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Daily News Roundup: Thursday, 17th March 2022

Posted: 17th March 2022


Fintechs call for OBIE to be ‘weaponised’

Fintech firms have called for the Open Banking Implementation Entity (OBIE) to be “weaponised” and simplified. A group of 26 fintechs have criticised the Competition and Markets Authority (CMA) for dithering on key decisions and failing to outline a role of the OBIE, despite holding a consultation on its future last March. Adam Jackson, director of policy at fintech industry body Innovate Finance, says uncertainty over the OBIE’s future was stalling innovation in fintech. City A.M. notes that with the Treasury, CMA, OBIE, Payments System Regulator, Financial Conduct Authority and the UK’s nine biggest banks all having had a hand in open banking technology so far, OBIE boss Charlotte Crosswell has warned that the “spaghetti soup” of regulators needs streamlining.

HMRC denied banks access to data that could have prevented Covid loans fraud

Hannah Bernard, the head of business banking at Barclays, has told MPs that HMRC did not provide vital data that banks indicated might have let them prevent billions of pounds of fraudulent Covid loans. She said Barclays had had asked the Government for up-to-date figures on the turnover of borrowers before handing out bounceback loans in 2020, but had been told it was not available. As a result, she said the bank had to ask the business what its turnover was, and hope it told the truth. Barclays’ data currently shows around 1.5% of fraud in the scheme, but Ms Bernard said this could rise.

Board of British Business Bank ‘should be sacked’, claims Agnew

Lord Agnew has told MPs that the board of the British Business Bank should be fired over its "woeful" handling of the bounce back loans scheme. Lord Agnew told the Business, Energy and Industrial Strategy Committee that the BBB was “blind” and unable to pressure banks into recovering loans to protect the taxpayer because of a lack of data and transparency in the scheme, which he said had prompted his public resignation. Patrick Magee and Richard Bearman, executives at the bank, have disputed Lord Agnew’s version of events and said performance data was available for ministers, that there were good governance standards at the business bank and that lenders were being properly challenged over recovery performance.

HSBC sets out more ambitious climate targets

HSBC has scaled up its climate commitments, saying it will phase down financing of fossil fuels and update the scope of its oil, gas, and thermal coal policies by the end of 2022. The move follows pressure from investors and activist shareholder group ShareAction. ShareAction boss Catherine Howarth said HSBC’s commitments were an “important step”  that showcased the power of shareholder engagement. She added: “As Europe’s largest provider of financing to top oil and gas expanders, HSBC must act decisively.”


One of Lebanon's biggest lenders closes all branches

One of Lebanon's biggest lenders has closed all of its branches following a judicial order and said it would be unable to meet client demands, including paying public sector salaries. Fransabank said that the judicial order had frozen all its "shares, properties and assets." The order required Fransabank to reopen the account of Egyptian depositor Ayad Ibrahim and pay out his deposit in cash, or else its assets would be seized, his lawyer Rami Ollaik said.

Deutsche Bank hires Macquarie tech dealmaker

Deutsche Bank has named Tej Shah as a managing director as part of its push into the technology sector. Mr Shah, who was a senior managing director at financial services firm Macquarie Capital and instrumental in building out the company's technology investment banking practice, will also head the US West Coast software origination unit.


Lloyd's of London fines insurer over inappropriate 'boys' nights out'

Lloyd's of London has fined member firm Atrium Underwriters £1m due to some managers' heavy drinking, initiation games and sexual remarks about female staff. The firm admitted charges relating to bullying and misconduct during annual 'boys' nights out', with Lloyd's finding that two senior leaders led, participated in and condoned some of the inappropriate behaviour. The £1,050,000 fine the largest ever imposed by Lloyd's independent disciplinary committee. It is also its first financial penalty for non-financial misconduct. Lloyd's said Atrium had sanctioned and tolerated the annual night out over a number of years up until 2018, with these events seeing some male members of staff engage in unprofessional and inappropriate conduct – including initiation games, heavy drinking and inappropriate and sexualised comments about female colleagues. Christopher Stooke, independent non-executive chairman at Atrium, said: “The behaviour outlined in the notice of censure has no place in our business or our industry.”

Cryptoasset scam reports double in 2021

A Freedom of Information Request submitted by Capital Block has revealed that the Financial Conduct Authority (FCA) received 6,372 reports of cryptoasset scams in 2021, far exceeding the 3,143 logged in 2020. Although investment in cryptoassets is not a regulated activity, some cryptoasset companies have been subject to money laundering regulations since 2020. This means they must be registered with the FCA. While the Treasury has said it will seek to extend financial promotions rules to unregulated cryptoassets, crypto advertising is not currently regulated by the City watchdog.


Drinks industry warn of price increases due to inflation hit

C&C Group, whose brands include Bulmers, Magners and Tennent's, has warned it will have to increase prices to combat rising inflation on raw materials. The drinks manufacturer and distributor said it has introduced a cost-cutting drive and is focused on liquidity management and net debt reduction, but will still have to raise prices. Separately, high-end mixers manufacturer Fever-Tree said it faced “significant uncertainty” over costs after a “dramatic” increase in commodity prices since the start of the war in Ukraine. The warning on costs came as it reported 23% growth in revenue to £311.1m last year. In the UK alone, revenue hit £118.3m.

Young's CEO to step down

Patrick Dardis, CEO of Young's, is stepping down from the role after six years in charge of the pub group. He will be succeeded by Simon Dodd, who is the current chief operating officer. Mr Dardis will remain on the group's board and stay on until he retires at the end of September to oversee the transition to Mr Dodd. He will then remain available for his notice period through to the end of March 2023.


Central London prices see fastest rise in seven years

Analysis shows that the pace of house price growth in central London is climbing at its fastest rate since July 2015. Prices in Prime Central London – the capital’s inner boroughs – were up 1.9% in the year to February, with this marking a tenth consecutive month of annual house price growth. Across parts of the capital’s luxury property market beyond the inner districts, average prices rose 4% in the 12 months to February, with this the highest figure since May 2015. The research shows Wandsworth (9%), Wimbledon (8.6%), Richmond (8.3%), Dulwich (6.4%), Islington (5.8%) and Bayswater (5.2%) led the way.


High street vacancy rate declines

Figures from the Local Data Company show that the number of empty shops and restaurants in Britain has fallen for the first time since 2018. The vacancy rate declined by 0.1% in H2 2021 compared to the first six months of the year to reach 14.4% of all shops. The retail vacancy rate hit a record high of 15.8% last year but has since decreased to 15.7%. While there has been a 0.3% reduction in the vacancy rate in shopping centres, the number of vacancies is still 19.1%. The leisure vacancy rate dropped from 11.3% to 11% over the six months — the biggest fall since records began in 2013. Lucy Stainton, commercial director at the Local Data Company, said that the figures “finally point to a reversal of the structural decline we had seen accelerate with the onset of the pandemic.”


Oaktree prepares offer for Chelsea as race to buy football club hots up

The FT reports that Oaktree Capital is preparing an offer for Chelsea football club as Roman Abramovich’s two-decades-long ownership nears an end.


Economists expect rate rise

The Bank of England is set to increase interest rates for a third time in a row, with economists expecting the Monetary Policy Committee (MPC) to lift rates by 25 basis points to 0.75%. Experts also believe May will see a further increase, taking the rate to 1%. This comes with inflation hitting a 30-year high of 5.5% in the year to January and Office for National Statistics data showing that the unemployment rate fell to 3.9% in the three months to January. Paul Dales of Capital Economics said that the unemployment rate falling “to within a whisker of the pre-pandemic rate will only encourage the Bank of England to raise interest rates.” Saying that rates are likely to be increased from 0.50% to 0.75%, he added: “What’s more, we think a low unemployment rate and high wage growth will prompt the Bank to raise rates to 2% next year.” Elsewhere, the Times’ nine-strong shadow MPC have all called for rates to increase. Four members voted to raise rates by 0.25 points to 0.75%, while another four opted for an increase of 0.5 points to 1% and one - Bronwyn Curtis, a non-executive director at the Office for Budget Responsibility - voted to raise rates by 0.75 points to 1.25%.

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