Banks expected to pay out £12.7bn in dividends
Investment firm AJ Bell has forecast that Britain’s banks will pay out £12.7bn of dividends this year. Barclays, HSBC, Lloyds, RBS and Standard Chartered are poised for a shareholder bonanza, handing out the most money since 2007. The five banks earned a £9.3bn profit in the second quarter of 2018, although bank shares are down 7% this year.
Finance sector pays biggest share of income tax
Bankers and insurance brokers are shouldering a bigger income tax burden than ever, according to HMRC’s annual statistics on the distribution by industry of tax. The finance and insurance industry made up 17.1% of the total amount HMRC collected in the 2016-17 tax year, a record high and a 0.5 percentage point increase on the amount of tax taken in 2015-16.
Bankers’ bonus cap may be here to stay
Writing in the Times, Katherine Griffiths contends that the EU’s bonus cap might remain in Britain after Brexit. This is because, she states, some employees like the fixed allowances banks have introduced. She adds that if the government tries to scrap the cap, it could lead simply to an increase in total compensation, with the banks trying to please all their employees.
Commerzbank warns on 2018 cost targets
Commerzbank has posted revenue of €2.22bn for the three months to the end of June, up from €2.06bn in the same period last year. The German bank posted pre-tax profits of €389m, which compared favourably with a loss of €628m during the prior corresponding period. The bank also said it would miss its 2018 cost target by about €100m. The FT’s Lex remarks that a merger between Commerzbank and Deutsche Bank would be the surest way to better returns for investors.
Supervisors to be placed inside Australian financial services firms
Staff from the Australian Securities and Investments Commission are to be placed inside large financial institutions to monitor their day-to-day operations. The development comes after a succession of banking scandals in Australia, which have ranged from the provision of poor financial advice and money-laundering to rigging Australia’s benchmark interest rate.
European Investment Bank bows to calls for reform
The European Investment Bank has agreed to commence talks to become independently supervised by the European Central Bank.
Ola to enter UK market
Indian taxi-hailing firm Ola is moving into the UK as it continues to challenge Uber around the world. The company, which was founded in 2011, plans to start operating in South Wales and Greater Manchester. Ola said it is working with local authorities across the UK to expand nationwide by the end of 2018.
Musk could take Tesla private
Elon Musk, the founder of Tesla, has suggested that he could take the electric carmaker private in what would be the largest buyout of its kind. The entrepreneur said on Twitter that he had secured funding for a $70bn takeover, sending the shares up to 10% higher before they were temporarily suspended.
Aviation industry urged to attract more female pilots
In order to avoid an impending shortage of pilots, Angela Gittens, director-general of the Airports Council International, has called on the industry to attract more women.
Interserve plunges into the red
Interserve has plunged into the red as it scrambles to find £50m in cost savings. The company reported a £6m loss in the six months to June 30. That compares to a profit of £24.6m in the same period last year. Revenues fell 9.7% from £1.64bn to £1.49bn.
Hargreaves Lansdown raises dividend on strong results
Hargreaves Lansdown has hiked its dividend on the back of impressive full-year results. Before tax profits were up 10% to £292.4m on the back of £7.6bn in new business - its client numbers rising to pass the 1m mark, up 137,000 on last year. Net revenue rose 16% to £447.5m. Chief executive Chris Hill said: “I am pleased we have been able do all of this whilst also reinstating a special dividend to shareholders, resulting in a 38% increase in the final dividend.” Meanwhile, Peter Hargreaves, the founder of the company, has said a no-deal Brexit would be "the best option" because EU countries would be clamouring for tariff-free trade.
Standard Life Aberdeen snubs Brexit drama
Standard Life Aberdeen co-chief executive Martin Gilbert has dismissed fears of a hard Brexit triggering turmoil in the City. “We are not seeing huge job movements out of London, we are seeing more recruitment,” he said, adding that the City's resilience and trust in regulators would suffice to weather the storm. Mr Gilbert was speaking as SLA announced that its AUM stand at £610bn, down from £626bn a year earlier. The fund manager’s pre-tax profits for the first six months of 2018 fell to £478m, from £521m for the same period last year.
LV bitten by the beast
LV blamed the “Beast from the East” for a more than 50% fall in operating profit in its general insurance business in its half-year results - from £49m at half year 2017, to £23m in the six months to June 30. The UK insurer said it had £17m of net claims as a result of the bad weather, though its life and group business operating profit was £19m, up 171% on the same period last year. General insurance gross written premiums were up 1% to £827m.
Broker plans for Paris base
TP ICAP has confirmed it plans to base its HQ in Paris in the hope of safeguarding its continental business after Brexit. A spokeswoman for the broker said "very few" staff would be moved as a result.
HSBC finance director to join GlaxoSmithKline
- Mackay is to join GlaxoSmithKline as CFO from early next year. Mr Mackay is currently the finance boss of HSBC. The bank has lined up former RBS executive Ewan Stevenson to replace him.
LEISURE AND HOSPITALITY
Luke Johnson among bidders for collapsed restaurant chain
Patisserie Valerie chair Luke Johnson has emerged as one of the bidders for steak restaurant chain Gaucho, after the group went into administration last month. Other bidders are said to include Carlyle and Aurelius Equity Opportunities.
UK house price growth accelerates, Halifax says
UK house prices were 1.4% higher in July than June, the Halifax has said, rising at the fastest annual pace since November. Prices in the three months to July rose by 3.3% from a year earlier, with the average cost of a house hitting a record £230,280. The lender said it did not expect much pick-up in activity for the rest of 2018. “Despite the recent modest improvement in mortgage approvals, the latest survey data for new buyer enquiries and agreed sales suggest that approvals will remain broadly flat until the end of the year,” said Russell Galley, managing director at the Halifax.
Usmanov accepts Kroenke bid for Arsenal
Arsenal shareholder Alisher Usmanov has said he will accept Stan Kroenke's bid to buy him out for £550m and take full control of the club. American billionaire Kroenke owns 67% of Arsenal through his company KSE and announced yesterday he had made an offer to buy up the rest of the shares. Kroenke's offer to shareholders values the Premier League club at £1.8bn.
Brits stockpiling cash
According to research by GoCompare Home Insurance, Britons are increasingly storing cash at home in case their bank or credit card is hit by a technology meltdown. Eight out of 10 consumers are hoarding a total of £7.7bn, or £187 on average.
Businesses urged to help Openreach
Catherine McGuinness, chairman of policy & resources at the City of London, has urged businesses in the capital to give Openreach permission to carry out vital digital infrastructure work on their properties or risk missing out on improved broadband connections.