Banks offer fewer switch incentives
Analysis shows that most banks have pulled current account switching deals, with First Direct the only bank offering an open-to-all £50 cash incentive for switching. This comes with data showing that many people failed to take advantage of deals that had been offering incentives of around £200. Figures published by Bacs, which runs the current account switching service, show that just 83,460 of the UK’s 70m accounts were moved in June 2019. While HSBC and Halifax have recently withdrawn open-to-all incentives for switching, some lenders still offer incentives that come with caveats, with M&S Bank offering M&S vouchers and TSB and Nationwide offering incentives for those recommended by existing customers.
March deadline for transfer checks
Banks will soon have to carry out extra security checks when customers send money, with the Confirmation of Payee scheme in force as of March 31 next year. This will force banks to check details customers provide on payee details match, with transfers to be blocked if the recipient's name and account number don't line up. The Payment Systems Regulator has told Barclays, HSBC, Lloyds, RBS, Santander and Nationwide to meet the March deadline, while smaller banks and building societies have not been told to do so.
McEwan: RBS would move HQ from independent Scotland
Royal Bank of Scotland’s chief executive Ross McEwan says the bank would move its headquarters to London if Scotland becomes independent because the bank would be too big for the Scottish economy. He said that if such a scenario played out, RBS’ Edinburgh base “would stay one of our major centres,” saying not much would change if the economy stayed competitive and “we could get talented people and they wanted to work here”.
Deliberating on dividends
Taha Lokhandwala in the Telegraph looks at the potential returns bank shares can offer, noting that Barclays, HSBC and RBS have announced higher dividends for shareholders. He offers that increased regulation following the financial crisis may mean profitability “will almost never be what it once was given the extra amounts of cash banks have to hold in case of a crisis,” and cites Jamie Ward, a fund manager at Crux, who says regulatory costs banks have faced “will start to abate." Mr Lokhandwala adds that the banking sector in general is in better shape than it was in the “dark days” of 2008.
Rate warning over easy-access accounts
The Mail’s Sylvia Morris warns that some savers may be seeing poor rates in closed easy-access accounts, saying some customers may be in older versions of accounts and missing out on headline rates advertised to new savers.
Blackstone takes stake in smaller rival BC Partners
Blackstone has snapped up a stake in BC Partners, taking between 10% and 15% in its smaller rival for about €500m. The FT says such deals have become more common in the sector.
Belgian prosecutors settle with HSBC
A Swiss private banking branch of HSBC has reportedly agreed a settlement worth almost €300m with Belgian prosecutors in a fraud and tax dodging case. HSBC said it could not comment on the case since any settlement would still be subject to court approval.
UBS cuts fee threshold
UBS’ Swiss banking unit is to halve its threshold for charging a 0.6% deposit fee on euro accounts to €500,000. The bank will impose a negative interest rate of 0.75% on clients who deposit more than 2m Swiss francs with the unit as of November.
HSBC eyes former Deutsche man for asset unit
HSBC is set to appoint Nicolas Moreau, who left Deutsche Bank’s DWS subsidiary last year, as head of its $500bn asset management arm.
Mastercard nets $3.2bn deal
Mastercard has announced the biggest acquisition in its history, having secured the $3.2bn purchase of the real-time payments unit of Nets Group.
RBA holds rates
The Reserve Bank of Australia has held rates at an all-time low of 1%. The central bank has warned that growth is threatened by a slowdown in the global economy and a housing market downturn.
Ryanair passenger numbers ascend
Ryanair’s passenger numbers grew to 14.8m In July, a 9% increase on the total recorded in July 2018. The total is made up of 14.2m Ryanair passengers and the 600,000 who flew with Lauda, the low-cost Austrian airline acquired by Ryanair.
Klarna the most valuable EU fintech
Swedish payments company Klarna is now the EU's most valuable fintech, after its latest funding round increased its value to $5.5bn - up from $2.5bn at the start of the year. The funding round included investment from BlackRock and Commonwealth Bank of Australia.
Low interest rates hit TP Icap
The continuing low interest rate climate is tethering traders at interdealer broker TP Icap, taking profits down £5m on last year to £134m. TP Icap said revenue at its biggest business, global broking, fell 6% to £648m due to a decrease in revenue across all asset classes.
Virgin Money veteran seeking disruptor funding
Dame Jayne-Anne Gadhia, the former head of challenger bank Virgin Money, is said to be seeking £10m in funding to set up her own fintech start-up designed to save consumers money on their household bills. Snoop will leverage Open Banking rules to utilise data about customers' spending habits.
Rolls-Royce sees engine costs climb
Engine-maker Rolls-Royce has reported statutory interim pre-tax losses of £791m for the six months to 30 June against £1.2bn a year ago. The firm saw underlying half-year profits climb 16% to £94m, while operating profits were up 32% to £203m. It warned it faces £100m in extra costs related to its flagship jet engine, saying the Trent 1,000 programme will cost it up to £500m this year and a further £50m to £100m in 2020.
German factory orders rise
Official statistics show that German factory orders rose 2.5% month-on-month in June, exceeding forecasts of a 0.5% increase. Factory orders fell 3.6% year-on-year, marking an improvement on May’s 8.4% dip and analysts’ expectations of a 7% decline.
MEDIA AND ENTERTAINMENT
Universal appeal for Tencent
Chinese tech firm Tencent is in talks with Vivendi over the purchase of a stake in Universal Music Group, a deal that would give Universal a total equity value of £27.6bn.
IWG announces £100m share buyback
Office space provider IWG has launched a £100m share buyback and increased its dividend, leaving boss Mark Dixon looking forward to a much-anticipated flotation of rival landlord WeWork to “level the playing field” between the two firms. In its first half results, IWG reported total pre-tax profit of £53.4m, while revenue increased 10% to £1.3bn from £1.16bn in the same period last year.
Boohoo buys Karen Millen and Coast
Boohoo.com has bought the online business and intellectual property of Karen Millen and Coast in a £18.2m pre-pack administration, with more than 200 stores set to close.
M&A deals decline in H1
Analysis shows that the value of merger and acquisition deals in Europe fell by £15bn to £23.8bn year-on-year in the first half of 2019, with the number of deals down from 251 to 238. H1 2019 saw UK investors complete 97 deals totalling £6.3bn, marking a decline on the 103 deals – which were worth £13.5bn - completed in H1 2018.
RBS chief in no-deal warning
RBS chief executive Ross McEwan says a no-deal Brexit would cause some medium-term economic “pain and anguish”, backing the “realistic position” of Bank of England governor Mark Carney who offered a similar warning last week.
Gadhia quits FPC
Dame Jayne-Anne Gadhia, has withdrawn from the Bank of England's financial policy committee (FPC) – which she was due to join in April 2020 - to lead the UK operations of cloud computing company Salesforce. Dame Jayne-Anne's decision to take an executive role nearly a year after leaving Virgin Money means that she will not be able to join the committee. Her place on the committee had been delayed by a conflict of interest issue as she had agreed to be a paid adviser to CYBG after it bought Virgin Money.