BANKING
Two-year fixed loans rise above 3% for the first time in seven years
The cost of an average two-year fixed mortgage climbed 0.17 percentage points this month to 3.03%, according to the data company Moneyfacts. It is first rise above the 3% mark since 2015. Meanwhile, rates on five-year fixes climbed for the seventh consecutive month to 3.17%, the highest since May 2016. Eleanor Williams, of Moneyfacts, said: "Remortgage borrowers, spooked by Bank of England rate rises, [are hurrying] to secure some financial stability and lock into a fixed deal to protect themselves from further rate increases."
Santander offers 2.5% interest rate
Santander is offering savers a 2.5% return on cash with its 123 Regular e-Saver account in what the lender claims is “one of the best regular savings accounts for savers currently on the market from a high street bank”. The account was launched last month and is open to new and existing customers. Elsewhere, HSBC is now offering customers £170 if they switch to their current account.
Nationwide says SCA is reducing online card fraud
Nationwide Building Society is seeing around 2,000 fewer cases of online card fraud per month after the introduction of strong customer authentication (SCA) - new industry payment checks to protect shoppers.
PRIVATE EQUITY
Ideagen agrees to £1.09bn takeover offer
UK software company Ideagen, which helps companies comply with regulation and manage risk, has agreed to a £1.09bn all-cash takeover offer from London-based private equity firm Hg.
INTERNATIONAL
Goldman Sachs pauses work on new SPACs after SEC takes tougher stance
Blank-cheque companies have suffered a further blow after Goldman Sachs paused new offerings and said it will stop working with a majority of the special purpose acquisition companies (SPACs) that it helped take public. The move comes after the Securities and Exchange Commission in March unveiled a draft rule that would require SPACs to disclose more details about their sponsors, their compensation, conflicts of interest and share dilution.
UBS shores up its ESG unit
UBS has made two appointments to its environmental and social governance team as the Swiss bank looks to beef up its environmental credentials. Josiane Fanguinovény and Viv Sedov will join the company's EMEA division to work on ESG- related transactions.
FINANCIAL SERVICES
Hiscox and Beazley reassure investors over Ukraine conflict
Analysts at Bank of America have praised insurers Hiscox and Beazley after trading updates from the pair went some way to assuage concerns about their exposure to losses from the aviation industry. Insurers are bracing for claims of billions of dollars after Russia seized hundreds of commercial jets owned by overseas leasing companies in the wake of sanctions on the country. But Beazley said that even including aviation claims it would not need to downgrade its forecasts for its combined ratio. Hiscox said it retains only a residual exposure to the conflict in Ukraine and has reserved £32m of reinsurance to cover any claims that arise from the war.
Carlyle to acquire NSM Insurance in $1.78bn deal
Carlyle Group has agreed to acquire US specialty insurance provider NSM Insurance Group from White Mountains Insurance Group for $1.78bn in cash. Pennsylvania-based NSM Insurance generates more than $1bn in premiums from more than one million clients. "We will look to invest back into the platform a bit more heavily and ramp up M&A activity," James Burr, a Carlyle managing director, said in an interview. "There's a lot of wide space in business-to-customer and improving technology."
AUB Group pays £500m for Lloyd’s stalwart Tysers
Tysers, the oldest remaining broker on the Lloyd’s of London insurance market, is to be acquired by Sydney-based AUB Group for a reported £500m. Tysers is being sold by its American private equity owner, Odyssey Investment Partners, which will take a stake in the Australian company as part of the agreement.
Big asset owners turn to external money managers as outsourcing swells to $2.5tn
The trend for outsourcing fund management activities is gaining momentum, with the industry predicted to grow to more than $4tn in assets by 2026.
MANUFACTURING
BAE Systems and Rolls-Royce win £2bn UK nuclear deterrent contracts
BAE Systems and Rolls-Royce have been awarded £2bn in contracts to build new Dreadnought submarines at Barrow-in-Furness in Cumbria. The funding is part of a planned investment of nearly £10bn for the delivery phase of a £31bn programme for the UK to renew its nuclear deterrent.
PMI in talks to buy Swedish Match
Swedish Match could be sold to Philip Morris International (PMI) in a $15bn deal as the tobacco giant moves further into smoke-free products such as nicotine pouches.
REAL ESTATE
Rightmove boss to step down in February
Peter Brooks-Johnson, the CEO of Rightmove, plans to step down after more than 16 years. He will hand over the reins when the property portal unveils its full-year results in February.
RETAIL
Morrisons wins battle for McColl’s
Morrisons has won a battle to rescue convenience store and newsagent chain McColl's, taking on all of its 1,160 stores, 16,000 staff and two pension schemes with more than 2,000 members. Morrisons will repay secured debt in full, with “a distribution also expected to unsecured creditors”. The supermarket group beat a rival offer from EG Group, the petrol station empire, owned by the billionaire Issa brothers. David Potts, Morrisons chief executive, said: “This transaction offers stability and continuity for the McColl’s business and, in particular, a better outcome for its colleagues and pensioners.” Commenting on the deal, the Guardian’s Nils Pratley says Potts was right to criticise the move to put McColl’s into administration so banks could get paid in full at the expense of pensioners, and lenders would be wise to rethink this approach with a recession looming and more rescues likely on the way.
ECONOMY
Rate-setter warns of persistent inflation
Michael Saunders, a member of the Bank of England’s rate-setting monetary policy committee, has echoed concerns recently raised by Andy Haldane, the Bank’s former chief economist, that inflation may be around for longer than expected. Saunders was among three members who called last week for a 0.5% rise in the bank rate – but the majority opted for a 0.25 percentage point hike to take the rate to a 13-year high of 1%. During a speech at the Resolution Foundation think-tank, Saunders said it would be better to ramp up borrowing costs more aggressively now to stop “the recent trend of higher inflation expectations and rising pay growth from becoming more firmly embedded.” Mr Haldane has predicted that inflation could top 10% and argued that the Bank should have acted sooner rather than waiting until November before raising interest rates.
Global stocks suffer worst day since June 2020 amid slowdown fears
The FTSE All-World barometer of global equities dropped 3% on Monday, its sharpest fall since June 2020, as investors grew concerned about rising rates and slowing growth in the world’s largest economies. Separate data from BlackRock show monthly allocations to global exchange traded products hit just $27.4bn of inflows in April, down from $117.4bn in the previous month. It was their worst month of flows since March 2020 as investor jitters spread amid soaring inflation and the continued turbulence of war in Ukraine.