Credit card lending on the rise
Credit card lending increased by 11% in June, according to new data from the Bank of England, its joint fastest rate since April 2017. The 12-month rate of growth in non-credit card consumer lending held steady at 8.5% in June, its joint lowest since May 2015. Total borrowing now stands at £72bn, up from £65bn two years ago. The BoE said credit cards have been accounting for an increasing share of consumer credit growth over the past couple of years, with the growth rate of credit card lending exceeding that of other loans and advances such as overdrafts and car finance. Debt charities said that the borrowing figures showed “the needle is in the red” and warned that even a small rise in interest rates could push some families over the edge.
CYBG warns on mortgage growth
CYBG has warned that full-year mortgage growth will be at the lower end of its guidance range amid an increasingly competitive environment. The group reported mortgage growth of 3.8% to £24.2bn in the year to date. Meanwhile, growth in its core small and medium-sized business division has grown 4.7% so far this year, with £420m of gross loans and facilities written in the third quarter. CYBG also noted that complaints over the mis-selling of payment protection insurance (PPI) “remain elevated”, while CYBG’s proposed takeover of Virgin Money could be completed in the fourth quarter of 2018, pending regulatory approval.
Mortgage approvals booming
British lenders approved 65,619 mortgages in June, up 1.5% from 64,684 in May, according to data from the Bank of England, a five-month high. Remortgage approvals fell from 51,669 to 47,895, while approvals for house purchases were down 0.2% year-on-year. Despite the drop-off, the BoE said “remortgaging approvals remain broadly in line with the average over 2018 so far”.
HSBC launches MyDeal
HSBC has rolled out its MyDeal app to new clients. The app aims to simplify the experience of investor roadshows with real-time updates on logistics and transactions. Since MyDeal was first launched internally for trialling in November last year, HSBC bankers have tested the app with more than 30 deals valued at over $25bn (£19bn), across investment grade and high-yield bonds, and equity deals.
Banks building blockchain-based app store
A brace of financial institutions, including Barclays and Citigroup, have already signed up to IBM and forex settlement service CLS' new blockchain-based platform for testing new applications. LedgerConnect will offer applications provided by different vendors, like Calypso, MPhasis, Openrisk and Synswap, for services such as customer compliance checks, sanctions screening and smart contracts, easing the way for firms to trial blockchain-based software.
Standard Chartered acts over compliance
Standard Chartered has appointed Tracey McDermott as head of financial compliance. Her promotion comes after the departure of Neil Barry, who left after an internal investigation found he acted inappropriately towards staff. Ms McDermott previously was acting CEO of the Financial Conduct Authority and has been group head of corporate affairs and brand marketing at Standard Chartered.
MPs attack Lloyds over HBOS fraud
A group of MPs have written to the Financial Conduct Authority to accuse Lloyds Bank of “victim blaming” and “unfairness” in how it offered redress to victims of fraud at its HBOS Reading division.
Carlyle raises largest fund aimed at North American deals
Carlyle has raised $18.5bn to invest primarily in the US across five industries, including aerospace, consumer and retail, healthcare, industrial and transportation, and technology, media and telecoms.
SocGen to sell Belgian unit
Société Générale has agreed to sell its private banking unit in Belgium to ABN Amro as part of its strategy to dispose of operations that lack critical size and potential for synergies with the group.
Schroders offloads Eastern European private banking operations
Schroders has said it will transfer its Eastern European private banking activities to CBH Compagnie Bancaire Helvetique SA for an undisclosed sum. The deal between Schroders' Swiss wealth management arm and Geneva-based CBH is expected to close in the fourth quarter of 2018.
Bank of Ireland profits rise
Bank of Ireland has reported pre-tax profits of €454m (£404m) for the first six months of the year as the lender continued a wide-ranging cost-cutting programme.
HSBC names India CEO
HSBC has appointed Surendra Rosha, currently head of the bank’s financial institutional group for Asia-Pacific, as its new CEO of India, subject to regulatory approvals.
Carmakers need a Brexit deal
The Society of Motor Manufacturers Traders (SMMT) has said that UK carmakers are not ready for Brexit. The SMMT warned that output of vehicles for the UK market crashed by 47% in June, compared with a 6% rise in export. Mike Hawes, chief executive of the SMMT, said the figures showed the importance of striking a deal with the EU, the destination for 53% of UK car exports. He also warned that a lack of clarity on Brexit had left the industry struggling to prepare for Brexit.
Uber hits brakes on self-driving truck programme
Uber has suspended its self-driving trucks programme as it looks to overhaul its autonomous technology following a fatal crash involving one of its test cars.
Ryanair threatened by fresh strikes
Ryanair’s pilots in Germany have voted overwhelmingly in favour of striking in a row over pay and conditions. The Vereinigung Cockpit pilot union said 96% were in favour of striking. It has given Ryanair until August 6th to make an offer to avoid a strike, which must be announced 24 hours in advance.
Ibstock issues profit warning
British brick maker Ibstock has issued a profit warning after warning that production would be lower after the refurbishment of one of its factories. The company now expects earnings to be between £121m and £125m instead of £130m and £134m because of the shortfall and extra spending. Shares in Ibstock were down by 11.9% to 245p.
UK warns Brussels over financial services
British officials have warned Brussels that thousands of European investment funds will be under threat if the EU refuses to bow to demands for a comprehensive trade deal with the City of London after Brexit. According to a section of a UK presentation made to the European commission’s negotiators last week, unless Brussels allows all UK sectors of the City to continue to operate after Brexit as they do now, then obstacles to European financial interests operating in the UK could also be put in place, at least initially. The presentation also warned that without fresh thinking both sides would raise damaging barriers to trade. The Times notes that European companies are bracing themselves for the worst. Nicolas Mackel, the chief executive of Luxembourg for Finance, commented: “If the EU does not allow UK funds to be sold to Europe, the UK is perfectly entitled not to allow EU funds to be sold into the UK.” Meanwhile, British negotiators have conceded that Brussels will have ultimate control over the City’s access to European markets. As a result Michel Barnier has softened his stance to the UK’s Brexit financial services plan.
Half-year premiums soar at Hiscox
Insurer Hiscox, which has a large Lloyd’s of London business, has reported gross written premiums up to $2.3bn (£1.8bn) from $1.8bn due to rising prices. Pre-tax profits came in at $163.6m, up from $129.1m, and the firm is on track to welcome over 1m retail customers this year. Hiscox International saw premiums rise past the $500m mark.
LEISURE AND HOSPITALITY
GVC confirms US partnership
GVC, which owns Ladbrokes, Coral and Sportingbet, is partnering with hotel and casino operator MGM Resorts for a US joint venture after the country's Supreme Court paved the way to legalise sports betting, with each investing an initial $100m (£76m).
Babcock moves to reassure investors
Babcock has moved to reassure investors over its performance after the Ministry of Defence refused to accept the company’s changes to split existing military vehicle contracts. In a statement Babcock said: “There has been no change to the company’s expectations for underlying revenue and underlying earnings as detailed in [our] recent trading statement, and no change to the bid pipeline.”
MEDIA AND ENTERTAINMENT
Publisher plummets to heavy loss
Reach, the owner of the Mirror and Express newspapers, has fallen to a £113m half-year loss after cutting the value of its regional publishing operations. Adjusted pre-tax profit for the UK’s biggest news publisher rose £3.4m to £64.7m. Group revenue rose by 10.6% to £353.8m reflecting the acquisition of the Express and Star, but fell by 7.2% on a like-for-like basis.
The Hut Group secures $1bn warchest
The Hut Group has secured a $1bn banking facility to enable greater expansion. Chief executive Matthew Moulding said the investment gave The Hut Group “significant firepower” to grow: “We are uniquely well-placed to become the global digital leader across such an exciting sector,” he added.