BANKING
Banks could be required to ensure cash access for customers
Plans being considered by the Treasury could see lenders required to ensure customers can still access cash even when branches are closed, in the wake of further closure announcements by Santander, HSBC and TSB. Gareth Shaw, head of money at consumer organisation Which?, remarked: “The Government must urgently set out its plans for legislation on cash. This should include giving the FCA responsibility for the cash system, so that a clear strategy is in place to protect those who are not yet ready or able to move to digital payments.”
Investors eye Standard Chartered bank's climate policies
Standard Chartered is to face shareholder action over its climate change policies, according to environmental organisation Market Forces. The move comes after the bank confirmed its participation in a $400m five year loan for global coal giant Adaro Indonesia, as part of a syndicate of banks. Market Forces UK campaigner Adam McGibbon warned that if the bank's policies do not improve, the campaign group will table a shareholder resolution at next year's AGM to “seek investor support to force the bank's leadership to properly address the climate crisis.”
Treasury plans to sell NatWest stake
The Government has announced plans to sell a further 5% stake in taxpayer-backed NatWest Group. The Treasury said it plans to sell around 580m shares in an accelerated book-building process, reducing the Government's stake in the lender to 54.8%.
PRIVATE EQUITY
TPG makes ex-Goldman banker Jon Winkelried sole chief executive
James Coulter has relinquished his role as co-chief executive of TPG, leaving former Goldman Sachs banker Jon Winkelried in sole charge of the investment manager.
INTERNATIONAL
Malaysia’s 1MDB launches legal bid to recover $23bn in assets
Deutsche Bank, Coutts and JPMorgan, and more than 20 individuals including Malaysia’s former prime minister, are being sued by the country’s state investment fund 1MDB in an effort to recover over $23bn in losses linked to the fund. Malaysia and US state investigators estimate at least $4.5bn was stolen from 1MDB between 2009 and 2014 in a fraud scandal that rocked the southeast Asian country. In March, it is noted, Deloitte struck an $80m settlement with Kuala Lumpur over its role as an auditor to 1MDB while Goldman Sachs ponied up nearly $3bn to Malaysia.
Bonus for UBS bankers
Swiss lender UBS is to pay a $40,000 one-time bonus to its global banking analysts when they are promoted to associates, on top of any regular salary increases. The move by the Zurich-based bank doubles what some competitors are offering. Bloomberg notes that lenders are seeking to reward and retain younger staff who are contending with a surge in workload and prolonged remote working arrangements that have intensified the focus on work-life issues precipitated by the pandemic.
Pressure politicians on climate, BNP says
Jane Ambachtsheer, the global head of sustainability at BNP Paribas Asset Management, says investors should start chasing politicians to help identify policies that support business and communities to speed up the transition to net-zero. “It's increasingly well understood if we don't implement the Paris Agreement, don't tackle the biodiversity challenge and crisis, significant portions of GDP are at risk,” Ambachtsheer said. “We need a plan. We need to accelerate that plan.”
Société Générale to boost corporate banking after trading pain
In a move away from higher-risk trading Société Générale plans to shift the focus of its investment bank towards corporate finance and advice, the FT reports.
HSBC creates 1,000 new wealth management roles
HSBC is on track to create more than 1,000 roles in its wealth management business in Asia by the end of this year. The move is part of the bank’s focus on rising affluence in the region.
Hundreds of BBVA employees rally against layoffs
BBVA employees protested in the streets across Spain on Monday after the country's second-biggest bank announced plans to cut around 16% of its staff in its home market.
FINANCIAL SERVICES
Provident Financial withdraws from doorstep lending
Provident Financial has announced it is withdrawing from doorstep lending after 140 years, putting 2,100 jobs at risk. The move comes amid scrutiny of the high-cost loans industry by the Financial Conduct Authority and a flood of customer complaints. Provident's boss Malcolm Le May believes that illegal lending could rise if regulated firms are driven out of the high-cost loans industry en masse. The company reported a pre-tax loss of £113.5m for 2020, with the bulk of the losses - £74.9m - coming from the home credit division. Provident will in future focus on the group's profitable credit card and unsecured personal loan division Vanquis Bank, which made £38m last year, and its car finance business Moneybarn which brought in £10m.
Biden tax plan could hasten shift to ETFs, say asset managers
The US plan to place a higher capital gains levy on wealthy investors will highlight the tax inefficiencies of mutual funds and accelerate a shift into exchange traded funds, analysts say.
HEALTHCARE
US drugs regulator authorises BioNTech/ Pfizer Covid vaccine for under-16s
BioNTech/ Pfizer’s COVID-19 vaccine has been granted EUA by the US Food and Drug Administration to be given to under-16s for the first time. Children aged 12 to 15 will now be allowed the jab. Meanwhile, BioNTech plans to set up a regional centre and a new factory in Singapore for its vaccines, boosting its presence in Asia.
LEISURE & HOSPITALITY
Star goes for control of Crown
Australian casino operator Star Entertainment Group has made a A$9bn offer for larger rival Crown Resorts Ltd, pitting it against Blackstone and Oaktree Capital for control of the company.
MEDIA & ENTERTAINMENT
BT pensions scheme deficit shrinks by £2.2bn
A triennial review of BT’s pension fund is expected to reveal that the scheme’s deficit has shrunk to £7.5bn, around £2.2bn lower than the market previously anticipated. Liabilities now stand at more than £54bn – nearly four times BT’s market value of £16bn – with the company agreeing to make annual top-up payments of around £900m a year until 2030. Going forward, Berenberg analyst Carl Murdock-Smith suggests delaying further contributions to the fund and investing instead in its networks would bring BT the advantage of a greater tax shield from higher corporation tax in 2023 and a tax boost from the super deduction.
REAL ESTATE
Halifax releases house price data
Halifax has reported that house prices are increasing at the fastest pace since 2016, with the average selling price at a record high of just over £258,000. Russell Galley, the lender’s managing director commented: “The stamp duty holiday continues to add impetus to an extremely active market, magnifying the current shortage of available homes as buyers aim to take advantage of the government scheme.” He went on: “The influence of the stamp duty holiday will fade gradually over the coming months as it’s tapered out but low stock levels, low interest rates and continued demand is likely to continue to underpin prices in the market.”
RETAIL
SoftBank subsidiary takes stake in The Hut Group
Softbank will become a top shareholder in Manchester-based internet shopping business The Hut Group (THG) in a deal that will initially see SB Management, a wholly owned subsidiary of SoftBank Group, take a 19.9% stake in THG's Ingenuity business and tech platform and a $730m stake in The Hut Group via share ownership. The total stake is worth $2.33bn.
Pret agrees Tesco partnership
Pret A Manger has agreed a partnership to open stores in Tesco, as part of efforts to broaden its appeal as it responds to the sharp falloff in commuters into London in particular, due to lockdowns and the trend towards working from home.
SPORT
Uefa to rule on Champions League final fixture
European football governing body Uefa is to decide by Wednesday whether travel restrictions will see the Champions League final switched to Wembley from Istanbul. Chelsea Supporters Trust has already signalled its intention to request that the final is moved, with Manchester City fan groups also renewing calls to have the fixture take place in the UK.
ECONOMY
UK consumer spending rises above pre-pandemic levels
Consumer spending rose 0.4% in April compared with the same period in 2019, up from a 7.2% contraction in March and the first expansion this year, according to Barclaycard. Raheel Ahmed, head of consumer products at the company, pointed to the reopening of non-essential stores and older people booking holidays as two of the chief reasons for the uptick. Separate figures from the British Retail Consortium showed retail sales up 7.3% in April, compared with the same month in 2019. Helen Dickinson, chief executive at the British Retail Consortium, confirmed strong increases in outdoor wear and furniture sales, and said that with consumers back to stores, non-food sales across stores and online increased by a quarter between March and April. “It is great to see customers feeling confident visiting shops, a testament to the ongoing investment by retailers in making their stores, warehouses and deliveries Covid-secure,” she said.
Pound hits highest level since February after Tory election triumph
The Conservative party’s success in the recent mid-term elections and the Scottish National Party’s failure to win a majority in Holyrood’s elections sent the pound to its highest level against the dollar since February, to trade as high as $1.4147. The euro slipped 1.1% against sterling to trade at £0.8601. The reduced risk of Scottish independence, optimism over the UK economy opening and wobbles in the US all led to a strengthening of sterling, analysts said.