BANKING
Savers pull £566m from Metro Bank
Metro Bank’s profits have halved to £6.1m in the first quarter, with chief executive Craig Donaldson saying the bank had lost customers after admitting in January that it miscalculated the risk of some loans. Customers withdrew £566m from Metro at the start of 2019 and deposits dropped by 4% in the three months to the end of March. Mr Donaldson said profits fell due to a mix of regulatory changes, interest paid on a debt raise last year and investments. Analyst John Cronin said the lender had published "what can only be characterised as a truly horrible set of numbers".
Barclays shareholders to vote on Bramson bid
Barclays investors will today vote on whether to appoint activist investor Ed Bramson to the bank’s board. Ahead of its annual meeting in London, Barclays chief executive Jes Staley has told staff that the lender could capitalise on Deutsche Bank's ongoing woes by gaining market share on its German rival. Bramson has previously argued that the problems facing Deutsche are a "cautionary sign" for Barclays as both have "similar strategic weaknesses". In the FT, John Gapper argues that Bramson’s campaign is “a brazen attempt to blur the separation of powers between directors and shareholders.”
Mortgage approvals down in March
Figures from the Bank of England show mortgage approvals in March fell to their lowest level in 15 months and consumer credit growth slowed sharply. Mortgage approvals for house purchases fell 4.6% in March from February to 62,341 in the run-up to the original Brexit deadline. Compared with last year, approvals were down by 2.1%. Annual consumer credit growth slowed to 6.4% in March, the weakest rate of increase since October 2014 and far below the 10.9% peak in November 2016.
PRA boosts Lloyds by cutting capital requirements
The Prudential Regulation Authority has lowered Lloyds Banking Group's systemic risk buffer, allowing the lender to free up around £1bn in capital. The news came within a wider announcement by the PRA on the capital buffer rates for large retail banks and building societies, which will apply from August 1. Lloyds is due to publish first-quarter results today, with pre-tax profit expected to be about £2.05bn.
Allied Irish Banks sees lending jump in first quarter
Allied Irish Banks has revealed an 11% rise in new lending during the first quarter, with a trading update also indicating a 21% reduction in legacy bad loans.
M&S Bank appoints Paul Spencer as chief exec
M&S Bank has named Paul Spencer as chief executive following his appointment as interim chief in February.
INTERNATIONAL
Fed holds rates steady despite pressure from Trump
The US Federal Reserve has kept interest rates on hold despite pressure from President Donald Trump to announce a cut. The central bank said borrowing costs will remain at between 2.25%-2.5%. The Fed made the decision despite Mr Trump tweeting on Tuesday that it should reduce rates by 1% to help the US economy "go up like a rocket".
Ireland appoints Makhlouf as central bank boss
Gabriel Makhlouf, chief economic and financial adviser to New Zealand's government, has been named as Ireland's new central bank governor.
CONSTRUCTION
Persimmon's recovery efforts dent sales
Housebuilder Persimmon’s weekly private sales rate has fallen 5%, compared with last year, while forward sales this year were £2.7bn, down from £2.8bn. Persimmon blamed the falls partly on “a more targeted approach to the timing of sales releases”.
FINANCIAL SERVICES
FCA launches market review
The Financial Conduct Authority (FCA) has launched a review of the financial advice market, with the findings to be published in 2020. The review will look at whether changes made since 2012 need updating, as well as identifying what consumers want and how the market goes about delivering this. Christopher Woolard, executive director of strategy and competition at the FCA, said: "Consumers and the market are changing rapidly, as technology, employment patterns and inter-generational challenges change the way consumers interact with financial services. As well as looking at how the market has evolved... it’s important that our work looks ahead to see how we ensure that this important sector works well in the future.” He added that the FCA, which is inviting industry feedback by June 3, wants the market “to deliver a range of good quality, affordable advice and guidance services that meet consumer needs."
Lloyd’s of London beefing up tech to cut costs
Lloyd’s of London is planning to strip out £1bn of costs from the London insurance market amid a wider consultation to revive the brand, which has suffered from structural criticism, high costs and recent claims of sexism. Younger tech talent will be encouraged to enter the market and there are plans to make it easier for capital from new sources like hedge funds to move in. Lloyd’s new tech platform, dubbed Lloyd’s Risk Exchange, could also allow complex risk to be placed with underwriters more quickly. Lloyd's has also re-iterated it is committed to creating an inclusive culture “in which everyone is respected and valued”.
LSE sees first-quarter boost from clearing
London Stock Exchange Group’s clearing arm has seen revenues for the first quarter rise by 17% to £182m year-on-year, defying concerns over the impact of Brexit. Total income for the LSE was £546m in the first quarter – 5% higher than a year earlier.
EBRD moves into Canary Wharf HQ
The European Bank for Reconstruction and Development (EBRD) has relocated its HQ from the City of London to Canary Wharf in a post-Brexit commitment to the capital.
HEALTHCARE
Shingles and HIV medications boost GSK first quarter sales
GlaxoSmithKline has posted first quarter sales of £7.7bn on the back of its shingles and two-drug HIV regimen treatments.
MANUFACTURING
Brexit extension slows UK manufacturing growth
Growth in the UK manufacturing sector slowed last month, according to the latest IHS Markit/ CIPS purchasing managers’ index, on the back of a faster-than-expected expansion in March due to Brexit stockpiling. Business optimism hit a seven-month high in April however, with over 50% of companies believing that output would increase over the coming year.
MEDIA AND ENTERTAINMENT
Guardian's digital push pays off
The Guardian has posted a profit for the first time since 1998, making £0.8m for the year to April, up from a loss of £23m the previous year, while revenues increased 3% to £223m. The results highlight a marked shift in focus to the company’s digital business, which now accounts for 55% of owner Guardian Media Group’s (GMG) total revenues.
REAL ESTATE
Brexit still dragging on house price growth
The UK housing market has endured another month of subdued growth amid the ongoing Brexit impasse, according to Nationwide, though first-time buyers remain active. House prices were just 0.9% higher in April than the same month last year, the fifth consecutive month in a row that growth was below 1%. Robert Gardner, Nationwide's chief economist, noted that the number of first-time buyers was steadily increasing - despite "the ongoing economic uncertainties... clearly weighing on consumer sentiment".
RETAIL
Failed Asda merger costs Sainsbury’s £46m
The failed bid to merge with rival Asda has cost Sainsbury's £46m, the supermarket chain admitted as it announced its annual results. In the year ending 9th March, profit before tax fell to £239m, from £409m the previous year. Sainsbury’s cited restructuring costs and the hit on the failed deal as major contributors, while defined benefit pension expenses of £118m were also included.
ECONOMY
BoE set to hold base rates
Bank of England policymakers are expected to hold interest rates at 0.75% today. The decision, which will be accompanied by its quarterly inflation report, comes amid signs that Brexit stockpiling has boosted recent economic growth figures.
OTHER
BoE summer party under review amid spending scrutiny
The Bank of England has put its summer party under review after its spending on travel and entertainment was compared to the MPs’ expenses scandal. Dorothy Thompson, a member of the Bank's Court of Directors, told MPs on the Treasury Select Committee that the £100,000 Governor’s day celebration was now under review. Meanwhile, Bradley Fried, chairman of the Court of directors, told MPs that appointing a female or ethnic minority Bank of England governor to take over from Mark Carney would be "an inspirational moment" for the nation.