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Canadian Funds In Talks Over Â£2.8bn O2 Stake

Written By Unknown on Sabtu, 28 Februari 2015 | 18.56

By Mark Kleinman, City Editor

Two of Canada's largest pension funds are in talks about acquiring a multibillion pound stake in the company that is expected to become the UK's biggest mobile communications provider.

Sky News understands that the Canada Pension Plan Investment Board (CPP) and the Ontario Teachers Pension Plan (OTPP) have expressed an interest in buying shares in a newly formed parent of O2 and Three.

The combined group, which will be created if Hutchison Whampoa completes a planned takeover of O2 for £10.25bn, would have an enterprise value of approximately £15bn.

It would carry debts of roughly £6bn, and Hutchison has signalled that it will sell about 30% of the new company - worth in the region of £3bn - to institutional investors.

Sources said on Friday that Hong Kong-based Hutchison was "inching forward" in discussions with prospective buyers of the minority stake.

Offers totalling as much as £5bn had already been received for the roughly £2.8bn of shares, they said, with three or four purchasers likely to be selected.

The discussions remain at a tentative stage and will not result in a definitive agreement until there is certainty that Hutchison's takeover of O2 will take place.

Sovereign funds from Qatar and Singapore have also engaged in talks about backing the tie-up of the two UK mobile networks, as Sky News revealed last month.

A Chinese state fund remains interested but is less likely to be part of the investing consortium, a source said.

The appetite from sovereign investors underlines the continuing interest in UK companies following the Qatari takeover of London's Canary Wharf business district and last month's acquisition of a 9.9% stake in British Airways' parent by Qatar Airways.

Hutchison Whampoa secured a period of exclusivity to negotiate a takeover of O2 with Telefonica, its Spanish parent, in January.

The deal is the second major transaction in the UK mobile sector in quick succession, with BT having announced a £12.5bn takeover of EE - currently the country's biggest network.

The mergers have sparked concerns about the prospect of higher charges for mobile phone customers, with Three's status in the market as a 'challenger' to its bigger rivals seen by analysts as unsustainable if its owner's takeover of O2 is completed.

Sky plc, the owner of Sky News, recently struck a deal with Telefonica UK that will allow it to offer mobile voice and data services for the first time.

Like rivals BT, Vodafone and TalkTalk, the move will enable Sky to provide the 'quad-play' of fixed and mobile telecoms, broadband and pay-TV to its customers.

The O2 purchase is the latest in a series of takeovers led by Li Ka-shing, the Hutchison chairman who is Asia's wealthiest man and who has become the UK's biggest foreign direct investor.

In addition to 3, Mr Li's businesses own the high street retailer Superdrug, the container port at Felixstowe and the Eversholt rail company.

Telefonica had been in talks to sell O2 to BT before the British telecoms group decided instead to pursue talks with EE, which is jointly owned by Deutsche Telekom and France Telecom.

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Customers 'Duped' By Energy Switching Deals

Energy price comparison websites have been "duping" customers into switching to deals that are not the cheapest on the market and should pay them compensation, a group of MPs have said.

The Energy and Climate Change Committee said some sites had used misleading language to dupe consumers into options that only displayed commission-earning deals.

It has called on energy watchdog Ofgem to consider requiring price comparison sites to disclose the amount of commission received for each switch at the point of sale.

Representatives of the "big five" sites told MPs they earn up to £30 in commission every time a customer switches to a participating provider, or up to £60 when a customer switches both their gas and electricity accounts.

Committee chairman Tim Yeo said: "Consumers trust price comparison services to help them switch to the best energy deals available on the market.

"But some energy price comparison sites have been behaving more like backstreet market traders than the trustworthy consumer champions they make themselves out to be in adverts on TV.

"Some comparison sites have used misleading language to dupe consumers into opting for default options that only display commission-earning deals. And others have previously gone so far as to conceal deals that do not earn them commission behind multiple drop-down web options."

He added: "As an immediate and essential first step towards rebuilding confidence, the companies should compensate any consumers who have been encouraged to switch to tariffs that may not have been the cheapest or most appropriate for their needs.

"We have no objection to commission being paid by suppliers to price comparison websites as long as the arrangements are clearly disclosed."

Earlier this month, uSwitch told the committee it would compensate consumers who had been misled into signing up for an energy tariff that was more expensive than others available.

Its chief executive Steve Weller told the committee he was "sincerely disappointed" that a customer was told by his call centre that the cheapest deal available to him was with First Utility, when it was in fact with extraenergy for more than £60 less.

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Unions Protest As East Coast Line Goes Private

Rail unions are planning to stage protests along the East Coast Main Line later - marking the day before the route is re-privatised by the Government.

The Rail, Maritime and Transport union is organising gatherings in London, Doncaster and Edinburgh to protest against the franchise being handed over to Virgin and Stagecoach.

Its general secretary, Mick Cash, has described the re-privatisation as an act of "industrial vandalism" - and claims the new private operators are solely motivated by profit.

Citing research which suggests that 70% of Britons want the whole rail network to be re-nationalised, he said: "Six years ago, the East Coast Main Line collapsed into chaos when National Express threw the keys back because they couldn't extract enough profit. That followed an earlier spectacular private sector failure on the line when Sea Containers went bust.

"It was left to the public sector to not only rescue this vital north-south rail link from total meltdown, but to turn around its performance and to start handing hundreds of millions of pounds back to the taxpayer - in contrast to rip-off private companies."

Virgin and Stagecoach already operate services from London to Scotland on the West Coast Main Line.

In proposals for its eight years running the East Coast franchise, the consortium has pledged to launch 23 new daily services from the capital, and offer direct links to Huddersfield, Middlesbrough, Sunderland, Dewsbury and Thornaby.

It also hopes to offer 3,100 additional seats during the morning rush-hour by 2020, by introducing 65 state-of-the-art Intercity Express trains to the fleet.

The Department for Transport has rejected the RMT's claims, and said the private sector has "helped to transform our rail network into a real success story".

"We are confident that the new East Coast franchise gives the best deal for passengers. It will provide more seats, more services, new trains and over £140m of investment along the route. In addition, more than £3bn will be paid to taxpayers," a spokesman added.

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Lloyds Resumes Dividend As Profits Quadruple

Written By Unknown on Jumat, 27 Februari 2015 | 18.56

Lloyds Banking Group is to pay a dividend for the first time since its taxpayer bailout after annual profits quadrupled to £1.76bn in 2014.

The taxpayer is set to net £130m from the payment, which equates to 0.75p-per-share or £535m in total.

It is a sign the bank's recovery plan is on track as the Treasury continues to slowly return Lloyds to private hands through share sales.

Its share price rose 1% in early trading on the FTSE 100 after the development was confirmed.

Chancellor George Osborne said the payout was good news for millions of savers who hold Lloyds shares or have money invested in Lloyds through their pensions.

He added: "Today's results are another major milestone in the recovery of the British economy from the great recession and the bank bailouts."

However, there is likely to be a backlash against the Lloyds chief executive Antonio Horta-Osorio, who is in line to net £11.5m in bonuses, including a £7m long-term award set three years ago which was linked to a recovery in the bank's share price.

He told Sky News it was "very important people focus on pay-for-performance for me and my team".

Lloyds' total bonus pool for the year was set at £369m - a decline of almost 4% on last year - and considerably lower than that of RBS for 2014 which on Thursday confirmed it remained loss-making.

Like its high-street rival, Lloyds was rescued in 2008 with a £20bn injection of taxpayer cash which led to it being 40% owned by the Government.

That stake has since been reduced to 24%.

Mr Horta-Osorio said: "Over the last four years we have transformed Lloyds Banking Group into a low cost, low risk, UK-focused retail and commercial bank.

"This has been made possible by the hard work of everyone at the Group. Today's results also demonstrate that our profitability and capital position have improved significantly, and this has enabled the Board, for the first time in over six years, to recommend we pay a dividend to our shareholders.

"While we recognise we have more to do, we enter the next phase of our strategy from a position of strength.

"We will remain focused on our customers, embrace the digital age throughout the whole Group, continue our support for the UK economy and aim to deliver strong and sustainable returns for our shareholders."

Its profits were achieved despite £2.2bn of charges in respect of the mis-selling of payment protection insurance (PPI) during the year - down from over £3bn in 2013 - and other regulatory provisions of £925m, which included its £217m fine for fixing the Libor inter-bank lending rate.

Lloyds said it was expecting 600,000 new PPI complainants in the current financial year and warned it may have to raise its current provision, which currently totals more than £12bn to date.

The bank also confirmed that it had withdrawn from a US Department of Justice programme examining allegations of tax evasion related to its historic private banking operations in Switzerland.

Lloyds said it had completed a process of due diligence related to the investigation and determined no further participation was warranted.

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BA Owner's Shares Soar On Profit Take-Off

The owner of British Airways, International Consolidated Airlines Group (IAG), has confirmed a 265% rise in annual profits to £601m.

The company, which is currently aiming to bring Irish carrier Aer Lingus into its stable, said Spain's Iberia had returned to annual profit for the first time following a major restructuring.

British Airways' operating profit increased to £883m last year, which IAG said demonstrated progress on its long-term targets.

Its share price rose almost 5% when the FTSE 100 opened for business on news the company had upgraded its profit forecast for 2015 by over 20%.

It cited lower fuel costs and rising capacity for the move.

The upgrade is the latest in a series from IAG, which raised this year's forecast last October, buoyed by its exposure to strong demand for North Atlantic travel and Iberia's profitability.

IAG, which also owns low-cost Vueling in Spain, wants to add Aer Lingus to its portfolio but its approach is yet to get the backing of the Irish government which owns a 25% stake.

Unions are also cautious as the £1bn bid is set to result in back office job losses though IAG insists its plans will grow the business.

IAG chief executive Willie Walsh told Sky News: "The board and the management team of Aer Lingus recognise the value of that and have strongly supported our bid ...we remain excited about the prospect of Aer Lingus being part of IAG.

"We believe we can bring a lot of additional value to Aer Lingus so we'll wait to see what shareholders in Aer Lingus have to say."

Ryanair, which holds a 29% stake in Aer Lingus, is believed to support the offer as it remains under regulatory pressure to draw down its holding to just 5%.

Mr Walsh added that the IAG proposals would, in his view, "significantly accelerate" the growth opportunities Aer Lingus had identified for its business.

"I think the management team at Aer Lingus has done a very good job but they recognise that their plan has quite an element of risk and that that risk could be eliminated or significantly reduced as part of IAG", he said.

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Royal Mail To Raise Stamp Costs From 30 March

Royal Mail is to increase the costs of both first and second class stamps from 30 March.

The news was contained in an announcement about wider pricing of letters and parcels.

It said the prices for first and second class stamps would rise 1p to 63p and 54p respectively, insisting the cost remained among the best in terms of value offered across Europe.

Sending a large letter would increase by 2p to 95p for first class and by 1p to 74p for second class, Royal Mail said.

Royal Mail also announced that it was simplifying and cutting the price of sending a second-class medium parcel, and will maintain prices for second-class small parcels which was introduced as a Christmas promotion.

It meant parcels weighing up to 2kg would be priced at £4.89, which Royal Mail said represented a saving of up to £3.11.

The postal group said it had thought "carefully" about the impact on its customers before deciding to raise letter prices, adding that it recognised how the recent tough economic conditions had made it difficult for consumers and businesses.

Royal Mail has long complained about the costs of its Universal Service Obligation, which forces it to deliver to every UK home for the price of a stamp.

It has accused rivals of "cherry-picking" - concentrating their operations in urban areas - though the industry regulator has said it sees no reason to re-examine the USO under Royal Mail's complaint it has uneconomic.

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RBS Posts Â£3.5bn Loss As Boss Hands Back Â£1m

Written By Unknown on Kamis, 26 Februari 2015 | 18.56

A £4bn writedown on its US business meant Royal Bank of Scotland (RBS) remained in the red in 2014, with the bank confirming a £3.5bn loss.

The annual loss marked the seventh consecutive year the part-nationalised bank has failed to achieve profitability, however the figure was a marked improvement on 2013 when it lost £9bn.

RBS said it would have made a profit but for the money it had written off at its US bank Citizens, which was built up over 25 years, through what it called a "fair value adjustment".

The bank also confirmed a Sky News story of Wednesday evening that chief executive Ross McEwan was giving up his £1m "role-based allowance" for 2015, which is intended as a top-up to his £1m basic salary.

He had already decided not to take a bonus for 2014 and RBS said it was reducing the size of its total bonus pool for the year by 16% to £483m.

Sir Howard Davies, currently leading the Airports Commission, is to be the bank's new chairman, replacing Sir Philip Hampton from September.

The bank said it had £2.2bn in litigation and conduct provisions during the year - money it set aside to cover the cost of previous misconduct.

It included additional provisions for the mis-selling of payment protection insurance (PPI) of £650m and provisions relating to investigations into the foreign exchange market of £720m.

The bank confirmed on Wednesday that it had suspended two further employees in connection with the currency-rigging investigation.

Operating profits were £3.5bn - the highest since 2010. - which RBS said reflected its restructuring efforts and renewed focus on the customer.

Mr McEwan said: "Our 2014 performance shows a strategy that is working. The strong execution against the targets we set now gives us a platform to go further and faster against this strategy.

"These results make clear that underneath the conduct, litigation and restructuring charges, we have strong performing customer businesses that are geared towards delivering sustainable returns for investors.

"What you see today is a bank that is on track and delivering on its plan; a bank that is able to deliver on its ambition to be number one for customer service and advocacy in the UK and Republic of Ireland".

Unions expressed concern that further planned restructuring would hurt jobs.

Unite national officer Rob MacGregor said: "Unite is deeply concerned that the announcement today by RBS of further restructuring will unfairly impact low-paid and administration staff within the investment banking division.

"Today's announcement won't leave the wealthy traders devastated and worried about how they pay their mortgages. It will be the worker in the back office earning £20,000 per year who now faces uncertainty about what the future holds.

"Already over 30,000 jobs have been cut from across RBS since the bailout in 2008.

"We now want a proper consultation period with Unite involving serious negotiations about how the business will be restructured."

The Chancellor welcomed Sir Howard's appointment as chairman in a letter this morning, calling on him to ensure the bank's business was "conducted to the very highest ethical standards".

George Osborne wrote: "Given the extraordinary support it has enjoyed in the past from taxpayers, I know you recognise that RBS must remain a backmarker on pay and continue to show responsibility and restraint."

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StanChart To Name Winters As Next Chief

By Mark Kleinman, City Editor

The struggling emerging markets lender Standard Chartered is appointing a former architect of British banking reform as its new chief executive.

Sky News has learnt that Bill Winters, who was a member of the Independent Commission on Banking set up in the early days of the Coalition, will replace Peter Sands later this year.

The announcement was later confirmed by the bank.

Mr Winters is a former JP Morgan executive who has been running his own hedge fund business, Renshaw Bay.

Mr Sands, who has led Standard Chartered since 2010, recently told staff that he had no plans beyond running the bank and was solely focused on improving its performance.

The board of Standard Chartered had insisted until the latest wave of speculation emerged last month that no specific planning was taking place for the departure of either Mr Sands or Sir John Peace, the bank's chairman.

In a recent statement, the bank said: "Peter and the management team are focused on executing the group's refreshed strategy, delivering growth, cost savings and shareholder returns, and have the full support of the board in achieving this.

"The group is clearly aware of its disclosure obligations in respect of executive directors, and we are not making any announcement.

"The chairman announced a multi-year refresh of the board in 2011, and we will make any further announcements on this in due course."

The bank, which sponsors Liverpool FC, recently announced the sale of its consumer finance operations in Hong Kong, days after US authorities said they were extending their scrutiny of StanChart until 2017 as part of a deferred prosecution agreement.

In 2012, Standard Chartered struck a deal with regulators that saw it pay a $667m fine for violating sanctions requirements, and was forced to pay a further $300m in August after failing to make sufficient improvements to its systems and controls.

Temasek, the Singaporean state fund, which owns nearly 18% of Standard Chartered's shares, is not agitating for changes at the top of the board, according to a person familiar with its views.

However, Aberdeen Asset Management, the second-largest shareholder, is reported to be keen for Mr Sands to step down and is expected to back Mr Winters' appointment.

Standard Chartered, which has seen shares fall by more than 25% during the last year, has shaken confidence among investors after a string of profit warnings, regulatory bust-ups and management changes.

The bank declined to comment.

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Ladbrokes Nets More Cash From Gaming Machines

Ladbrokes has revealed a significant rise in earnings from gaming machines described by critics as the 'crack cocaine of gambling', ahead of an industry-wide crackdown on their use.

The bookmaker said it was now making almost £1,000 weekly from each of its so-called fixed-odds betting terminals after adding 9,000 to its stable in the first half of 2014.

Ladbrokes said such gaming revenues, from activities including roulette, grew "ahead of expectations" by 6.4% in the second half.

The company revealed the gross win for Ladbrokes per terminal per week was £996 in its fourth quarter, up from £913 during 2013 and £682 in 2008.

It meant it was now making 14% more via its in-store machines than its traditional over-the-counter betting offering.

Ladbrokes said that while new regulations on £50-plus staking were being introduced by the Government in the second quarter of the current year, it was "already preparing our shop teams to meet the new requirements whilst continuing to deliver a good customer experience."

The regulatory crackdown on fixed-odds terminals, on which punters can potentially wager £100 every 20 seconds, aims to limit stakes in a bid to curb problem gambling.

The earnings figures were contained in the company's results which showed a 44% dip in group annual profits - hurt by recovery programme costs which included the closure of 89 poorly performing UK shops.

The betting firm, which is set to lose its embattled chief executive Richard Glynn this year amid frustration over a slow response to digital business growth, confirmed it planned to close an additional 60 UK stores this year with compulsory job losses likely.

Its statutory pre-tax profit for 2014 fell to £37.7m as Ladbrokes suffered its worst ever football daily loss on Boxing Day of £8.1m through punter wins.

But it managed to get the bulk of its retail and digital transformation plans ready in time for the World Cup.

As a result, group revenues rose 3.8% in the year to £1.2bn, with digital revenues rising 23% to £215.1m.

Richard Glynn, who will leave the business once a successor is appointed, said: "Ladbrokes entered 2014 clear on what needed to be done to deliver a successful World Cup and to move from operational delivery in H1 (first half) to financial growth in H2 (second half).

"We delivered against all our operational targets, enjoyed a successful World Cup and saw clear growth in key areas of the business.

"The changes put in place have made us competitive and our customers are responding.

"Strong operational delivery delivered a second half of growth as envisaged but the £8m hit on Boxing Day did take some of the shine off our performance.

"However, this is the business we are in and does not overshadow the positive customer reaction.

"Ladbrokes exited 2014 with pleasing operational metrics and is in good shape to compete even more effectively with a clear view on what more needs to be done.

"2015 will see new management but the focus on satisfying customer demands, improving the resilience of our retail estate, growing internationally and further improving our Digital offer remains.

"Whilst recognising there are regulatory headwinds, Ladbrokes is confident in its plans for 2015."

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TSB Lures Customers From High Street Rivals

Written By Unknown on Rabu, 25 Februari 2015 | 18.56

The newly spun-off TSB bank has seen its pre-tax profit rise by 2.3%, as it lures customers from established high street rivals.

As a result, the company said it would consider making acquisitions in the future to help accelerate expansion plans.

TSB became Britain's 7th biggest lender after it was hived-off from the taxpayer-backed Lloyds Banking Group last June.

It says it now has 8.4% of all new personal current accounts opened in 2014, with the total almost reaching 500,000.

The bank said pre-tax profit rose to £133.7m for the year ending in December, up from £130.7m in the previous year.

Since its spin-off TSB has sought to position itself as one of the new breed of smaller "challenger banks", amid public discontent with the sector.

The bank said it hopes to lift its share of the total personal current account market to 6%, up from the target figure of 4.2% during the initial public offering (IPO) on the London Stock Exchange.

Chief executive Paul Pester said: "2014 was a pivotal year for our business as we started to establish TSB as Britain's challenger bank.

"We've exceeded the expectations we set out at the time of our IPO in June last year."

Banking regulators have been supporting the new breed of bank on the high street as a way of offering greater competition to the overwhelming dominance of the four large lenders.

Meanwhile, new figures released by the British Bankers' Association show personal credit usage continuing to rise.

It said in January annual growth in personal loans and overdrafts was up 3.9% - the highest rate since late 2008.

But that was tempered by mortgage approvals, which were little changed in January compared with December, and still down a fifth on the figure from a year ago.

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Apple Fined $500m For iTunes Patent Infringement

Apple has been told pay $533m (£343m) after a jury in Texas found that iTunes infringes three patents.

A jury deliberated for eight hours and found that the world's most-valuable company willfully used Smartflash's patents without permission.

Smartflash had been asking for damages of $852m (£549m) - Apple says it will appeal the decision.

A spokesman for Apple said: "We refused to pay off this company for the ideas our employees spent years innovating and unfortunately we have been left with no choice but to take this fight up through the court system."

The case began in May 2013 when Smartflash sued, alleging that iTunes software infringed on patents related to accessing and storing downloaded songs, videos and games.

Apple tried to have the case thrown out, but a judge ruled that Smartflash's technology was not too basic to deserve the patents.

It then asked the jury to find Smartflash's patents invalid because previously patented inventions covered the same technology.

Brad Caldwell, a lawyer for Smartflash, said: "Smartflash is very happy with the jury's verdict, which recognises Apple's longstanding willful infringement."

Tyler in Texas has become the focus for patent litigation.

It was also in Tyler federal court that a jury ordered Apple to pay $368m (£237m) to VirnetX Inc for patent infringement in 2012.

Smartflash has also filed patent infringement lawsuits against Samsung Electronics Co Ltd, HTC Corp and Google Inc.

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AO World Shares Plunge 46% On Profit Warning

Online white goods retailer AO World has seen its share price drop by almost 50% in early trades, wiping £500m from its market value.

The plunge occurred after it released a statement lowering its financial forecast for the full-year ending March 31.

The company's profit warning said Black Friday resulted in "adverse effects".

Shares eased to around 30% down as noon approached.

The company said: "AO has found achieving expected sales growth to date in Q4 FY15 difficult and this has negatively affected adjusted (pre-tax earnings).

"It is now apparent that some of the revenue growth in the second half of FY14 and going into FY15 was due to the extra publicity surrounding the company at that time."

It now expects gross revenue to be around £472.5m and pre-tax profit to reach £16.5m.

The Bolton-based retailer said that November's Black Friday damaged longer-term sales growth.

It said the online frenzy "did not produce incremental sales but condensed sales into a shorter time period".

The company reassured investors its business plan was sound as it pursued expansion in Germany and other potential markets.

Chief executive John Roberts said: "We remain committed to our market-leading, customer-focused business model.

"Having delivered on all our strategic objectives through this financial year, we are confident of our ability to continue to deliver for our customers and to further drive the success of AO in the interest of all stakeholders."

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Payday Loan Shake-Up Prompts Wonga Job Cuts

Written By Unknown on Selasa, 24 Februari 2015 | 18.56

Wonga has announced hundreds of job losses, hours after a regulator confirmed new rules for payday loan firms to boost competition and help borrowers shop around.

In its final report on the controversial industry after a 20-month investigation, the Competition and Markets Authority (CMA) said it was ordering online payday lenders to publish details of their products on at least one price comparison website (PCW).

But it said the site must be authorised by the Financial Conduct Authority (FCA) and it admitted there was currently no commercial PCW with such approval on payday loans.

The CMA said lenders would be obliged to set up a site if one did not emerge but it added there would be an additional consultation before the ruling was implemented.

Wonga - the country's best-known payday lender - confirmed it was cutting 325 jobs in response to the wider regulatory crackdown on the industry.

The company said it had to cut costs as the rules meant it would be smaller and less profitable in the short term, but it committed to operate "fairly and responsibly."

The CMA said its investigation into the payday market had found that a lack of price competition between lenders had led to higher costs for borrowers and many did not shop around, partly because of the difficulties in accessing clear and comparable information.

The regulator also cited a lack of awareness of late fees and additional charges.

The CMA estimated the UK's 1.8 million payday borrowers could save themselves an average £60 annually by hunting down cheaper deals.

Payday lenders operating online and on the high street will also be ordered to provide existing customers with a summary of the cost of their borrowing.

Its action is part of a wider regulatory focus on the industry.

Politicians and consumer groups demanded action on the treatment of customers who fell foul of sky high interest rates for late payments.

The FCA has already strengthened its rules under which payday lenders are allowed to operate and has placed limits on the amounts lenders are allowed to charge as well as the number of times that they can roll a loan over.

Simon Polito, chair of the CMA's Payday Lending Investigation Group, said: "The payday lending market is undergoing substantial change as a result of FCA initiatives to eradicate unacceptable practices.

"Our actions complement the FCA's measures and are aimed at making the market more competitive and further driving down costs for borrowers."

Russell Hamblin-Boone, chief executive of the CFA industry body, said: "Today's short-term lending industry is very different to the one that the CMA observed at the start of its investigation in 2013.

"The FCA's rules, including a cap on the amount that lenders can charge, have created a new lending landscape and there are now fewer lenders granting fewer loans but the demand for loans still exists.

"The CMA's final report, which we welcome, gives borrowers even greater transparency from a sector that is pioneering real-time data sharing and simple, affordable lending.

"We need to draw a line under the past and recognise the value of short-term lending in a competitive consumer credit market."

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Greek Economic Reforms 'Valid Starting Point'

Hopes have been raised that Greece will secure its four-month bailout extension, with a European Commission source welcoming its planned economic reforms.

The list of measures, which has to be agreed by its creditors in return for funding from next month, was submitted just ahead of a midnight deadline last night.

While the plans were not published ahead of the negotiations, they included proposals to boost tax collection and tackle smuggling.

According to a document seen by the Reuters news agency, Greece has pledged to not roll back any ongoing or completed privatisations and ensure that efforts to address a "humanitarian crisis" do not hurt its budget.

The Commission source said: "Last night, close to midnight, the letter with a first list of reform measures was sent by Greece's finance minister (Yanis) Varoufakis to Eurogroup President (Jeroen) Dijsselbloem and to representatives of the Commission, the European Central Bank (ECB) and the International Monetary Fund (IMF).

"This was preceeded by constructive exchanges over the weekend between the Greek authorities and representatives of the Commission and the other institutions.

"In the Commission's view, this list is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review, as called for by the Eurogroup at its last meeting.

"We are notably encouraged by the strong commitment to combat tax evasion and corruption.

"Further specification of the reforms is expected to be provided and agreed before the end of April, in line with last week's Eurogroup statement.

"Determined and swift implementation of all reform commitments will be key for a successful conclusion of the review," the source added.

It is understood the anti-austerity government of Alexis Tsipras took its time to compile the list of reform commitments as it was anxious to be seen to be delivering its promises to the Greek people to tackle poverty following six years of recession, while also securing support from creditors.

Reports suggested members of his Syriza party felt the balance had been tipped too far towards the demands of the lenders.

On Friday, Mr Tsipras had declared victory in the country's battle to secure financial support though critics suggested the deal amounted to a new bailout in all but name.

The reform list will be discussed in Brussels today and a teleconference of the eurozone's 19 finance ministers could take place later on Tuesday.

Germany's finance minister Wolfgang Schaeuble, who was the most vocal critic of Greece's efforts to seek a new loan without strict bailout conditions attached, has paved the way for a possible German parliamentary vote this week.

The move, reported by the Handelsblatt newspaper and expected on Friday, is dependent on the reform proposals from Greece being accepted by the ECB, European Commission and IMF.

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Aviva Investors Fined Â£17.6m For Failings

The City regulator has fined investment firm Aviva Investors £17.6m for systems and controls failings that "led to its failure to manage conflicts of interest".

The Financial Conduct Authority (FCA) explained that the case centred on the payment of performance fees over almost eight years from August 2005.

It said the company's use of a side-by-side management strategy within its Fixed Income area meant that traders had an incentive to favour one fund over another because of varying levels of performance fees.

The FCA said the conflicts of interest were identified by the company but its risk management framework was so weak it failed to prevent what it called an "abusive practice known as cherry picking".

It said Aviva Investors' processes meant traders could delay recording the allocation of executed trades for several hours, allowing traders to allocate trades to favourable funds.

Georgina Philippou, acting director of enforcement and market oversight at the FCA, said: "Ensuring that conflicts of interest are properly managed is central to the relationship of trust that must exist between asset managers and their customers.

"It is also a fundamental regulatory requirement. This case serves as an important reminder to firms of the importance of managing conflicts of interest effectively by implementing a robust control environment with effective systems to manage the risks.

"Not doing so risks customers' interests being overlooked in favour of commercial or personal interests.

"While Aviva Investors' failings were serious, the FCA has recognised that its actions since reporting its failings were exceptional.

"The level of co-operation during the investigation and commitment to ensuring no customers were adversely impacted meant it qualified for a substantial reduction in the penalty."

Compensation totalling £132,000 was paid to eight funds impacted by the failures.

Euan Munro, Aviva Investors' chief executive, said: "We fully accept the conclusions of this investigation.

"We have fixed the issues, improved our systems and controls and ensured no customers have been disadvantaged.

"We have also made substantial changes to the management team which is leading the turnaround of Aviva Investors.

"We have a clear focus on simple and specific investment outcomes for clients and we are delivering strong levels of investment performance within a robust control environment."

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UK Banks Slash Ranks Of Millionaire Pay Deals

Written By Unknown on Senin, 23 Februari 2015 | 18.56

By Mark Kleinman, City Editor

The UK's biggest banks slashed the number of employees earning at least £1m last year in a move they will argue demonstrates that they are heeding calls for greater pay restraint.

Sky News understands that Barclays, Lloyds Banking Group and Royal Bank of Scotland (RBS) will disclose alongside their annual results during the next eight days that the number of millionaires they created during 2014 fell sharply from the 583 a year earlier.

Insiders familiar with the figures said that the combined number of £1m-plus pay deals across the three banks would fall to approximately 450.

That decline partly reflects the fact that the bonus pool at each bank will be lower for 2014 than in the previous year despite the fact that City analysts expect them all to report stronger financial performances for the last 12 months.

Sky News revealed last week that the three banks were close to finalising bonus pools worth an aggregate £2.8bn, down from nearly £3.4bn in 2013.

However, the fall in the bonus pools can be partly explained by the fact that under new European rules, banks have shifted sums of money from senior employees' variable pay to their fixed remuneration.

This has led some critics to accuse the banks of sleight of hand in seeking to claim credit for reducing bonus payouts just weeks before the General Election campaign gets underway.

The banks are therefore likely to argue that the reduced number of millionaire pay deals - the figures for which include both fixed and discretionary pay - is illustrative of their determination to exhibit more restraint.

Last year, Barclays said it had paid 481 staff more than £1m, while at Lloyds the figure was 27 and at RBS, 75.

Collectively, bonuses at the three banks will be roughly 15% lower than the equivalent numbers for 2013.

Barclays, which is independent of the taxpayer and has by far the largest investment bank of the three institutions, will say that bonuses fell from almost £2.4bn in 2013 to below £2bn last year.

The fall will come amid a retrenchment at Barclays' investment bank, with thousands of jobs being shed under a revamped strategy announced last year by Antony Jenkins, the chief executive.

Analysts are forecasting an uptick in annual profits at Barclays, which is due to report its results on March 2.

The news on pay will mark a contrast with last year's situation at the lender, which provoked a row with some leading shareholders by increasing bonuses despite a fall in profits.

Barclays has also set aside £500m to pay fines related to control failings in its foreign exchange operations, although it has yet to reach a formal settlement with any regulators.

Lloyds and RBS will collectively pay out approximately £875m in bonuses for 2014, sources said on Thursday, compared to an equivalent figure of roughly £975m a year earlier.

The two banks, which report results towards the end of the week, are continuing negotiations over their bonus plans with UK Financial Investments (UKFI), which manages the taxpayer's stakes in them.

Sky News revealed on Friday that the chief executives of Barclays, Lloyds and HSBC would receive annual bonus awards for 2014 totalling more than £3m, although the payouts have been reduced because of fines imposed on them for mis-selling and market manipulation.

HSBC will kick off the reporting season on Monday, when it is expected to disclose that its bonus pot for 2014 was more than 5% lower than the previous year.

None of the banks would comment on their pay proposals.

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HSBC Annual Profits Fall 17% To Â£12.14bn

HSBC, the global bank currently at the centre of a tax scandal, has blamed a 17% fall in annual profits on the cost of past mistakes.

The London-listed group said reported profit before tax fell to $18.68bn (£12.14bn) in 2014 and it reflected "lower business disposal and reclassification gains and the negative effect, on both revenue and costs, of significant items including fines, settlements, UK customer redress and associated provisions".

The explanation reflected the continued cost on the industry of a number of scandals, including the mis-selling of payment protection insurance (PPI).

HSBC's share price fell more than 5% in the wake of the results as profits fell short of expectations.

Dividend and return-on-equity targets were also unexpectedly cut.

The earnings report was announced just hours after HSBC's chief executive Stuart Gulliver, who has vowed to reform the bank in the wake of allegations of complicity in tax evasion at its Swiss arm, was dragged into a tax row himself.

Mr Gulliver, who denies any wrong-doing in connection with his own Swiss-based account, said he was "disappointed" in the group's performance last year.

"2014 was a challenging year in which we continued to work hard to improve business performance while managing the impact of a higher operating cost base.

"Profits disappointed, although a tough fourth quarter masked some of the progress made over the preceding three quarters.

"Many of the challenging aspects of the fourth-quarter results were common to the industry as a whole."

Banks have not only been negotiating the effects of record-low interest rates but also uncertainty over the global economy.

In relation to the Swiss tax scandal, HSBC chairman Douglas Flint said the bank needed to reinforce controls and demonstrate their effectiveness.

He added: "We deeply regret and apologise for the conduct and compliance failures highlighted, which were in contravention of our own policies as well as expectations of us."

The bank was also the subject of a £216m fine from the Financial Conduct Authority relating to HSBC's failure to prevent the rigging of foreign exchange operations.

Mr Gulliver's total pay package for 2014 was £7.6m though his bonus of £1.3m was weaker and reflected the foreign exchange failures.

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HSBC Boss Gulliver In Â£5m Swiss Account Claims

Stuart Gulliver, HSBC's chief executive, reportedly kept millions of his own money sheltered in the bank's private Swiss offshoot.

The Guardian says Mr Gulliver - who announced the bank's full-year results this morning - kept $7.6m (£4.93m) via an account held by a Panamanian company.

Leaked files reportedly show that in 2007 he was the beneficial owner of an account held by Worcester Equities Inc though Mr Gulliver has insisted it was created for privacy reasons only and no tax was dodged in any jurisdiction.

It comes amid the ongoing scandal over claims HSBC's Swiss private banking arm helped wealthy clients evade and avoid tax, and provided services to criminals including arms dealers.

The Derby-born banking chief spoke today of the "shame" felt by staff, having apologised for the behaviour of the Swiss division in national newspaper advertisements last week.

Mr Gulliver insisted the private bank had been "completely overhauled" since 2007, when whistleblower Herve Falciani opened the door to the scandal, stealing company data and passing it to French authorities.

Swiss prosecutors have launched a criminal investigation into allegations of money laundering after raiding the bank's offices in Geneva.

The 55-year-old - believed to have raked in a £7.4m reward package last year - is legally domiciled in Hong Kong after working there for many years, despite now working in the UK.

Representatives for the banking boss told the Guardian he had paid his bonus payments into HSBC Suisse until 2003.

They said Hong Kong tax had been paid and that Mr Gulliver had also told the UK taxman about the account a "number of years" ago.

HSBC added: "Full UK tax has been paid on the entirety of his worldwide earnings less a credit for tax paid additionally in Hong Kong.

"The Swiss account was set up in 1998 in the name of a Panamanian company for reasons of confidentiality and this had no other purpose and provided no tax or other advantage.

MPs are set to grill HMRC tax officials on Wednesday over accusations they failed to act properly on the leaked files and potential evidence of tax evasion by more than 3,000 Britons.

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Greece Agreement 'Old Deal In New Clothing'

Written By Unknown on Minggu, 22 Februari 2015 | 18.56

The clue came right at the start of Yanis Varoufakis' press conference.

Up until last night's bailout extension deal, the Greek finance minister spent most of his international media appearances addressing an international audience - speaking fluent, verbose English, taking questions from outlets from around the world.

Last night, in the small Greek briefing room in the Justus Lipsius building in Brussels, he was talking to someone else entirely.

His eyes fixed down the barrel of the cameras, for a quarter of an hour he spoke only in Greek.

"We are now co-authors of our own destiny," he said.

"Negotiation means compromise. But this deal is a small step in the right direction.

"We are no longer following a script given to us by external agencies," he added.

Unusually for him, though, he was reading his speech rather than talking off the cuff.

It did not take a political genius to work out what was going on.

Syriza came to power in Greece last month promising not to do a deal with the shady characters in Brussels.

It promised not to sign up to a continuation of the unpopular bailout programme.

It promised not to have its domestic policies monitored and influenced by the so-called Troika of lenders (the International Monetary Fund, European Commission and European Central Bank).

But the deal it signed up to on Friday night involved, essentially, all of the above.

There were changes in some of the terminology.

The "programme" is now renamed the "contract"; the hated "memorandum of understanding" which entailed the reforms the country needed to make, is called the "Master Financial Assistance Facility Agreement"; the "Troika" is now referred to as "the institutions".

But, for the most part, the bailout extension Greece signed up to looks like precisely the thing Syriza and Varoufakis said they would not agree to.

True, there are some important changes: Greece will be given more leeway on its public finances this year; it will have the opportunity to curtail some of the tougher reforms, such as firesales of assets and changes in pension provisions - though these, too, will have to be approved by the Troika, sorry, institutions, in conversations starting on Monday.

Crucially, Syriza can rightly claim that its government has eased the conditions on the bailout a lot more than its predecessors.

However, this was hardly the revolution in economic policy that many Greeks will have hoped for.

It does not represent a new deal - so much as an old deal in new clothing.

Then again, perhaps that is the best that could have been expected.

This is only a short-term extension to bide the country over.

Without it, there was a distinct chance it would have defaulted and left the euro - the latter of which the vast majority of Greeks are set against.

The country's financial system was looking perilously exposed.

Throughout the Eurogroup meeting, the ECB president Mario Draghi warned repeatedly that unless Greece and its euro counterparts came up with a deal soon, money could start escaping from Greek bank accounts rapidly that there might be a full-blown financial crisis as soon as Monday.

This was a difficult meeting for Mr Varoufakis.

The former academic has taken the political world by storm in recent weeks, carrying out a whistlestop tour of European capitals to explain the Greek position.

However, so visible has he been in this period, so adamant that Greece will not water down its demands, that the events of the past 24 hours may prove tough to contextualise.

What made the job harder still is the fact that he and the finance ministry were marginalised towards the end of the negotiations.

Alexis Tsipras, the Prime Minister, stepped in and carried out some of the talks behind the scenes with his fellow leaders when things looked as if they were breaking down.

After the previous Eurogroup meeting on Monday descended into farce, amid a flood of leaks, the PM insisted that all press communications should be done through his office, rather than Mr Varoufakis'.

It was said that behind-the-scenes, the Germans were refusing to talk to Mr Varoufakis - that some Greek finance officials had been urged to get rid of their boss.

That would be a terrific mistake: their new finance minister is one of the biggest assets Greece has, particularly when it comes to explaining to an international audience why austerity has not worked, and why future deals might have to be different.

And there will almost certainly need to be another deal once these four months have elapsed.

In the meantime, Mr Varoufakis and his colleagues have a tough job on their hands explaining why what was agreed in Brussels was a triumph rather than a defeat.

Their previous feat - overturning decades of two-party domination in Greece - may end up looking easy in comparison.

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New Look Fashions Plans For Â£2bn Flotation

By Mark Kleinman, City Editor

The high street fashion retailer New Look has recruited bankers to work on a stock market listing that could value it at as much as £2bn.

Sky News has learnt that the company this week appointed JP Morgan, the Wall Street investment bank, to work on options for a flotation.

The hiring will fuel expectations that New Look's owners are actively preparing to take it public five years after it aborted an identical move amid challenging markets.

JP Morgan is working alongside Goldman Sachs, which is working with New Look to identify other potential investors for the company.

The chain, which trades from more than 800 stores in 21 countries around the world, is the UK's second-biggest women's value clothing and accessories retailer, according to Kantar Worldpanel, a research firm.

New Look has been owned since 2004 by Apax and Permira, two private equity firms, along with Tom Singh, its founder.

According to third-quarter financial results released last week, New Look saw like-for-like sales in the UK declined by 1%, a dip that it attributed to unseasonably warm weather.

The company is continuing to expand internationally, as well as attempting to grow its menswear business.

It now has nearly 20 shops in China although it retreated from Russia and Ukraine because of continuing instability in the two countries.

Anders Kristiansen, its chief executive, described New Look's trading performance as "robust...against a challenging backdrop".

"It was a record online sales performance over the Christmas period with all channels well-prepared for peaks in demand around Black Friday, Cyber Monday and Boxing Day, whilst our high street presence came into its own as we handled a surge in demand for our Click & Collect and Order in Store offerings," he said.

Mr Kristiansen said last week that New Look was a company "ready to float" although he added that a decision to do so rested with the chain's owners.

New Look's examination of a stock market listing makes it one of several well-known companies looking at such a move.

Sky News revealed earlier this week that Center Parcs had hired bankers to work on a flotation which would value it at about £2.5bn.

New Look declined to comment.

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Eurozone Agrees To Extend Greek Bailout

Eurozone finance ministers have agreed to extend Greece's rescue loans - although not by as long as the government wanted.

The deal, which will enable Athens to continue paying its bills, was reached at talks in Brussels which were delayed for four hours as ministers worked on a draft accord.

Jeroen Dijsselbloem, the eurozone's top official and the Dutch finance minister, said Athens had asked for a six-month extension but this was rejected.

"Four months is the appropriate delay in terms of financing and future challenges," he said.

The agreement was clinched just a week before Greece's €240bn (£178bn) bailout expires, leaving just enough time for some member country parliaments to endorse it.

As part of the deal Greece must provide a list of economic and other reforms based on the current bailout programme by Monday.

This will be reviewed on Tuesday by the European Central Bank, the International Monetary Fund and the European Commission.

If the three institutions do not believe the proposals go far enough, the list will be revised with a view to it being agreed by the end of April.

Greek Finance Minister Yanis Varoufakis said the deal would mark a new era for Athens and its relations with the European Union.

"Today was a pivotal moment because Greece for five years now has been lonely, isolated in the Eurogroup. Today that isolation has broken," Mr Varoufakis said.

He said Greece had not used any threats or bluff to get the agreement and added it was a small step in a new direction for the country.

Markets reacted positively to the deal, with the Dow and S&P 500 surging to fresh records on Wall Street.

Mr Dijsselbloem said it was a "first step in this process of rebuilding trust" between Greece and its euro partners and allows for a strategy to get the country "back on track."

"Trust leaves quicker than it comes," he said.

Mr Dijsselbloem worked flat out on Friday to secure an agreement as Germany insisted Greece stick with the austerity commitments included in its bailout programme.

The fraught discussions focused on a new package of concessions beyond those contained in the formal request for a loan extension submitted on Thursday.

Greece has ruled out another bailout like the existing one, saying the people who swept the anti-austerity Syriza party to power last month would not tolerate it.

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Gallery: Art War On The Streets Of Athens

Athens has become a Mecca for street artists as anger grows over the impact of Greece's bailout deal with Europe

Wall paintings have sprung up all over the city reflecting the general frustration at rising unemployment and falling living standards

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New Look Fashions Plans For Â£2bn Flotation

Written By Unknown on Sabtu, 21 Februari 2015 | 18.56