BANKING
League tables can be game changer for banks and customers
Patrick Hosking in the Times reflects on the Competition and Markets Authority’s decision to force retail banks in Britain to display, in their branches and on their websites, league tables ranking the best banks for customer service in personal banking and disclosing their own position in those league tables. He says the tables have a dual purpose. They provide useful information to customers shopping around or thinking about switching banks, while they can also be a persuasive force in embarrassing companies into better behaviour. Mr Hosking also questions why the approach is only confined to banking.
Standard Chartered sells first chunk of real estate business
Standard Chartered has sold its principal finance real estate business in Asia to private equity firm Actis. The bank remains in talks to sell the rest of its private equity business, outside Asia, to Intermediate Capital Group (ICG). The business has around $700m in investments across Asia and Africa. A spokesman for the bank confirmed the completion of the Actis deal, while Standard Chartered declined to comment on the prospective ICG sale.
Breastfeeding perk at bank
Goldman Sachs is to pay for its breastfeeding mums to courier their milk back to their babies if travelling overseas for work. The US bank, which employs 6,000 staff in London, is believed to be the first company in the UK to offer the perk. Goldman will also pay for employees to have a fridge in their room. Laura Young, global head of wellness, commented: “We want our employees to feel fulfilled, both personally and professionally.”
Barclays names new German boss
Barclays has appointed Peter Kimpel as head of banking for Germany and country manager for Barclays in Germany. He has spent more than 20 years at Goldman Sachs, most recently as a partner covering clients in the financial institutions sector across Europe.
Banking sector resembles struggling department stores
Fund manager Crispin Odey has warned investors in his hedge fund that big banks now resemble struggling department stores, luring investors to a sticky end with an outdated business model. He said banks’ profits are threatened by fintech rivals who target areas where banks traditionally charge large fees.
Are the banks ready for digital challenge?
Spriha Srivastava questions in City AM whether traditional banks are prepared for the challenge to go digital. She notes that while banks can use technology to their advantage, it can also be there worst enemy – as noted by recent cyber attacks. She adds that established lenders are also facing immense challenges from fintech firms, such as Monzo and Revolut.
INTERNATIONAL
Merrill Lynch pays $8.9m to settle SEC disclosure claims
Merrill Lynch will pay $8.9m to settle SEC claims that it failed to disclose a conflict of interest when making decisions on products managed by an outside advisory firm.
ECB hits Crédit Agricole with nearly €5m in fines
The European Central Bank’s banking watchdog has imposed three fines totalling almost €5m on Crédit Agricole for breaches of rules on how banks classify their top-grade capital.
US banks tap the brakes on consumer credit
The FT’s Robert Armstrong looks at the economic situation in the US, noting that although spending is up, concern is growing over credit quality and profitability.
Ant Financial IPO plans pushed back again
Ant Financial has pushed back its planned IPO as the electronic payments group continues to burn through cash. The FT’s Lex adds that the regulatory net is closing on “the non-bank that behaves a lot like a bank”.
AUTOMOTIVE
Tesla hit by doubts over Musk’s delisting plan
Shares in Tesla remained volatile yesterday amid doubts about Elon Musk’s ability to take the company private. The shares started trading down more than 4%, but later recovered to close in positive territory. Meanwhile, JPMorgan Chase has cut its price target on the stock from $308 to $195. Analysts at the bank raised doubts about Mr Musk’s claims to have secured funding to take Tesla private.
AVIATION
Cable damage causes Gatwick screen failure
Gatwick airport staff had to resort to using whiteboards to display flight information yesterday after an IT failure. The UK’s second busiest airport said "a handful" of passengers missed flights after a fibre optic cable was damaged.
FINANCIAL SERVICES
Mixed reactions in City to Brexit deal
Ahead of talks between Brexit secretary Dominic Raab and his counterpart Michel Barnier today, the Government has published more details about its proposal for a post-Brexit deal in financial services, prompting a mixed response from the City. The framework builds on a white paper launched last month which called for "expanded" equivalence, and stresses that "rule-taking will simply not work for this sector" while also "respecting the principle of autonomous decision making". It also highlights the EU's recent deal with Japan as a precedent for close cooperation but with both sides having autonomy. Catherine McGuinness, policy chair at the City of London Corporation, welcomed the development but cautioned that many unknowns remain. UK Finance described the framework as “encouraging”, but David Henig, director of the UK trade policy project at the European Centre for International Political Economy, remained unimpressed, warning it was “still a bit of a stretch.”
Origo joins SFE
Origo, a not-for-profit fintech business owned by major financial services firms including Aegon and Scottish Widows, has joined the Scottish Financial Enterprise industry body. The move comes as Origo looks to raise its profile in the sector where major projects it has been involved in include the UK Government's Pensions Dashboard.
Meiklejon named head of real assets team at Aviva Investors
Aviva Investors has appointed Mark Meiklejon as head of real asset investment specialists. He will lead a newly-formed real assets investment specialist team within global client solutions and report to Steven Blackie, global head of product strategy.
HEALTHCARE
NMC Health acquires Aspen Healthcare
NMC Health, a Middle East-focused private healthcare group, has acquired Aspen Healthcare for £10m from Tenet Healthcare. The deal was announced alongside NMC’s half-year results, which showed revenue up 20.2% to $932m in the six months to the end of June.
LEISURE AND HOSPITALITY
Paddy Power completes first part of share buybacks
Paddy Power Betfair has completed the first £200m tranche of its share buyback programme. Goldman Sachs International bought up 2.4m shares on the bookmaker's behalf, cancelling them all, as it embarks on the second tranche to repurchase £300m of shares.
MEDIA AND ENTERTAINMENT
Apple culls apps in China after state media criticism
Apple has reportedly pulled more than 25,000 apps from its App Store in China that were deemed to fall foul of Chinese regulations.
PROFESSIONAL SERVICES
Broker cuts rating on Sage
Deutsche Bank has cut its rating on Sage from “hold” to “sell” sending the shares down 46.5p to 619.25p. After speaking to accountants and resellers in Britain, America and Australia, the broker was told that there was rising competition, principally from Microsoft's Dynamics package, to Sage's accounting software used by smaller businesses.
REAL ESTATE
Countrywide scraps bosses’ bonus package
Countrywide has cancelled plans for a new bonus package for its bosses following an outcry from investors. The package could have paid out a total of £20m to three executives, depending on the firm's share price performance over the next three years.
RETAIL
Tough UK market hits Mulberry
Mulberry has warned that full-year profits could be “materially reduced” if current tough conditions in the UK retail market continued in the second half of the year. However, it said that trading in the rest of the world was keeping up with expectations.
Farfetch plans US float
Goldman Sachs, JP Morgan, Allen & Co, UBS, Credit Suisse, Deutsche Bank, Wells Fargo, Cowen and BNP Paribas are acting as underwriters to UK online fashion retailer Farfetch, which has yet to turn a profit but is planning to list on the New York Stock Exchange this year.
ECONOMY
British households more upbeat over finances
A new survey has revealed that although British households are the most upbeat about their finances since early 2015, pessimism about how they will fare over the next 12 months is the greatest since March 2017, fuelled by Brexit uncertainty and higher living costs. IHS Markit said its monthly Household Finance Index rose in August to its second-highest level since it was launched nine years ago at 45.9, up from 45.0 in July. Meanwhile, research from Citizens Advice shows that British households owe almost £19bn in utility bills, missed council tax payments and overpaid benefits. The charity said missed bill payments had now overtaken credit card troubles as the key money problem faced by consumers.
OTHER
Haldane: AI could lead to widespread unemployment
Andy Haldane, a member of the Bank of England's rate-setting committee, has warned that artificial intelligence threatens UK employment like no other period in history. He said that he had seen a widespread “hollowing out” of the jobs market, rising inequality social tensions, and many people struggling to make a living. Mr Haldane added that it was important to learn the “lessons of history” and ensure that people were given the training to take advantage of the new jobs that would become available. His comments were echoed by Tabitha Goldstaub, chair of the newly formed Artificial Intelligence Council, who said that the challenge was ensuring that people were ready for change and that the focus was on creating the new jobs of the future to replace those that would disappear.
Royal Mint halves number of coins it produces
The Royal Mint has cut the number of coins it puts into circulation by nearly half in four years. The government-owned mint issued 1.3bn coins last year - down from 2.3bn in 2014. The number of 1p, 2p and 5p coins being issued all fell by more than half, while the number of pound coins trebled due to the introduction of the new 12-sided coin last year.