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Daily News Roundup: Wednesday, 12th December 2018

Posted: 12th December 2018

BANKING

New mortgage commitments climb in Q3

New mortgage commitments were 4.7% higher than last year in the third quarter of 2018, according to fresh data from the Bank of England. The value of residential property mortgage loans increased to £1.43bn in the quarter, up 3.2% on the same period last year. The share of new lending to first-time buyers was broadly flat at 21%. The news comes several months after the Bank showed that new lending commitments in the second quarter of 2018 had reached their highest levels in a decade.

New scheme will help banks trace stolen money

Britain’s biggest banks and building societies have launched a new system to combat banking fraud by making it easier to track the flow of illicit cash. The Mule Insights Tactical Solution (MITS), developed by Mastercard-owned Vocalink, allows fraud teams to follow the money as it moves through the bank system. They can then freeze funds before they are withdrawn in cash or sent abroad.

Barclays app a step in the right direction

The I’s James Moore welcomes Barclays' launch of an app-based service that allows customers to stop themselves from spending at five types of outlet. He comments: “Personal financial management is not one of this country's strong suits, so the development of a tool like this counts as a thoroughly good thing.”

PRIVATE EQUITY

Investors flock to venture capital funds

Wealthy savers poured more money into tax-efficient venture capital schemes that invest in early-stage companies in 2017-18 than in any year since 2006.

INTERNATIONAL

IMF fears economies are unprepared for crisis

The deputy head of the International Monetary Fund has warned that governments and central banks might not be adequately equipped to cope with the storm clouds gathering over the global economy. David Lipton, the first deputy managing director of the IMF, said that "crisis prevention is incomplete" more than a decade on from the last meltdown in the global banking system.

India names bank chief

Shaktikanta Das has been named as the new governor of the Reserve Bank of India following the unexpected resignation of Urjit Patel on Monday. Meanwhile, the FT says the resignation of Mr Patel continues a recent trend of central bankers clashing with politicians.

Danske sells pensions unit

Danske Bank has sold its Swedish pensions arm to Nordic investor Polaris and its German peer Acathia, in what some analysts see as an attempt to raise cash to pay potential penalties from the money-laundering scandal enveloping it.

Alfa-Bank owners discuss sale with VTB and UniCredit, sources say

The owners of Alfa-Bank, Russia's largest private lender by assets, are understood to have approached competitors including VTB and UniCredit to discuss a possible sale.

Noble plans to push ahead with debt deal

Noble Group is still working towards its $3.5bn debt-for-equity swap, potentially saddling investors with shares in a private, unlisted stock.

HSH Nordbank slashes jobs

Germany's maritime lender HSH Nordbank intends to lay off 700 of its 1,700 employees as part of a major restructuring under new US owners.

Italian bank merger on the cards after Banco BPM bad loan sale

Italy’s Banco BPM has agreed to sell up to €7.8bn of non-performing loans, clearing the way for a potential merger, with UBI Banca among the lenders in the frame.

AUTOMOTIVE

Hyundai Motor Group commits $7bn to fuel-cell technology

South Korea's Hyundai has pledged billions to developing hydrogen-powered systems for cars, drones and ships, which operate by converting hydrogen to electricity to power motors.

FINANCIAL SERVICES

Brussels set to ease post-Brexit clearing fears

Brussels is said to be preparing to unveil concrete plans to grant EU financial institutions access to London's clearing houses in the event of a no-deal Brexit. The draft proposals could be published as early as today. The Bank of England, trade bodies, and clearing houses had called for urgent clarity on temporary arrangements first mooted by the EU last month, in order to protect derivative contracts worth trillions of pounds being moved out of London.

No post-Brexit regulatory 'race to the bottom', says Hammond

London will remain a global financial centre after Brexit, Philip Hammond has indicated, ruling out relaxing financial regulation in favour of a "safe, transparent and predictable" regime. The chancellor said that the English language, Britain’s legal system, universities and technologies made London a global financial centre - not its EU passport.

No-deal Brexit could push up pension fund deficits by £219bn

Risk-management firm Cardano has warned that the impact of a no-deal Brexit could see the total deficit of UK pension funds rise by as much as £219bn. It said the 37% rise in deficits would be triggered by a combination of falling gilt yields, a further weakening in sterling and rising inflation.

LEISURE AND HOSPITALITY

888 eyeing US expansion

London-listed 888 has bought the remaining half of All American Poker Network for $28m (£22.26m) to strengthen its US position ahead of regulatory change in the country. The online gambling firm has also signed a sponsorship agreement with American football team New York Jets.

MEDIA AND ENTERTAINMENT

WPP to cut 3,500 jobs

WPP is cutting 3,500 jobs worldwide, roles that overlap across its multiple agencies, as it struggles against competition from digital disrupters in the advertising space. Mark Read, chief executive of the advertising conglomerate, said that “painful steps” were unavoidable as he laid out a three-year plan to reboot the company for the digital era.

UK development arm CDC to invest $180m in Africa's Liquid Telecom

CDC, the UK's development finance institution, has taken a 10% stake in Liquid Telecom, Africa's biggest fibre optic and cloud computing provider, which already covers 13 different countries.

RETAIL

Carpetright losses deepen amid store closures

Carpetright's half-year losses have widened to £11.7m, from £600,000 a year ago, impacted by costs related to store closures and its restructuring programme, as well as weak trading. Revenue declined 16% to £191m in the six months to October 27th, while total like-for-like sales declined 12.7%. Depressed consumer confidence and Brexit uncertainty “remain concerns”, Carpetright said.

King joins M&S

Former Sainsbury’s boss Justin King is to join Marks & Spencer’s board in January as a nonexecutive director.

SPORT

Premiership aims to seal CVC deal by Christmas

Premiership Rugby hopes to complete a £220m "landmark deal" with CVC Capital Partners before Christmas, despite failing to reach agreement at a board meeting of the club owners yesterday.

ECONOMY

Wage growth fastest since 2008

ONS data shows wages in the UK are continuing to rise at their highest level for nearly a decade. Compared with a year earlier, wages excluding bonuses, were up by 3.3% for the three months to October, the biggest rise since November 2008. Average weekly wages are £495 - the highest since 2011, when adjusted for inflation. The number of people in work rose by 79,000 to 32.48m, a record high. Unemployment increased by 20,000 to 1.38m, although the margin of error is 70,000 and the total is still lower than a year ago. Job vacancies were up by 10,000 on the quarter to a record high of 848,000.

OTHER

Wealthy feeling the pinch

The richest 1% are experiencing a higher rate of inflation when they buy luxury items, analysis by Coutts has found. The bank’s "luxury basket" of high-end goods and services including opera tickets, school fees and oysters, shows that prices rose by 5.9% over the past year. This was more than twice the consumer price index (CPI) of 2.4%.

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