Analysis 'Last nail in the coffin' for savers


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Analysis ‘Last nail in the coffin’ for savers

Analysis ‘Last nail in the coffin’ for savers
The Guardian’s Patrick Collinson claims that savers are “paying a high price for funding for lending”, which has reduced interest rates on deposit accounts and Isas to record lows.
The Guardian, p. 29

Investors call on top bosses to exercise more restraint on pay
The bosses of Britain’s biggest firms are too often paid enormous salaries even when they perform poorly, and should show more restraint in bonuses this year, the National Association of Pension Funds (NAPF) argued yesterday.
City AM London, p. 8

Pension postcode lottery
A gap between the cost of living and pension income means many retirees are facing a shortfall of thousands of pounds a year, it has emerged.
Daily Express, p. 15

Europe’s insurers warned of rate risks
The European Insurance and Occupational Pensions Authority are to step up scrutiny of insurers’ ability to meet promises made to policyholders after warning that persistently weak investment returns put one in 10 at risk of serious difficulties.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Companies and Markets, p. 20

F&C lifts dividend for 43rd year
Foreign & Colonial Investment Trust, which launched in 1868 and is listed on the London Stock Exchange, yesterday announced it plans to increase its dividend for the 43rd year in a row.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Companies and Markets, p. 22

HSBC struggles in UK with fines and PPI costs
Last year HSBC made no profit in the UK, the bank revealed yesterday, with regulatory fines, PPI compensation payments and the low interestrate environment all taking their toll on the giant lender. Shares slipped 2.49 per cent on the full year results as pre-tax profits unexpectedly fell six per cent to $20.6bn (£13.6bn) in 2012.
City AM London, p. 6

Even I, as a pro-European, am against an EU cap on bankers’ bonuses
The latest EU rules to cap bank bonuses have the potential to severely damage a strategic sector, and one that Britain leads in Europe, writes Roland Rudd.
City AM London, p. 20

Future Bank of Japan chief set up for stimulus
The Japanese government’s nominee to be the next central bank boss yesterday outlined more forceful policy prescriptions to finally defeat deflation. Haruhiko Kuroda said he would not set any limits on the amount of cash the Bank of Japan pumps into the economy.
City AM London, p. 8

HSBC meets Basel capital target early
HSBC has hit tough new capital targets years before the official deadline, removing the drag on the lender’s growth and allowing it to supply more credit in the coming years, the firm’s full year results showed yesterday.
City AM London, p. 1

UBS appoints fund strategy guru O’Neill
UBS the investment bank has poached wealth management executive Bill O’Neill from rival Merrill Lynch as part of a reshuffle of its Wealth Management Research (WMR) unit. O’Neill was Merrill Lynch Wealth Management’s chief investment officer for EMEA having spent more than 20 years in investment management and research positions.
City AM London, p. 11

Bank of Ireland sees losses sink deep into red
The BANK of Ireland recorded another big loss in 2012 as operating profits plunged on squeezed interest margins, the lender revealed yesterday.
City AM London, p. 11

Bank loans fall six months into fund aid plan
Bank lending to the private sector plunged again in the final quarter of 2012 despite continued government efforts to pump more credit into firms and households, Bank of England data showed yesterday. Data from the British Bankers’ Association suggests almost 80 per cent of small firms’ loan requests are approved, hinting that low demand led to falling loan levels.
City AM London, p. 5

Former Lloyds banking bigwig Eric Daniels re-emerges at CVC
Former Lloyds chief Eric Daniels, who led the bank’s muchmaligned takeover of HBOS in 2008, has been recruited by CVC Capital Partners to offer advice on buying and selling financial institutions.
City AM London, p. 5

Irish bank sees signs of revival
Bank of Ireland suffered heavy losses for 2012 however said there were signs of improvement in the Irish and British housing markets. It reported underlying pre-tax losses of £1.2bn in 2012, down 2pc against the previous year, after booking £1.5bn losses on the sale of businesses, redundancy charges and buying back bonds.
Daily Express, p. 50

HSBC dividends up despite fall in profit APR 11
HSBC has shrugged off a fall in profits by raising its dividend payout and promising more to follow in 2013 in a move welcomed by investors, including the UK’s battered pensions funds. The bank’s profits for 2012 fell six per cent to £13.7billion but it announced dividends for last year of £5.5bn, a rise of 10pc and said the first 3 payouts for 2011 would be increased by 11pc, a rise of £600m.
Daily Express, p. 50

Scandal-hit HSBC lavishes £1million payouts on 200 staff
HSBC last yera handed million-pound pay packages to more than 200 staff despite being fined £1.2billion for money laundering, while Lloyds Banking Group announces it would pay a £1.5million bonus to its chief executive Antonio Horta-Osorio despite making an annual loss of £570million.
Daily Mail, p. 12

Bank placates shareholders with dividend
HSBC investors are due to receive a larger dividend than they did last year, according to the Daily Mail’s Ruth Sunderland, who adds that its decision will keep HSBC in the top three dividend payers in the FTSE100 index, along with Royal Dutch Shell and Vodafone.
Daily Mail, p. 63

Complaints to banking watchdog soar
It has been announced that banks triggered more than 1,500 complaints a day to the industry referee. The Financial Ombudsman Service dealt with a record 283,251 cases between July and December – a 110% surge on the previous six months. In many instances, complainants had their problem rejected by the bank only for it to be upheld later by the ombudsman.
Daily Mirror, p. 44

Yesterday banks were slammed as figures showed a massive slump in the amount lent to businesses in the last quarter of 2012. Net lending by major banks fell by £2.4billion on the previous quarter, with Lloyds down £3billion, Santander £2.8billion and RBS £1.6billion. Only Barclays and Nationwide increased their net lending, by £1.9billion and £1.7billion respectively. Shadow Business Secretary Chuka Umunna said ministers needed to “get a grip”. The British Bankers Association claimed businesses were preferring to pay down their debts rather than borrow more.
Daily Mirror, p. 6

Outrage as HSBC’s boss earns £7.4m
Stuart Gulliver the boss of HSBC picked up £7.4million in pay and perks last year – 500 times more than the bank’s lowest-paid workers. He was among 204 staff paid more than £1million last year as HSBC profits soared 18% to £10.9billion. Yet the bank where staff can earn just £14,000 a year is planning to close its final salary pension scheme and cut holidays by two days.
Daily Mirror, p. 2

HSBC misses profit target after double blow costs billions
HSBC disappointed the market today with an unexpected fall in profits: pre-tax profits fell 6% to $20.6 billion, below the analysts’ average forecast of $23 billion. Chief executive Stuart Gulliver still picked up a pay package worth £7.4 million. Gulliver missed targets on return on capital and cost efficiencies last year, but was praised for his “strong leadership” and “personal behaviour” over the money laundering scandal.
Evening Standard London, p. 41

Banks lending even less in spite of cheap money pool
The Bank of England’s flagship Funding for Lending scheme to boost desperately needed credit has been criticised as banks and building societies slashed lending by £2.4 billion at the end of last year. Mortgage interest rates have been slashed by the scheme, although business borrowers have yet to see a real impact from the initiative. The British Chambers of Commerce said: “Although the fourth quarter is typically a subdued period for lending, the latest update is clearly disappointing.”
Evening Standard London, p. 41

Daniels puts Lloyds turmoil behind him with CVC role
Eric Daniels, the former boss of Lloyds Banking Group who found his tenure at the bank heavily criticised by both press and politicians, is joining private equity firm CVC Capital Partners as a member of its global financial institutions advisory board.
Evening Standard London, p. 44

78 city bankers paid £1m by HSBC
HSBC paid 78 of its London staff more than £1 million each last year despite being hit by a record fine for money laundering. HSBC chief executive, Stuart Gulliver, got £7.4 million. Barclays is expected to reveal that it paid hundreds of staff around the world more than £1 million each last year. TUC general secretary Frances O’Grady said: “At a time when real wages are falling for the vast majority of people, the banking sector is continuing to hand out huge bonuses as if they were pocket change.”
Evening Standard London, p. 1-2

Banks look at suing over bonus cap
London’s City big banks are considering suing the EU over rules to cap bonuses after receiving legal advice that the regulation could be struck down in court.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 4

Lloyds tops list of banks suffering most complaints
Lloyds Banking Group, which includes the Halifax, Lloyds TSB and Bank of Scotland brands, has again been named as the bank attracting most complaints, the Financial Ombudsman Service has said.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 4

Scheme fails to stem lending decline
Funding for Lending, the flagship government initiative to boost credit creation, failed to stop a decline in lending during the final three months of 2012, sparking calls from the business secretary to review the scheme.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 2

HSBC rules out transferring HQ to Hong Kong despite bonus cap
HSBC’s management has “postponed indefinitely” a relocation of the bank’s headquarters to Hong Kong, stressing it is committed to keeping its domicile in Britain despite the threat of new European bonus restrictions.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 1

Chairman defends pay
The chairman of HSBC, Douglas Flint, defended Stuart Gulliver, the chief executive, over his £1.95m bonus for 2012 by arguing it was unfair to punish indiscriminately those charged with a turnround at the bank.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Companies and Markets, p. 19

Partial success leaves plenty of work for Gulliver
News analysis on HSBC’s chief executive Stuart Gulliver facing a series of challenges to boost revenue and cut costs – at least according to the scorecard used to determine his pay awards.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Companies and Markets, p. 19

BofA loses claim against mortgage insurer
A court has ruled against Bank of America’s claim that a New York regulator improperly allowed MBIA, the bond insurer, to transfer billions of dollars of cash between subsidiaries, depriving banks of hundreds of millions of dollars in payouts.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Companies and Markets, p. 21

Bank of Ireland hails new momentum
Report on how Bank of Ireland’s underlying operating profits fell 41 per cent last year amid difficult business conditions in its home market.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Companies and Markets, p. 20

Banks lending even less in spite of cheap money pool
The Bank of England’s flagship scheme to boost desperately needed credit came under heavy fire as banks and building societies slashed lending by £2.
Independent i, p. 38

Daniels puts Lloyds turmoil behind him with CVC role
Eric Daniels, the former chief executive of Lloyds Banking Group, showed yesterday that being discredited in the public eye is no barrier to lucrative new roles in finance.
Independent i, p. 39

HSBC gifts show nothing’s changed despite US fine
What would it take for a banking executive to not be awarded a bonus, as opposed to voluntarily forgoing a payout as only Antony Jenkins at Barclays did this year?
Independent i, p. 39

Investors buy into the turnaround at HSBC
Not only is HSBC too big to fail ? it’s too big to damage. Even as its 2012 performance was hit by the biggest fine ever levied against a bank, the lender’s bottom line was barely blemished.
International Herald Tribune, p. 20

Greek bank deposits rose by €2 billion, or $2. 6 billion, in February, the country’s central bank governor said Monday, an increase that suggests growing confidence in the country’s banking system as fears of a Greek euro exit recede.
International Herald Tribune, p. 19

Banks find wrongful foreclosures for U.S. military
The biggest U. S. banks wrongfully foreclosed on more than 700 military members during the housing crisis and seized homes from roughly two dozen other borrowers who were current on their mortgage payments, findings that eclipse estimates of the improper evictions.
International Herald Tribune, p. 17

Britain joins fray on bank pay
The British finance minister, George Osborne, was expected to urge his European Union counterparts on Tuesday to dilute the strength of proposed rules restricting the size of bonuses for bankers.
International Herald Tribune, p. 1

Profit falls 17% at HSBC after fines for laundering
HSBC, the biggest British bank, said Monday that its net profit decreased 17 percent last year because of a record fine to settle money-laundering charges and changes related to the value of its debt.
International Herald Tribune, p. 16

Bank makes £13bn then takes 2 days holiday from staff
HSBC was accused yesterday of attacking the pensions of its lowest paid staff and stealing holidays as the bank reported pre-tax profits of £13.7billion for 2012.
Metro London, p. 41

Lending falls as BoE scheme stalls
State-owned banks were yesterday accused by Former Liberal Democrat Treasury spokesman Lord Oakeshott of ‘stabbing Britain in the back’ as it emerged that net lending fell in the last quarter of 2012.
Metro London, p. 41

BANK of Ireland yesterday announced […]
Bank of Ireland yesterday announced an annual pre-tax loss of £1. 8 billion for last year.
Metro London, p. 41

HSBC leaves rivals behind as profits hit £13.7bn
The Financial Services Authority has given green light to HSBC to increase its dividend, ahead of a report expected to identify shortfalls at several lenders.
The Daily Telegraph Business, p. 1-5

Banks fail to pass cheap credit on to businesses
Britain’s banks and building societies ended up cutting loans to households and businesses by almost £2bn. despite drawing £13. 8bn from the state-backed Funding for Lending cheap credit scheme in its first five months of operation.
The Daily Telegraph Business, p. 1-5

HSBC offers a vision of the UK’s future growth
Comment on HSBC reporting annual profits of more than $20bn (£13bn) after shaking off the US subprime crash, the eurozone crisis, and the UK’s economic slump.
The Daily Telegraph Business, p. 2

Too big to fail – and too big to manage
Commentator Joris Liyendijk discusses the nature of the country’s semi-private banks and the circumstances in which the government’s stake in them should be sold.
The Guardian, p. 1-28

HSBC So why shouldn’t Stuart […]
Analysis of the decision by HSBC to award its chief executive a £2m bonus following a year in which it was forced to pay a record-breaking fine of £1.2bn in the US for money-laundering and sanctions breaches.
The Guardian, p. 31

Banking/PPI drives surge in complaints
Complaints to the Financial Ombudsman more than doubled in the second half of 2012 to a record 283,251, a 110pc increase over the first 6 months. Three-quarters of the complaints were about mis-sold payment protection insurance (PPI), with Lloyds TSB the most complained-about brand. It had 45,727 complaints, after the number of PPI claims rose 344pc.
The Independent, p. 52

Yesterday the Bank of England and the Treasury released a progress report on their Funding for Lending Scheme (FLS). The results did not look good. Since the scheme was launched, to considera¬ble fanfare, last summer the participating banks have drawn down £13.8bn in cheap funding from the central bank. But rather than using this money to increase the volume of lending to households and small businesses, as the scheme was designed to encourage, the banks have instead shrunk their lending books by £1.5bn.
The Independent, p. 50

Outrage as HSBC hands £2m bonus to chief after fine in US
HSBC handed its chief executive a £2m bonus as part of a pay and benefits package worth £7.4m, de¬spite a year in which it was exposed as a conduit for drug money and sanc¬ tions busting. The massive bonus sparked fresh outrage among campaigners who are reportedly aghast at the payment, given the damn¬ing indictment of the bank’s activities filed by United States watchdogs, who imposed a record fine of $1.9bn (£1.3bn).
The Independent, p. 48

Calls grow for Bank to print more money as builders get shakier
An alarming fall for Britain’s builders in February has intensified calls for the Bank of England to offer more help to the economy yesterday. The Chartered Institute of Purchasing & Supply’s latest snapshot of the sector – where a score under 50 signals falling activity – sank from 48.7 to 46.8 last month, marking the fastest pace of decline since October 2009.
The Independent, p. 49

Banks awash with cash but small firms see none of it
Britain’s small businesses remain locked in a credit crunch half a decade after the dawn of the financial crisis, despite government efforts to ease credit conditions, the latest Bank of England data show.
The Times, p. 31

Bonus for bank boss
Stuart Gulliver, HSBC’s boss, got a £1. 95 million bonus last year, despite record fines for money laundering and a fall in profits.
The Times, p. 31

Not everyone loses money at the bank
The Irish taxpayer is on course to make a substantial profit from its stake in Bank of Ireland, despite the group reporting another year of losses.
The Times, p. 35

Record fines and fall in profits, but HSBC boss still gets £2m bonus
Adding fire to the debate over bankers’ pay, it has been revealed that 78 HSBC employees were paid more than £1 million last year, despite the lender’s record $1.9 billion fine in the United States for money laundering and its annual losses in Britain.
The Times, p. 35

FTSE 100 is up but sterling is weak
Since the beginning of the year, the FTSE 100 is up 7 per cent, compared to gains below 1 per cent for both the German DAX and the French CAC.
City AM London, p. 23

FSA warns of cash for access crackdown
The Financial Services Authority is ready to clamp down on asset managers using investors’ money to pay for access to chief executives.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 1

Cash for access is a breach of trust
Editorial comment calling for a clamp down from the Financial Services Authority over commission paid by clients to asset managers and, in the UK at least, justified as research.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 12

Wall Street’s latest idea
Report looking at how new regulations and competitive pressures are hurting profits on Wall Street, but there are hopes it will boost bank earnings.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 11

Britain must do whatever it takes to nix the bonus cap
Focus on today’s Ecofin meeting of EU finance ministers, where the British government has a chance to nip the bankers’ bonus proposal in the bud.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 13

Trading post Jamie Chisholm
This week has been busy for central bank monetary policy meetings, with the ECB and Bank of England in focus. First up is the Reserve Bank of Australia, which announces its decision early today. The RBA is expected to leave interest rates unchanged at 3 per cent.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Companies and Markets, p. 33

The above articles appeared on 05/03/13 reproduced with the kind permission of Kantar Media UK. All rights reserved.

Charterbridge Private Financial Planning, Independent Financial Advice, Thornbury, Bristol.