Barclays 'Must Learn' From Culture Review

Barclays has revealed that an independent review of its former business practices makes for "uncomfortable reading in parts".

The company said it must learn from the findings revealed in the review.

The report, by veteran lawyer Anthony Salz, called on the bank to maintain and publish a global code of conduct and to ensure a sufficient number of non-executive directors have banking experience.

"The report makes for uncomfortable reading in parts," Barclays chairman David Walker said in a statement.

The bank said it will report ahead of its annual general meeting on implementation of the review.

"Our plan is to report back in advance of the AGM on how we intend to implement the recommendations made, particularly those that go beyond the scope of work already underway."

Barclays, which was criticised for its key role in Libor-fixing and payment protection insurance mis-selling, said the review of business practices already substantially aligned with its transformational progress.

The Barclays share price dropped around 1% in mid-morning trading.

The company came under fire recently amid its promise of pay restraint.

Barclays picked Budget Day in March to reveal nine executives will receive more than £40m in shares.

It was earlier revealed that the bank paid 428 staff more than £1m - with some of those receiving £5m salaries.

Meanwhile, chief executive Antony Jenkins has also revealed that the growing automation of banking services could result in tens of thousands of jobs disappearing from its workforce during the next decade.

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SSE Fined £10.5m By Ofgem Over Mis-Selling

Energy provider SSE has been fined £10.5m by industry watchdog Ofgem for repeated mis-selling to householders.

The regulator said the proposed penalty is the largest it has made against an energy firm.

It relates to failures at "every stage" of the sales process for telephone, in-store and doorstep activities.

Ofgem said: "The level of fine reflects the seriousness and duration of breaches, the likely substantial harm that they have caused and the likely gain to SSE."

Ofgem found that a failure of SSE's management arrangements meant that insufficient attention was paid to ensuring compliance with obligations.

The watchdog said this enabled misleading and unsubstantiated statements to be made by sales agents to potential customers about savings.

SSE is one of Britain's "big six" energy suppliers and has admitted its selling procedures were below an adequate level.

On its website, SSE said: "We've been busy making lots of practical changes to make it simpler, fairer and easier for you to deal with us.

"We're building a better way to do business, and we believe the changes we are making will improve the energy industry for good."

Many consumers struggled to understand firms' complex tariff structures

The watchdog said the company's various selling techniques had brought the company into disrepute.

"Ofgem found failings at all stages of SSE's sales processes, from the opening lines on the doorstep, in-store or over the phone through to the confirmation process which follows a sale," the regulator said.

"In particular, SSE consistently failed, over a prolonged period of time, to conduct its sales activities in a way that would provide clear and accurate information on prices and potential savings to enable customers to make an informed decision about whether to switch suppliers."

Although SSE terminated doorstep sales in July 2011, the failures in telephone and in-store sales persisted, Ofgem said.

"Today's fine sends a clear message to suppliers that Ofgem will hold to account those companies which fail to treat consumers fairly.

"It is time for the energy industry to take note and get behind Ofgem's reforms to rebuild trust and make the market simpler, clearer and fairer for consumers."

Ofgem does not have legal power to require companies to award consumer compensation.

It has argued for powers of redress and said it was encouraged that the Government has backed its call over new powers.

The regulator said the when the Energy Bill powers come into force they will further strengthen Ofgem's ability to take more targeted action against companies that are found in breach of their licence.

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RBS Shareholders Launch £4bn Lawsuit

By Poppy Trowbridge, Business and Economics Correspondent

A group of Royal Bank of Scotland (RBS) shareholders has launched proceedings against the bank and four directors, including former chief executive Fred Goodwin.

The RBOS Shareholder Action Group, which represents more than 12,000 investors, claimed they were misled by directors over its £12bn rights issue in April 2008.

The group said the final claim against the bank could be worth up to £4bn.

A spokesman for the Action Group said: "Today represents a giant step forward for the many thousands of ordinary people who lost money as the result of inexcusable actions taken by banks and their directors in the financial crisis.

"Now, for the first time, some of these directors will have to answer for their actions in a British court."

It named the bank, Mr Goodwin and former directors Tom McKillop, Johnny Cameron, and Guy Whittaker as defendants.

Fred Goodwin oversaw RBS' multi-billion pound deal to buy ABN Amro in 2007

As the financial crisis took hold in 2008, RBS announced new shares would be offered to investors to buy, in an effort to raise the £12bn and boost the bank's financial strength.

RBS also announced at the time that it would suffer write-downs of nearly £6bn because of its exposure to credit markets.

The shareholders claim the true purpose of the rights issue was not disclosed at the time and the directors in charge gave the false impression the bank was generally financially sound.

The bank has around a month to respond to the lawsuit by issuing their defence, or apply for extra time before replying. It has the option of settling the claims or going to court.

Patricia Mohammed, one of the shareholders involved in the claim, said investors trusted RBS to tell them the truth.

"It was a huge institution, it had a huge history behind it and people on enormous salaries running it - people that we trusted to do the right thing," Ms Mohammed told Sky News.

"If we get some compensation, that is very nice.

"But if it is brought to the Government's attention that there are people prepared to do something - that they are not happy - that is important."

In 2007, RBS beat rivals, including Barclays, to buy Dutch lender ABN Amro in 2007 for nearly £50bn.

But the deal left the bank dangerously overstretched, and the following year it was forced to take a multi-billion pound bailout by the British Government.

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Apple Says Sorry Over China Customer Service

Apple's chief executive has been forced to apologise for its after-sales service in China following weeks of criticism in the country's media.

Government-controlled media across the country had attacked the technology giant's "arrogance" and accused it of "throwing its weight around".

Tim Cook has spoken about the importance of the Chinese market in the past

Critics said faulty iPhones were only repaired under its one-year service policy - not replaced as in other countries - and its warranty was shorter than elsewhere.

China is Apple's second-largest market after the US.

Tim Cook said on the company's Chinese website: "We are aware that owing to insufficient external communication, some consider Apple's attitude to be arrogant, inattentive or indifferent to consumer feedback.

"We express our sincere apologies for causing consumers any misgivings or misunderstanding."

Apple would now offer full replacement of iPhone 4 and 4S devices in China, along with a new one-year warranty, Mr Cook said.

The iPhone 5 already has a similar warranty in place.

He added that he has "much to learn about operating and communicating in China."

Mr Cook has previously spoken about the importance of the Chinese market to the company.

In the first quarter of the year, revenue from Greater China - which includes Taiwan and Hong Kong - hit $7.3bn (£4.8bn) - up 60% from a year before.

The popularity of Apple products flies in the face of China's attempts to push its own brands and develop internationally competitive companies.

Apple's opened its flagship Asia store in Beijing in October

Following the anti-Apple campaign, thousands of Chinese people defended the company on the internet.

They accused the media of hypocrisy for keeping silent when Chinese companies were implicated in other scandals.

China's state broadcaster CCTV was also accused of paying celebrities to post online comments against Apple, in what appeared to be a grass-roots campaign.

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Triple-Dip Recession 'To Be Avoided': BCC

The UK's manufacturing and services sectors have strengthened in the first quarter of the year, according to the British Chambers of Commerce (BCC).

The group's survey of more than 7,000 businesses revealed that export orders and sales in services were particularly strong - close to their all-time high in 1994.

Investment levels and business confidence about the next 12 months also increased over the period, the BCC said.

It comes ahead of GDP figures for the first quarter of the year - which, if negative, would mean that Britain had slipped into its third recession in less than five years.

But the BCC's chief economist, David Kern, said its survey results showed the economy had continued to grow at the start of 2013.

"The survey reinforces our assessment that recent GDP figures published by the Office for National Statistics have exaggerated the weakness of the UK economy and the volatility in output," he said.

"If an announcement of negative growth in the first quarter is misleadingly described as a triple-dip recession, confidence will again be damaged unnecessarily."

The EEF said the poor state of the UK's roads were hitting businesses

The BCC warned that despite the economic improvements, most of the group's key indicators remain below their pre-recession levels, last seen in 2007.

But the survey's positive report on Britain's manufacturing contrasts with separate figures which showed a contraction in the sector for the second consecutive month in March.

The Markit/CIPS manufacturing purchasing managers' index came in weaker than forecast for the month, but was slightly higher than February's four-month low.

In response, EEF manufacturers' organisation said there had been little to suggest the sector had staged a recovery in the first quarter of the year – despite the BCC's survey.

"The continued weakness in the PMI is disappointing overall, but of particular concern is another month of falling export demand," the EEF's chief economist Lee Hopley said.

"While manufacturers have made some good gains in non-EU markets over the past couple of years, the ongoing drag on orders from the eurozone is still significant and likely to impact on prospects over the coming months."

It comes as the group called on the Government to boost spending on roads - ahead of investment in high speed rail.

The EEF said that half of their members said their operating costs were significantly higher because of the poor state of the UK's roads.

It said an independent infrastructure commission should be set up to "take the politics out of" spending plans.

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Benefits: Osborne Defends Welfare Shake-Up

George Osborne is robustly defending the Government's controversial benefits shake-up - insisting Britain can no longer afford to reward people who do the "wrong thing".

Speaking at a supermarket distribution centre in Kent, the Chancellor condemned the old system as "fundamentally broken", and warned Labour that they were out of step with public opinion on the issue.

Mr Osborne insisted that nine out of 10 working households will be better off as a result of the welfare and tax changes.

He said people in Britain understood that the welfare system needed to change.

"In 2010 alone, payments to working age families cost £90bn. That means about one in every £6 of tax that working people like you pay was going on working age benefits. To put that into perspective - that's more than we spend on our schools."

He pledged to make sure people were better off in work than out, thereby making the system much "fairer". Changes, such as cutting housing benefit for social housing tenants deemed to have a spare bedroom, were simply asking people on welfare to take the same choices as working families, he said.

He said: "For too long, we've had a system where people who did the right thing - who get up in the morning and work hard - felt penalised for it, while people who did the wrong thing got rewarded for it.

"That's wrong ... This month we will make work pay.

"What this Government is trying to do is to put things right. We're trying to make the system fair on people like you, who get up, go to work, and expect your taxes to be spent wisely.

"And we're trying to restore hope in those communities who have been let down by generations of politicians by getting them back into work."

Wider welfare and tax changes coming into force this month will also see council tax benefit funding cut, and working-age benefits and tax credit rises pegged at 1% - well below inflation - for three years.

Disability living allowance (DLA) is being replaced by the personal independence payment (PIP), while trials are due to begin in four London boroughs of a #500-a-week cap on household benefits, and of the new Universal Credit system.

In his speech at the Morrisons depot, Mr Osborne dismissed "depressingly predictable outrage" about the reforms, claiming they would help the most vulnerable and "give people a ladder out of poverty".

He said: "Because defending every line item of welfare spending isn't credible in the current economic environment.

"Because defending benefits that trap people in poverty and penalise work is defending the indefensible.

"The benefit system is broken; it penalises those who try to do the right thing; and the British people badly want it fixed.

"We agree - and those who don't are on the wrong side of the British public."

Mr Osborne's speech came a day after Work and Pensions Secretary Iain Duncan Smith, the architect of the reforms, was facing a a growing backlash after suggesting that he could get by on £53 a week, rather than his current after-tax income of £1,600 a week.

In the wake of the comment in a radio interview, more than tens of thousands of people have signed a petition on the change.org website, calling for the minister to try surviving on that money for a year.

More follows...

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Cyprus Bank Deposits 'To Lose 60% Of Value'

Savers with more than 100,000 euros in the Bank of Cyprus could lose up to 60% of their deposits, two senior officials have warned.

The Central Bank official and the Finance Ministry technocrat said sums held at the country's largest lender will  lose 37.5% of their value after being converted into bank shares.

And the pair said the deposits could lose up to 22.5% more in value, depending on an assessment by officials who will determine the exact figure aimed at restoring the troubled bank back to health.

Both figures were speaking to the Associated Press on condition of anonymity because they are not authorised to publicly discuss the issue.

Cyprus' President Nicos Anastasiades

It comes after Cyprus agreed on Monday to make depositors contribute to a financial rescue in order to secure 10 billion euros (£8.5 billion) in loans from the eurozone and the IMF.

Cypriot President Nicos Anastasiades defended the bailout deal, saying it had contained the risk of national bankruptcy.

"We have no intention of leaving the euro," the conservative leader told a conference of civil servants on Friday in the capital, Nicosia.

"In no way will we experiment with the future of our country," he said.

Cypriots have expressed anger at the price attached to the rescue - the winding down of the island's second-largest bank, Cyprus Popular Bank, also known as Laiki, and an unprecedented raid on deposits over 100,000 euros.

Under the terms of the deal, the assets of Laiki bank will be transferred to Bank of Cyprus.

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Cyber Currency Surge Amid Eurozone Crisis

By Siobhan Robbins, Sky News Reporter

As the eurozone is rocked by the crisis in Cyprus, a cyber currency called Bitcoin has seen a surge in popularity from people looking for an alternative place to invest their money.

Bitcoins are basically virtual money which can be earned or bought. They were created four years ago by a hacker who remains anonymous.

There are no banks to control them, people just exchange them directly with each other over the internet. That makes them difficult to tax, trace or freeze.

In the last month, the Bitcoin has more than doubled in value.

It is claimed the surge is partly down to people in cash-strapped countries including Spain and Greece turning to Bitcoins in the hope of protecting their money.

Amir Taaki has helped develop the Bitcoin since it was created by a hacker

Amir Taaki, who has helped to develop it in the UK, told Sky News he believes it is a purer alternative to traditional banks.

"There are so many things that are wrong and broken with banks. Primarily, the biggest problem is I have to trust them and I have no other option.

"Bitcoin is a basic system where I can choose how much trust I put in other people.

"There is no central bank or central authority controlling it. Everyone that participates in the network is upholding the network and it's not a theoretical concept but a billion dollar market with charts and graphs and people are using it.

"Because it's decentralised and runs off a mathematical algorithm it means it can't be corrupted."

The premises where the digital currency is being developed

The huge spike in value makes it an attractive investment for some, but currency experts like Simon Smith from FxPro warns against that.

"It's totally unsafe. They might as well burn their money in a pile as far as I'm concerned. Yes, Bitcoin has doubled in value over the last month but it has every sign of being a bubble."

Bitcoin has reached an all-time high, trading at almost £60. Its market value is now more than £500m.

Some restaurants and shops already accept Bitcoin as payment and its supporters claim that in the future it will be dispensed from ATMs like pounds and euros.

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Bank Of England Powers Increase Amid Overhaul

The Bank of England is to become one of the world's most powerful central banks as the biggest overhaul of financial regulation for 16 years takes effect.

Sweeping changes are undoing the system set up by former Prime Minister Gordon Brown when he was Chancellor in 1997.

The Financial Services Authority (FSA) is being replaced by three new bodies - the Financial Policy Committee (FPC), the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA).

The new system comes instead of the so-called Tripartite structure of the FSA, Treasury and Bank of England, which was blamed for being "asleep at the wheel" during the 2008 financial crisis.

George Osborne hopes the new system will fix financial regulation

With both the FPC and the PRA sitting within the BoE, it will take on vast new powers and responsibility not just for regulating lenders, but also spotting and preventing possible financial shocks.

It marks a return of regulatory powers to the central bank, which were taken away from it on gaining independence in 1997.

Chancellor George Osborne is hoping the shake-up will plug the gap that previously existed in the Tripartite system, with no one taking responsibility for monitoring risks to the financial system as a whole, such as the lending boom.

He has previously criticised the structure for being "incoherent" and "without clear lines of accountability".

This perceived lack of oversight was blamed for excessive lending that sparked a sub-prime mortgage crisis and in turn the credit crunch and banking meltdown.

The system brought in by ex-PM Gordon Brown will be swept away

The changes also hope to address the FSA's self-proclaimed "light touch" regulation, which saw the watchdog fail to rein in the banks.

It has since admitted mistakes were made in the run up to the collapse of Northern Rock, while it appeared woefully inept in preventing the banking scandals that have emerged in recent years - such as the Libor interbank rate-rigging affair and the mis-selling of payment protection insurance (PPI).

As the pillar of the incoming regime, the FPC will take the broadest overview of financial regulation.

The PRA will ensure banks and insurers have enough capital and liquidity, while the FCA will protect consumers by promoting effective competition and regulating all financial services firms.

PRA chief Andrew Bailey has already promised a more intrusive approach to regulation of the 1,700 financial institutions under his remit.

Incoming bank chief Mark Carney recently outlined his thinking for MPs

His counterpart at the FCA, Martin Wheatley, has also pledged to clean up the sector with new powers to suspend or ban products and issue fines.

But there are concerns the BoE will become too powerful, given that it also has responsibility for monetary policy in the UK.

In a stark warning, the former head of Germany's central bank said recently it risked impacting its independence.

Ex-Bundesbank boss Axel Weber, who currently chairs Swiss group UBS, said he "flatly refused" taking on a regulatory remit when he was head of the bank due to concerns over independence.

The man wielding the BoE's new powers will soon be Mark Carney, who is currently Canada's top central banker. He takes over from governor Sir Mervyn King in July.

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Post Office Staff On Strike Over Closures

Thousands of staff in the country's biggest post offices are striking in a row over jobs, pay and closures.

Members of the Communication Workers Union (CWU) in around 370 so-called Crown offices were mounting picket lines in protest at plans to close or franchise 70 branches.

The union said the walkout was "solidly" supported by thousands of its members, with picket lines set up outside post offices across the country.

The Post Office said that out of the 370 Crown branches, 10 were closed all day and more than 250 closed at lunchtime.

But it said that the 166 Crown branches that have external ATMs will be fully stocked for customers to withdraw cash on Saturday.

The union organised the strike because it believes 800 jobs are at risk and also staff had not received a pay rise for two years.

The Post Office put forward the restructuring plan because Crown branches were losing £40m a year and accused the union of ignoring the "harsh realities" the company faces.

Dave Ward, the CWU's deputy general secretary, said: "Our post office members are standing up against destructive plans which would slash 20% of the Crown network and are simply asking for fair treatment and job security.

"The Post Office's plans are short-sighted and would rob the network of the most productive offices while simultaneously putting hundreds of jobs at risk and potentially damaging local economies.

"We'd like to see a better vision for a successful network which maintains services in the heart of communities alongside quality jobs."

The strike follows a ballot of workers in which 88% of those who voted demanded action.

Kevin Gilliland, network and sales director at the Post Office, said: "We regret any disruption to services the CWU's call for strike action may cause to customers. Crown branches are currently losing £40m per year and this is being subsidised by public money. This cannot continue.

"The Post Office is transforming its network to improve customer experience and in turn bring in new business. We are committed to the Post Office remaining a key part of UK high streets and our plans ensure this will happen."

He said the closures - which do not apply to smaller sub-Post Offices - affect less than 1% of the total network. At the same time as closing some branches, the Post Office was planning to improve the 300 other Crown offices.

The union said it was receiving strong public support for its campaign, with petitions circulating in areas affected by the proposals.

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