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Daily News Roundup: Thursday 23rd August 2018

Posted: 23rd August 2018


No-deal impact papers set for release

The government will today release its first batch of documents detailing the impact of a no-deal Brexit on various sectors. They could include information on the financial services sector. The plan for banks and businesses was not expected to be among the first batch of notices released, as the Independent suggests it is likely to stir up controversy. Brexit Secretary Dominic Raab will also demand the EU does more to ensure adequate preparation for a no-deal scenario, saying British and European institutions have not been able to work together sufficiently to smoothly facilitate such an outcome. Meanwhile, Valdis Dombrovskis, the EU’s financial services chief has warned that market access should never be taken for granted, with Brussels determined to toughen its assessments of whether countries meet the conditions.

Deutsche Bank chief reassures UK staff in London visit

Deutsche Bank’s CEO Christian Sewing has told employees in London that he plans to keep a significant presence in the capital after Brexit. Mr Sewing added that London will remain one of the world's top financial centres post-Brexit.

Monzo plans to raise £20m

Digital bank Monzo is looking to raise £20m through an equity crowdfunding round as it prepares to receive a $1bn (£774m) valuation from new investors later this year. As in its previous rounds, it is expected the bank will turn to Crowdcube to facilitate the raise. As it is above the EU’s €8m (£7.2m) crowdfunding cap, Monzo will be required to build a formal prospectus for the round.


TA Associates looks to get more women on boards

Private equity firm TA Associates has said it will use Athena Alliance's network to put female leaders into the top ranks of its portfolio companies.


Royal Bank of Canada beats expectations

Ahead of an expected slowdown when tougher lending rules introduced by Canada's banking regulator take effect, Royal Bank of Canada chief financial officer Rod Bolger has said the bank is on track to achieve its target of mid-single digit mortgage sales growth for the year.

US insurer Hartford to buy rival Navigators in $2.1bn deal

Consolidation in the specialist insurer sector continues with US insurer Hartford acquiring rival Navigators in a $2.1bn deal. AIG has bought Validus this year, while AXA has acquired XL Group.

Credit Suisse freezes $5bn of Russian money due to sanctions

Credit Suisse has frozen roughly 5bn Swiss francs ($5bn) of money linked to Russia to avoid falling foul of U.S. sanctions, according to its accounts, further increasing pressure on Moscow.


KKR in talks to buy Fiat’s Magneti Marelli

KKR is in talks to buy automotive component maker Magneti Marelli, in a deal that could be worth as much as €6bn. The business is being spun out of Fiat Chrysler Automobiles.

Continental shares suffer worst fall in almost a decade

Continental has cut its 2018 sales and margin guidance, citing lower revenues, higher costs for developing hybrid and electric car technologies, and unspecified warranty claims.


Ryanair compensation cheques ‘bounced’

Ryanair passengers who have received compensation for cancelled and delayed flights have been charged extra fees after banks rejected the cheques. The airline said up to 190 customers were sent unsigned cheques, out of a batch of 20,000.


Construction employment boosted by new work orders

The UK's construction industry enjoyed high levels of employment last year, as the value of new work hit a record. More than 1.3m construction workers were employed with their pay rising by 5.3%, and new work was worth £109m in 2017, overtaking pre-crisis levels as a result of private sector growth, data from the Office for National Statistics revealed. The ONS also found that the number of firms operating in the construction industry hit 314,590 in 2017, a 6.2% rise compared with the previous year.


Revolut offers crypto cashback

Revolut is now offering customers a choice of fiat or cryptocurrency cashback as part of its new Metal account tier. Those who sign up can get up to 1% cashback on transactions made outside Europe, but just 0.1% in Europe. Founder and CEO Nik Storonsky said: “The launch of Revolut Metal is also an important step towards the company generating additional revenue, especially as we prepare to launch a commission-free trading platform and expand the business into North America and Asia later this year”.

JPMorgan to lay off 100 in asset management division

JPMorgan’s asset management unit is laying off roughly 100 people as part of a routine review of staffing levels. The business produced $1.8bn in revenue in Q2 of 2018, up 2% year over year.

Claims management companies drive rise in payday lender complaints

Scott Greever, managing director of Elevate Credit’s international division, has predicted a surge in customer complaints driven by claims management companies that could put payday lenders out of business.

AMP appoints Credit Suisse banker as new chief executive

Australian wealth manager AMP has appointed Francesco De Ferrari, Credit Suisse’s Asia Pacific private banking chief as CEO.


AstraZeneca names new construction boss for HQ

AstraZeneca has appointed a new construction manager to finish work on its new flagship headquarters in Cambridge, following a series of delays and rising costs.


Corbyn will tax tech firms to subsidise the BBC

Jeremy Corbyn is set to propose a new tax on tech firms such as Facebook, Google and Netflix to subsidise the BBC’s income and to enable it “to compete far more effectively with the private multinational digital giants”.


Fewer first-time buyers in London

Just 10,300 new first-time buyer mortgages were completed in London in the second quarter of 2018, a 3.7% from the same period a year ago. Jackie Bennett, director of mortgages at UK Finance, said the data underlines the need for clarity over the future of the Help to Buy scheme after 2021. Meanwhile, Jeremy Leaf, a former Royal Institution of Chartered Surveyors residential chairman, said: “Clearly, we need to see more transactions and that will only happen if first-time buyers in particular and home movers generally feel more confident about the future, and we see more realism among sellers.”

Goldman offloads London HQ

Goldman Sachs has revealed that it has sold its new, unfinished European headquarters in London to South Korea's National Pension Service for £1.17bn. The bank will move staff to the site next year.


Moonpig-owner acquires Dutch retailer

Photobox Group, which owns greeting card company Moonpig, has acquired Dutch online gift retailer Greetz, which sold almost 1m gifts last year to generate year-on-year growth of 25%, for an undisclosed sum.


Scotland’s deficit four times higher than rest of UK

Scotland's fiscal deficit was £13.4bn in the 2017-18 financial year, down £1bn compared with the previous year. However, this represents 7.9% of GDP, compared with the 1.9% recorded for the UK as a whole. The Times points out that this is more than double the limit allowed by the European Union for independent member states. Tax revenue per person was £306 lower in Scotland than the UK average, while total public expenditure was £1,576 higher. Murdo Fraser, the Scottish Conservative party's finance spokesman, commented: "If Nicola Sturgeon wants to continue her threat of second referendum, she has to come out and explain where she would find £13bn to fill this deficit."

Axing 1p and 2p coins would not push up inflation

In a blog post, the Bank of England has claimed that scrapping 1p and 2p coins would not push up inflation. Two analysts from the Bank said their research and the “overwhelming weight of literature and experience” suggests that retiring 1p and 2p coins would have “no significant impact on prices”. The analysts also highlighted that price tags ending in 99p now only account for 12% of prices. This means rounding up would be less of an issue if 1p and 2p coins were ditched, they said.


Business fears a Corbyn government almost as much as Brexit

Research by BritainThinks reveals a Corbyn government is perceived by business leaders to be the second biggest threat after Brexit. High taxes and productivity were seen as the next greatest challenges.

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