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Daily News Roundup: Tuesday, 30th April 2019

Posted: 30th April 2019


Metro investors urged to oust Hill

Glass Lewis has recommended that shareholders vote against Metro Bank founder Vernon Hill's re-election as chairman at next month's annual meeting. The advisory group said numerous board members had been in their roles since the bank's inception, which "creates the risk of group-think" and potentially blocks non-executives from challenging senior management. Some investors had already called for Mr Hill to go following revelations about a major accounting blunder at the bank. Glass Lewis also accused Metro of undermining basic pay principles by awarding its new CFO David Arden tens of thousands of pounds in bonus payments for a period before he joined the bank.

Fintech will unlock funding, Carney predicts

Mark Carney has predicted that artificial intelligence will make it easier for small firms to access credit. The Bank of England governor told the Innovate Finance global summit that digital innovations in financial services will improve bank supervision and create better services for consumers and businesses, helping to deliver “more sustainable and inclusive growth”. Mr Carney’s comments coincide with new research which suggests lending to SMEs has stagnated in recent years. According to Oxford Economics, lending by banks to small businesses has fallen by 3% since 2015, while credit provision to large companies has increased by 43%. The research found that small business lending accounted on average for 2% of big banks' balance sheets.

Banks hit by technical difficulties

Halifax, Lloyds Bank, NatWest and Royal Bank of Scotland were all affected by online and mobile banking issues yesterday, with some customers unable to access their accounts. Website tracker Down Detector reported 1,272 complaints related to Halifax, 667 problems with Lloyds, 280 issues with NatWest and 81 reports at RBS on Monday morning at about the same time. The issues were successfully resolved quickly and the banks apologised to those affected.

Challenger banks ranked

Monzo and Atom Bank were the only banks to receive more praise than complaints in data firm Brands Eye's analysis of around 120,000 tweets about challenger banks. Tesco Bank and Metro Bank, which had the second worst sentiment score after it reported a loans blunder and two regulatory investigations, are the worst challenger banks in the eyes of consumers, but N26 and Revolut also performed poorly.


Buyout group Inflexion raises £1bn as weak pound boosts UK’s appeal

Inflexion, the private equity owner of Mountain Warehouse, has raised £1bn in two funds - largely from US investors finding the UK more attractive following the Brexit-related fall in sterling.


Goldman forecasts gloomy outlook for Deutsche

Goldman Sachs has told clients that that Deutsche Bank's longer-term outlook has “worsened” after the German bank abandoned merger talks with rival Commerzbank. Analysts at Goldman said that while it might be tempting to think "avoiding a complex, costly and disruptive merger" was a good idea, there were no better alternatives.

Brussels to pursue Danske probe

The European Commission says it will continue to investigate Danske Bank's €200bn money laundering scandal after the European Banking Authority rejected its own draft report into the bank. Valdis Dombrovskis, the vice president of the Commission and head of financial regulation, has also called on the EU to overhaul the way it investigates money-laundering cases.

Writedowns and currency woes cut BBVA profits 10%

BBVA has reported a 9.8% drop in profits in the first quarter. The Spanish bank reported profits of €1.16bn in Q1, down from €1.29bn a year ago.


Car manufacturing falls in March

Car manufacturing in Britain fell by more than 14% in March, according to the figures from the Society of Motor Manufacturers and Traders. The number of cars made fell to 126,195 last month, down from 147,505 in the same month last year.

AA finance chief steps down

The AA’s finance chief, Martin Clarke, has resigned “with immediate effect”. Mr Clarke’s number two, finance director Mark Strickland, will handle his executive responsibilities in the meantime but will not join the board.


Visa and Mastercard agree to cut foreign card fees

Mastercard and Visa have both agreed to cut their fees for tourists using their cards in the EU, after a long-running battle with the European Commission. The credit card firms will now charge retailers around 40% less on non-EU credit and debit cards payments. The European Commission said the deal would lead to "lower prices for European retailers to do business".

Allianz close to L&G deal

German insurer Allianz is in advanced talks to buy Legal & General’s (L&G) general insurance arm. The deal could value the division, which provides home and pet insurance, at up to £350m. Allianz is understood to have beaten off competition from other insurers, including Direct Line Group, to emerge as the frontrunner for the L&G operation.

NSF issues Provident deal deadline

Non-Standard Finance has given Provident Financial shareholders until May 15 to back its offer to take over the doorstep lender. NSF, led by former Provident boss John van Kuffeler, already has the approval of investors holding more than 50% of the stock.

FCA steps up dawn raids

The number of dawn raids carried out by the Financial Conduct Authority has risen to its highest level since the banking crisis. Investigators launched 25 raids in 2018, compared with 13 the previous year. The rise is thought to be linked to the FCA's crackdown on unregulated investments, according to finance consultancy Fscom.

Sanlam UK acquires Thesis

Sanlam UK has acquired asset manager Thesis - adding £1.2bn to its assets under management (AUM) and taking its UK private client discretionary assets under management to £4.2bn.

Sales soar at Scottish Friendly

Scottish Friendly has achieved its second highest annual sales total in its 157-year history. Total sales for Scotland's largest financial mutual came in at £38.6m during 2018, according to annual premium equivalent.


Fewer Britons choosing EU countries for holidays

Fewer British holidaymakers have booked a summer holiday inside the European Union this year amid continuing Brexit uncertainty, according to Thomas Cook. The travel firm says almost half (48%) of the holidays it sold up until the end of February were to non-EU destinations, up 10% on last year.

Hostelworld booking growth slows

Hostelworld has reported slowing bookings growth as it implements a plan to return to profit. The travel booking site said overall group bookings were flat due to the managed decline on the group’s supporting brands, while operating profit fell from €11.9m in 2017 to €6.7m.


Alphabet misses sales forecasts

Google's parent company, Alphabet, saw its shares drop in after-hours trading after the internet giant missed revenue forecasts. Alphabet reported $36.3bn (£28bn) in sales for the first quarter, below expectations of $37.33bn. Profits also fell during Q1, to $6.7bn compared with $9.4bn a year ago.

Spotify reaches 100m premium subscribers

Spotify has reached the milestone of 100m premium subscribers in the first quarter of 2019. It follows the streaming giant’s entry into the Indian market in February, where more than 1m users signed up within the first week.


Estate agents see supply and demand drop

The supply of new properties on the UK market has hit a record low. The typical estate agency branch had 37 properties available for sale during March, according to data published by the National Association of Estate Agents – the lowest figure ever recorded for the month.

Hedge fund agrees record UK rent

Hedge fund boss Ravi Mehta has broken the record for the UK’s highest office rent after agreeing to pay £250 a square foot for a new London base. The 37-year-old founder of Steadview Capital Management has signed a deal to move his company into 30 Berkeley Square in Mayfair.


UK top in Europe for foreign investment

Figures from the Organisation for Economic Cooperation and Development (OECD) show the UK remains the top destination in Europe for foreign investment despite a fall in new funds coming into the country. New investment fell from $100bn to $64bn, but the UK still had a £1,400bn stock of funds - more than Germany, Spain and Poland combined and only surpassed by the US and China.

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