Weekend economic news round up

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Weekend economic news round up

Sale of Lloyds and RBS stakes comes a step nearer
The government has asked banks to tender for contracts to advise on the potential sales of the government stakes in Lloyds Banking Group and Royal Bank of Scotland.
The Guardian, p. 37
Also appeared in : Financial Times, p.13

The truth about the mortgage timebomb
Outgoing Bank of England Governor Sir Mervyn King warned this week that homeowners in their thirties and forties are facing a mortgage timebomb, writes Simon Read. He told MPs that households which are heavily in debt could struggle with increased mortgage repayments and other loans if interest rates rise.
The Independent, p. 55
Also appeared in : Financial Times, p.2

PRA rule will cut lending, says Jenkins
Antony Jenkins, the chief executive of Barclays, has warned it may cut lending if a new rule designed to make banks more secure is introduced too quickly
Daily Mail, p. 93

Report into alleged racism in bank lending gathers dust
A Nick Clegg-commissioned inquiry into racism in British banks’ lending practices has not been completed, despite it commencing 19 months ago. Chuka Umunna, the shadow business secretary, yesterday expressed concern at the delay,
The Guardian, p. 24

Virgin Isa goes straight to the top
Review new financial products, including a Virgin Money fixed rate individual savings account, A Woolwich Barclays mortgage and Tesco Bank motor insurance.
Sunday Express Financial, p. 5

Inflation wipes out £17 billion a year of savers’ cash – but there IS an answer
Savers must be prepared to take on board more risk in their search for income or see their savings undermined by inflation, according to leading money experts.
The Mail on Sunday, p. 87-88

New Isa pays more than rate of inflation
A new Isa that pays more than rate of inflation.
The Sunday Telegraph Money, p. 4

Ageing voters threatening rebellion on pension cuts
A survey of OAPs showed that many believe the Government’s state pension system reforms will leave them worse off than before.
Sunday Express, p. 18

Alternative annuity could beat inflation
Andrew Tully, pensions technical director at MGM Advantage, says people approaching retirement have been hit by low interest rates and quantitative easing.
Sunday Express Financial, p. 4-5

Owners take big risk using pension to finance firm
A rising number of small business owners are reportedly using private pension funds to provide capital for their firms.
The Mail on Sunday, p. 86

Fraud fear over new pension pot rules
Tom McPhail of Hargreaves Lansdown, the adviser, said: ‘Pension liberation fraudsters could use automatic transfer under the current proposals for ‘pot follows member’ to facilitate siphoning money out of the pensions system.’
The Sunday Times Money, p. 3

EU MORTGAGE MUDDLE
The EU wants to introduce a new way of calculating interest rates on home loans – a recipe for confusion, experts tell Rosie Murray-West.
The Sunday Telegraph Money, p. 1

Interest rates are rising – except for savers
Turmoil in the markets means wholesale interest rates are rising. Richard Dyson looks at the effect on mortgages and savings.
The Sunday Telegraph Money, p. 4

THE LONG AND WINDING ROAD
Every house-price measure is showing a rise, including a 12-month increase of 2.6% on the Office for National Statistics (ONS) measure, 2.7% for the Acadametrics index, 2.6% for the Halifax (based on the average of the latest three months) and 1.1% for Nationwide.
The Sunday Times Home, p. 14

Lenders relax landlord terms
Landlords will be able to offer their tenants longer-term contracts following a policy change by one of the biggest buy-to-let lenders, which could see other banks follow suit.
The Sunday Times Money, p. 5

Lock into a fix before rates rise
Paragon Mortgages, a buy-to-let lender, has also stopped offering fixed-rate deals. In the past fortnight, Skipton, Newcastle and Principality building societies have raised the cost of fixes.
The Sunday Times Money, p. 5

JPMORGAN profits surge to £8 billion
US bank JPMorgan is expected to announce a 20 per cent surge in second-quarter pre-tax profits. Elsewhere, Treasury Select Committee is expected to press Bank of England deputy governors Paul Tucker and Andrew Bailey to elaborate on claims that the Government had put pressure on the banking regulator to water down new capital rules.
Sunday Express Financial, p. 3

Bank boss may continue with QE
Mark Carney,the new Bank of England governor, is widely expected to pump more money into the economy with another round of quantitative easing in August.
Sunday Express Financial, p. 1

PAYDAY LOANS SUMMIT
Payday loan firms have been summoned to meet ministers amid fresh calls to outlaw the huge interest rates that cause debt misery for millions. Consumer Minister Jo Swinson, along with regulators and charities, will meet the companies tomorrow in a bid to stamp out problems in the £2billion-a-year industry. It comes days after the Office of Fair Trading referred the market to the Competition Commission for a year-long probe.
Sunday Mirror, p. 2

Still got debt? Then be warned: things will get tougher
Julian Knight comments on interest rates.
The Independent on Sunday, p. 78

Banks drag feet on £2bn rate swap scandal payout
Thousands of the small and medium-sized businesses are still waiting to receive compensation for interest rate ‘swaps’ one year after the Financial Services Authority 90 per cent of firms had been mis-sold the policies.
The Mail on Sunday, p. 81

Battered bankers find salvation in charity
A new survey suggests that banks give more to charity than any other business sector.
The Mail on Sunday, p. 83

First-time homebuyer hopes soar as lenders scramble to offer deals
Hopeful first-time home buyers look set to have the best summer in four years as banks slash the size of deposit they require for their lowest rate deals and come up with a range of other incentives.
The Mail on Sunday, p. 94-95

Business as usual at Barclays – threaten the regulator
The Business Leader column in The Observer criticises Barclays for “fronting up” to the UK banking regulator.
The Observer, p. 38

Squeezing banks too hard will throttle lending
Comment on the row between Barclays and the Prudential Regulation Authority.
The Sunday Times Business, p. 4

TSB is back as Lloyds rebrands
Lloyds Banking Group is to rebrand the branches it was planning to sell to the Co-operative Bank as TSB, ahead of a planned float. Monday, September 9, is the likely launch day.
The Sunday Times Business, p. 2

Bank lashes Barclays for loans threat
The Bank of England is heading for a showdown with Barclays this week over threats from Antony Jenkins, chief executive of Barclays, to rein in its lending.
The Sunday Times Business, p. 1

Investors fight Co-op
Co-operative bank bondholders are clubbing together to block plans by the bank to cut their investments.
The Sunday Times Money, p. 2

A little advice for you, Mr Governor: your credibility will be crucial
Observer economic columnist Heather Stewart introduces a series of recommendations by policy experts and economists for the incoming governor of the Bank of England, Mark Carney.
The Observer, p. 36-37

Rising rates knock Osborne off course
Rising interest rates could blow a multibillion-pound hole in George Osborne’s finances, undermining his attempts to control public spending.
The Sunday Times Business, p. 2

Osborne’s long march to an affordable state
Comment on the state of the economy and recent revisions to gross domestic product (GDP) figures from the Office for National Statistics.
The Sunday Times Business, p. 4

The above articles appeared on 29/06/13 & 30/06/13 reproduced with the kind permission of Kantar Media UK. All rights reserved.

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