Skip to Content
Skip to Main Menu

Daily News Roundup: Thursday, 28th April 2022

Posted: 28th April 2022


Lloyds upbeat despite economic uncertainty

Lloyds Banking Group on Wednesday posted a 14% fall in pre-tax profit in the three months to the end of March, down from £1.9bn a year ago to £1.6bn. However, this was better than the £1.4bn expected by City analysts. An expected rise in bad loans cost the bank a £177m impairment during the quarter, with rising inflation contributing to part of the charge. However, Lloyds was upbeat about its prospects lifting its guidance for both its banking net interest margin. Share rose almost 3% before closing down 0.25% at 45¾p. Finance chief William Chalmers said the lender was well-placed to weather the uncertain outlook for the UK economy, adding that although impairments may rise as the environment gets tougher, it is important to remember they are starting from low levels. Lending and advances increased by 2% £451.8bn, while overall group revenues advanced 12% to £4.1bn.

Ulster Bank and KBC customers face ‘cliff edge’ moment

The withdrawal of KBC and Ulster Bank from the Irish market this year will lead to a rush of account transfers. Derville Rowland, the director general of financial conduct, said: “We are assertively supervising the banks to ensure they prioritise the interests of customers and prospective customers throughout this unprecedented volume of account migration.” Meanwhile, Revolut is taking advantage, adding more than 1,000 new customers each day since the two banks announced they were leaving the market.

Metro Bank delivers flat performance

Metro Bank has reported a broadly flat quarter-on-quarter performance for the three months to the end of March. Total deposits of £16.49bn were flat, as were net loans, which totalled £12.34bn. But the high street lender maintained that it remained on track to deliver on its strategic plan

UK launches fraud squad to hunt down lost Covid billions

A counter fraud task force will be created by ministers to recover money stolen from state-backed pandemic support schemes. The move comes after the Treasury and the British Business Bank were heavily criticised for the billions lost to the fraud.


Credit Suisse overhauls top executive team

Credit Suisse is to replace its chief financial officer, head of Asia Pacific and general counsel as part of a sweeping overhaul of its executive board. The Swiss bank also announced that Francesca McDonagh would join as head of EMEA. The announcement came less than 24 hours after she announced her departure as the CEO of Bank of Ireland. Credit Suisse posted a $284m net loss for the first quarter, mainly because of $730m in provisions for lawsuits. The bank suffered $5bn in losses in the same quarter last year from exiting stock positions of family office Archegos Capital Management, the founder of which, Bill Hwang, and his CFO Patrick Halligan, have now been indicted on charges of securities fraud.

Deutsche Bank profits hit highest level in almost a decade

Deutsche Bank reported its highest quarterly profits in almost a decade on Wednesday with market turmoil boosting trading revenues by 15%. Net income climbed 18% to €1.2bn in the first three months of the year. Deutsche’s corporate and private bank also increased revenue and profit, but chief executive Christian Sewing warned that the bank was facing growing risks from the deteriorating economic outlook and rising inflation. The bank earmarked €300m for loan losses in the quarter, up from €100m in the first quarter of 2021.

SEB and Handelsbanken beat forecasts

Swedish banks SEB and Handelsbanken both delivered better-than-expected quarterly profit gains on Wednesday. SEB’s net profit rose to 6.40bn Swedish crowns ($652m), beating a mean forecast of 4.93bn crowns while operating earnings at Handelsbanken rose to 6.59bn Swedish crowns ($671m) from 5.31bn crowns a year earlier.


UK car production down

Car production in the UK has continued to fall as manufacturers struggle with global supply chain problems. Manufacturing dropped by nearly a third in the first three months of 2022 compared to last year, according to the Society of Motor Manufacturers and Traders (SMMT) with almost 100,000 fewer cars built. Mike Hawes, chief executive of the SMMT said that two years after the start of the pandemic, automotive production was still suffering badly. "Recovery has not yet begun and, with a backdrop of an increasingly difficult economic environment, including escalating energy costs, urgent action is needed to protect the competitiveness of UK manufacturing," Mr Hawes continued.


Boeing losses mount

Boeing posted a steeper than anticipated quarterly loss on Wednesday with the US aircraft maker saying its plan to pause production for the 777X, which has suffered with certification problems and weak demand, will lead to a $1.5bn hit in the next quarter. Total revenue at Boeing fell 8% to $13.99bn in the three months to March. Net losses widened from $561m to $1.24bn. Shares in the group closed down 7.5%.


M&G chief retires amid board changes

John Foley, the chief executive of M&G, has announced his departure from the group. The move comes six weeks after the arrival of a new chairman at the fund manager and one week before a new finance director joins. Chairman Edward Braham paid tribute to Foley, saying: “John has led M&G through significant change and overseen a successful demerger, while steering the group through the unprecedented events of the pandemic. The business has performed strongly, returning £1.8bn to shareholders since listing in October 2019.”


GSK sales boost from shingles jab and Covid treatment

GlaxoSmithKline sales rose 32% to £9.8bn in the first quarter, lifted by supplies of its Covid antibody treatment and a recovery in its blockbuster shingles vaccine. Dame Emma Walmsley, GSK’s chief executive, said the company would begin a “new period of sustained growth” this year with the spin off Haleon, its consumer healthcare business, on the London Stock Exchange in July.

Covid care home policies were unlawful, High Court rules

Discharging thousands of patients from hospital into care homes at the start of the coronavirus pandemic was unlawful, the High Court ruled on Wednesday. Judges found that the Department of Health and Social Care failed to take into account the risk that moving asymptomatic elderly patients from a hospital to a care home could infect other residents. The decision could lead to a wave of compensation claims, lawyers said.


Streaming giants to come under Ofcom supervision

Viewers will be able to complain to Ofcom about the programming gout put of on-demand platforms such as Netflix, Amazon Prime Video and Disney+ under new rules being considered by the Culture Secretary, Nadine Dorries. In a white paper published today, Ms Dorries proposes a new code, under which online platforms would be required to protect users from harmful content or risk fines of up to £250,000 or 5% of their annual turnover. The white paper also paves the way for the privatisation of Channel 4 and revises the programming requirements that public service broadcasters must follow.

Facebook reports slowest ever sales growth

Shares in Facebook owner Meta surged over 12% to $196 in afterhours trading after revealing Facebook’s daily active users increased by 4% to 1.96bn, just above Wall Street expectations. However, the company suffered its slowest ever sales growth with Meta revenues growing by just 7% to $27.9bn and profits dropped 21% to $7.4bn. The rise of TikTok has hit Facebook’s core social networking business while changes Apple made to the iPhone have made it more difficult to target adverts.

Alphabet’s earnings decline

Fears over a global economic slowdown and the war in Ukraine put further pressure on advertising budgets at Google, sending shares in its parent company Alphabet down 5.6% on Wednesday. Revenues at the group rose by 23% to $68bn in the first quarter - growth during the same period last year was 34% - while net income fell by more than 8% to $16.4bn. Shares in Alphabet are down 18% this year.


House prices to rise, then fall next year

Capital Economics forecast that house prices will keep rising this year, up by 9% at the end of 2022 compared with 2021. But analysts at the firm say homeowners should brace for a 5% fall in values across 2023 and 2024 brought on by a doubling of the average mortgage rate to 3.2% at the end of the year and a peak of 3.6% in mid-2023. Andrew Wishart at Capital Economics, said: “That would be the sharpest rise in mortgage rates since 1990.”


Apollo and Reliance plan joint bid for Boots

US buyout firm Apollo Global Management has teamed up with India’s second-richest man Mukesh Ambani to launch a bid for Boots. Ambani’s Reliance Industries is working with the private equity giant on a bid that could see one of Britain’s best-known retailers expand its presence into India, south-east Asia and the Middle East. Boots is expected to fetch a price tag of between £5bn and £6bn.


Germany cuts growth forecast, raising recession fears

Germany has slashed its growth forecast for GDP growth this year to 2.2%, down from the 3.6% it predicted in January. Growth next year is now expected to reach 2.5%, slightly faster than previously expected. German consumer confidence has plunged to an all-time low as the conflict in Ukraine and soaring prices leave households fearful about their finances. Joachim Lang, head of the BDI Federation of German Industries, said “a short-term recovery is not in sight”. Surveys of private economists by Bloomberg indicate a 30% chance Germany will soon enter a recession, and 35% for the eurozone as a whole.

Close Menu