Search

The City of London suggests that the UK could attract an additional £7.7 billion in investment by 2030 if it improves its ability to attract foreign sovereign wealth. To achieve this, the government should establish a long-term financial and professional services strategy and create a dedicated agency to implement it. The City of London Corporation's research shows that investors who open a UK office more than double their investments in the country compared to the previous five years. Sovereign investors with UK bases have committed £119.5 billion over the past decade. [Extracted from the article]

Citigroup Inc. is selling its global fiduciary and trust administration services business, Citi Trust, to JTC Plc for $80 million. The move is part of Citigroup's strategy to focus more on wealth planning and investment management. JTC, based in Jersey, will acquire a unit that serves over 2,000 ultra-wealthy clients and manages more than $70 billion in assets. This deal will also expand JTC's presence in the US, where it has recently acquired other American trust companies. [Extracted from the article]

Commerzbank AG's CEO, Manfred Knof, will not seek an extension to his contract, prompting the bank to search for a replacement. This coincides with the German government's decision to sell its stake in the bank, starting with approximately 53 million shares valued at €720 million ($794 million). Knof's departure comes at a crucial time for Commerzbank, as it experienced record profits last year and saw its stock price more than double under his leadership. The bank's supervisory board will begin the search for a successor immediately. [Extracted from the article]

The chair of the Financial Conduct Authority (FCA) has been accused of violating the FCA's policy on protecting the confidentiality of internal whistleblowers. Ashley Alder allegedly forwarded unredacted correspondence from a whistleblower to other individuals within the FCA without obtaining consent. The whistleblower, who was dismissed from the FCA for alleged misconduct, raised concerns about opaque hiring practices, leading to an internal review. The FCA has not commented on the matter. [Extracted from the article]

Deutsche Bank AG is set to review its plans for shareholder payouts after reaching agreements with over 80 plaintiffs in a long-standing dispute over its acquisition of retail lender Postbank. The settlements are expected to boost the bank's pretax profit by €430 million in the third quarter. This progress raises the possibility of Deutsche Bank resuming plans for buybacks later this year or in early 2025. The bank has reached agreements with plaintiffs representing nearly 60% of the total claims related to the Postbank takeover. The litigation has been ongoing since 2010, and a ruling in one case has been postponed to October. [Extracted from the article]

Deutsche Bank AG has announced that it expects a €430 million ($480 million) boost to its third-quarter results after reaching agreements with over 80 plaintiffs in the long-standing Postbank AG litigation. These settlements represent about 45% of the provisions the bank had set aside for the claims and include the largest individual plaintiff. The remaining provisions related to the settling plaintiffs will be released, potentially boosting pretax profit by €430 million in the third quarter. This development could signal more capital returning to shareholders in the future. [Extracted from the article]

Deutsche Bank AG has announced that it expects a €430 million ($480 million) boost to its third-quarter results after reaching agreements with over 80 plaintiffs in the long-standing Postbank AG litigation. These settlements represent about 45% of the provisions the bank had set aside for the claimants. The remaining provisions related to the settling plaintiffs will be released, potentially increasing the bank's pretax profit by €430 million. The litigation stems from allegations that Deutsche Bank should have offered a higher price to shareholders in rival Postbank during a successful takeover bid in 2010. [Extracted from the article]

Deutsche Bank has announced that it expects a €430 million ($480 million) boost to its third-quarter results after reaching agreements with over 80 plaintiffs in the long-standing Postbank AG litigation. These settlements represent about 45% of the €1.3 billion provision set aside by the bank in April. The remaining provisions related to the settling plaintiffs will be released, potentially increasing pretax profit by €430 million in the third quarter. The litigation stems from claims that Deutsche Bank should have offered a higher price to shareholders in rival Postbank during a successful takeover bid in 2010. [Extracted from the article]

The UK's Takeover Panel has banned 10 individuals from merger activity after they were found to have used sham transactions to deceive shareholders in MWB Group Holdings Plc, the holding company that owned the Liberty department store and Malmaison hotels. The individuals have been banned for periods ranging from one to five years, and this punishment, known as cold-shouldering, is the most severe sanction available to the watchdog and is rarely used. The ruling concludes a complex investigation and the individuals involved are also liable to pay compensation to MWB shareholders. [Extracted from the article]

The UK's Financial Conduct Authority (FCA) has stated that it is more likely to intervene in motor finance practices, potentially leading to compensation for customers who were sold car loans by firms such as Lloyds Banking Group, Close Brothers Group, and Barclays. The FCA's probe has been delayed due to data delays and a legal challenge from Barclays, and the regulator now plans to outline the next steps of the review in May 2025. Lloyds has already set aside £450 million for possible compensation, while Close Brothers has suspended dividend payments for the 2024 financial year. Barclays has not made a provision, citing its low market share and lack of complaints. The FCA has received the necessary data for its assessment, but the timeline has been affected by the legal challenge. The FCA will also extend the pause on the eight-week deadline for motor finance firms to respond to complaints until December 2025. [Extracted from the article]

Pershing Square, led by Bill Ackman, has begun a roadshow for the initial public offering (IPO) of a US closed-end fund. The IPO is expected to be the largest of its kind in the US, with Pershing Square planning to raise around $25 billion. The filing also revealed the full list of banks involved in the IPO, including Citigroup, UBS, Bank of America, Jefferies, Wells Fargo, RBC, BTG Pactual, Barclays, and Deutsche Bank. The IPO price has been set at $50 per share, and Pershing Square intends to list on the New York Stock Exchange under the symbol PSUS. [Extracted from the article]

Morgan Stanley is removing the cap on bonuses for bankers in the City of London, aligning with the trend among US and UK banks to offer bonus-heavy compensation packages similar to those in New York. The current limit, which restricts certain employees' bonuses to two times their fixed pay, will be replaced with an internal bonus cap. The bank did not provide specific details on how pay structures for material risk takers will be adjusted, but emphasized the need for balanced compensation. This move comes after the European Union introduced the bonus cap in 2014 to mitigate excessive risk-taking in the banking sector, which the UK abandoned last year to attract more financial activity post-Brexit. [Extracted from the article]

Morgan Stanley is removing the cap on bonuses for bankers in the City of London, aligning with the trend of US and UK banks adopting bonus-heavy compensation packages similar to those in New York. The bank will replace the current limit, which restricts certain employees' bonuses to two times their fixed pay, with an internal bonus cap. Other banks, such as JPMorgan Chase and Goldman Sachs, are also implementing new pay structures, with the former allowing bonuses up to 10 times the base salary and the latter planning to lower fixed pay while offering bonuses up to 25 times the base salary for top traders and dealmakers. The bonus cap was initially introduced by the European Union in 2014 to mitigate excessive risk-taking in the banking sector after the 2008 financial crisis. [Extracted from the article]

According to an article on Bloomberg.com, a major investor in UK infrastructure projects, Pension Insurance Corp. (PIC), has criticized the country's "not-in-my-backyard" culture, which it claims is hindering productivity and regional economic growth. PIC argues that the UK's reluctance to invest in infrastructure and regeneration projects, due to objections from regulatory bodies and watchdogs, is preventing capital from being mobilized through public-private partnerships. The investor suggests that the next government should take a holistic view of the economy and public sector agencies to identify and address blockages in the system. PIC, which has significant assets, laments the lack of approved projects in the UK. [Extracted from the article]

Private equity managers who put their own capital at risk will be exempt from the Labour Party's proposed tax increase on private equity fund managers, according to Rachel Reeves. The Labour Party plans to change the taxation treatment of carried interest, a portion of profits from an investment shared by select employees in a private equity fund, to be taxed as income rather than capital gains. Reeves stated that if managers are risking their own capital, it is appropriate for them to pay capital gains tax. The proposed changes aim to raise £565 million annually for various initiatives, including mental health services and support for disaster victims. [Extracted from the article]

Alison Rose, the former CEO of NatWest Group Plc, has joined private equity firm Charterhouse Capital Partners as a senior adviser. This marks her return to the City of London after stepping down from the UK bank. Rose's resignation from NatWest was prompted by a scandal involving the closure of a politician's account, which she attributed to his financial situation but was later revealed to involve discussions about his political views. Charterhouse focuses on mid-market European companies in the services and health-care sectors. [Extracted from the article]

Shares of EFG International AG experienced a significant increase after rumors circulated that Julius Baer Group Ltd. may be planning to acquire the rival bank. The share price of EFG rose by as much as 10% and trading was temporarily halted due to excessive volatility. Julius Baer's shares, on the other hand, fell by up to 5% following the report. While representatives from both banks declined to comment, Bloomberg previously reported that preliminary discussions had taken place between the two institutions. If a deal were to occur, it would result in a wealth management firm with over 500 billion Swiss francs ($561 billion) in assets under management. [Extracted from the article]

TSB, the UK arm of Banco Sabadell SA, is set to close 36 bank branches and cut 250 roles as it shifts its services online. The closures will begin in September and continue through May, resulting in a net reduction in roles as the bank streamlines its operations. TSB has seen a significant decline in customer transactions at its branches over the past four years, prompting the need for a better balance between digital and face-to-face services. Once the closures are complete, TSB will have 175 branches across the UK. [Extracted from the article]

The number of complaints in the UK about debanking has increased by almost half in the last tax year, with 3,858 new account closure complaints in the year through March, up 44% from the previous year. Small businesses in particular have seen a rise in the volume of complaints. The issue of debanking gained attention after Nigel Farage publicly criticized the closure of his account with NatWest Group Plc's Coutts unit, claiming his political views played a role in the decision. This has sparked a wider debate about the fair treatment of businesses and individuals by banks. [Extracted from the article]

The Financial Conduct Authority (FCA) in the UK has warned motor finance firms to prepare for potential financial fallout from its review of car finance products. The FCA has been reviewing historical commissions for car loans and has urged firms to plan for additional operational costs from increased complaints and to meet the costs of resolving those complaints. Lloyds Banking Group has set aside £450 million for possible compensation and other costs, while Close Brothers Group has decided not to pay dividends for the 2024 financial year. Barclays, on the other hand, has not made a provision for the probe due to its low market share and lack of complaints. The FCA's review could result in a significant bill for banks as it investigates discretionary commission arrangements that incentivized car dealers to increase borrowing costs. The FCA has also mentioned the possibility of extending its probe due to a legal challenge filed by Barclays. [Extracted from the article]

According to the Financial Conduct Authority, approximately 7.4 million people in the UK are currently struggling to pay their bills, although this number has decreased from 10.9 million in January 2023. However, it is still higher than the 5.8 million recorded in February 2020 before inflation increased. The FCA's survey of 3,450 UK adults found that 5.5 million people had fallen behind on or missed payments for domestic bills or credit commitments in the previous six months. The FCA also noted that renters, single adults with children, adults from minority ethnic backgrounds, and those living in the north-east of England were more likely to experience financial difficulties. This data highlights the ongoing financial struggles faced by many households in the UK. [Extracted from the article]

Lloyds Banking Group is undergoing a restructuring of its risk management division as part of CEO Charlie Nunn's efforts to simplify the company. This restructuring will result in approximately 175 roles being made redundant, with 150 of those in the risk department. However, the company is also creating over 100 new roles that require more technical expertise. Lloyds is engaging with unions and providing support to those affected. The bank aims to reset its approach to risk and controls after an internal review highlighted the need for more "intelligent risk-taking." This restructuring follows Lloyds' previous efforts to enhance its digital offerings and wealth products by cutting 1,600 roles across its branches. [Extracted from the article]

Goldman Sachs Group Inc. has seen its gender pay gap in the UK widen to its highest level in six years, with women earning about half of what men earn on average. This gap is primarily due to the underrepresentation of women in senior positions at the bank. While Goldman Sachs has made efforts to improve gender representation, no woman has ever held the positions of chair, CEO, president, or CFO in the company's history. In comparison, other US-based investment banks in the UK have seen a slight narrowing of their gender pay gaps. It is important to note that these figures represent the overall workforce and do not account for factors such as job role or experience. [Extracted from the article]

RedBird IMI, a joint venture between RedBird Capital Partners and International Media Investments, is considering selling the Telegraph newspaper and Spectator magazine after the UK government announced plans to ban foreign state ownership of UK media titles. The investment vehicle had secured control of the media group through a loan package with the Barclay family, but there has been growing criticism of the takeover. RedBird IMI is waiting for further clarity on the planned change to the law before making a decision. The deal has already drawn scrutiny and is currently under investigation by the Competition and Markets Authority and media regulator Ofcom. [Extracted from the article]

RedBird IMI, a United Arab Emirates-backed investment vehicle, is considering stepping away from a deal to acquire the Telegraph newspaper and Spectator magazine due to a proposed ban on foreign states acquiring print news media. The potential change in ownership has caused controversy in the UK, with concerns about an autocratic state having influence over a major British newspaper. RedBird IMI obtained an option to take control of the titles in November, but its difficulties may result in other buyers entering the picture. The UAE's involvement in the deal has caused surprise and upset at senior levels of its government. [Extracted from the article]

Direct Line Insurance Group has rejected a second takeover offer from Ageas, a Belgian insurer. Ageas increased its offer by about 3% in a proposal on March 9, valuing Direct Line at approximately £3.2 billion ($4.1 billion). However, Direct Line's board deemed the offer "uncertain, unattractive, and significantly undervaluing" the company. Ageas plans to continue engaging with Direct Line's board before a March 27 deadline. This potential acquisition follows a trend of overseas acquirers buying UK insurers in recent years. [Extracted from the article]

Direct Line Insurance Group has rejected a second takeover offer from Ageas, a Belgian insurer. Ageas increased its offer by about 3%, valuing Direct Line at £3.2 billion ($4.1 billion). However, Direct Line's board deemed the proposal "uncertain, unattractive, and significantly undervaluing" the company. Ageas plans to continue engaging with Direct Line's board before the March 27 deadline. [Extracted from the article]

The London Stock Exchange has announced that it will begin accepting applications for exchange-traded notes (ETNs) backed by Bitcoin and Ethereum. This move provides professional investors with another avenue to invest in cryptocurrencies. The exchange has outlined specific requirements for the proposed notes, including that they must be non-leveraged and backed by at least 90% of offline-held cryptoassets. The Financial Conduct Authority has stated that it will not object to these requests from recognized investment exchanges, but a ban on offering such instruments to retail investors remains in place. [Extracted from the article]

Nationwide Building Society has agreed to acquire Virgin Money UK Plc for £2.9 billion, a move that would increase consolidation among mid-sized lenders in the UK. Virgin Money has struggled to compete with the dominant "big four" banks, and the merger would make Nationwide and Virgin the second-largest provider of home loans in the UK. The deal would bring together Nationwide's existing offerings with Virgin's 6.6 million customers, business lending arm, and 8.6% market share in UK credit cards. The terms of the deal include a 38% premium to Virgin Money's closing share price on Wednesday. [Extracted from the article]

Nationwide Building Society has agreed to purchase Virgin Money UK Plc for £2.9 billion, creating the second largest provider of mortgages and savings in the UK. Under the proposed deal, Virgin Money shareholders would receive 220 pence in cash per share, a 38% premium to the closing share price on Wednesday. The combination would result in a group with approximately 25 million customers and almost 700 branches, making it the second largest behind Lloyds Banking Group Plc. The deal is part of a trend of consolidation in the UK retail and mortgage banking sector. [Extracted from the article]

Nationwide Building Society has announced a preliminary agreement to acquire Virgin Money UK for £2.9 billion, creating the second largest provider of mortgages and savings in the UK. Under the proposed deal, Virgin Money shareholders would receive 220 pence in cash per share, a 38% premium to the closing share price on Wednesday. The combination would result in a total asset value of approximately £366.3 billion and total lending and advances of approximately £283.5 billion. The acquisition would add Virgin's 6.6 million customers and business lending arm to Nationwide's existing offerings. Both companies have expressed their commitment to fair banking practices and customer service. [Extracted from the article]

Nationwide Building Society has announced a preliminary agreement to acquire Virgin Money UK for £2.9 billion, creating the second largest provider of mortgages and savings in the UK. Under the potential cash acquisition, Virgin Money shareholders would receive 220 pence in cash per share, representing a 38% premium to the closing share price on Wednesday. The board of Virgin Money has indicated that it would be inclined to recommend the offer to their shareholders. The combined group would have total assets of approximately £366.3 billion and total lending and advances of approximately £283.5 billion. Nationwide CEO Debbie Crosbie stated that the merger would bring the benefits of fairer banking and mutual ownership to more people in the UK, while maintaining existing branches and high levels of customer service. [Extracted from the article]

Blackstone Inc., Thomson Reuters Corp., and other investors have sold a 4% stake in the London Stock Exchange Group Plc. The sale involved the disposal of 21.5 million shares through a placing and a directed buyback. Institutional investors purchased about 15.9 million shares for £1.4 billion ($1.8 billion) at a discount, while LSEG bought back approximately £500 million worth of shares from the consortium at a discount as well. The offering received significant investor demand within minutes of its announcement. [Extracted from the article]

Berkshire Hathaway Inc., the conglomerate led by Warren Buffett, saw its market value approach $1 trillion before retreating slightly. The company reported higher operating earnings, driven by increased insurance underwriting earnings and investment income. If Berkshire were to surpass the $1 trillion mark, it would be the first non-tech US company to do so. Despite its size, Berkshire faces challenges in finding attractive deals due to its large cash hoard. Analysts remain positive about the company's diversified businesses and strong insurance results. [Extracted from the article]

Berkshire Hathaway Inc., the conglomerate led by Warren Buffett, is inching closer to a $1 trillion valuation as its shares reached another all-time high. The company's operating earnings for the fourth quarter of 2023 were $8.48 billion, up from $6.63 billion the previous year. Berkshire's diverse range of businesses, including insurance, railroads, and ice cream, contribute to its strong performance. While it is not the first company outside of the technology sector to approach a trillion-dollar market capitalization, it is the closest, with only a few US-based companies having achieved this milestone. [Extracted from the article]

Berkshire Hathaway Inc., the conglomerate led by Warren Buffett, saw its shares rise by 5.5% in premarket trading, bringing it closer to a $1 trillion valuation. The company reported higher operating earnings, which contributed to the stock's upward trajectory. If Berkshire reaches a market capitalization of $1 trillion, it would be the first non-tech US company to achieve this milestone. However, the company's size makes it challenging to find significant deals, and Buffett emphasized the importance of fiscal conservatism in his annual letter to shareholders. [Extracted from the article]

Jacob Rothschild, a prominent banker and philanthropist, has passed away at the age of 87. Rothschild left his family bank, N.M. Rothschild & Sons Ltd., in 1980 to establish his own financial empire, including the creation of RIT Capital Partners Plc, one of the UK's largest investment trusts. He was also involved in co-founding the asset manager St. James's Place Plc and was known for his philanthropic work, including chairing the boards of the National Gallery and the National Heritage Lottery Fund. Rothschild's family described him as a respected financier, supporter of the arts, and passionate advocate for charitable causes. [Extracted from the article]

Jacob Rothschild, a banker and philanthropist, has passed away at the age of 87. He left his family's banking dynasty, N.M. Rothschild & Sons Ltd., in 1980 and went on to build his own financial empire in the City of London. Rothschild was known for his involvement in various business ventures, including co-founding the asset manager St. James's Place Plc. He was also a prominent philanthropist, chairing the boards of the National Gallery and the National Heritage Lottery Fund. Rothschild's death was confirmed by his family, who described him as a respected financier, supporter of the arts, and environmentalist. [Extracted from the article]

Berkshire Hathaway Inc., the conglomerate led by Warren Buffett, saw its shares rise by 5.5% in premarket trading on Monday, bringing its market value closer to $1 trillion. The company reported fourth-quarter operating earnings of $8.48 billion, an increase from the previous year, thanks to higher interest rates and milder weather. However, Berkshire's cash hoard reached a record $167.6 billion as it struggled to find attractive deals. Despite this, the company's shares have already increased by 17% in 2024. [Extracted from the article]

Bank CEOs saw pay increases in 2023 despite a challenging year for the finance industry. Bill Winters, CEO of Standard Chartered, received a 22% pay rise, while Noel Quinn, CEO of HSBC, saw his compensation double. This increase in pay is attributed to positive share price performance and rising interest rates. However, not all CEOs experienced pay hikes, as C.S. Venkatakrishnan of Barclays saw his annual bonus fall 27% and Brian Moynihan of Bank of America saw his pay decrease by 3%. [Extracted from the article]

Close Brothers Group Plc has announced that it will not pay any dividends for the 2024 financial year in order to strengthen its balance sheet amidst a regulatory review of historic car finance loan arrangements. The Financial Conduct Authority (FCA) is reviewing car finance loans made before 2021, which could result in millions of customers being eligible for compensation. Close Brothers' shares have dropped by 8.4% due to the investigation and a potential crackdown on insurance premium financing. The FCA is examining whether customers were informed about the commission paid to dealerships. Close Brothers' motor finance accounted for about a fifth of its loan book, and the company stated that the uncertainty surrounding the FCA review prevents it from taking a charge related to the matter. The company is also taking other measures to strengthen its balance sheet, including optimizing risk weighted assets and cost management initiatives. The bank's transitional CET1 ratio, a measure of capital strength, was 12.5% at the end of December, exceeding the regulatory requirement of 9.5%. Analysts have noted the challenge faced by Close Brothers in balancing the need for certainty with the inherent uncertainty of the situation. The company's banking division generated approximately £112 million of adjusted operating profit for the six months to January 31, 2024, and its asset management arms experienced annualized net inflows of 9%. Winterflood, its stockbroker, is well positioned for a recovery in investor confidence. [Extracted from the article]

Close Brothers Group Plc has announced that it will not be paying any dividends for the 2024 financial year due to an ongoing regulatory review of car finance loan arrangements. The company stated that the reinstatement of dividends will be reviewed once the Financial Conduct Authority (FCA) has concluded its process and assessed any financial consequences. The FCA is currently reviewing car finance loans made before 2021 and is also considering measures to address concerns about insurance premium financing. Close Brothers' shares have declined by 50% this year following news of the investigation. [Extracted from the article]

Bankers at the Davos conference are cautioning against high expectations for interest rate cuts. Executives from JPMorgan Chase, Standard Chartered, and Cantor Fitzgerald have all expressed their belief that monetary policy will ease slower than anticipated by the market. This sentiment is echoed by central bankers, leading traders to scale back their bets on aggressive rate cuts. While some experts, such as the chief investment officer of Guggenheim Partners Investment Management, predict rate cuts to combat an impending recession, there is still room for nuance in the discussion. [Extracted from the article]

Panmure Gordon and Liberum, two City of London stockbrokers, have agreed to merge in an all-stock deal. The merger aims to help the firms survive a dry spell in dealmaking and fundraising for listed companies. The combined firm, to be called Panmure Liberum, will become the largest adviser to UK-quoted companies with over 250 retained corporate clients. The merger is a response to the sharp downturn in capital markets activity in London, which has led to a decline in revenues for brokers. The creation of Panmure Liberum brings together one of the oldest firms in the Square Mile with a newer firm. Panmure Gordon, founded in 1876, is controlled by the private equity vehicle of former Barclays Plc head Bob Diamond, while Liberum, founded in 2007, is owned by its staff. The merged firm plans to focus on investment banking, research, sales, and debt advisory services, and aims to strengthen its M&A and private capital capabilities. [Extracted from the article]

The Financial Conduct Authority (FCA) in the UK has announced that it will review car finance loans made before 2021, potentially leading to compensation for millions of customers. The FCA will examine historical motor finance commission arrangements and sales across multiple firms, following complaints from consumers who were sold unfair loans by units of Barclays and Lloyds Banking Group. The FCA plans to outline its next steps in the third quarter of 2024 and has paused the deadline for motor finance firms to respond to customer complaints. This investigation has been compared to the payment protection insurance misselling scandal, which resulted in billions of pounds in compensation being paid by UK banks. [Extracted from the article]

Barclays Plc has reduced its global headcount by approximately 6% in 2023 as part of its cost-cutting efforts. The majority of the job cuts were in support functions, as the bank aimed to streamline management layers and improve technology and automation capabilities. The bank's CEO, C.S. Venkatakrishnan, is working to boost the bank's stock performance, which has fallen by 10% in the past year. Barclays is currently undergoing a strategic review and plans to announce a new strategy in February. Despite the job cuts, the bank is still hiring selectively for front office roles in key businesses. [Extracted from the article]

The UK and Switzerland are set to sign a post-Brexit agreement aimed at strengthening ties between their financial centers. The deal, which has been in the works since 2020, is expected to facilitate cross-border market access for various financial services, including insurance, banking, asset management, and capital market infrastructure. The City of London has been significantly affected by Brexit, as it was excluded from the post-Brexit trade deal with the EU. The agreement with Switzerland is seen as a way to enhance the UK's financial services relationship and take advantage of new freedoms granted after leaving the EU. [Extracted from the article]