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Daily News Roundup: Tuesday, 22nd May 2018

Posted: 22nd May 2018


Barclays' Qatari loan charges dismissed
The Crown Court has dismissed all charges against Barclays in relation to its capital raising in 2008. The Serious Fraud Office alleged Barclays gave Qatar Holding an illegal $3bn (£2.2bn) loan "for the purpose of directly or indirectly acquiring shares in Barclays". Under the Companies Act it is unlawful for banks to lend money to themselves.

Next year will see mobile phone banking become most popular method
Industry data specialists CACI say that 2019 will see mobile banking smartphone apps eclipse desktop banking as the most popular digital banking method, with Monzo announcing a waiting list of several thousand people as demand for its services surges.

TSB and analyst disagree on IT cost
TSB and analyst Ben Toms, of RBC Capital Markets, have disagreed about the cost of the lender’s recent IT problems. TSB estimated costs, not including any fine, at £30m, while Mr Toms’ estimates claim a £16m fine will be levied on top of £51m in compensation to its 5m customers.

Banks and tech groups urged to join forces to deal with IT risk
Banks, tech firms and regulators must collaborate to find new ways of categorising risks emanating from cloud, artificial intelligence and blockchain technology, according to finance and management consultants Parker Fitzgerald.

Banks seek tech talent for digital shift 
European banks have increased recruitment of technology specialists more than tenfold in the past three years as they are forced to compete with big technology groups in addition to traditional rivals in the financial services industry.

Brussels to unveil safe-asset initiative for crises
The European Commission wants to create a eurozone debt instrument - sovereign bond-backed securities (SBBS) – in the hope of making banks and governments safer in financial crises.

RBS mobile bank occupies ferry space
Barra residents have complained that a RBS mobile banking van is taking up valuable space on a ferry to and from the island, despite the island’s branch of the bank being given a reprieve until the end of 2018 in RBS' programme of branch closures.


Apax sells $1bn stake in Silicon Valley firm
British private equity firm Apax has sold a $1bn (£750m) stake in GlobalLogic, which provides a broad range of digital engineering services, to European rival Partners Group. 

Tax break warning by Blackstone
Investors have been warned by private equity group Blackstone that the firm faces an increasing risk of significantly higher tax bills in the US.


Currency fluctuations halve Aston Martin profits
The pound’s fluctuating value, caused by Brexit-related uncertainty, has hit first-quarter pre-tax profits at Aston Martin, which have fallen almost 50% to £2.8m.


Ryanair cautious amid soaring results
Ryanair's profit after tax rose 10% to €1.5bn (£1.3bn) for the year, with revenue rising 8% to €7.2bn, as the low-cost carrier's passenger numbers increased 9% to 130m. Its outlook for the year ahead is "on the pessimistic side of cautious", however, as unit costs appear set to rise due to higher staff and oil prices, expecting profits in the range of €1.25bn to €1.35bn.

Luton worst for delays
Departures from Luton Airport were an average of 20 minutes late in 2017, according to Civil Aviation Authority (CAA) data, which pegs Gatwick as the second-worst for punctuality performance, followed by Jersey and Durham Tees Valley. Heathrow enjoyed the best performance, with Leeds Bradford second, followed by Belfast City and London City.


IHS Markit buys Ipreo for nearly $2bn
Data provider Ipreo is to be bought by IHS Markit from Blackstone and Goldman Sachs for $1.86bn. IHS also announced that it would sell its derivatives business MarkitServ. Lance Uggla, chief executive of IHS Markit, noted that Ipreo is “a perfect strategic fit for us… It repositions our financial services segment in a faster growing market”.

LMAX to offer institutional crypto trading
LMAX Exchange Group is launching the first physical cryptocurrency exchange to serve institutional clients. The fintech firm, which is regulated by the Financial Conduct Authority, will offer trading in bitcoin, ethereum, litecoin, ripple and bitcoin cash.

‘Robo’ financial advice catches eye of UK regulator
The FCA has accused providers of automated investment advice of failing to give clear information about costs and charges and of not giving customers enough warning about risk. Seven platforms offering automated online discretionary investment management (Odim) were found to be lax on costs and risk assessment, while three platforms providing robo-advice were criticised for not putting an adequate focus on "know your client" rules.

Phasing-out of Libor forces requires contingency plan
The International Swaps and Derivatives Association is formulating an emergency contingency plan as firms prepare for the end of interest rate benchmark Libor.

Cryptoassets Taskforce gets going 
Britain's Cryptoassets Taskforce met for the first time yesterday. Members include Andrew Bailey, CEO of the FCA, and Katharine Braddick, director general of financial services at the Treasury. The Taskforce agreed its objectives, which include exploring the impact of cryptoassets, the potential benefits and challenges of the application of distributed ledger technology in financial services, and assessing what, if any, regulation is required in response.

Lower paid, but women fund managers outperform men
Female fund managers are still paid less than their male counterparts despite outperforming them, according to the HFRX Women index. Female managers have also outperformed male managers over three, five and ten years while hedge funds run by women grew nearly twice as fast as the industry average in the past year. Fiona Hathorn, managing director of Women on Boards UK, said: “All the data shows that diverse groups make better investment decisions but it is not clear that the fund management industry is listening.”

LEISURE AND HOSPITALITY                                                                                                                                              

Blackstone to buy LaSalle 
Private equity firm Blackstone Group is to buy LaSalle Hotel Properties in a $3.7bn cash deal, with rival Pebblebrook Hotel Trust having failed with a bid made up of 20% cash and the rest in stock. LaSalle Chairman Stuart Scott said the firm had been in touch with 20 potential buyers, signing confidentiality agreements with 10 of them, before accepting Blackstone's offer.

Hotel chain reveals port plan
Growth in the cruise market has prompted Travelodge to seek ten new hotel sites close to the UK’s busiest ports. The firm will invest around £60m in adding hotels in Edinburgh, Glasgow, Harwich, Hull, Liverpool, Newcastle, Poole, Portsmouth, Southampton and Tilbury.

Hawthorn may sell for £100m
New River Retail is reportedly in discussions to buy pub group Hawthorn Leisure for £100m from Hawthorn’s management and American private equity firm Avenue Capital.


Boost for Nokia mobile revival
HMD Global, which has attempted to revive the Nokia mobile phone brand, has raised $100m in a funding round.

Technology conference suggested
Daniel Ek of music streaming company Spotify, and music manager Ash Pournouri, have launched an event called Brilliant Minds which they hope could be a “creative Davos”.


Price index shows third consecutive monthly decline 
The latest Your Move index shows that average property prices in England and Wales were down 0.1% in March, the third consecutive month where a decline was recorded. The figures show that the annual rate of growth has fallen for 11 months in a row and currently stands at 1% - far lower than the 9% peak recorded in February 2016. On areas where prices have risen, Monmouthshire in Wales leads the way, with values up 11.3% in the year to the end of March. At the opposite end of the spectrum, values in the City of London are down 31.4%, with the average price dropping to £683,000 from £997,000. On increases seen in Wales, Oliver Blake, managing director of Your Move and Reeds Rains, notes that a number of buyers brought forward purchases of high value homes to avoid a new land transaction tax introduced in April. He added that the high price growth seen in Wales “is likely to prove short-lived.”

Investec backs billionaire's King's Cross plans
Asset management group Investec has made a £72m loan to the Labtech Group to fund a major mixed-use scheme in King’s Cross. The real estate development and investment business, owned by billionaire Teddy Sagi, is looking to develop on Camley Street, next to King’s Cross station.

Many investors no longer prize property
New Stamp Duty requirements, along with new regulations by the Prudential Regulation Authority affecting landlords, have led to many investors re-evaluating property, according to a new survey commissioned by Rathbone Investment Management, which suggests 38% now view it as a poor investment. Just 7% of high net worth investors that currently own buy-to-let properties plan to increase their portfolio.

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