BANKING
UK finance sector in top 10 for carbon emissions
UK financial institutions are responsible for 1.8 times the carbon emissions of Britain's annual net total, according to a study commissioned by Greenpeace and the WWF. Major UK banks and asset managers were responsible for 805m tonnes of emissions in 2019, stemming from loans and investments in areas such as energy and industry, and from mortgages, making sector the ninth largest emitter in the world if it were a country. Greenpeace says the study shows that the financial sector should be considered "high carbon" along with the oil and gas industry, coal mining, aviation and transport. A spokesman for UK Finance said lenders are "playing a leading role in the shift to net zero finance". "Last month the UK's six largest banking groups were among the founding members of the UN's new Net Zero Banking Alliance, committing to net-zero emissions from their portfolios by 2050 or sooner," he added.
City police launched 50% more loan fraud investigations in February
City of London police commenced 50% more fraud probes in connection with the Government’s Bounce Back Loan scheme (BBLs) in February than the month before. Police opened 26 such probes in February, up from 17 in January, RPC said. It opened a further 28 in March. Back in October the National Audit Office (NAO) estimated that the taxpayer could lose up to £26bn on the BBL scheme, which sees small businesses given up to £50,000 in loans. More than 1.5m businesses took out a loan before the scheme closed on 31 March 2021. Due to increased risk of credit and fraud risk related to the scheme, it has been estimated that between 35 and 60% of lenders could default on the losses. Sam Tate, partner and head of white collar crime at RPC says: “The authorities will want to accelerate the pace of investigations. Otherwise there is a high risk these assets will leave the country.”
Bailey and HSBC negative on cryptos
Andrew Bailey, the Governor of the Bank of England, has repeated his scepticism of cryptocurrencies telling MPs on Monday that he considered them "dangerous". Meanwhile HSBC's chief executive Noel Quinn said the bank has no plans to launch a cryptocurrency trading desk citing Bitcoin's volatility. Quinn's comments follow similar criticism from Deutsche Bank last week and NatWest last month.
SoftBank invests $250m in Zeta
SoftBank Group Corp's Vision Fund 2 has invested $250m in banking technology start-up Zeta, valuing it at $1.45bn.
PRIVATE EQUITY
The infrastructure boom behind KKR’s bid for John Laing
The FT reports on KKR's bid for John Laing and how the move presages further private investment in infrastructure businesses as governments plan massive post-pandemic expenditure.
INTERNATIONAL
Why cyber risks are getting even more important for big banks
The FT reports on the heightened risk to banks from cyber attacks and the now prevailing view that if companies don’t strengthen their security appropriately they risk not only their reputations, but also their credit ratings.
Former Aviva CFO Stoddard joins BofA
Tom Stoddard, the CFO at Aviva between 2014 and 2019, has joined Bank of America as vice chairman of investment banking.
AUTOMOTIVE
Electric vehicle ‘ultra rapid’ charging points to triple at UK service stations
Britain’s energy market regulator, Ofgem, has approved a £300m two-year programme to install 1,800 new “ultra rapid” electric vehicle charging points at motorway service stations and on key trunk roads. A further 1,750 charging points will be installed in towns and cities.
AVIATION
UK suspends Belarusian carrier over “hijacking”
The UK’s Civil Aviation Authority (CAA) has been instructed to tell aircraft to avoid Belarusian airspace after a Ryanair flight was intercepted by a fighter jet and diverted to the country to arrest a journalist. Belarusian carrier Belavia’s operating license has also been suspended, the UK transport secretary Grant Shapps announced. Ryanair described the forced diversion as an “act of aviation piracy”.
Supersonic jet maker runs out of cash
Nevada-based supersonic jet maker Aerion has collapsed after running out of funds. The company had spent more than $1bn in development but without building any planes it will now cease operations.
CONSTRUCTION
MJ Gleeson optimistic
MJ Gleeson said on Monday that it expects full-year results to be better than expected after strong demand boosted selling prices.
FINANCIAL SERVICES
UK and US urged to lead the world in climate-related financial services regulation
A new report from the City of London Corporation calls on US and UK watchdogs to collaborate on the development of global standards in climate-related financial services regulation. City of London Corporation Policy Chair Catherine McGuinness said: “Financial regulation is a key part of the toolkit in fighting climate change, enabling financial firms to address climate challenges whilst maintaining safe and efficient global markets. The UK and US have a unique opportunity to lead the world in climate-related financial services regulation, pushing forward international discussions on data, disclosures and metrics with a view to gaining consensus on global standards."
New index seeks to peer inside Lloyd’s of London insurance market
Two former Lloyd’s of London researchers have created a proxy stock index allowing third-party investors in Lloyd’s to benchmark their performance against the specialist insurance market as a whole.
Goldman lobbyist joins crypto exchange Coinbase
Faryar Shirzad, co-head of government affairs at Goldman Sachs, has joined cryptocurrency exchange Coinbase as its new chief policy officer -a new role created by the company.
Venture capital firm sees crypto bet pay off
9Yards Capital, a venture capital firm which former chancellor of the exchequer George Osborne works as strategic adviser to, has made gains of 3,000% after betting on obscure cryptocur¬rency Internet Com¬puter, or ICP.
HEALTHCARE
UK's biggest care home operator hikes fees
Private equity-owned HC-One has hiked fees for residents in the pandemic while funnelling cash to its super-rich owners, critics have claimed. The care home operator has been accused of using loans and a complex web of offshore structures to “extract cash” and reduce its tax bill. Newly published accounts reveal the company, which has 8,000 residents in 170 care homes, increased fees to residents and councils by an inflation-busting 3.6%. The jump meant that the average resident was paying £40,196 per year by September 2020. At the same time, its founder, Dr Chai Patel, a Labour donor, extracted £2m in “management fees” during the year through his investment vehicle Court Cavendish, accounts reveal.
MEDIA & ENTERTAINMENT
Cineworld upbeat after return of film lovers
Cineworld chief executive Mooky Greidinger has said the firm is optimistic about a summer revival, with strong reopening weekend ticket sales and concession income.
REAL ESTATE
Higher mortgage rates for drafty homes
New Government climate change plans would see banks discouraged from lending to owners of draughty homes. Homes will be expected to achieve an energy performance certificate (EPC) rating of C or above from 2030, under plans to be set out within weeks by the Department of Business, Energy and Industrial Strategy (BEIS). To achieve this, the Government has outlined plans to require mortgage lenders to ensure they have higher EPC ratings across the average of their portfolio from 2025. Homes that failed to reach the top ratings could face more costly mortgages or lose part of the property value.
RETAIL
Ted Baker blames Covid disruption for results delay
Fashion chain Ted Baker has blamed pandemic-related disruption to audit work for the delay to the publication of its annual results. Ted Baker had expected to publish its results for the year to the end of January on May 27, but the date has been pushed back to June 10.
ECONOMY
Runaway inflation could derail recovery – Haldane
Bank of England chief economist Andy Haldane told MPs on the Treasury Select Committee on Monday that inflation could surge in coming months, forcing the Bank to hike interest rates or slash its money printing programme. Mr Haldane said: “It is hard to find very much, whether it is goods or assets, that is not going up right now.” He continued: “Of all the things we want to avoid right now, an upside surprise to inflation is amongst the greatest - that would come at the cost of us needing to tighten monetary policy more rapidly or on a significantly greater scale, or possibly both, in way which would take the legs out of the recovery we hope we’ll get.” Meanwhile, Bank of England policymaker Michael Saunders said yesterday that he expected the BoE would need to raise interest rates modestly over the next three years if the economy grew as strongly as forecast.
OTHER
Nearly half of Brits financially illiterate
Research has found that a significant number of Brits don’t understand key financial terms such as ‘overdraft’ (44%), ‘mortgage’ (46%) and ‘arrears’ (52%). The study also found that just a third of people claim to feel “very confident” when handling their finances. Almost half of young people wouldn’t say they were confident with their finances, and one in 10 claim to have no confidence at all in their own understanding of personal finance. Financial education could be the answer, the research suggests, with 84% of Brits believing that being taught about finances at school could help prevent financial issues in the future.
UK banks use tech to green their operations
New research by Censuswide reveals that nearly three quarters of all UK banks are embracing digital technology to make their business operations greener. Two in five banks are using intelligent automation and digitising all paper processes in a bid to be more sustainable and 39% are helping customers to be greener by encouraging less travel to the branch. Two in five UK banks reported cost savings and customer retention and growth through harnessing sustainability initiatives, Censuswide found.