BANKING
Banks urged to adopt TSB’s fraud stance
The Sun is urging other banks to follow TSB’s lead and commit to refunding all innocent victims of fraud. From this week, TSB will pay back any of its five million account holders who are victims of "authorised push-payment" fraud. The Sun argues that a decade on from the financial crisis, banks still have work to do to restore trust and that giving customers more protection is one way of doing so.
Open banking could upend liquidity models
Writing in the Scotsman, Caroline Stevenson of law firm Womble Bond Dickinson says that if open banking is as successful as hoped, the speed and simplicity of the transfer of balances will pose a real threat for many financial institutions. She says that aside from the potential data issues, some big banks' liquidity models are based on the presumption of a steady flow of balances.
Citigroup adds to property-buying spree with Belfast deal
Citigroup has followed up its £1bn purchase of its London Canary Wharf skyscraper by buying its office building in Belfast.
INTERNATIONAL
Deutsche braced for legal action over money laundering scandal
Deutsche Bank is braced for potential fines and prosecutions after estimating that it processed at least €175m of dirty money for Russian criminals between 2011 and 2014. Deutsche concedes the Global Laundromat scandal has hurt its “global brand” and is likely to cause “client attrition”, loss of investor confidence and a decline in its market value.
BNY Mellon profits fall 20%
BNY Mellon has reported a 20% profit fall in the first quarter of the year after a drop in fee revenue. The US bank posted $910m (£697m) profit in the first three months of 2019, compared with $1.14bn over the same period the previous year and below analysts’ forecasts.
Morgan Stanley beats expectations
Morgan Stanley reported $2.43bn profit in the first quarter of the year, beating expectations despite falling from $2.67bn the previous year. But the bank’s chief executive James Gorman fears banks could soon be hit by market turmoil.
BaFin files criminal complaint against FT journalists
Germany’s financial regulator has filed a criminal complaint against two Financial Times journalists accusing them of attempting to manipulate markets. The complaint by BaFin centres on an alleged attempt to manipulate the share price of Wirecard, the online payment giant, with negative media coverage.
Gam funds to be liquidated
Gam Investments has reported net outflows of SFr 2.1bn (£1.6bn) in Q1 and confirmed that the liquidation of funds connected to a scandal at the firm would be completed this summer.
Crédit Agricole and Santander unveil $3.8tn custody tie-up
Crédit Agricole is to take over the global custody operations of its Spanish rival Banco Santander to create a new business with $3.8tn of assets.
AUTOMOTIVE
Pendragon warns on profits
Car dealer Pendragon’s new management has launched a review of the business after profits slumped in Q1. The owner of the Evans Halshaw and Stratstone brands said like-for-like profit fell by 5.4% on new cars, 1.6% on used cars and 5% on aftersales, such as parts and servicing. The company made a £2.8m underlying loss in the first quarter.
AVIATION
EU proposes tariffs on US products in Boeing row
The EU has proposed tariffs on $20bn (£15bn) of US goods in a long-running dispute over Boeing aircraft subsidies. The proposal comes after the WTO said earlier this month that the US had failed to remove some Boeing subsidies.
Jet Airways suspends flights
Jet Airways has temporarily suspended all its domestic and international flights after failing to find fresh funding. The Indian airline said its last flight would operate on Wednesday as it was not able to pay for fuel and other critical services.
CONSTRUCTION
Goldman backs Birmingham tower
Goldman Sachs has backed its first build-to-rent project in the UK - a £184m skyscraper that is expected to be the largest residential tower in Birmingham.
FINANCIAL SERVICES
FCA outlines priorities amid 'considerable demands' of Brexit
While outlining plans to improve governance and workplace culture, and crack down on financial crime through better use of technology, the Financial Conduct Authority has warned that Brexit will continue to place “considerable demands” on its work. In its annual business plan, published yesterday, the FCA said it is examining the regulatory landscape post-Brexit - including what areas it does and does not regulate - along with issues of equivalence and the transition away from using the Libor interest rate by 2021. The FCA has also vowed to overhaul its industry directory, following reported failings with the current register.
CMA recommends audit reforms
The Competition and Markets Authority has outlined several proposed reforms to the audit market but stopped short of ordering a structural break-up of the biggest firms. The regulator’s review of "serious competition problems" in the sector recommended the government pass laws forcing accounting giants to put more distance between their audit divisions and consulting operations, to prevent conflicts of interest. It also called for firms to be forced to hire smaller "challenger" auditors to analyse their books alongside the Big Four, in an effort to stoke competition.
Bailey laments ‘unfortunate’ LCF scandal
Financial Conduct Authority head Andrew Bailey has described the London Capital & Finance scandal as “extremely unfortunate” for those involved. LCF collapsed earlier this year after raising £267m from 11,700 investors, with the FCA criticised for missing multiple warning signs. After calls from the Treasury Select Committee, the Treasury has ordered the FCA to launch an independent investigation into the scandal.
Mastercard likely to settle claim
Lawyers have suggested Mastercard is likely to settle a landmark £14bn consumer rights claim because of commercial pressures. They said that settling the claim out of court would be an astute strategy because Mastercard might be able to claw back some of the payout.
City of London cements dominance of renminbi trading
The UK remains home to the largest offshore share of renminbi payments, after accounting for 37% of renminbi foreign exchange transactions outside of China in January.
Quilter assets under management increase
Wealth management firm Quilter has said assets under management rose 5.1% in the first three months of 2019 to £114.9bn, despite a “challenging” market environment.
Hedge funds realise going long has its rewards
Long-only funds are fast-becoming one of the strongest areas of growth for some of the world’s largest hedge funds, including CQS, DE Shaw, and Man Group.
REAL ESTATE
House price growth at six-year low
House prices rose in February at the slowest rate since September 2012 while in London house prices fell, the Office for National Statistics said. Average house prices increased by 0.6% in the year to February 2019 but fell by 3.8% in London.
Countryside completions rise
Countryside Properties has revealed that house completions soared in the first half of the financial year amid increased buyer demand. Though its average selling price of homes, in the six months to March 31, fell 4% to £377,000, as it sold more homes outside of London, the housebuilder completed 2,362 homes - 43% more than in the same period the prior year.
ECONOMY
Inflation holding steady
The UK’s headline annual inflation rate held steady at 1.9% in March, according to monthly figures from the ONS, with real wages increasing above price rises. The inflation rate including housing costs and council tax held at 1.8%, with wages rising at 3.4%.
OTHER
Central banks warn of climate risks
The heads of two major central banks have issued a warning about the financial risks of climate change. Bank of England governor Mark Carney and France's François Villeroy de Galhau set out the dangers to the global economy in an open letter. "If some companies and industries fail to adjust to this new world, they will fail to exist," they wrote. Meanwhile, the Bank of England could face climate change targets under a Labour government, John McDonnell said yesterday. The shadow chancellor made the pledge to explore new responsibilities for the Bank whilst also praising Mr Carney’s stance on climate change