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Daily News Roundup: Thursday, 1st March 2018

Posted: 1st March 2018


Scottish Government to start investment bank

Nicola Sturgeon has unveiled the Scottish Government’s commitment to creating a publicly-owned national investment bank that will be designed to tackle a lack of investment in Scotland. The First Minister said the venture will be operational by 2020, and will be ethical, inclusive and “mission-driven”, meaning it will fund big ideas such as the transition to a hi-tech, low-carbon economy. Ms Sturgeon said almost £500m would become available for new investment over the next three years, with a range of products available, including microloans for small enterprises, loans of up to £10m for businesses wanting to scale up operations and targeted debt support.

Lloyds pursued HBOS takeover at 'colossal risk' to shareholders

Lawyers representing investors in Lloyds say the bank exposed its shareholders to “colossal risk” by buying HBOS in the teeth of the financial crisis. Richard Hill QC told the High Court it was “not acceptable” for Lloyds to have recommended the HBOS takeover to investors given what it knew about its financial woes.

Rise in profits and membership for building societies

Leeds Building Society and Skipton Building Society made a collective profit of more than £320m and increased their combined membership to more than two million people, new figures show. David Cutter and Peter Hill, respective chief executives of Skipton and Leeds, attributed the increase in membership to consumers having faith in the mutual business model.

Loss of cashpoints could devastate small firms

The Federation of Small Businesses (FSB) has warned that the removal of cashpoints threatens to wipe out small businesses as 250,000 are located at least a kilometre from a free ATM. Some 51% of small businesses with a view on free-to-use ATMs say cashpoints are important to their business. Among retailers, the figure rises to 59%. Mike Cherry, FSB national chairman, said: “Access to cash is vital to local high streets all over the country. Many small firms are already miles from their nearest free-to-use cashpoint.”

Shoppers still facing extra fees

Shoppers are still being charged extra fees for using debit and credit cards, a month after a new law banning the practice was introduced. The new rules, which took effect in January, mean companies are no longer allowed to charge consumers up to 20% more for paying by card, but research showed that 14% of shoppers have been charged an additional fee for card transactions since the rule was introduced.

Barclays launches new £370m business fund

A new £370m fund intended to help small and medium-sized businesses across the Midlands is being launched today by Barclays. This follows on from the roll-out of the next stage of the Midlands Engine Investment Fund last week, worth £100m.

Overseas scam victims will not be reimbursed

Regulators have revealed that under a new compensation scheme, financial scam victims conned into sending money overseas will not be reimbursed by banks.

Metro Bank commits to funding

Metro Bank has promised to ring-fence £1bn of funding for businesses this year, on top of the same amount it approved in 2017.


US launch for NIO

Bank of America Merrill Lynch, Credit Suisse, Citigroup, Deutsche Bank, JPMorgan, UBS, Morgan Stanley and Goldman Sachs have been hired by Chinese electric vehicle start-up NIO to work on a planned US stock market listing this year of up to $2bn.

US private equity consortium to buy HSH Nordbank

A consortium of US private equity groups led by Cerberus and JC Flowers is to buy HSH Nordbank in a €1bn deal.

Sberbank sees leap in profit

Sberbank has reported a 22% year-on-year increase in net income for the final quarter of 2017. The company benefited from its dominant position in Russia’s large retail market.

Novo Banco bonds probe continues

Pimco is seeking compensation for damages related to alleged insider trading of Novo Banco bonds, in the latest development of a heated dispute between international investors and Portugal’s central bank.

Overdue US credit card debt hits 7-year high at $11.9bn

Figures published by the US Federal Deposit Insurance Corporation have revealed that overdue US credit card debt has reached a seven-year high, underlining the difficulties consumers are facing.


Toyota commits to UK car manufacturing

Toyota has followed Honda and Nissan in allocating new models to UK plants, after the government pledged to invest up to £21.3m in an upgrade of its Burnaston plant in Derbyshire.

Aurora wins funding for self-driving cars

Self-driving car technology firm Aurora has raised $90m in funding, days after California approved regulations that could result in driverless cars appearing on its roads within weeks.

Geely plays down fears over state links in Daimler swoop

Geely chairman Li Shufu has sought to play down concerns about the group's links to the Chinese state, hours after it became the largest shareholder in Daimler.


Taylor Wimpey profits hit by ground rents

Taylor Wimpey profits have slid as the housebuilder’s results were hit by the fallout of the scandal which saddled homeowners with doubling ground rents. Pre-tax profits for 2017 were down 7% to £682m – although excluding the ground rent costs, profits were up almost 11% at £812m. Full-year revenue rose 7.9% to £3.97bn, while forward sales were lower for a second year in a row, with 47% of 2018 private completions already sold, compared to 49% at the same stage last year.

MPs declare that Carillion lost grip of facts

MPs have accused Carillion chairman Philip Green of lacking even "a tenuous grasp on the reality of the situation" before the firm’s collapse, according to just-published minutes of a board meeting.


Money flows into Man Group’s funds

Man Group attracted record inflows of $12.8bn last year, with its funds under management rising from $80.9bn at the end of 2017 to $109bn by the close of 2017. Luke Ellis, chief executive, commented: “The results show we are delivering real value to the end client, whether they be a retiree in Hull, Osaka or wherever.”

Start-ups attract record sums last year

In a challenge to the hegemony of traditional high street banks, investment in online finance start-ups hit a record high in 2017 of $27.4bn (£19.8bn). Funding for the sector has reached $97.7bn since 2010.

Admiral to set up subsidiary in Madrid as EU base post-Brexit

British insurer Admiral is to set up a new business in Madrid to provide services for its customers in the EU after Brexit.

Klarna sees sales soar

Online payments group Klarna has reported a 27% increase in revenues to SKr4.53bn ($550m) with net profit more than tripling to SKr346m.


Whitbread buys 19 hotels in Germany

Whitbread has bought 19 hotels in Germany from Foremost Hospitality Group GmbH for an undisclosed sum. The deal will eventually give it a total of 31 hotels in 15 cities in the country, expected to be operational by the end of 2020.


Tough climate impacts ITV profits

ITV has reported a fall in annual pre-tax profit due to "ongoing economic and political uncertainty" in the UK, with profit in 2017 down 10% to £500m and a fall in advertising revenue partly offset by growth in its studios business. Chief executive Carolyn McCall said its 2017 performance was strong in a challenging environment and expects 2018 advertising revenue to be up 1% in the first quarter, with a boost from football in the second quarter.

Remaining TV deals still unsold

The Premier League is facing a challenge in selling the remaining two domestic television rights packages and looks set to include further incentives in negotiations with bidders, after deals agreed more than two weeks ago with Sky and BT totalled £4.5bn.


Foxtons sees 65% fall in profits

London-focused estate agent Foxtons has reported pre-tax profits of £6.5m for the year ending December 2017, down 65% on a year earlier.


Black Wednesday for high street brands

Toys R Us (UK) has fallen into administration after facing a £15m tax bill amid poor sales. Administrators have been appointed to begin “an orderly wind-down” of the toy retailer following the failure to find a buyer. Elsewhere, electronics retailer Maplin has also collapsed, appointing administrators after potential investors walked away. Meanwhile, Italian restaurant chain Prezzo is seeking to close around a third of its 300 outlets, placing hundreds of jobs at risk.


Confidence slump in Yorkshire

The latest Business Barometer from Lloyds Bank Commercial Banking shows that business confidence in Yorkshire declined by four points to 27% during February.


Old tenner expires today

The old £10 note will expire today, despite some £2.2bn worth still being in circulation. The Bank of England will exchange the old paper notes for free, either by post or in person.

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