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Daily News Roundup: Wednesday 9th December 2020

Posted: 9th December 2020


Online challengers beat big banks in customer satisfaction survey

Challenger banks Starling and Monzo have come top of a customer satisfaction survey from Which? that included 24 brands. Starling scored 88% and Monzo 82% while First Direct came third with 79%. All were ranked highly for their customer service, application process, communication and transparency over charges. M&S Bank was recommended for its online service. All of the biggest banks finished outside the top six - with RBS at 61%, and TSB and Santander, which both scored 63%, in the bottom third of the table. Tesco Bank and Citibank received the joint lowest customer score, with both earning just two stars for com- plaints handling. Which? money editor Jenny Ross said: “The leading challenger banks have cemented their position ahead of many of the UK's biggest banking brands in terms of customer satisfaction, showing that innovation and modern ideas are shaking up the market. However, it's still good service that is truly valued by customers.”

Green gilt advice contracts auction

Banks have been asked to bid for contracts to advise on the launch of the first climate-focused securities in the UK. Simon Bond, a director at Columbia Threadneedle Investments, said the proceeds of such gilts that “can be directed into projects such as renewable energy provision or better transportation systems.” He went on: “I’m confident a sterling-denominated UK green gilt will be welcomed by investors and thus help the government raise finance from new sources for environmentally beneficial projects.”

Investment banks see revenues from capital raising and listings almost double

Data from Dealogic show investment banking revenues from capital raising have soared to £20.3bn this year compared to £11.7bn for 2019. Revenues from flotations hit £22.2bn compared to £18.4bn last year while £8.8bn was made from floats compared to £4.6bn the year before.


Commonwealth Bank of Australia moving European base to Amsterdam

Commonwealth Bank of Australia’s European headquarters is to relocate from London to Amsterdam next year, with the bank issuing a statement saying: “Our new European head office will… enable us to share valuable international insights with our Australian clients.” Institutional banking and markets executive Andrew Hinchliff noted: “Amsterdam is the perfect choice for CBA to support its institutional clients based in Europe and offers a talented, multilingual workforce as well as a thriving fintech ecosystem.”

Goldman Sachs seeks 100% control of China securities venture

Goldman Sachs has signed a definitive agreement and initiated regulatory processes to take full ownership of its Chinese securities joint venture from its local partner, Beijing Gao Hua Securities.

Eurozone chief seizes on virus and Brexit to revive banking union

Paschal Donohoe, the head of the Eurogroup of finance ministers, has said that Brexit and the coronavirus pandemic have reinforced the need to solidify the single currency’s foundations.


Ineos to build new vehicle in France

Sir Jim Ratcliffe has confirmed that his Ineos Automotive firm will make its new 4x4 off-road vehicle in France, dealing a blow to hopes that the model would be built in Bridgend, Wales. Ineos confirmed that it has bought a car factory in Moselle, France from Mercedes-Benz and will start to build its Grenadier 4x4 there in late 2021. The acquisition of the French plant will “safeguard 1,300 jobs that might otherwise have been lost” in the region, Ineos Automotive said in a statement. Chris Elmore, MP for Ogmore in Bridgend, tweeted the decision was a “crushing blow” for the area.

Car prices could soar if tariffs are imposed

Lloyd Mulkerrins, of the Society of Motor Manufacturers and Traders, has told MPs that car prices could soar and production levels plummet if tariffs are imposed in the absence of a post-Brexit trade deal with the EU. He added that delays at ports could cost the motor industry £50,000 a minute.

Uber to sell ATG unit

Uber is reported to be selling its Advanced Technologies Group (ATG) for some $4bn (£3bn) to Amazon and Sequoia Capital-backed start-up Aurora. Uber will invest $400m in Aurora in return for a minority stake of 26% under the terms of the deal, which will also see Uber chief executive Dara Khosrowshahi join Aurora’s board.

Tesla plans to raise another $5bn in share sale

Tesla has announced plans to raise as much as $5bn through a share sale, hiring banks including Goldman Sachs, Citigroup and Barclays to assist.


Lobby group criticises financial services Brexit ‘politicisation’

Miles Celic, chief executive of lobby group TheCityUK has criticised the EU for politicising decisions on the British financial services sector’s access to European markets after the Brexit transition period ends. He told parliament’s Business, Energy and Industrial Strategy Select Committee: “We’ve seen a regrettable politicisation of what ought to be technical decisions on the European side. The equivalence process has unfortunately become politicised and companies will look at this, consider there is uncertainty, consider there is a cost and, particularly with some foreign companies, they may decide for now that the United States or Asia is a better bet, certainly in the short or medium term.”

Job creation in Scots financial services plunges

Core-Asset Consulting, which specialises in recruiting for financial and professional services roles, says the number of roles created by the key financial services sector in Scotland plunged by more than 10% in the last three months. The upheaval sparked by Brexit and the implications of the pandemic were to blame, the firm said.

Numis results released

City broker Numis has reported revenues up 39% to £155m, with profits up 198% to £37m during the coronavirus lockdown restrictions. Co-chief executive Ross Mitchinson added that Numis may open a new office in the EU or buy a rival on the continent in order to service its clients in the region.


UK broadcasting regulation could undergo sweeping change

Television regulator Ofcom has said Netflix, Now TV and other streaming services could be encouraged to provide public service programming as they increasingly challenge the dominance of traditional television broadcasters.

CMA proposes new digital regulation unit

A new Digital Markets Unit being set up by the Competition and Markets Authority (CMA) from next April could see the largest technology firms fined billions for failing to comply with rules to reduce their market dominance.

Meditation app valued at £1.5bn

Meditation app Calm has been valued at $2bn (£1.5bn) after raising $75m, with co-founder Alex Tew noting: "Our Calm for Business expansion is a priority as employment investment in mental health skyrockets.”


Allied succeeds in takeover bid for G4S

G4S, the world's largest security company, has accepted a £3.8bn takeover offer from US rival Allied Universal Security Services. Allied is 78%-controlled by US private equity firm Warburg Pincus and CDPQ, a Canadian fund.


Asda takeover to be probed

A planned £6.8bn takeover of Asda by billionaire petrol station forecourt operators the Issa brothers and private equity firm TDR Capital is to be investigated by the Competition and Markets Authority. A spokesman for the brothers and TDR Capital said the probe was not unexpected, remarking: “We are looking forward to working constructively with the CMA to address any questions they may have.”


Fitch says upgrades of major economies unlikely in 2021

Despite COVID-19 vaccines beginning to roll out Fitch Ratings has told Reuters that upgrades of any major economy are unlikely in 2021. Brian Coulton, Fitch’s chief economist said countries hit hard by the coronavirus will see the maximum economic boost from an effective vaccine. Coulton also said that the start of 2021 will be weak in Europe and the United States as a result of recently tightened restrictions and that the clearest benefits in annual growth numbers will be seen in 2022. Separately, Bank of America predicts the FTSE’s vaccine-driven rally is set to continue suggesting it would rise by a further 5% in the "near term", which would take it back to about the 6,900 mark.

Vaccine makes negative rates less likely, economists say

Economists have said the arrival of a vaccine for COVID-19 has reduced the probability of the Bank of England shifting to negative interest rates. However, no-deal Brexit worries have returned to markets with ING analyst Padhraic Garvey saying the scenario will likely see the Bank "ramping up the pace of quantitative easing.”

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