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Daily News Roundup: Tuesday, 15th September 2020

Posted: 15th September 2020


Banks must warn of planned closures

New rules will see banks have to give customers 12 weeks' warning before shutting their local branch. The Financial Conduct Authority guidance says banks, building societies and credit unions considering closing a branch must ensure customers can access bank services elsewhere – such as a Post Office, mobile bank, ATM or online. Sarah Coles, personal finance analyst at Hargreaves Lansdown, said of the guidance: "This isn't enough to safeguard the future of the increasingly endangered branch network. At best, it'll give you time to switch to a different local branch, and at worst it will close the last bank in town and offer advice on online banking instead.”

Nationwide leads on consumer trust

Nationwide is the UK’s most trusted bank, according to the Banking Brand and Trust Index published by tech research platform Glow. Neil Gupta, Glow’s UK managing director, said the study shows that the banking industry “has only felt a minor dip in confidence” amid the coronavirus crisis, deeming this “a testament to the resilience of their reputations built over the last 12 years.” Nationwide, with a trust score of 31, came out on top, with Halifax, Lloyds, NatWest and Tesco scoring 24, 21, 21 and 19 respectively to round out the top five. Royal Bank of Scotland, the UK’s worst performing brand, scored 5.

Coronavirus support extended

The Financial Conduct Authority (FCA) has announced that mortgage holders will get more support if they face payment difficulties due to coronavirus. With support offering a three-month mortgage holiday set to expire on October 31, firms have been advised to offer further short-term support for those who require it, with potential measures outlined including a more tailored payment break that could see reduced payments, extended repayment terms or loans restructured. UK Finance says lenders have granted more than two million mortgage payment deferrals since the scheme came into effect in March.

Hedge funds slug it out over Lloyds Bank

Patrick Jenkins says Lloyds is at the centre of a “tussle” between bullish and bearish investors including Lansdowne Partners, Harris Associates and Marshall Wace.


UBS eyes Credit Suisse tie-up

UBS chairman Axel Weber is considering a tie-up with rival Credit Suisse, with Mr Weber reportedly asking consultants to weigh up the potential of such a move. If the merger were to go ahead it would create a business with over £4trn worth of assets under management. JPMorgan analyst Kian Abouhossein said there would be "quite significant" risks involved in such a tie-up, pointing to the large restructuring costs and the regulatory requirements that would come into play.

Weber to appear in Orcel trial

A Madrid court has called UBS chairman Axel Weber to speak as a witness in the trial between Santander and banker Andrea Orcel over a withdrawn job offer that would have seen the bank name Mr Orcel CEO. Santander's chairman Ana Botin has also been called as a witness for the trial, which begins in March 2021.

Catherine Leung trial begins in Hong Kong

A bribery trial in Hong Kong involving Catherine Leung, JPMorgan's former Asia investment banking vice-chairwoman, has heard allegations that the bank did not carry out key checks when employing the son of a potential client. Ms Leung, who pleads not guilty, is charged with bribing the then chairman of Kerry Logistics Network by employing his son in 2010.


London City Airport culls hundreds of jobs

London City Airport is to cut up to 239 roles due to low passenger numbers during the coronavirus pandemic. The airport has launched a consultation with staff over voluntary redundancies.

Passenger numbers through Luton tanked last month

The number of passengers travelling through London Luton airport dropped 56% in August, as coronavirus hit the travel sector hard. Just 820,000 people travelled through the airport in August, down from 1.7m a year earlier, and across the summer as a whole - June, July and August - the total number of passengers was 75% lower than the same period in 2019.


FCA scraps half its criminal probes into money-laundering breaches

Figures show that the Financial Conduct Authority has discontinued seven of 14 criminal investigations into breaches of money laundering rules since January, with just one solely criminal investigation still being pursued.

Amanda Blanc backs turnaround with own money

Aviva's new boss Amanda Blanc has bought £1m of the insurance giant's shares. In a huge vote of confidence in the firm's turnaround, she bought 324,887 shares at just over 300p a share.

Traders switch to FX after central banks numb bond markets

Bond traders are moving into currency markets after central banks' stimulus measures weigh heavy on fixed-income markets. Currency volatility is well up on a year ago.


Dozens of JD Wetherspoon staff test positive for virus

Sixty-six JD Wetherspoon employees have tested positive for coronavirus since the firm reopened its pubs in July.


Focusrite records strong performance

Audio firm Focusrite has reported “substantial” growth in revenue and profit. Netflix actors are using the company’s equipment to record voiceovers from home, while its Scarlett range of audio products is being used on The Voice and other TV shows. Focusrite, which recently acquired Adam Audio and Martin Audio, expects to record revenue of roughly £129m for the year to the end of August, up from £84.7m last year and ahead of market expectations.


G4S shares soar on takeover bid

Canadian security giant GardaWorld has asserted a £2.96bn potential offer to buy G4S. The firm approached G4S three times between June 15 and August 31, but has so far been ignored.


CLS in £60m deal to buy three UK office buildings

Landlord CLS has agreed a £59.7m deal to buy three properties in Richmond, Chelmsford and Leatherhead. A month ago in London, where CLS has 35 buildings, occupancy levels stood at about 15-20% at the firm's sites, though CLS boss Fredrik Widlund says this has now increased to around 30-35%.


Shopper numbers slip

Market research firm Springboard has revealed that shopper numbers across UK retail destinations were down 6.3% last week compared with the week before, with the first week-on-week decline since April. Footfall across UK high streets declined 5.4% and by 5.2% at retail parks. While regional cities saw a 7.9% fall in footfall, the decline in central London was just 3%. Springboard said a dip in the week when the school year starts is common but the scale is greater this year. The annual decline in shopper numbers stood at 27.5% last week, compared with a 25% dip recorded the previous week.

New Look CVA put to landlords

New Look’s restructuring plans could be dealt a blow by its landlords today, with a number of property owners expected to oppose the retailer’s CVA. New Look’s hedge fund owners plan to inject £40m into the business through a debt-for-equity swap, with this dependent on the chain’s stores switching to turnover-linked rent. This would see landlords accept no rent on 68 stores for three years and as little as 2% of turnover on 402 others.


Mike Ashley to sue Premier League

Newcastle United owner Mike Ashley has instructed lawyers to pursue a legal case against the Premier League following the collapse of a proposed takeover by Saudi Arabia’s Public Investment Fund. Ashley feels that the Premier League acted inappropriately in failing to allow the takeover.


BCC calls for tax cuts to save economy

The British Chambers of Commerce (BCC) has urged the Government to take "bolder and more ambitious" action to help keep business afloat and support jobs amid the coronavirus crisis. Outlining measures the BCC feels are required to boost the economy, president Baroness Ruby McGregor-Smith said more than £20bn of tax cuts are needed to save jobs and boost investment. The BCC has suggested raising the threshold at which employers' national insurance contributions kick in from £8,788 to £12,500 and increasing the Employment Allowance from £4,000 to £20,000. To boost investment, it suggests extending the Annual Investment Allowance at £1m for another two years and continuing 100% business rates relief for industries hit by the pandemic and restrictions it prompted.

Second spike could reverse recovery

Tom Rees in the Telegraph considers the impact a second wave of COVID-19 infections could have on the economy, saying a record-breaking rebound in GDP expected in Q3 “could be a brief respite rather than the start to a roaring recovery”.

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