BANKING
UBS opts for Frankfurt as future HQ
UBS’s boss Sergio Ermotti has said the Swiss bank has chosen Frankfurt as the base for its EU operations after Brexit. Mr Ermotti said the bank has already made “worst-case” scenario plans, adding: “The financial system is already operating on the assumption that there is no agreement,” between the UK and EU. He added that the impact of Britain’s decision to leave the EU has already been felt, with companies pulling back across the continent. He explained: “It’s a complication that undermines the willingness to make investments. In the UK and in general in Europe this has been something that has prevented people taking action and investing for the future.” The Standard notes that UBS believes it will have to spend more than $100m (£76.4m) on Brexit, including the cost of moving staff from London.
Santander in talks to acquire Peel Hunt
Banco Santander is reportedly in talks to buy Peel Hunt, the City stockbroker. According to Sky News, Santander is in early stage discussions over a deal, although the talks may not lead to an agreement. Steven Fine, Peel Hunt’s chief executive, commented: “We do not comment on press speculation, however I can confirm that Peel Hunt is categorically not up for sale.”
Management reshuffle at HSBC
HSBC has announced a reshuffle of its top executives in its private banking and European divisions. The bank said that António Simões was stepping down as CEO of Europe and head of HSBC Bank plc to become head of its private bank from January 1. He will replace Peter Boyles who is retiring after working for the bank for 43 years. James Emmett, who has been acting head of Europe since Mr Simões went on a sabbatical for family reasons in March, will replace him permanently.
Goldman Sachs expands remit of Gnodde
The Telegraph reports that Goldman Sachs has expanded the remit of its London-based international head, Richard Gnodde. According to an internal memo, he will become responsible for Goldman’s activities outside of North America. Meanwhile, Tim O’Neill, who co-heads the bank’s investment unit, has been promoted to vice chairman.
Mortgage rates largely static
Mortgage rates have remained largely static since the Bank of England raised the base rate from 0.5% to 0.75%, according to information website Moneyfacts, with two-year fixes dropping to an average 2.51% from 2.52% the day after the decision in August. The difference for two-year fixes, between September 2017 and September this year, is only around 0.31 percentage points - from 2.20 to 2.51% respectively. Meanwhile, the proportion of savings accounts on the market paying above the Bank of England base rate has sunk to a five-year low, analysis has found. Just over two-thirds of savings accounts pay a rate above 0.75%, Moneyfacts found.
British banks a bright spot in the gloom
Analysts at Barclays have published research which paints a gloomy picture for the European banking sector. A total of only 28% of investors expect European financial companies to outperform the market, down from 45% last year. Meanwhile, 66% of investors are “underweight” on the sector. Barclays noted that despite concern over a post-Brexit recession, investors saw “the greatest upside amongst the UK banks with the least confidence in the Nordic banks”.
Former Lloyds executives to be quizzed on HBOS fraud
Sir Win Bischoff, the former chairman of Lloyds Banking Group, and Eric Daniels, the bank’s former CEO, are to be quizzed by investigators about what they knew about criminals operating out of the Reading branch of HBOS, which was bought by Lloyds during the financial crisis. Neither Daniels nor Bischoff is accused of any criminal wrongdoing but both were sent letters warning them about the fraud before the police investigation began.
PRIVATE EQUITY
Private equity buying banks is not a good mix
Reflecting on Blackstone’s €1bn purchase of a 60% stake in Luminor, the FT warns that the banking sector should not become another investment sector for private equity houses.
INTERNATIONAL
Credit Suisse rapped over suspected FIFA corruption
Swiss banking watchdog Finma has enacted two enforcement procedures against Credit Suisse over “deficiencies” in its anti-money laundering procedures, in connection with suspected corruption at football body FIFA.
Denmark to tighten money-laundering laws
Politicians in Denmark have said they will tighten the country’s anti-money laundering laws amid investigations into Danske Bank, the country’s largest bank, over past failings in its money laundering controls in Estonia.
AUTOMOTIVE
Jaguar workers on three-day week over Brexit
Half of Jaguar Land Rover’s Castle Bromwich plant, around 1,000 workers in Birmingham, have been moved from a five-day to a three-day week until Christmas. The carmaker said in statement: “As is standard business practice, Jaguar Land Rover regularly reviews its production schedules to ensure market demand is balanced globally. In light of the continuing headwinds impacting the car industry, we are making some temporary adjustments to our production schedules at Castle Bromwich.”
AVIATION
EasyJet reported to FRC
ClientEarth has reported EasyJet, among other firms, to the Financial Reporting Council following concerns that it failed to address climate change threats in its latest annual reports.
CONSTRUCTION
MJ Gleeson building on growing demand
Housebuilder MJ Gleeson’s revenue rose almost a quarter to £196.7m in the 12 months to the end of June, compared to the same period a year ago, while profits before tax grew 12% to £37m. Gleeson sold 1,225 homes, 21% more than the first half of last year, at an average selling price of £125,200, and is on track to double home sales to 2,000 a year by 2022.
FINANCIAL SERVICES
Shore Capital hit by weak capital markets
Profits at small cap stockbroker Shore Capital were hit by weaker capital markets in the first half of this year, despite a jump in asset management earnings. The firm’s total revenues rose by 6.5% for the first six months of the year, to £21.6m, compared to the same period last year, while capital markets revenues fell by 8.5% to £13.5m. Overall profits before tax were up slightly to £2.6m amid heavy investment in its asset management division.
LEISURE AND HOSPITALITY
Stonegate toasts record quarter
Slug and Lettuce-owner Stonegate has asserted that growth would continue after acquiring a portfolio of Be At One cocktail bars. The company, which also owns Walkabout and Yates, sold 4.5m pints over the course of the World Cup, with a peak of 367,000 during England's semi-final against Croatia. Like-for-like sales in the third quarter, a record period for the firm, were up 6.1% with total revenue for the 40 weeks up to July 1 up 8.4% to £579.4m. Underlying earnings rose 9.1% to £84.6.
MANUFACTURING
Boatmakers stay afloat
British Marine’s latest UK Leisure Boat Manufacturing has revealed that boat manufacturing revenue rose by 8% last year, generating £844m in turnover, despite Brexit causing uncertainty throughout the industry.
MEDIA AND ENTERTAINMENT
Benioff acquires Time magazine
The co-founder of Salesforce.com, Marc Benioff, and his wife are reportedly buying Time magazine for $190m from US media group Meredith Corporation. In a statement, Meredith said the Benioffs "will not be involved in the day-to-day operations or journalistic decisions".
REAL ESTATE
Landlords braced for new HMO rules
Landlords affected by the government's new “house in multiple occupation” (HMO) rules must apply to their local authority for a licence by October 1 or face unlimited fines and possible criminal prosecution. The Residential Landlords Association said the change would result in 177,000 more landlords needing an HMO licence, for homes in which at least two households share facilities - such as a kitchen or bathroom.
RETAIL
Lidl to open Leeds mega warehouse
Discount retailer Lidl is opening a 38-acre warehouse site in Gildersome, Leeds, as part of its plans for long-term expansion. The warehouse, which will create 500 jobs in Leeds, will be Lidl’s seventeenth in Britain, and is set to be approximately 60,000 sq m in size. Ingo Fischer, Lidl UK's head of expansion and development, said: “As we continue to open new stores and serve more customers across the country, it's important that we also continue to build foundations for the future.”
ECONOMY
IMF warns over Brexit hits to UK economy
The IMF has warned that all of the UK's Brexit plans, including the Chequers blueprint, threaten to damage Britain’s economy - and that a potential “no deal” scenario would be worst of all. “While all likely Brexit outcomes will entail costs for the UK economy by departing from the frictionless single market that now prevails, an agreement that minimizes the introduction of new tariff and nontariff barriers would best protect growth and incomes in the UK and EU,” the Washington-based thinktank said.
OTHER
Fewer than 2% of bank chiefs worldwide are women
Despite an increased focus on diversity and studies showing having women in senior roles improves banks’ performance, just 15 of the more than 800 bank chief executives around the world are female, according to a study by the IMF. Women account for 20% of all executive board positions, but in savings banks the figures rises to 45%. Investment banks have fewer women than average, as do fintech firms. The IMF also found that rich countries are often worse than those in emerging markets when it comes to gender balance in banks and regulators.
Adoboli given temporary reprieve
Kweku Adoboli, the former UBS trader convicted of fraud, has been given a temporary reprieve from deportation to Ghana, the country of his birth. A judge said the reprieve will last until a last-minute judicial review of his case has been heard.