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Daily News Roundup: Wednesday 10th April 2019

Posted: 10th April 2019


Barclays unveils restructuring plan

Barclays has revealed it plans to carry out a restructuring plan that will cut 54 roles and impact at least 400 more across the UK. The majority of cuts will affect the West Midlands - with staff in Coventry Westwood Park and Birmingham Snowhill the most likely to be affected. Barclays said by making the changes, it hopes to amalgamate teams who may have been disparate in the past. The bank added that the merger will allow for better in-bank career paths with greater opportunities to move internally. The Unite union said that the job losses are “extremely alarming” and will be “a huge blow for the workforce”.

Standard Chartered fined for breaching Iran sanctions

Standard Chartered is set to pay $1.1bn (£843m) for violating US sanctions against Iran and over inadequate financial crime controls. The penalties, imposed in connection with a range of different investigations in the US and the UK, all date back to before 2014. The London-based banking firm set aside $900m in February in preparation for the settlements. It will pay $947m to US agencies, and £102m to the Financial Conduct Authority. The watchdog said it had found “serious and sustained shortcomings” in the bank's controls. Bill Winters, the bank's chief executive, said the circumstances behind the fines were “completely unacceptable” and that the bank did not tolerate “misconduct or lax controls”.


Private equity backing bounces back

According to figures from Unquote Data, private equity investment in UK companies bounced back in the first three months of this year, following a slump at the end of 2018. Total deal value climbed from £6.1bn in the fourth quarter of 2018 to £8.9bn between January and March this year, a £3.9bn increase on the £5bn total value in the same period last year.

VCTs at 13-year high

Data from the Association of Investment Companies shows that investors shielded £731m from the taxman in the tax year 2018/19 by buying shares in venture capital trusts (VCTs). The figure marks the second-highest amount ever raised in a year, with only 2005/06 seeing a greater total.

Berlin-based venture capital firm launches in London

Berlin-headquartered Target Global has defied Brexit concerns to launch a new office in London. The firm will target investments in promising British start-ups.


Société Générale to cut 1,600 jobs

Société Générale has revealed plans to cut 1,600 jobs, mostly from its investment banking division, in a bid to boost profits. The bank said around 750 jobs would be lost in France, with bankers in London and New York also facing redundancy. As part of the new strategy, SocGen said it would retrench to its “area of strength” where it has “sustainable and differentiating competitive advantages”, such as equity derivatives and structured finance.

Commerzbank pledges to maintain employee interests as Deutsche Bank merger talks continue

Commerzbank’s executive board has promised its workers’ council that it will keep employees interests clearly in sight as it evaluates the merits of a merger with Deutsche Bank. Meanwhile, City AM reveals that a plan by the Qatar Investment Authority to acquire a significant investment in Deutsche Bank has stalled.

Italian bailout scheme damages credibility of EU rules

A leading EU lawmaker has warned that an Italian government scheme to reimburse shareholders of failed lenders damages the credibility of EU rules on bank rescues. The lawmaker has urged Brussels to block the plan.

SEB offloads stake in Swedbank

Swedish bank SEB has sold just over of its stake in rival Swedbank amid a money laundering scandal. SEB sold around 5m shares in March and over 7m in February. Beforehand SEB had been Swedbank's 10th biggest shareholder.

Japan’s biggest bank eyes digitisation to translate data trove into proactive sales

Mitsubishi UFJ Financial Group is planning a fresh push into AI and fintech as it seeks to unlock the pool of assets spread across the bank’s 30m individual accounts.


Nissan cuts ties with Ghosn

Former Nissan boss Carlos Ghosn has accused former executives at the firm of “backstabbing” and says he is innocent of all charges against him. Meanwhile, Nissan’s shareholders have voted to remove Ghosn from the company’s board and strip him of his director title.


Boeing commercial aircraft deliveries fall

New figures have showed that deliveries of Boeing commercial jets plummeted in the first quarter of 2019, as airlines around the world recoiled from the second fatal crash of its 737 Max model.


Probe launched into cartel

The Competition and Markets Authority has accused three construction suppliers of colluding to form a cartel in order to keep prices up. The CMA said its investigation into groundworks suppliers Vp, MGF, and Mabey Hire had provisionally found that the trio of companies broke competition law.


Home insurance customers hit by loyalty scam

New research from Citizens Advice has found that home insurance companies make all of their profits from loyal customers who have held policies for six years or more. Citizens Advice revealed that loyal customers are charged nearly twice as much for their annual premiums as newcomers - £325 on average for their sixth year compared with £172 for the latter group’s first year. The consumer charity has called on the FCA to investigate the practice.

Hargreaves Lansdown and the Share Centre acquire JPMorgan clients

Hargreaves Lansdown and the Share Centre have each acquired a combined 53,000 clients from JPMorgan Asset Management, representing funds with a total of around £1.52bn.

Travelex parent plans $200m London initial public offering

Finablr, the parent company of Travelex, is planning an IPO on the LSE to raise more than $200m via new shares. Evercore is advising the payments firm, with Barclays, Goldman Sachs and JPMorgan acting as global co-ordinators.


Novartis to limit M&A spend to 5% of market value

The CEO of Novartis, Vas Narasimhan, has said he is aiming to limit spending on mergers and acquisitions to about 5% of its market capitalisation.


Lush abandons social media

Cosmetics firm Lush has announced plans to close all of its social media channels in the UK as it aims to speak more directly to customers.


Debenhams handed over to lenders in pre-pack administration

Debenhams has fallen into administration and has been taken over by its lenders as part of a pre-packaged process. Under the deal, all 166 stores will remain open for now, although about 50 have been earmarked for closure in the next few years, putting 4,000 of its 25,000 jobs at risk. Shares in the business have been suspended as a result. Sports Direct chief Mike Ashley, Debenhams biggest shareholder, has described the takeover as “nothing short of a national scandal” and has called for the administration process to be reversed. Commenting on the administration, Ruth Sunderland in the Mail says the downfall of Debenhams should be taught in business schools as a lesson in the dangers of greedy, short-term private equity takeovers


IMF issues another Brexit warning

The IMF has produced another gloomy analysis of the dangers posed by a no-deal Brexit. A study by the fund suggested that if Britain leaves without a deal this quarter, GDP could be 1.4% lower in the first year after Brexit when compared with a base-case scenario where an agreement is secured. The IMF also highlighted that a no-deal outcome would also pose a risk to the rest of the world. Under its more benign scenario, EU GDP would be 0.5% lower by 2021 than currently forecast, while global GDP would decrease 0.2%.

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