Traditional banks must wake up to non-bank threat
Scott Lanphere, the chairman of fintech firm Omnio, says in a piece for City AM that traditional banks need to up their game in the battle for personalised banking or face losing more customers to non-banks that offer loans and wealth management services. Companies such as Uber, which has launched Uber Money - providing payment and banking services to the company's drivers – have vast amounts of data that allows them to personalise financial services in a way that no traditional bank can compete with” and “also have the tools to package this knowledge into a product using modern, intuitive digital banking systems, which can be tailored to the needs and desires of each of their customers.” Big banks need to act like challengers and build their data capabilities or they’ll be brought down by these non-bank insurgents, warns Lanphere.
Interest rates on credit cards hit record high
Research by Moneyfacts reveals that banks are now charging an average of 25.1% for credit card purchases - the highest-ever figure – leading former pensions minister Baroness Altmann to accuse providers of profiteering. Baroness Altmann says the Bank of England's attempt to stimulate the economy by lowering its base rate will not work if banks don't pass on the cuts.
NatWest accused of forcing people online
NatWest has been accused of forcing people to bank online by refusing to print out statements in branch or permit customers to report a death, leading to speculation the bank wants a drop in footfall to justify more branch closures.
Newcastle BS dims the lights for disabled
Newcastle Building Society is introducing a service to make banking easier for customers with invisible, visible, intellectual or cognitive disabilities. At different times each week its 29 branches will dim the lights and turn off the music.
KKR cashes out from Trainline
KKR along with a group of other Trainline investors have cashed out completely from the online rail bookings company just months after its IPO. The group raised gross proceeds of £279m after selling 68m shares.
Achleitner facing calls to step aside
Deutsche Bank chairman Paul Achleitner is facing calls from some of the lender’s largest shareholders to step down following deepening losses and the bank’s collapsed merger talks with Commerzbank. Cerberus, which is Deutsche’s third-largest shareholder with a 3% stake, joins BlackRock and other large Deutsche shareholders who have an increasingly negative view of Mr Achleitner’s performance.
Italian banks rush to profit from ECB negative rates
The ECB’s use of tiered interest rates has provided Italian banks with the opportunity to borrow at negative rates and deposit the cash at the central bank for free, making a profit on the difference.
Liberty House considers selling supply business to JLR
Liberty House is considering selling its automotive supplier Liberty Pressing Solutions to Jaguar Land Rover (JLR) and Renault. Elsewhere, the Telegraph reports that Tata-owned JLR is looking to team up with a bigger player such as BMW or Geely, but Tata is resisting an outright sale.
Nissan cuts profit forecast as stronger yen hits turnaround plan
Nissan has reported half-year net profits down 73% to 65bn yen (£464m) on revenues 9.6% lower at 5trn yen, with the strong yen exacerbating the company’s problems. Its UK operations are in the spotlight again with sales in Europe falling almost a fifth to 265,000.
Meggitt reports stronger than expected Q3 results
Aerospace engineers Meggitt has reported revenue growth of 11% for the third quarter, prompting the firm to raise full-year guidance from between 4%-6% to between 6%-7%. The defence and energy divisions saw particularly strong growth, with incomes up 20% and 26% respectively.
Experian revenues hit $2.5bn
Revenues at consumer credit firm Experian hit $2.5bn for the first half of this year, up 7% from $2.36bn in 2018. On the back of strong performances in North America, Latin America and global business to business platforms, profit increased from $470m last year to $480m in 2019. The firm also saw users of its website for checking credit scores for free rise 56%, from 45m in 2018 to 70m in 2019.
Arrow sets sights on fund management
Manchester-headquartered debt purchasing group Arrow Global is to develop its fund management capabilities after swallowing a 15.1% rise in costs related to IFRS 16. Despite the group’s profits before tax increasing 65.6% to £42.4m and cashflow increasing 14.7% to £174.4m, underlying profits fell 5.4% to £50.4m in the nine months ending in September.
MEDIA & ENTERTAINMENT
Vodafone raises profit guidance despite Indian problems
Despite posting a €1.9bn loss for the six months to September, Vodafone has raised its annual profit guidance for next year to between €14.8bn and €15bn, up from €13.8bn to €14.2bn. Part of the forecasts upgrade was due to income from buying rival Liberty’s huge German fibre business. However, CEO Nick Read warned the company could pull out of India over a $4bn tax bill going back to 2003 as he wrote down the value of the Indian business to zero.
DCC posts strong profit growth for first half
Marketing and support services group DCC has reported a 15% growth in profit for the first half of 2019, to £162.6m from £141.9m in 2018. DCC said it expects to deliver year-end results broadly in line with current market expectations.
Write-down pushes Landsec into slump
Land Securities has reported a £147m half-year loss as the "voracious storm" in the retail sector hits property valuations. The landlord, which owns the shopping centres Trinity Leeds and Gunwharf Quays in Portsmouth, was hit by a £368m write-down on its portfolio in the six months to September 30. Nevertheless, the UK's biggest listed property company by portfolio value confirmed it plans to push ahead with four London schemes totalling 1m sq ft of new buildings, part of a £3bn programme of potential developments.
B&M writes off German unit as profits fall short
B&M is undertaking a review of its Jawoll unit in Germany after a persistent weak performance resulted in an impairment charge of £59.5m and half-year results that fell short of expectations. Pre-tax profit in the six months to September 29th fell 70.5% to £32.2m, including an impairment charge of £59.5m relating to Jawoll. The UK business, which generates more than four-fifths of sales, saw revenue rising almost 14% to £1.5bn.
Employment falls as pay growth slows
Figures from the Office for National Statistics yesterday showed that employment had fallen by 58,000 during the third quarter of 2019 – the biggest fall since May 2015. Britons also faced slowing pay growth in the third quarter - average weekly earnings grew by 3.6% in the third quarter, down from 3.8% in the three months to August.
Productivity remains flat
Labour productivity failed to grow in the third quarter after a 0.5% contraction in the second quarter, according to ONS preliminary figures released yesterday. The UK has registered either zero or negative annual productivity growth in each quarter since the three months to June 2018.
Millionaire investors hoard larger cash piles
A survey by UBS reveals that wealthy investors have increased their cash holdings amid concern about global political and economic uncertainty with 60% considering further increases in their cash levels.