BANKING
Banks face Brexit ‘point-of-no-return’ in coming months
Bundesbank board member Andreas Dombret, who oversees regulatory issues for the German central bank, has said Europe’s banks and brokers could be facing a Brexit “point-of-no-return” with key financial contracts as soon as March. Mr Dombret stated: “For the banks, once they start re-papering it is the point-of-no-return and that will happen in the first half of next year, maybe even in the first quarter of next year.” Mr Dombret added that that he “cannot believe” there will be no Brexit deal. “There's too much at stake that I cannot believe that there will not be an agreement,” he tells the BBC.
MPs raise concerns over cash machines
MPs have hinted that they may force banks to keep cash machines in poor areas to avoid “ATM deserts”. It comes after plans emerged to cut Link’s 70,000 machines. Nicky Morgan, the head of the Treasury Select Committee, said: “Link is taking a leap in the dark. Every effort must be taken to ensure 2.7m people reliant on cash transactions aren’t cut off.” Meanwhile, the Scottish affairs committee is set to question executives at RBS about its plans to close 62 branches across Scotland. Scottish Secretary David Mundell said: “It is not good enough for RBS to say that people can rely on internet and mobile banking when so many people in Scotland do not have access to the internet or effective mobile services.”
PPI redress reaches £299m in September
The Financial Conduct Authority has revealed that banks paid out £299m in September to victims of payment protection insurance, up from £272m in August. September’s payouts were the biggest monthly PPI claims since April 2016 and point to the success of an advertising campaign, using an animatronic of Arnold Schwarzenegger, ahead of an August 2019 claim deadline.
Coutts has no plans to invest in Bitcoin
Coutts has deemed Bitcoin to be purely speculative and refused to invest in the cryptocurrency. “Its sharp rise brought back memories of the dotcom bubble back at the turn of the century,” said Lilian Chovin, an investment strategist at the bank. The development comes as Bitcoin reached $14,000, up from around $760 a year ago. Elsewhere, the FT reports that the world’s largest banks are pushing back on the introduction of Bitcoin futures, amid concern that the financial system is ill-prepared for the launch of the contracts.
Banking apps contained security flaw
Researchers at Birmingham University have found that online criminals would have been able to fool apps from HSBC, NatWest, Co-op and others into revealing personal details. The researchers found that an attacker connected to the same network as an app user, such as via Wi-Fi or a corporate network, could retrieve the user’s credentials including username, password and pin code. Dr Tom Chothia, who led the research, said: “It’s impossible to tell if these vulnerabilities were exploited but attackers could have got access to the banking app of anyone connected to a compromised network.”
PRIVATE EQUITY
Bertram joins EQT Ventures
Jo Bertram, the former UK boss of Uber, has joined EQT Ventures, where she will be tasked with finding the next generation of Ubers. Ms Bertram, who left Uber in October, is joining as “executive in residence”, tasked with advising companies on growing from small-scale start-ups to sustainable businesses.
Bridgepoint raises €5.5bn for new fund ahead of target
Bridgepoint has raised €5.5bn for its latest fund six months ahead of target. The private equity group had to turn away some existing investors, and about €5bn of extra capital, having already exceeded its target.
INTERNATIONAL
Ping An revealed as HSBC’s second-largest shareholder
Chinese insurance giant Ping An has increased its interest in Britain's biggest bank from 4.96% to 5.01%, making it HSBC's second-largest shareholder after Blackrock. The world's largest insurer by market capitalisation said its investment is financially motivated and based on HSBC's track record of paying a dividend.
Banks hiring more workers in Poland
Big banks are hiring more staff in Poland, according to the Mail. Goldman Sachs is seeking 250 new employees to add to its 525 workers in Warsaw, while Standard Chartered could create another 500 roles in the city. JP Morgan also plans to up its recruitment in the Polish capital.
FINANCIAL SERVICES
Government to ease tax on asset managers to boost post-Brexit Britain
The Treasury has issued an Investment Management Strategy II paper, intended to support the country’s £8.1tn asset management industry. The paper says the government recognises the importance of the UK’s tax and regulatory systems in facilitating growth post-Brexit and will consult on maintaining the UK’s competitiveness in the asset management industry, including changing the tax treatment of people working for short periods of time in the UK. The report also outlined a commitment to work with universities and fintech initiatives and promote the UK’s asset management talent pipeline.
Mifid won’t help pensions, Numis warns
Numis Securities boss Alex Ham has said Mifid II is unlikely to work as a pension fund stimulator. Describing the Markets in Financial Instruments Directive as “something to get through” he said: “In theory the regulators want to look after the lady in the street. It is difficult for fund management companies to cut fees though. That would suggest they have been overcharging her for all these years.” Meanwhile, a report from Coalition, a specialist research group, has suggested that Mifid II will erode less than 3% of investment banks’ annual revenue from Europe, the Middle East and Africa.
ISS backs LSE over TCI plot
The shareholder advisory group ISS has urged investors in the London Stock Exchange to reject calls by Sir Christopher Hohn to remove chairman Donald Brydon. Mr Hohn was riled by the ousting of CEO Xavier Rolet and believes Mr Brydon has managed a “poor process” in succession management. But in a share note, ISS said "perceived" corporate governance failures had “not been sufficiently substantiated at this time”.
Saga issues profit warning
Saga has warned profits in the current financial year would grow more slowly than expected, and that next year’s profits would be 5% lower than 2017. The over-50s travel and insurance specialist said it had been hit by the collapse of Monarch Airlines in October and had faced “more challenging” trading conditions in insurance broking.
Bluefin lied to clients about independence
Insurance broker Bluefin, a leading adviser to Britain's small businesses, has been fined £4m by the FCA for improperly favouring its previous owner Axa while claiming to clients that it was independent. The Times says one company overpaid by £45,000 as a result. Bluefin is now owned by US company Marsh & McLennan.
Sabre to be valued at £575m
UK car insurer Sabre Insurance Group is pricing its equity in a planned initial public offering at 230 pence per ordinary share, suggesting a market capitalisation of the company of £575m. The proceeds from the IPO will go to existing shareholders, including BC Partners, which wants to sell down its stake.
MANUFACTURING
MPs urged to review Boeing contracts
Stephen Kelly, CEO of trade group Manufacturing NI, has told the Northern Ireland select committee that Britain should threaten to pull multibillion pound defence contracts with Boeing to protect its own manufacturing industry in the wake of the US imposing trade levies on UK-built airliners. Mr Kelly said: “If the UK is serious about protecting jobs here in Northern Ireland - they really need to exert that power 'in buying US defence equipment'. The reality is that the Bombardier story isn't a Northern Ireland and Belfast problem. It's a UK problem.”
MEDIA & ENTERTAINMENT
CMA delays publishing Fox-Sky deal report
The Competition and Markets Authority has pushed back publication of its provisional findings on 21st Century Fox's plans to increase its Sky stake, from the week beginning December 18 to mid-January. The regulator is expected to deliver its final report to Karen Bradley, the minister for culture, media and sport, by March next year.
REAL ESTATE
Shaftesbury launches fundraising
Shaftesbury has launched a £265m fundraising to add new London buildings to its portfolio, releasing 10% of its stock. The West End landlord will use some of the money to finance the purchase of two new Soho properties, and has agreed a deal with Legal & General to buy an office and residential scheme for £92m.
RETAIL
Hammerson lines up deal to buy Intu
Shopping centre owner Hammerson has agreed to acquire Intu Properties, creating a combined £21bn portfolio of retail and leisure properties in a deal valuing its smaller rival at £3.4bn. The offer represents a value of 253.9p per Intu share and brings the ownership of London’s Brent Cross,
SPORT
Jockey Club extends racecourse bond
The Jockey Club has extended its £25m racecourse bond, first issued in 2013 to help fund its major development at Cheltenham racecourse. Its decision to offer a rollover on the bond issue has seen 96% of original investors choose to retain more than £23.6m invested in the product.
ECONOMY
City running out of patience over Brexit
Senior figures in the City have expressed their frustration at delays to the Brexit talks. Paul Drechsler, president of the CBI, said 60% of firms with contingency plans will begin acting on them unless the second phase of talks is unlocked next week, while Catherine McGuinness, the City of London Corporation’s policy chief, warned: "The status of London has diminished in the eyes of our partners and competitors, and we now have a case to prove.” Meanwhile, a House of Lords report has warned a “no deal” outcome to Brexit would be destructive to the UK economy.