BANKING
HSBC explores sale of Canadian business
HSBC is examining a sale of its Canadian arm, with it suggested than a deal could put a price tag of almost $10bn on the business. Investment bankers from JPMorgan are helping HSBC with its review of its operations in Canada, where it is the seventh largest lender. HSBC has been in Canada for 41 years and has grown its business in the country through acquisitions. Its Canadian operations generated pre-tax profits of $768m last year, compared with $18.9bn for the group as a whole. An HSBC spokeswoman said it regularly reviewed its businesses in all markets, adding: “HSBC Bank Canada is a very strong business and Canada’s leading international bank …The review is at an early stage and no decisions have been made.” City AM suggests that an exit from Canada could “embolden” HSBC’s largest shareholder’s efforts to split out the bank’s Asian arm, with Chinese insurer Ping An lobbying HSBC to demerge the business which generates most of the group’s profits. HSBC last year announced it would exit mass-market banking in the United States, and in June said it would sell its French retail business as part of a plan to improve profits.
Mortgage rates continue to climb
The average rate on a two-year fixed mortgage has edged closer to 6%, with data from Moneyfacts showing that the rate climbed to 5.97% yesterday, having already risen to 5.75% on Monday. The average has risen from 4.74% before September’s mini-Budget and far exceeds the 2.34% rate recorded last December. The average new five-year fix is now priced at 5.75%, up from 5.48% on Monday. Meanwhile, analysis shows that the number of 95% mortgages available has plunged. The 129 deals currently on the market is less than half the number available on the day of the mini-Budget, with 283 options on September 23. Lenders are pulling deals amid concern homeowners could end up in negative equity if house prices were to fall by 10% or more. In more positive news for borrowers, Moneyfacts research shows that there were almost 100 more new standard mortgage deals on sale yesterday than there were the day before, with 2,358 deals offered on Tuesday compared with 2,262 on Monday .
Barclays reshuffles leadership to boost investment bank
Tim Main is to lead Barclays’ investment bank in Europe, the Middle East and Africa, replacing Reid Marsh amid a reshuffle as Barclays seeks to expand its corporate and investment banking business.
INTERNATIONAL
SocGen names Ducholet to lead French unit
Societe Generale, France's third-biggest bank, has named Marie-Christine Ducholet as the head of its newly restructured French retail banking unit. This comes just a few days after SocGen appointed its investment banking boss Slawomir Krupa as group chief executive.
AUTOMOTIVE
Drivers should have seen bigger fuel price cuts, says RAC
Motorists are being denied cheaper petrol because retailers have hiked their profit margins, according to the RAC. The motoring organisation said a further oil price fall in September pushed down the average price at forecourts nearly 7p to 162.9p. RAC fuel spokesman Simon Williams said: "Drivers really should have seen a far bigger drop as the wholesale price of delivered petrol was around 120p for the whole month."
FINANCIAL SERVICES
FCA criticises insurers over business interruption claims
The Financial Conduct Authority (FCA) has warned that insurers have “fallen short” of the watchdog’s required standards in their handling of business interruption claims. The City regulator said it will “consider using all regulatory tools” it has available to ensure insurers meet its standards, having conducted a review. This comes after a Supreme Court ruling in January which said insurers must pay out on claims made by businesses forced to close during the pandemic. While insurers have paid out more than £1.2bn to 34,506 businesses over pandemic-related claims, the FCA review found that insurers had failed to meet the required standards, especially in regard to paying policyholders within a “reasonable time frame.” Sheldon Mills, the FCA's executive director of consumers and competition, said: "As consumers and businesses across the country are affected by inflationary pressures and the rising cost of living, it is crucial that insurers are handling claims promptly and treating customers fairly."
Dalio gives up control of Bridgewater
Investor Ray Dalio has handed over control of hedge fund Bridgewater Associates to a new generation of investors, transferring his majority stake to the board. He has stepped down as one of three co-chief investment officers but will keep his seat on Bridgewater's operating board of directors and remains a "meaningful" owner of the fund. Mr Dalio stepped down as Bridgewater's chief executive officer in 2017 and chairman at the end of 2021. Co-CEOs Nir Bar Dea and Mark Bertolini said in a statement: “The control of the company now sits with our operating board. There is nothing left to do on Ray´s transition. It's done.”
RETAIL
Made.com seeks buyer
Online retailer Made.com has begun talks with potential buyers, with the furniture company revealing that it will need up to £70m in funding to survive the next 18 months. Made.com has set a mid-October deadline for potential suitors to table indicative proposals. After this, the board “will review these proposals and expects a select number of parties will be invited to participate in a second phase to conclude as soon as practicable thereafter,” the company said in a statement yesterday. It also warned that it would need between £45m and £70m to continue until the end of next year.
SPORT
Greggs serves up sales growth
Greggs has reported a robust third quarter. Like-for-like sales rose 9.7% in the three months to October 1 compared with the same period last year. Greggs said that like-for-like cost inflation expectations for the full year were unchanged around its previous guidance of 9%, with energy costs hedged for the first quarter of 2023. It said that average energy costs were expected to be below the level of the recently announced price cap.
ECONOMY
Kwarteng: tax plans will grow economy ‘very quickly’
Kwasi Kwarteng has promised that the Government’s tax reforms will start to grow the economy “very quickly.” Asked at a conference fringe event how long it would take for his economic reforms to boost GDP, the Chancellor said: “There can be immediate impacts – the investment zones, some of these projects, are going to be happening very soon. And I think you’re going to see progress very quickly – I hope so.” While the Chancellor had been planning to announce his medium-term fiscal plan on November 23, Treasury sources say it could be brought forward. The plan is also expected to come alongside an updated economic forecast from the independent Office for Budget Responsibility.
OTHER
Small businesses are losing customers as prices climb
Santander research shows that 80% of smaller firms are struggling to compete with the lower prices offered by larger firms, meaning 72% are losing customers. While 73% believe the current economic climate is making it harder than ever to compete, 69% said they have no option but to increase their prices. While many small businesses recognise the difficulty in matching their larger competitors in terms of price, 67% said they can offer customers a more personalised service and 42% believe they have more flexibility to reach niche markets. Four in 10 think the quality of their products is better than that of large companies. The poll also saw 76% say some of their customer base has been understanding or supportive following their price increases.