BANKING
HSBC to remove references to gender in some products
HSBC UK has begun removing references to gender in some products as the bank pursues more inclusive services for non-binary and trans people. “The concept of gender is evolving at a societal level, and we’re looking at how it’s relevant for our sector,” Jimmy Higgins, co-chair of HSBC’s UK Pride Employee Network, said in emailed comments. “There is no reason we should be capturing information for a bank account or a loan if it’s not relevant.” Bloomberg notes that Bank of Montreal in recent months began offering bank cards aimed at non-binary people, following a similar move by Citigroup. Matt Cameron, founder and global managing director of LGBT Great, an organization that works with firms including Citigroup and BlackRock, says increasing numbers of young people are identifying as LGBT+. “Organizations that are bold on LGBT+ inclusion will be those that build more trust, attract broader talent and appeal to a broader customer base.”
BBB's bounce back loan report ‘inconclusive’
A delayed publication on lender performance, which is anticipated to provide only "limited and inconclusive data," has brought the British Business Bank (BBB), which managed the Government's bounce back credit programme, further criticism. According to reports, the state-owned BBB is preparing a protracted lender-by-lender performance report on the £47bn scheme but has warned the data “should not be regarded as definitive nor conclusive as to the performance of the schemes”. A response to a Freedom of Information (FOI) request by The Times revealed that the bank has agreed with undisclosed participating lenders that the public must be warned not to make “incorrect comparisons/conclusions” by comparing performance. A spokesperson for the state bank told the paper: “Given the size of the schemes, the numbers of loans, and the speed at which they were offered and drawn down, data collection remains fluid and subject to refining and correction.”
Shoppers stick with cash to keep tabs on costs
Millions of consumers are using cash to help them budget during the cost of living crisis. Research by ATM network Link estimates that 15m people reject cards payments as a way to save money, but they’ve found it harder to use money in shops and restaurants since the pandemic. Access to cash has also been restricted following years of bank branch and free-to-use cash machine closures. The Telegraph notes that the Financial Conduct Authority was last month granted powers to ensure communities were not left without ATMs, bank branches or a Post Office from where to withdraw or deposit cash. The changes are part of the Financial Services and Markets Bill.
Barclays to pay £540m for securities blunder
Barclays said on Monday that it would repurchase about $17.6bn of structured notes and exchange-traded notes that it sold by mistake. In March, Barclays said it had exceeded a limit set in August 2019 by about $15.2bn, but this has been revised up. The lender took a $652m (£540m) provision to account for the blunder in its first-quarter results.
TSB to dish out £1,000 cost-of-living bonus to 4,500 staff
As inflation soars towards 10%, TSB is handing 4,500 workers a £1,000 bonus to help them cope with the cost of living crisis. The cash will be given to all workers at TSB earning £35,000 or less - regardless of whether they work full or part time. TSB follows in the steps of Lloyds and Barclays, who have made similar payments to employees.
PRIVATE EQUITY
Private equity firm CVC sells TMF Group stake to its own fund
CVC Capital Partners is selling a stake in business services company TMF Group from a fund it raised in 2017 to its “strategic opportunities” vehicle, which can hold companies for longer.
BC Partners nears deal to buy 50% of Fedrigoni
BC Partners is close to buying 50% of Italian paper manufacturer Fedrigoni from Bain Capital. The deal values the company at $3.1bn.
INTERNATIONAL
Morgan Stanley's institutional equities head to retire
David Russell, the global co-head of institutional equities at Morgan Stanley, is to retire after 32 years with the investment bank. Following his departure at the end of the year, Alan Thomas and Gokul Laroia will continue as global co-heads of the unit.
Deutsche Bank's investment banking coverage chief to step down
Deutsche Bank's global investment banking coverage and advisory chief, Drew Goldman, is to leave the bank after 22 years at the German lender. He will be replaced by regional heads, according to a memo.
UniCredit Italy private banking head exits
Stefano Vecchi, the head of the UniCredit’s Italian private banking and wealth management unit, is leaving as CEO Andrea Orcel continues his overhaul of the bank leadership structure.
AVIATION
BA pilots prepare to launch strike action
British Airways pilots are threatening industrial action after airline chiefs rejected demands for a new pay deal. The pilots' union Balpa is preparing for a ballot after check-in and baggage staff won pay increases. A union source said: "'BA seems to ignore you until you issue a ballot,’ is the sentiment among members. Within Balpa we don’t usually like to do that. We would rather take a grown-up approach. But we are under enormous pressure. And the longer this goes on, the harder it gets.”
Ryanair warns days of cheap fares are coming to an end
Dublin-based airline Ryanair posted profit before exceptional items of €170m in the three months to June. This is up from a loss of €273m in the same period last year and well above the consensus market forecast of €157m. However, Ryanair said the recovery was fragile due to the ongoing war in Ukraine and continued threat of COVID-19.
FINANCIAL SERVICES
BNPL use soars, as do missed payments
A study by Credit Karma reveals over 14m Britons used a buy now, pay later provider this year, with £5.6bn spent by the middle of last month. Last year it took shoppers until October to spend the same amount. Additionally, 41% of customers have missed at least one repayment this year, up from 11% last year. The research also found that many people were now using buy now, pay later instead of overdrafts. Regular overdraft use had dropped from 37% to 29% of consumers. Ziad El Baba, of Credit Karma, said: “Until buy now, pay later is fully regulated and incorporated into all credit reporting, consumers should be aware they won't be recognised as credit-responsible for using these methods of borrowing, as they are for using overdrafts and credit cards. Our research has also shown that consumers can sometimes lose track of what they owe or miss payments.” The Financial Conduct Authority is to start regulating providers next year.
Lloyd's of London progresses towards diversity target
A quarter of firms operating at Lloyd's of London have reached a target for 35% of leaders to be women. Eighteen firms, or 26% of those surveyed, met or exceeded the target for 35% of boards, executive committees and those committees' direct reports to be women, Lloyd's said. It added that women currently filled 30% of leadership positions. Ethnic minority representation rose by one percentage point to 9% and the average gender pay gap across Lloyd's market firms remains high, at 37%. "Representation of women and ethnic minorities (is) improving across our market - but we can't be complacent," Lloyd's of London CEO John Neal said. "We need to keep that momentum going, and address any areas of weakness, to maintain Lloyd's unique ability to attract, connect and grow the best talent in our industry."
Julius Baer profit plunges in ‘worst’ market in decades
Swiss wealth manager Julius Baer has reported a 26% fall in net income to SFr450m ($468m) for the first-half, missing estimates, while assets under management also declined by SFr54bn to SFr428bn. “This decrease was driven by the significant corrections in global equity and bond markets,” chief executive Philipp Rickenbacher said.
Platform boosts investors’ participation in shareholder votes
The FT reports on how the Interactive Investor platform has boosted the number of retail investors voting on shareholder resolutions after the company automatically opted all of its customers into a voting and information service.
London’s financial markets need more reform to beat rivals, adviser says
Recommendations made in a review of London’s capital markets by Freshfields lawyer Mark Austin have been backed by the Treasury, but Austin warns that complacency will allow rivals to get ahead.
LEISURE & HOSPITALITY
Lastminute.com executives arrested over alleged Covid fraud
Five former and current executives at travel booking site Lastminute.com have been arrested in Switzerland over accusations of misusing public Covid recovery funds. The company told investors that police were looking into “a possible situation of abuse in connection with claims and withdrawals of COVID-19 related short-time work allowances” by its three Swiss subsidiaries.
MANUFACTURING
UK chemicals sector hit by £2bn Brexit red tape bill
A government impact assessment of the UK chemicals sector estimates that the costs of registering chemicals on a new UK database at £2bn - twice the cost of initial industry estimates.
MEDIA & ENTERTAINMENT
Vodafone posts increase in revenue
Vodafone posted a 2.5% increase in group service revenue to €9.5bn in its first quarter, an acceleration on the 2% growth in its fourth quarter last year. A rise in prices in Britain offset a decline in Germany where new regulations have brought an end to automatic contract renewals.
REAL ESTATE
London office sector faces major ‘reset’ as sales drop sharply
Research by BNP Paribas indicates that rising interest rates and fears of a recession are sending the value of London offices down sharply, with the bank’s Etienne Prongué predicting a total reset of the market.
RETAIL
Walmart issues profit warning as soaring inflation hits customers
Walmart has issued its second profit warning in just over two months as consumers cut spending. The US supermarket giant warned its operating income would fall by 13-14% in the quarter and by 11-13% over the full year. Shares were down 9% in trading, dragging down rivals including Target and Amazon.
ECONOMY
Households cut back as disposable income shrinks
The average household was £175.80 worse off in June this year than they were in the same month in 2021, according to the Centre for Economics and Business Research. June’s fall in disposable income marks the eighth consecutive month of decline and leaves the average household with £200 left to spend after taxes and essential bills – the lowest level in five years. A separate report by Nationwide found spending fell by an average of 4% in June, driven by a 6% decline in spending on non-essentials and a 3% fall in essential spending. Mark Nalder, head of payments at Nationwide, said: “Following a peak in spending during May, our data suggests households have started to cut back across the board.” He added: “As we head into the holiday season, we expect budgeting to continue being a feature as the nation prepares for even higher costs with inflation continuing to climb and the energy price cap rising again this autumn.”