices of 1% in England. House prices in the capital had an average value of £474,601, while UK house prices’ average value was £250,677.
Mulberry sees UK high street losses widen
Mulberry has reported a pre-tax loss of £9.9m compared to a loss of £8.2m the previous year. Sales in the UK, which account for 65% of the business, fell 4% amid challenging conditions and subdued demand from shoppers. Revenue of £68.9m was reported for the 26 weeks to September 28th, an increase from £68.3m the previous year.
Inflation falls to three-year low
The consumer price index (CPI) dropped to 1.5% in October, according to the Office for National Statistics (ONS), down from 1.7% in September to its slowest rate in almost three years. The largest downward contribution “came from electricity, gas and other fuels as a result of changes to the energy price cap,” the ONS said.