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Daily News Roundup: Wednesday, 28th March 2018

Posted: 28th March 2018


FreeAgent deal sees RBS back on acquisition trail

Royal Bank of Scotland is to make its first acquisition since its £49bn takeover of ABN Amro in the lead-up to the financial crisis. The deal will see it pay £53m to buy Scottish accounting software firm FreeAgent. Ross McEwan of RBS said the acquisition would allow the lender to offer more online services to business banking customers. Shares in RBS shares fell 0.3% to end at 257.6p.

More crash protection for banks considered

Minutes of the Bank of England's financial policy committee meeting show that after coming to the decision that risks in the system are increasing, financial regulators are considering a requirement that banks strengthen their defences against overheating in credit markets.

Elderly hardest hit by ATM closures - FSB

The elderly could be most affected by plans to do away with thousands of free-to-use ATMs around the country, after cash machine network LiNK cuts fees that card providers pay to ATM operators from July 1. Federation of Small Businesses national chairman Mike Cherry noted: “LiNK needs to understand that millions find it easier to budget when they use cash.” Which? money expert Gareth Shaw said that 20% of people are already more than 30 minutes from their nearest cashpoint, with LiNK chief executive John Howells insisting that ATMs will be maintained in locations that really need them.

Women paid a third less in City

After major finance firms published their gender pay gap numbers for the first time, it has been revealed that Morgan Stanley paid its female UK staff 35.2% less than men, while Citigroup disclosed a differential of 30.1% and Credit Suisse 28.9%.

Business banking expansion eyed by Nationwide

Joe Garner, Nationwide’s chief executive, has said the firm would offer business current accounts for the first time if it was awarded funding by Royal Bank of Scotland.


Carlyle wins battle for Akzo Nobel unit

Private equity group Carlyle and Singapore's sovereign wealth fund GIC are to acquire the speciality chemicals arm of Akzo Nobel for €10.1bn, including debt. Apollo Global Management, Hal Investments and a consortium of Bain Capital and Advent International lost out to Carlyle and GIC in the bidding. Though still subject to regulatory approval and employee consultations, the disposal was described by Akzo Nobel’s chief executive Thierry Vanlancker as a "milestone" that would enable the firm to "achieve its full potential".

Australian mine sold by Rio Tinto for $2.25bn

Rio Tinto has sold its remaining Australian coal asset Kestrel to private equity manager EMR Capital and Indonesia's Adaro Energy Tbk, in a deal worth $2.25bn (£1.59bn).


German apathy leaves way clear for France to challenge the City

Katherine Griffiths, in the Times, writes on Britain retaining its position as a global financial centre. It is noted that while “France is a challenge to British interests, Germany has not been that engaged”, as the latter country has not aggressively campaigned to win business from Britain after Brexit.


Citigroup provides Oodle with £100m of funding

Used car fintech startup Oodle has received £100m of funding from Citigroup, following a £60m investment from KKR last year. Chief executive Jonny Clayton commented: "The Citigroup funding is a key milestone that will help us support innovation and turn the used car market on its head, transforming the way car purchases are financed”.


Plea for support for builders

A cross-party group of MPs has warned that smaller developers are key to solving the housing crisis, with the number of small and medium-sized housebuilders dropping from 12,000 in 1998 to 2,500 today. Mike Cherry, chairman of the Federation of Small Businesses, commented: "Small housebuilders will welcome the cross-party effort to shine a light on the very real challenges that are holding them back."


Bonus lift brings Aviva chief’s pay to £4.3m

Aviva chief executive Mark Wilson was paid £4.3m in 2017, with almost £2m of that coming as a bonus. Chief financial officer Tom Stoddard received almost £2.5m, with chief executive for UK insurance Andy Briggs getting £2.5m and chief executive of international insurance Maurice Tulloch earning just over £1m.

Europe regulators back tough rules for spread-betters

The European Securities and Markets Authority has firmed up tough new rules to limit the amount retail investors can borrow to leverage bets using so-called “contracts for difference” products.


Novartis sells stake in consumer business to GSK for $13bn

Swiss pharmaceuticals group Novartis has sold a 36.5% stake in its consumer health business for £9.2bn to British firm GlaxoSmithKline, to focus more on its core pharmaceuticals business.


Zuckerberg to avoid MPs’ data interrogation

After being summoned to give evidence to the Commons' Digital, Culture, Media and Sport Committee, Facebook founder Mark Zuckerberg is believed to be sending a colleague instead. The Government is investigating how data firm Cambridge Analytica acquired details of 50m Facebook users, with committee chairman Damian Collins saying yesterday: "We believe, given the serious nature of the allegations that have been made around the access and use of Facebook for data, that it's appropriate that Mark Zuckerberg should give evidence to the committee.”

Telit investigated by FCA over profit warning

Telit Communications is being investigated by the Financial Conduct Authority after a major profit warning last year. Shares in the company fell by 8.1% to close at 145p yesterday. Company chairman Richard Kilsby said the firm had faced "unique challenges" in 2017.


Government wades into GKN tussle

Business Secretary Greg Clark has written to Melrose demanding "binding" commitments concerning its £8.1bn bid for GKN, raising concerns over national security given its role in supplying the UK armed forces. Mr Clark sought "extensive and clear" measures over GKN's workforce, research and development, and pension schemes.


Families will struggle if interest rates reach 2%

The Bank of England has warned that British families would struggle if interest rates rose to 2% or more. Minutes from the latest meeting of the Bank's Financial Policy Committee highlight that mortgages have risen as a share of borrowers' income, while the share of lending at high loan-to-value ratios is also climbing.


Fewer firms offer wage rises

Fewer employers are giving their staff a pay rise, according to data from the Recruitment and Employment Confederation. Just 50% of companies gave their staff an increase in the 12 months to February - down from 65% in the previous year and the lowest level since October 2016. The figures contradict economists’ predictions that pay rises would kick in as a result of low unemployment and intensifying skills shortages. Meanwhile, a study from the FSB has found 82% of its members reporting a steady or rising headcount, the strongest number since mid-2016.


Switzerland told to get tough on money laundering

Following a year-long investigation, the OECD has concluded that Switzerland must urgently do more to protect whistleblowers and stop money laundering and bribery. The group said lawyers and trustees operating in Switzerland must face tougher penalties for perpetrating or facilitating bribery taking place abroad.

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