Weekend economic news headlines

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Weekend economic news headlines

National Savings to cut rates on old accounts
Tens of thousands of customers with old National Savings & Investment savings accounts will have their returns cut in November.
The Daily Telegraph, p. 31

In praise of inertia
A comment on the number of employees who have decided to opt out of auto-enrolled workplace pensions, according to the Department for Work and Pensions.
Daily Mail, p. 83

Data highlight rising cost of advice
Hourly rates for financial advice have increased, with setting up a stocks and shares ISA now £300 and arranging a pension contribution £500, up from £492.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Money, p. 2

Staff stick with workplace plans
The DWP says that fewer than one in 10 employees chose to opt out of pension schemes, exceeding expectations. Fewer than a tenth opt out after being automatically signed up.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Money, p. 2

Investors shun advice as costs are laid bare
New GfK research indicates that 63% of the people who made a stocks-and-shares investment over the past five years – including pensions – took financial advice.
The Daily Telegraph Your Money, p. 1

Who is going to save the saver?
Mark Carney is going to make life a misery for the next three years for anyone who saves, is approaching retirement or is running a pension scheme.
The Guardian Money, p. 4

Cash point
The West Bromwich Building Society unveiled Britain’s cheapest ever mortgage yesterday – a two-year fixed-rate deal charging interest of just 1.48%.
Daily Mirror, p. 56

Buy-to-let at new high
New Council of Mortgage Lenders figures indicate that 40,000 buy-to-¬let mortgages were advanced by UK lenders in the three months to June.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Money, p. 2

Living with the new ‘normal’
Four out of ten first-time homeowners surveyed by the Post Office said that competitive mortgage rates would tempt them to move.
The Times, p. 55

Carney is dragged into Co-op conflict
BANK of England Mark Carney, the governor of the Bank of England, has been dragged into the row over the Co-operative Bank’s plan to make bondholders share the pain of its £1.5bn capital-raising exercise.
Daily Mail, p. 81

Human cost of a banking mess
Mark Carney is being confronted this week with the problems of the troubled Co-operative Bank, notes The Daily Mail.
Daily Mail, p. 83

FCA clampdown
The Financial Conduct Authority has fined the Guaranty Trust Bank £525,000 for failing to implement anti-money laundering controls.
Daily Mail, p. 83

HSBC and StanChart hit by slowing emerging markets
A slowdown in emerging markets has hindered the profits of HSBC and Standard Chartered in the first half of the year. The news has led to analysts downgrading full-year earnings forecasts for both banks.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 11

BoE guidance signifies more work for investors
John Authers comments on Mark Carney, the Bank of England’s new governor, breaking with centuries of precedent to offer forward guidance on monetary policy.
This abstract from the Financial Times was produced by Kantar Media
Financial Times, p. 20

Central banking: still a man’s world
Gillian Tett comments on central banking.
This abstract from the Financial Times was produced by Kantar Media
Financial Times FT Weekend Magazine, p. 46

Carney pledge lifts homeowners, but not savers
Bank of England governor Mark Carney has announced that the MPC is keeping benchmark interest rates at 0.5% until the unemployment rate falls to 7%.
This abstract from the Financial Times was produced by Kantar Media
Financial Times Money, p. 3

Simple plan for making banks safer
NEW YORK Five years ago, before Lehman Brothers imploded and the global economy lurched to a halt, Fannie Mae issued a report that encapsulated the financial system’s biggest problem.
International Herald Tribune, p. 9-10

A simple plan for safer banks
Many economists agree that banks should not be allowed to borrow so much, Adam Davidson writes.
International Herald Tribune, p. 1

UBS agrees to settle Lehman case
UBS has agreed to pay $120 million to settle a lawsuit by investors who accused the Swiss bank of misleading them about the financial condition of Lehman Brothers Holdings during the sale of structured notes.
International Herald Tribune, p. 11

Activist takes up Co-op bondholders’ cause
Approximately 15,000 holders of Co-operative Bank bonds have written to the Bank of England’s financial policy committee to urge them to prevent a £1.5bn rescue of the bank from requiring them to take losses on their investment.
The Guardian, p. 28

Gilts
Financial analysis column noting the Bank of England’s new “forward guidance” policy on interest rates.
The Times, p. 49

How you can survive and thrive in Carney’s low-interest world
The Bank of England Governor’s guidance will create winners and losers, says a column in The Times.
The Times, p. 51

Carney’s doing nothing for retirees
Considering that not a lot has changed for the man or woman on the street, Carney’s, pictured, press conference, formally known as the Bank of England Inflation Report, has caused quite a hoo-hah.
Independent i, p. 49

Take more risk on your savings
Mark Carney’s pledge to keep interest rates low for three more years will burn a hole in your savings. Holly Thomas looks at how to boost returns.
The Sunday Times Money, p. 4-5

Delaying annuity purchase? Be prepared to wait years
Pension savers face a long wait until annuity rates rise following the Bank of England’s “forward guidance” on interest rates, according to experts.
The Sunday Telegraph Business, p. 14

Few avoid auto-enrolment
Research has shown that only 9 per cent of workers have opted out of automatic enrolment pension schemes since their launch last October, the Department for Work and Pensions has revealed.
The Sunday Times Money, p. 2

Royal Mail pumps £90m into bosses’ pension plan
A report on the extra funds of £90m being prepared for Royal Mail’s executive pension scheme. The payments have been disclosed in the company’s annual report.
The Sunday Times Business, p. 1

Germany battles boffins over Nats
University Lecturers are battling the German state to grab a stake in Nats, Britain’s air traffic controller. The Universities Superannuation Scheme (USS), Britain’s second-biggest pension scheme, is vying with Deutsche Flugsicherung, Germany’s state-owned air traffic controller, for a 20.5pc stake.
The Sunday Times Business, p. 3

Buy-to-let bonanza as rates stay low
Savers are expected to pile into property to beat the prospect of another three years of ultra-low interest rates. Last week the Council of Mortgage Lenders, the trade body, said 40,000 buy-to-let loans worth £5.1bn were approved between April and June, up 21% on the previous quarter.
The Sunday Times Money, p. 1
Also appeared in : The Sunday Telegraph Business, p.11

Overseas property owners lock in to stronger pound
Holiday homeowners and new buyers rushed to secure improved foreign exchange rates after sterling rose last week.
The Sunday Times Money, p. 1

Cable: RBS sell-off ‘five years away’
The Business Secretary has signalled that the Royal Bank of Scotland will be in public hands for another five years.
The Sunday Telegraph Business, p. 1
Also appeared in : The Sunday Times Business, p.3, The Mail on Sunday, p.79, The Sunday Telegraph Business, p.2

Rise in jobless could bolster Carney plan
A rise in unemployment could be announced this week, a vindication of the Bank of England’s decision to keep interest rates at a record low to support the recovery. The Office for National Statistics will also release inflation figures for July, notes a Sunday Times report.
The Sunday Times Business, p. 1-2

Inflation still above target despite fall
Official figures this week are expected to show that UK inflation remains well over the Bank of England’s target.
The Sunday Telegraph Business, p. 3

Lord Sugar complains over £10m Lioyds fees in ‘mis-selling’ dispute
Alan Sugar has emerged as a potential victim of the mis-selling of interest rate hedging products by Britain’s major banks.
The Sunday Telegraph Business, p. 1

JP Morgan reaps the whirlwind
When bets placed by a star trader turned sour, the bank dismissed it as a ‘tempest in a teapot’. Now, amid accusations that the losses were covered up, the storm is out of control, Ben Laurance reports.
The Sunday Times Business, p. 8

London Whale duo may face extradition
Two City traders could be arrested within days over their role in the $6.2bn “London Whale” trading scandal at JP Morgan. The possible charges stem from a probe by the US Attorney’s office launched shortly after the trading losses were first revealed more than a year ago.
The Sunday Times Business, p. 1

Barclays turning to the City for support
Barclaysis hoping to secure investor backing for its £5.8 billion emergency share sale next week with the release of the prospectus for the deal. The bank is holding informal meetings with key institutional investors to get an idea of their support for the rights issue, which will take place in mid-September. It hopes to cement their support with the prospectus.
Sunday Express Financial, p. 3

HSBC says ‘yes’ to £1 million loan for importer
Barnes Williams has secured £1 million in fresh finance from HSBC to grow the herb, spice and other ingredients import business. HSBC has also reportedly pened a renminbi current account for the Cheltenham-based importer, so that it can trade with its Chinese suppliers in their own currency.
Sunday Express Financial, p. 2

Co-op is seeking promises over jobs
A source reportedly claims that the Co-operative Group has sought pledges to safeguard jobs from potential buyers of its general insurance business. Deutsche Bank is advising the Co-op and it is thought that the mutual wants to have a working shortlist of bidders for the division, valued at £280 million, by the end of the month.
Sunday Express Financial, p. 1

Bankers show how to knock off the EU’s bonus cap
The Observer’s Business Leader comments on bankers’ pay. “From next year, Brussels is limiting bonuses for anyone paid more than €500,000 (£430,000) a year to one times their salary – or twice with the explicit approval of shareholders,” the article notes. HSBC chairman Douglas Flint last week conceded that the bank was considering giving bankers pay rises to compensate them for their potentially lower total income. “The sentiment behind the bonus cap – clamping down on bankers’ pay – is a undoubtedly a good one. But the method was ill thought through and the consequences could be disastrous,” the article concludes.
The Observer, p. 40

The above articles appeared on 07/08/13 & 08/08/13 reproduced with the kind permission of Kantar Media UK. All rights reserved.

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