IMF warns banking watchdogs to “stay humble”
The IMF has suggested that banking watchdogs should “stay humble” to avoid another financial crisis. In its latest global stability report, the body warned that as “new threats to financial stability emerge, regulators and supervisors should remain attentive to risks”. The IMF added that the new risk is “reform fatigue”, especially in overseeing the “shadow banking” sector, such as asset managers. “Regulators' must remember that risk tends to rise during good times and it migrates to new, unexpected corners. They mustn't get caught fighting the last war,” the IMF said.
N26 prepares to launch
European digital bank N26 is set to launch in the UK today, becoming the latest foreign lender to enter Britain’s digital banking space in recent weeks. The Berlin-headquartered mobile bank will initially be available to “friends and family” of N26 staff before being made available to a waiting list that the company says is 50,000 strong. The Times notes that N26 currently has 1.5m customers across 17 European countries. N26 has not revealed its present valuation, although a recent report suggested that the business was worth more than $1bn, granting it "unicorn" status.
Private bank names new banking director
Hampden & Co has appointed Duncan Buchanan as banking director. He joins the firm from Lloyds Banking Group, where he specialised in lending to high-net-worth individuals.
London VC raises biggest fund yet
London-based early stage venture capital firm Fuel Ventures has raised £20m for a new fund. Founder Mark Pearson said: “Our ethos hasn't changed since launching in 2014. We say we are a fund by entrepreneurs for entrepreneurs and that's important to us… This fund, our biggest to date, with Brexit looming over us, shows that foreign investors, family offices and institutions are still confident in the UK start-up scene.”
Epiris raises £821m for UK-focused maiden fund
UK private equity firm Epiris has revealed one of the largest first-time funds in Europe, raising £821m to buy assets including the auction house Bonhams and publisher Time's UK business.
Banks brace for potential 'Quitaly'
Claudio Borghi, the economic head of Italy’s Lega Party, which is ruling in coalition with the Five Star Movement, has suggested that Italy might solve its economic problems by reverting to its own currency - reigniting fears of a potential “Ital-exit”, or "Quitaly, the Standard's Mark Shapland says. Banks and asset managers including Barclays, HSBC, Standard Chartered, Schroders and Legal & General, are all exposed by their holdings of under-pressure Italian government bonds and property assets.
Pimco reveals Gurtin acquisition
US asset management firm Pimco has bought muni bond investment firm Gurtin Municipal Bond Management, which has more than $14bn (£10.78bn) of assets under management. It is Pimco’s first acquisition since appointing new chief executive Emmanuel Roman and the combined business will manage $38bn in dedicated municipal bond assets.
Greek bank shares plummet
Shares in Greek banks have plummeted amid investor fears over lenders’ needs to reduce their large stock of bad loans resulting from the financial crisis. Piraeus Bank led the losses, at about 27%, after reports said it and the National Bank of Greece have pledged to reduce their bad loans more aggressively in coming years.
UBS Wealth Management bullish on Italian debt following sell-off
In a rare nod of confidence in Italy's debt markets, UBS Wealth Management has suggested that clients should take an overweight position on Italian two-year government debt.
Aston Martin shares down on debut
Shares in sports carmaker Aston Martin closed almost £1 below their float price on their first day of trading in London. They had been priced at £19, valuing the firm at £4.3bn, but fell as low as £17.75 before ending at £18.10. The share sale is expected to raise at least £1bn for the firm. Andy Palmer, chief executive, said the move was an historic moment: "We are delighted by the positive response we have received from investors across the world and are very pleased to welcome our new shareholders to the register."
Crossrail boss set to depart
Sir Terry Morgan, the boss of Crossrail, is expected to step down within weeks after it emerged that the construction of the London railway line will be delayed well into 2019.
EU regulator urges Brussels to tighten clearing rules ahead of Brexit
Pan-European markets regulator Esma has warned Brussels it must finalise legislation to tighten oversight of overseas derivatives markets, as fears rise over potential market instability if the UK leaves the European Union without a deal. Cross-border banks fear that if Britain crashes out of the bloc, they could no longer use LCH, a unit of the London Stock Exchange that clears about 90% of euro-denominated interest rate swaps. “To respond to those risks in financial stability of EU financial markets, in my view we need to ensure continued access to UK clearing houses for EU clearing members and trading venues,” said Esma chairman Steven Maijoor in a speech in Athens.
Schroders poised to pip BlackRock to £109bn Lloyds portfolio
Schroders is set to beat BlackRock in the battle to manage a £109bn portfolio of assets from Lloyds Banking Group. Schroders is allowing Lloyds to take a stake in its Cazenove Capital arm.
Calbee UK buys Yorkshire-based Seabrook Crisps
Calbee UK is to acquire crisp-maker Seabrook for an undisclosed sum. Calbee UK is the subsidiary of multi-billion dollar Japan-based snack company Calbee Inc., though Seabrook, which employs around 160 people, will continue to operate from its Bradford base.
MEDIA AND ENTERTAINMENT
Irish watchdog launches Facebook probe
The Irish Data Protection Commission has formally begun an investigation into Facebook’s recent data breach. It will now decide whether the firm should be fined for failing to prevent hackers from being able to access up to 50m users’ accounts.
ITV rules out Endemol bid
ITV has moved to allay shareholder concerns of a potential shares or rights issue by ruling itself out of a bid for Endemol Shine, the Dutch television show producer.
UK finance chiefs raise concerns over audit shake-up proposals
FTSE 100 CFOs raised concerns with the ICAEW last week about plans to remove the power to appoint auditors from company boards and restrict choice by introducing a cap on auditors’ market share.
Tesco posts rise in revenues
Tesco has posted a 13% year-on-year rise in group sales to £28.3bn for the first half of its financial year, while revenue including fuel grew 12% to £31.7bn. Group operating profit grew 24.4% to £933m, but missed analyst expectations of £978m. Investors reacted badly to the news sending Tesco’s shares down by 8.6%. In the UK, same-store sales were up 2.3% overall in the first half, with a 2.5% rise in the second quarter. Sales at Booker were almost 15% higher and it contributed £97m of profit during the half.
UK services sector activity slowed in September
UK service sector growth slowed in September, according to IHS Markit's latest purchasing managers' index, down to 53.9 from 54.3 in August. Firms recorded a slight uptick in confidence but Brexit fears meant it was still below the long-term average. Chris Williamson, economist at IHS Markit, said Brexit worries are “keeping optimism at levels which would normally be indicative of an imminent slowdown”. Samuel Tombs, of Pantheon Macroeconomics, added that growth will “likely slow further if Brexit talks aren't concluded soon”.
Government pledges to pay 90% of SMEs within 5 days
The Government has pledged to pay 90% of their SME suppliers within 5 days when invoices are uncontested, an improvement on the current target of 80% in five days and 30 days for the remainder. Business minister Kelly Tolhurst also said the Government will consult on how to improve payment times in the private sector, including looking at using new accounting technology and requiring companies to nominate a director responsible for fair payment practices.
Santander expands women’s SME scheme
Santander UK has expanded its SME mentoring scheme to create its biggest programme yet to help women grow their businesses. Run by social enterprise Women Ahead, the Breakthrough initiative focusses on SMEs with turnovers up to £3m and running for a year or more, and will incorporate 180 participants: 90 mentors and 90 mentees across the UK.