CYBG completes merger of Virgin Money
CYBG has formally completed its £1.7bn takeover of Virgin Money, marking one of the first major banking deals since the financial crisis. It comes after the two banks – which together hold around £84bn in assets – received final approval in a court hearing last week. Virgin Money’s London-listed shares have now been cancelled, with the all-stock deal resulting in another 540m new CYBG shares entering the market. CYBG chief executive David Duffy said the deal will help it compete with larger rivals. He said: “Bringing the two banks together creates the UK’s sixth-largest bank combining strong product, service and technology capabilities alongside an iconic brand with well-known consumer champion credentials.”
Banks and insurers urged to tackle climate change risks
The Bank of England has formally urged banks and insurers to better tackle the financial risks of climate change, and the Prudential Regulation Authority has now launched a consultation calling for “board-level engagement and responsibility”. The PRA warned of two types of risk: physical, relating to natural disasters, and transitional, changes to a low-carbon world that might affect sectors. The PRA added: “Financial risks from climate change will be minimised if there is an orderly transition to a low-carbon world, but the window for an orderly transition is finite and closing.” The consultation will run until January 15, 2019. Meanwhile, HSBC has unveiled plans to invest around £250m in wind and solar power parks.
Banks demand clarity from EU on no-deal Brexit
The Association of Financial Markets in Europe (AFME), which represents the interests of around 40 of the largest banks in Europe and the UK, has warned that the European Commission and EU regulators must clarify how they intend to avoid “significant market disruption” if no agreement is reached in Brexit talks. A letter signed by AFME chief executive Simon Lewis to Valdis Dombrovskis, the EU’s vice-president for financial stability, said: “It is vital that clarity is now provided on actions that the European Commission, member states, and regulators will take to ensure financial stability.” Mr Lewis added that it is “essential” that the Commission acts to prevent UK clearing houses from having to ditch Eurozone clients.
Santander’s new SME account offers cashback on turnover
Santander is offering small businesses up to 3% cashback on turnover with its new 123 Business Current Account, with those businesses switching to the account also receiving a discounted monthly fee for the first 12 months.
Carlyle dealmaker puts $100m of his cash into own fund
Marcel van Poecke, who oversees Carlyle’s international energy fund, has invested $100m of his own money into the group’s $4bn latest fund.
BoA posts record quarterly income
Bank of America has posted record quarterly pre-tax profits for the third-quarter, up 18% to $9bn in the three months to the end of September. Revenues rose 4% to $22.8bn, while net income hit $7.2bn, a 32% year-on-year increase driven in part by recent tax cuts. However, investment banking fees fell by 18% to $1.2bn. Brian Moynihan, the chief executive, said that performance was buoyed by a "solid US economy and a healthy US consumer”.
Ford warns on “disastrous” no-deal Brexit
Steven Armstrong, Ford’s boss in Europe, has said that a no-deal Brexit “would be pretty disastrous” for British industry and could affect the company’s future in the UK. He said he was still confident that a tariff-free frictionless trade deal would be completed but added that a no-deal outcome would “force us to think about what our future investment strategy for the UK would be.”
Germany recalls 100,000 Opel cars in diesel probe
Germany’s transport ministry has ordered Opel to recall almost 100,000 cars amid concerns that some diesel-engine models were modified to manipulate emissions.
Crossrail delays could derail HS2
A report published by the Construction Products Association has warned that the nine-month delay to the construction of Crossrail through London could have a significant impact on HS2. The report suggests that the hold-up could affect the construction industry’s ability to deliver other infrastructure projects including Hinkley Point C, the nuclear power plant being built in Somerset.
Allianz AI fund approaching £1bn
Allianz Global Investors’ artificial intelligence (AI) fund, launched in March last year, has already passed the €1bn (£880m) assets under management mark. The fund invests in firms developing AI systems in a bid to gain exposure to advancements in disruptive technology, including the big data, machine learning, self-driving cars and Internet of Things sectors.
Fidelity launches company to facilitate crypto trading
Fidelity Investments has launched a new company, Fidelity Digital Asset Services, for its institutional clients that will trade and store digital assets such as bitcoin. Abigail Johnson, chairman and chief executive of Fidelity Investments, commented: “Our goal is to make digitally-native assets, such as bitcoin, more accessible to investors.”
Coinbase sets up base in Dublin
Coinbase, the cryptocurrency exchange, is opening new offices in Dublin as part of the company’s contingency planning for a hard Brexit. The company said that Dublin’s English-speaking workforce and diverse technology talent pool, made it the “clear choice” for a second European outpost.
FCA warns payday lenders on customer complaints
Following the demise of Wonga in August, the Financial Conduct Authority has written to payday lenders advising them to assess their credit worthiness assessments and begin compensating former customers.
Convatec reveals profit warning
Medical equipment manufacturer Convatec's chief executive is stepping down amid a profit warning. Convatec blamed a change in “inventory policy” from its biggest customer for infusion devices - which it sells to firms manufacturing insulin pumps for diabetics - for reduced earnings guidance, a hit of between $18m (£13.7m) and $23m.
Thread boosted by investors
Thread, the online shopping start-up, has raised £16.7m from several venture capital investors, including Balderton Capital, Beringea, Forward Partners, and H&M's investment arm H&M CO: LAB.
A third of UK firms expect decline in profits due to Brexit
A survey of finance professionals by the Chartered Institute of Management Accountants has found that 35% of businesses forecast their profits will decline because of Brexit, while 27% expect profits to be flat. More than half of respondents said they expect business costs to rise, with 14% forecasting to spend more than £1m on Brexit planning. Some 77% of businesses have taken steps to prepare for Brexit, while 20% have conducted a full risk assessment, the study said.
Dimon pulls out of KSA investor conference
JP Morgan boss Jamie Dimon has become the latest high-profile business figure to pull out of a Saudi investor conference as political tensions in the kingdom continue. He joins Ford chairman Bill Ford, Uber boss Dara Khosrowshahi, Viacom boss Bob Bakish and AOL founder Steve Case on the list of withdrawals.