Metro Bank shares continue to slide
Shares in Metro Bank have fallen another 8% as concerns persist over the bank’s financial health. Metro Bank’s shares have lost three-quarters of their value since January, when it announced it needed money to boost their capital after an accounting error. It said it was in “final discussions” with shareholders and new investors over its plans to raise £350m. Meanwhile, the bank has moved to reassure customers that their money and safety deposit boxes are safe after a flurry of WhatsApp messages caused queues to form at some of its London branches over the weekend. Metro said the messages amounted to “false rumours” and that the majority of customers queuing were primarily interested in accessing items stored in safety deposit boxes rather than cash in their accounts. An editorial in the FT says that the panic at Metro Bank shows that there is a need for more proactive regulation. Patrick Hosking in the Times says that Metro Bank should have raised the extra capital it needed months ago with less dilution to existing shareholders, less anxiety for depositors and less distraction to management. Katherine Griffiths in the Times also reveals that the bank is understood to be in discussions with several institutional investors around the world, including sovereign wealth funds, about becoming a cornerstone investor. The Times also hears from small business owners who express their support for Metro Bank.
Independent checks on capital buffers gaining momentum
The ICAEW has developed a framework for checks on how banks calculate how much capital they must hold against their loans and has asked accounting firms whether they would have had any interest in using it to carry out such work. The move comes as support for independent checks of banks’ capital buffers grows following Metro Bank’s misclassification of loans, which meant it had to find an extra £900m of capital.
Banks should have legal duty of care for customers
The Treasury Select Committee has proposed that banks should be subject to a legal duty to always act in customers’ best interests. The committee suggested that regulators clamp down on lenders following a long-running string of scandals that has seen banks pay out more than £30bn to compensate consumers for mis-sold endowment mortgages, PPI and pensions. The committee also believes that banks should not be allowed to ignore communities when choosing to close branches or cash machines.
Bankers pay on the rise
Research by the TUC has found that the average worker is £17 a week worse off than a decade ago but salaries for bankers and others in the financial sector have risen by £120 a week. On average workers in the financial sector are paid £1,405 a week. The TUC said nurses and teachers were among the hardest hit, with those employed in health and social work and education £36 a week worse off than in 2009.
Deutsche Bank talks with UBS over asset management deal stall
According to sources, talks between Deutsche Bank and UBS over the two banks combining their asset management businesses have stalled. A deal is now seen as increasingly unlikely after disagreements emerged over who would retain majority control of the combined entity.
Goldman Sachs applies for Tokyo banking licence
Goldman Sachs has applied for a banking licence in Japan as part of a plan to start a global cash management business later this year.
Swedbank investors call for new board members
Investors in Swedbank have called for new board members, including former Swedish PM Goran Persson as chairman.
Honda to close Swindon plant in 2021
Honda has confirmed that it will close its Swindon factory in 2021, ending any hopes of rescuing the jobs of 3,500 employees. A Honda spokeswoman said consultants hired by the company had proposed several options to save the plant but the carmaker had decided none of them were viable. A spokesperson for Theresa May said the closure decision was “clearly disappointing”. Honda said it needed to close the site to focus company resources on large electric car markets outside the UK. However, industry experts said Brexit played an important role in the decision.
Ford to cut jobs
Ford is preparing to cut as many as 550 jobs from its offices in Essex as part of major restructuring plans. The cuts are not expected to affect workers at its factories in Dagenham, Bridgend or Halewood. It comes after the automaker revealed plans last month to cut its 24,000-strong German workforce by 5,000.
Air France to cut jobs amid ‘fierce’ competition
Air France has announced plans to cut 465 ground staff jobs, following first-quarter losses that showed the company suffering under pressure from low-cost rivals and high-speed trains.
Lloyds calls for review of working practices
Lloyd’s of London has called on the Banking Standards Board to conduct a survey of the insurance market’s 45,000 participants on issues such as honesty and respect in order to help improve the working environment. The reputation of the market has been tarnished by recent allegations of sexual harassment in the workplace.
NSF expects to meet watchdog’s concerns over Provident bid
Non-Standard Finance (NSF) has said it expects to meet concerns raised by the competition watchdog during the first phase of the review of its hostile £1.3bn takeover bid for Provident Financial. NSF said it is now in the final stage of discussions with the Competition and Markets Authority as to when it can make its CMA filing.
Bailey arrives down under
The Times notes that FCA boss Andrew Bailey has travelled to Australia to speak at two panel sessions at an event in Sydney. He focused on the end of Libor and the impact on the Australian financial markets. Mr Bailey is also attending the annual meetings of the International Organisation of Securities Commissions in the city.
Liquidnet expands into research with RSRCHXchange purchase
US broker Liquidnet has expanded into the provision of investment research with the acquisition of London-based platform RSRCHXchange.
Fintech firm secures funding
Edinburgh-based fintech firm The ID Co has secured a £1.5m funding injection as it looks to expand its global customer base. The firm's technology is said to “remove the friction caused during application processes by the current challenges of risk, fraud, compliance, and regulation”.
US court orders Bayer to pay $2bn in Roundup cancer case
A jury in California has ordered Bayer-owned Monsanto to pay more than $2bn in damages to a couple that sued on grounds the weed killer Roundup caused their cancer. Bayer said in a statement that it was “disappointed with the jury’s decision” and promised to appeal against the verdict.
MEDIA AND ENTERTAINMENT
Vodafone offloads New Zealand arm
Vodafone has agreed to sell its New Zealand operation to Brookfield Asset Management and Infratil, a New Zealand-based infrastructure fund, for €2.1bn (£1.8bn).
Roland Rudd approaches WPP about Finsbury buyout
Roland Rudd, the founder of Finsbury, has approached WPP about a possible management buyout of the PR firm.
Tenants face rent hikes as landlords bail
The withdrawal of tax breaks for landlords is leading to an exodus from the buy-to-let market risking a crisis for tenants, according to the Residential Landlords Association (RLA). The RLA says that tenants face less choice and higher rents if landlords sell up.
May considering “definitive votes” as last throw of dice
Theresa May will attempt to find consensus in Parliament on Brexit by holding a series of votes on alternatives that will eventually show what a majority of MPs could support. The result of the “definitive votes” would not be legally binding but could break the deadlock and provide a way forward. The Government and Labour met on Monday evening for further compromise talks, but the discussions broke up with “no substantive progress” made, according to sources. However, Downing Street insisted Mrs May would try to keep the talks alive despite concerns Labour demands would further split the Conservative party.