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Daily News Roundup: Wednesday 30th January 2019

Posted: 30th January 2019

BANKING

Analysis of banks’ online security reveals weaknesses

Research by Which? and cyber security company Sure Cloud has revealed that less than half of Britain’s leading banks are doing enough to protect customers from hackers. They found that just five of the 12 banks investigated used two-factor authentication at login, a feature which makes it more difficult for criminals to hack into accounts. Metro Bank was deemed the worst performer, with just under half of its security features meeting the Which? standard. NatWest was ranked second worst, but First Direct was named the most secure, with HSBC and Barclays second and third best respectively.

Jenkins expected “special” bonus for Qatar deal

Southwark Crown Court has heard that Roger Jenkins, a former executive chairman for Barclays Capital, allegedly expected a “special” bonus for his role in securing a multimillion-pound deal with Qatar to protect Barclays from being nationalised. Former chief executive John Varley, Mr Jenkins, Tom Kalaris and Richard Boath all deny fraud by false representation. Katherine Griffiths in the Times looks back at Barclays’ decision to agree a deal with Qatar, rather than be nationalised. She says the move helped to protect Barclays investment bank but this is now being called into question by activist investor Edward Bramson, who wants to scale it back.

More customers switching banks

Figures from the Current Account Switch Service (Cass) have shown that more customers are switching their current accounts. In the final three months of 2018, 235,648 switches were successfully completed using the service. This was up by 22% compared with the previous quarter, when 193,621 switches took place. Nationwide Building Society, HSBC and Santander were among the "winners" in terms of customers using Cass to move accounts. Challenger bank Monzo gained a net 5,363 switches. TSB, which was beset by online banking problems last year, saw a net loss of 16,142 switches.

Customers can use WhatsApp to pay

First Direct has launched a new service which allows customers to make payments through WhatsApp and Facebook Messenger. The bank is the first in the UK to offer the feature, called fdpay.

INTERNATIONAL

JP Morgan reshuffles European banking team

JP Morgan has reshuffled its European banking division moving David Lomer, its co-head of M&A for Europe, the Middle East and Africa (EMEA) alongside Dirk Albersmeier, to become co-head of its UK business with Ed Byers. Dwayne Lysaght, who was head of UK M&A at JPMorgan, will replace Lomer as co-head of EMEA M&A. Announcing the moves, Vis Raghavan, head of JP Morgan’s EMEA division said the moves would “ensure we maintain our momentum and build on our leadership position in the region.”

Nomura to cut 50 staff from sales and trading unit

Nomura is to cut as many as 50 employees from its global trading division as the Japanese bank trims underperforming staff and businesses after a difficult year in volatile markets.

Denmark proposes tougher penalties for bankers’ failings

Denmark’s financial regulator is planning tougher penalties for banks and their senior managers following Danske Bank’s €200bn money laundering scandal.

Andrea Orcel plans legal battle with Santander

The FT reports that former UBS boss Andrea Orcel has approached Spanish lawyers after Santander rescinded its chief executive offer to him.

Online start-up offers highest US rate to woo bank customers

US online bank Varo Money is hoping to attract new customers by paying 2.8% to some checking account customers, some 0.4% higher than the next best available rate.

Maria Ramos to retire as head of South Africa’s Absa

South African bank Absa has announced that Maria Ramos is to step down as CEO having held the role for the past decade.

AVIATION

Norwegian Air seeks cash injection

Norwegian Air wants to raise 3bn Norwegian kroner (£268m) through a rights issue to improve its finances. The news comes as the company announced that its preliminary earnings for 2018 showed an operating loss of roughly 3.8bn kroner. The budget carrier said it was not in talks with any potential buyers after British Airways owner IAG abandoned its plans to buy it last week.

Ryanair completes takeover of Austrian carrier Laudamation

Low cost carrier Ryanair has acquired Austrian upstart Laudamation, founded by motor racing legend Niki Lauda, along with startup losses of €140m for the year.

ANA buys billions worth of jets

Japanese airline ANA Group is to buy 30 aircraft from US manufacturer Boeing and 18 from European rival Airbus, worth $2.3bn and $1.99bn respectively.

CONSTRUCTION

London market drags on Crest Nicholson

Brexit and slower demand in London took profit before tax down 15% at housebuilder Crest Nicholson last year. Though forward sales at mid-January were up 11% on the previous year, at £639.4m, pre-tax profit was £176.4m In the year to 31 October, compared to £207m the year previously, while its operating profit margin fell from 20.3% to 16.7%. Chief executive Patrick Bergin warned that continued Brexit and political uncertainty were impacting consumer confidence and breeding unease.

FINANCIAL SERVICES

City regulators push for ‘unprecedented’ powers in the event of no deal

Andrew Bailey, the head of the FCA, Sam Woods, the CEO of the Prudential Regulation Authority, and the City minister John Glen have urged Parliament to hand them “unprecedented” powers to keep the UK open for business in the event of a no-deal Brexit. The trio explained that 53 “statutory instruments” would be needed – more than 2,000 pages – to create a fully functioning financial services regime in the UK, essentially transferring EU regulations into UK law after Brexit. They said that currently there was not enough time for firms to prepare for the changes and that enforcing all the new regulations on the same day – March 29th – would be impossible. Mr Woods commented: “It’s a massive operation and the reason we need these powers is that, despite the very fast and hard work done by everyone involved, these changes are going to be put down quite late before exit day.”

Lloyd’s chief lays out plans to rejuvenate market

New Lloyd's of London chief executive John Neal has asserted his plans to boost the insurance market, along with cost-cutting initiatives, business development ideas and technology adoption programs.

Market volatility shakes Hargreaves Lansdown

Weak investor confidence and market volatility cost Hargreaves Lansdown a 24% drop in new business, down to £2.53bn, in the second half of last year. While revenue grew 9% to £236.4m over the period and a further 45,000 clients joined the firm, total assets fell 6% to £85.9bn, down from £91.6bn at the end of June, and its own investor confidence index dropped to its lowest point since it was launched - in 1995.

Insurance boss warns pension shake-up plans are ‘terrifying’

Tracy Blackwell, chief executive of Pension Insurance Corporation, has said the government’s new pension proposals are “terrifying” and could leave members with less protection than currently.

LEISURE AND HOSPITALITY

Wetherspoons urged to pay Living Wage

A Wetherspoons campaign group, Spoons Against Brexit, has called on the pub chain to pay workers the Living Wage and offer trade union recognition. The group has also demanded that boss Tim Martin withdraws all material promoting his pro-Brexit views from their workplace.

MEDIA AND ENTERTAINMENT

Judge blocks Yahoo data breach payout

A judge has rejected Yahoo's attempt to draw a line under a series of breaches it experienced between 2013 and 2016. The firm had proposed a payout to lawyers acting on behalf of affected US and Israeli users. But while the deal said the attorneys could claim up to $37.5m (£28.5m) in fees and costs, it did not disclose the sum reserved for victims. The California judge also objected to Yahoo being too vague about what remedial steps it was taking.

RETAIL

RCapital keen on Patisserie Valerie

RCapital is among the front runners in the race to acquire most of the remaining Patisserie Valerie business from administration. The list of potential buyers is also thought to include private equity firm Endless. Meanwhile, it has emerged that Patisserie Valerie failed to share a fraud report with its banks as it grappled to secure a funding lifeline prior to its collapse last week. According to the Telegraph, neither Barclays nor HSBC were given sight of analysis prepared by forensic accountants. The Telegraph suggests the revelation raises fresh questions over the role of top executives at the company during the final throes of its existence.

ECONOMY

Concerns raised over ability to detect financial crises

The International Monetary Fund and the European Systemic Risk Board, part of the ECB, have warned that threats to the world economy could go unnoticed until too late because of flaws in the European and worldwide systems for spotting potential financial disasters. Officials believe another crisis is "inevitable", but that regulators are not yet proficient in scanning the horizon for emerging problem. The report suggests that country analysts “do not have the breadth and depth of skills and resources to adequately identify and explore financial stability risks. While 'finance' teams are better equipped for this purpose, they often lack in-depth country knowledge, and the assessments are too infrequent to detect fast developing financial stability risk.”

OTHER

Parents passing on bad money habits

A survey of 1,000 primary school parents carried out by financial education charity RedStart has revealed that 19% of parents do not save for a rainy day, and 18% say they “overspend”. A further 13% say they do not have the right knowledge to educate their children about money, while 26% believe schools should be promoting more financial education.

Government policy hits regional small businesses hardest

Federation of Small Businesses analysis shows that the cost of tax and regulation for SMEs increased in all devolved regions during 2017, but there was a drop in London.

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