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Daily News Roundup: Tuesday, 2nd October 2018

Posted: 2nd October 2018


Tesco Bank fined £16.4m over 2016 cyber attack

The Financial Conduct Authority has fined Tesco Bank £16.4m over the 2016 cyberattack which resulted in over £2m being stolen from 34 accounts. The regulator noted that the attackers exploited the design of Tesco Bank’s debit card, as well as its financial crime controls and its financial crime operations team, to carry out the hack. Gerry Mallon, Tesco Bank’s chief executive, said: “Our priority is always the safety and security of our customers’ accounts and we fully accept the FCA’s notice. I apologise to our customers for the inconvenience caused in 2016.”

Banco Santander warns over Brexit uncertainty

Banco Santander has warned that continuing Brexit uncertainty over financial services provisions is likely to significantly impact the bank's operations. In a filing to the US Securities and Exchange Commission, the Spanish lender said: “the lack of clarity of the impact of the UK EU referendum on foreign nationals’ long-term residency permissions in the UK may make it challenging for our subsidiaries in the UK to retain and recruit adequate staff, which may adversely impact our business.”

Moody's applauds British banks' resilience

Moody’s Investor Service has said Britain’s banks have grown more “resilient” to shocks despite the increase likelihood of a no-deal Brexit. While the broader financial services sector is preparing for the worst, the credit ratings agency said: “The banks’ strong capital, improving profitability and robust liquidity will offset deteriorating operating conditions and asset quality”. Moody’s also warned that the next eurozone recession could be even worse than the last as governments and central banks have run out of ammunition to fight a new crisis.

Estlin issues war cry for UK banks and financial services

Senior Barclays adviser Peter Estlin, newly-elected as ambassador for UK-based financial and professional services as the 691st Lord Mayor of the City of London, has urged UK and EU authorities to "urgently tackle" issues including contract continuity - which could hit cross border insurance and pensions. Calling on the City to rise to Brexit challenges and take advantage of new technologies and innovations, he added: “Implementing a transition agreement and delivering a deal on the future UK-EU relationship which adequately covers the sector are also major priorities”.

Barclays hires new director

Barclays has hired Laura Klaassen as a director in its corporate broking division. She was previously director UK ECM at Goldman Sachs where she spent 11 years working in New York and London.


Standard Chartered faces possible Iran sanctions

Standard Chartered is facing a possible $1.5bn penalty from the US Department of Justice for violating sanctions on Iran. The bank said in July that it was cooperating with a US investigation focused on “the extent to which conduct and control failures permitted clients with Iranian interests to conduct transactions through Standard Chartered Bank after 2007 and the extent to which any such failures were shared with relevant US authorities in 2012”. According to reports, the new penalty relates to whether the bank let Iranian-linked entities move money through a Dubai unit.

Danske Bank positions interim boss

Danske Bank has appointed its head of Danish banking Jesper Nielsen as interim chief executive, after former boss Thomas Borgen left following news of its €200bn money laundering scandal.

Policymakers share blame for the shadow banking boom

Patrick Jenkins writes in the FT that central banks should take some of the blame for the growth in so-called “shadow banking”.


Aston Martin narrows IPO price range

Aston Martin has narrowed the price range for its IPO on Wednesday. The car maker is now set to float shares at between 1,850p and 2,000p per share, from its previous range of 1,750p to 2,250p.


Budget airline collapses

Primera Air which began to offer long-haul flights from UK airports to the US earlier this year has collapsed. The carrier said it was ceasing all operations at midnight after 14 years of operating. The airline said it had failed to secure long-term financing, meaning it had "no choice" but to file for bankruptcy.

Turbulence leaves Ryanair hanging

Ryanair has warned that full-year profits will be 12% lower than the €1.25bn to €1.35bn (£1.1bn to £1.2bn) previously forecast, due to the "lower fare, higher oil and higher cost environment.”


UK housebuilders fall on proposed foreign buyers tax

Berkeley, Barratt and Taylor Wimpey were among UK housebuilders hit hard on the stock exchange yesterday, after the government announced plans to tax foreign buyers of UK property.


Advent to acquire Zentiva

Private equity firm Advent International, which has €35bn of assets under management globally, has acquired European pharmaceutical company Zentiva for £1.69bn. Separately, Pfizer's chief operating officer Albert Bourla is to take over as the pharma giant's chief executive when Ian Read steps down after almost eight years.


Hard Rock Café turning it up

The Hard Rock Café chain generated revenues of £23.4m in 2017, up from £21.8m a year earlier, with pre-tax profits rocking up to £3.8m from £3.5m.


UK manufacturers signal brightening outlook in September

UK manufacturers are on the up, according to IHS Markit’s latest monthly purchasing managers' index, which rose to 53.8 in September, on expanding output and a rise in orders.


Mortgage approvals hit seven-month high

The latest Bank of England data indicates that mortgage approvals climbed to 66,440 in August, their highest level since January. Approvals were down 0.4% year-on-year from August 2017, however, and are 18% below their long-term (1993-2018) average of 81,137. Remortgaging remained strong, with just over 53,000 remortgages approved in the month, up from 47,600 over the previous six months. The figures also showed that the net change in the value of mortgages in August slowed to £2.9bn, the weakest in more than two years.


Aldi’s UK sales top £10bn as expansion continues

Discount supermarket Aldi has revealed significant expansion plans after sales in the UK and Ireland rose 16.4% to £10.2bn in 2017, with operating profit up almost 30% to £265m.


Growth in consumer credit weakens

Latest figures from the Bank of England have showed that the recent hike in interest rates has led to increased caution in household borrowing, with annual growth in consumer credit weakening to its lowest levels in three years. The BoE said borrowing from sources such as credit cards, personal loans and overdrafts increased by 8.1% annually in August, down from 8.5% growth in July.


Paris opens English schools to lure finance workers

The Times profiles how Paris is opening schools in the city where children are being taught in English as part of a determination to lure financial workers from London after Brexit. The Lucie-Aubrac international school, which opened last month, is preparing for an influx of pupils as executives cross the Channel after Britain leaves the EU.

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