Homeowners seek out interest-only mortgages to cut costs
Inquiries for interest-only mortgages have jumped by about 20% in the last six months, experts say, as borrowers look to reduce their bills by cutting out the repayment element of their monthly mortgage bill. Ben Merritt, of Yorkshire Building Society, said that interest-only mortgages accounted for 5.4% of all new mortgage applications over the last six months, compared to 3.6% in the previous six months. But brokers urge caution, warning that switching to interest only can make it harder to pay off the loan long-term. Separately, data from Moneyfacts show that the number of available buy-to-let deals has plunged by a third since June as lenders withdrew 1,100 deals in two month. In July alone, the number of available mortgages fell by 14%.
Newcastle and Manchester building societies in merger talks
Newcastle Building Society has revealed that it is in exclusive talks with Manchester Building Society over a potential merger. In a statement, the two lenders said they intend to “explore the possibility” of transferring Manchester's business to Newcastle, but discussions are at an early stage.
Patrick Boumalham named HSBC’s new global head of wealth sales
HSBC has appointed Patrick Boumalham as its new global head of wealth sales within its markets division. He replaces Antony Shaw, HSBC’s global head of wealth sales who was named the CEO of HSBC Australia two weeks ago.
SoftBank reports record $23bn loss
Japanese technology investment firm SoftBank reported a record quarterly loss of more than $23bn (£19bn) on Monday after a worldwide sell-off in technology shares. Masayoshi Son, CEO, said he was "embarrassed and remorseful" at the losses, adding that job cuts were planned. The investment giant also revealed that it sold its remaining stake in Uber, among other companies, over the last few months.
Carlyle’s chief executive resigns after breakdown in contract talks
Carlyle Group is replacing its chief executive Kewsong Lee, who will leave the New York and Washington-based private equity group just two years after he was appointed. Reasons for his departure were not disclosed. William Conway, a co-founder of Carlyle, will become its interim leader as it looks for a full-time replacement.
Berenberg to cut 5% of London staff
Berenberg is axing more than 5% of its employees in London, according to a note the German investment bank sent staff. The move is the first by a City investment bank to trim its headcount as the economic outlook darkens. David Mortlock, Berenberg's managing partner, said: "Clearly 2022 is a much more challenging environment. In terms of equity issuance, it's the quietest year since 2003 and one of the biggest [year-on-year] declines ever. In response, we have taken steps to ensure the cost base of our investment bank is appropriate."
Putin allows Russian banks to halt some FX operations
A decree signed by Vladimir Putin on Monday allows Russian banks that have their foreign currency funds frozen due to sanctions imposed by the West to suspend operations in such currencies with their corporate clients. The decree said the new measures could stay in place until sanctions that impaired transactions in foreign currencies were lifted.
Toyota unit Hino admits falsifying engine data for nearly 20 years
Hino Motors, a unit of Toyota Motor, conceded last week that it had been falsifying fuel performance reports going back as far as 2003, and on more models than previously admitted.
Hungary fines Ryanair for passing on tax to customers
The Hungarian government has fined Ryanair €760,000 for passing a windfall tax imposed on airlines and other companies on to customers. The country’s prime minister Viktor Orban announced the “special business tax” in May targeting companies such as banks, energy firms and others that he believed were making “extra profits”. The Irish carrier has been accused of passing on the levy, which puts a tax of €10 and €25 on passenger journeys, through rises in customer fares. Ryanair’s CEO Michael O’Leary promised to fight the fine in the courts.
Bristol-based Vertical Aerospace to test 200mph flying taxi
Bristol-based flying taxi company Vertical Aerospace has built a functioning prototype of its four-engined VX4 aircraft and will put it through an intensive, multi-month flight test programme. Last month the company signed a deal with the defence contractor Babcock to develop an ambulance version of the vehicle to sell to emergency services and the military.
Tory think tank calls for financial services regulators to be merged
A new report from the centre-right Policy Exchange suggests merging the UK’s several financial services regulators into one body post-Brexit to make it easier for companies to innovate and grow. The think tank also said creating a single regulator would “enable greater accountability for regulatory performance” and lead to more talented people being put in charge of regulating the sector. A source from the FCA dismissed the call adding: “There are things we’ve recently done to show we’re agile and listening to concerns, like implementing changes to the listings regime at pace.” Meanwhile, a Treasury spokesperson said the current contingent of financial services watchdogs was “the most effective way of ensuring clear and robust regulatory focus on macroprudential, microprudential, economic, and conduct risks”.
SEC proposes new rules for clearing houses
The U.S. Securities and Exchange Commission (SEC) has proposed new rules aimed at preventing conflicts of interest in management and governance of clearing houses. The SEC said on Monday that registered clearing houses would be required to disclose more details on board composition, independent directors, and nominating and risk management committees. "I think these rules would help to build more transparent and reliable clearing houses, SEC Chair Gary Gensler said in a statement. "This in turn would help ensure our markets are more resilient, protecting investors and building trust in our markets."
Lord Hammond enlisted by new £1bn UK fintech fund
A new £1bn fund aimed at accelerating the expansion British fintech, provisionally named the Fintech Growth Fund, has tapped former chancellor Lord Hammond to join its advisory board. Sources told Sky News the fund would seek to raise capital from institutional investors and be independent of the government.
Shareholders oust chair of Trian UK investment firm
Shareholders of UK investment trust Trian Investors 1 Ltd have voted to remove chairman Chris Sherwell over issues including recent changes to the trust's strategy, proposals to turn the trust into a special purpose acquisition company, and about its share price performance.
Pfizer buys sickle cell treatment maker for $5.4bn
Pfizer has bought Global Blood Therapeutics (GBT), the maker of Oxbryta, a treatment for sickle cell disease, in a $5.4bn all-cash deal. Oxbryta generated about $195m in net sales for GBT in 2021. Pfizer believes it and similar drugs in the company’s pipeline could achieve combined worldwide sales of more than $3bn.
Arm posts record revenues
Cambridge-based computer chip maker Arm reported record revenues of £594m for the three months to the end of June, up 6% year-on-year. The figure was boosted by royalties which rose 22% to £374m, the first time the total has surpassed £330m.
MEDIA & ENTERTAINMENT
Cox Enterprises buys Axios in $525m deal
The digital news publisher Axios has been sold for $525m to Cox Enterprises, the holding company for one of America’s wealthiest families. Under the deal Axios will receive $25m to expand its national and local subscription services.
Job fears cast cloud over Page Group
Shares in recruitment firms have fallen as concerns about an impending recession start to hit employers’ hiring intentions. Revenue jumped by more than a quarter to £977.3m while profit soared by 79.8% to £114.5m from £63.7m the year before. However, shares were down 7.2%, or 32.6p, to 419p. Page Group’s results, although positive, revealed “a slight slowing” in some of its markets in July. Shares in Robert Walters and Hays also declined, with the former shedding 1.5%, or 8p, to 510p and the latter sliding 4.9%, or 6.2p, to 120.8p.
July sales bump could be 'lull before storm'
Figures from the British Retail Consortium (BRC) revealed sales rose 2.3% in July, compared with a 6.4% rise the year before. The report said sales growth was largely down to inflation which masked a much larger drop in the number of items sold. Helen Dickinson, the BRC chief executive, said: "Consumer confidence remains weak, and the rise in interest rates coupled with talk of recession will do little to improve the situation. Meanwhile, Barclaycard said spending on essential items was up 7% in July compared with a year before, up from the 4% rise recorded in June, driven by fuel and supermarket shopping.
Boris Johnson rejects calls for emergency measures on cost of living crisis
Boris Johnson has no plans to introduce tax and spending measures before he leaves office to ease the cost-of-living crisis, Downing Street has said. Mr Johnson's spokesman argued it would be up to his successor to make any decisions on further help. The statement comes after the CBI joined calls by Gordon Brown, former Labour prime minister, for Johnson to start work now on a package to help vulnerable households. Tony Danker, the CBI director general, said: “The economic situation people and businesses are facing requires all hands to the pump this summer. We simply cannot afford a summer of government inactivity while the leadership contest plays out followed by a slow start from a new prime minister and cabinet.”