Category Archives: Financial sector

FCA acts against PayPal and QVC as more Britons turn to buy now, pay later

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Payments group and TV shopping channel change small print after financial regulator steps in

The City regulator has taken action after finding that customers of two leading buy now, pay later providers were “at risk of harm” because of potentially unfair and unclear small print.

The US-based online payments group PayPal and the TV shopping channel QVC have changed the terms of their contracts after the Financial Conduct Authority (FCA) expressed “concern” over the impact to customers.

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KPMG boss says Carillion auditing was ‘very bad’ as firm is fined record £21m

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Jon Holt says some employees ‘simply didn’t do their job properly’ in run-up to one of UK’s biggest corporate failures

The UK boss of KPMG has said he “simply cannot defend” the firm’s auditing work on the failed government contractor, Carillion, describing it as “very bad,” as the accounting giant was hit with a record £21m fine by Britain’s accounting watchdog.

The fine comes almost six years after the outsourcing firm collapsed with £7bn debts. Carillion had been one of the UK’s biggest construction and facilities management companies, with several major government contracts.

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Bond market sell-off sends UK long-term borrowing cost to 25-year high

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Rate tops level last seen after Liz Truss mini-budget as fears of global inflation and US political instability spook markets

Britain’s long-term cost of borrowing has hit its highest level since 1998, as political instability in the US and fears of sustained high levels of inflation triggered a sell-off in global bond markets.

The yield, or interest rate, on 30-year UK government bonds hit 5.115% early on Wednesday, according to the financial data provider Refinitiv.

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City watchdog ex-chair says he faced ‘political pressure’ to let in crypto firms

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Charles Randell says some of the exchanges the FCA was pressed to allow to trade in the UK are now being investigated in the US

The UK’s financial watchdog came under “political pressure” to welcome crypto firms into the British market, its former chairman has said.

Charles Randell, who stepped down as chairman of the Financial Conduct Authority (FCA) in the spring, said it was an example of the kind of influence that elected politicians have tried to exert on independent regulators.

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HSBC more than doubles profits as interest rates soar

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Bank says it earned £17bn in first half and will hand more money back to shareholders

HSBC more than doubled its profits in the first half of the year, as rising interest rates increased returns for the London-headquartered lender.

The bank reported pre-tax profits of $21.7bn (£17bn) in the first six months of 2023, up from $8.8bn during the same period last year, despiteputting aside more money to protect against potential defaults, as rising living costs put pressure on customers’ finances.

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UK banks are closing more than 1,000 accounts every day

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Nigel Farage calls for royal commission as data shows big jump in customers being ‘debanked’

Banks are closing more than 1,000 accounts every working day, according to new data that has fuelled the growing row over so-called “debanking” and prompted Nigel Farage to call for a royal commission to investigate what he said was a scandal.

Hours after the former Ukip leader revealed he was spearheading a website to campaign on behalf of people whose accounts had been shut, data revealed a big jump in the numbers of customers dumped by their bank.

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NatWest was caught out by Nigel Farage’s deft political game

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Tory anger over Coutts affair led to bank’s board feeling it had no choice but to sack CEO Alison Rose

Just after 5.40pm on Tuesday afternoon, the two people in charge of NatWest Group put out a joint statement. Dame Alison Rose, its chief executive, admitted she had been the source for an incendiary BBC story about Nigel Farage’s accounts at its exclusive private bank, while Sir Howard Davies, the bank’s chair, expressed his support for her remaining in charge of the lender.

Eight hours later, the bank had performed a dramatic reversal, having catastrophically misjudged the mood of its largest shareholder, the UK government. After last-minute interventions from both the prime minister, Rishi Sunak, and the chancellor, Jeremy Hunt, board members convened for a late-night virtual call that was to spell the end of Rose’s 31-year career with the bank.

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New cryptocurrency offers users tokens for scanning their eyeballs

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Worldcoin, launched by CEO of ChatGPT developer OpenAI, says scheme will distinguish between ‘verified humans’ and AI

Members of the public are being invited to have their eyeballs scanned by a silver orb as part of cryptocurrency project that aims to use biometric verification to distinguish humans from AI systems.

People signing up to the Worldcoin scheme via an app this week will receive a “genesis grant” of 25 tokens, equivalent to about £40, after having their iris scanned by one of the bowling ball-sized devices.

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UBS to make $35bn in Credit Suisse takeover – but lose $17bn in rushed deal

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UBS says it will absorb costs related to litigation, regulatory matters and liability adjustments in emergency rescue

UBS is in line to make an almost $35bn (£28bn) gain after its emergency takeover of Credit Suisse – but has said it will take a $17bn hit from costs related to the rushed rescue deal.

The Swiss lender has said it will make gains of $34.8bn after taking on Credit Suisse, based on an initial assessment of data until the end of last year, according to a regulatory filing. The accounting gain will be one of the biggest ever reported by a bank in a single quarter.

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Credit Suisse says £55bn left bank in lead-up to rescue by UBS

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Results reported for what is likely to be the last time as lender’s takeover by Swiss rival nears completion

Credit Suisse said customers pulled more than 61bn Swiss francs (£55bn) worth of assets from the bank at the start of the year, laying bare the scale of the panic that contributed to its failure and emergency takeover by its rival UBS last month.

The Swiss lender said the “significant withdrawals” were partly to blame for its poor financial performance in the first quarter, with its adjusted pre-tax loss ballooning to 1.3bn Swiss francs for the first three months of the year. That compares with a profit of 300m Swiss francs during the same period in 2022.

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Credit Suisse investors suing Swiss regulator after £4bn bond wipeout

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Finma accused of acting unlawfully and undermining confidence in Switzerland as a financial centre

A group of Credit Suisse investors who lost bonds worth more than CHF 4.5bn (£4bn) are suing Switzerland’s financial regulator over a decision to wipe out risky bank debt after an emergency merger with UBS last month.

The investors filed their claim at a court in St Gallen, in the north-east of Switzerland, weeks after Swiss authorities orchestrated the takeover of Credit Suisse by its larger rival UBS, to try to stem a crisis of confidence in the global banking sector.

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HSBC shareholders urged to vote against break-up of business

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Bank warns spinning off more profitable Asia business would be complex and would lower dividends

HSBC’s board has urged shareholders to vote against a proposed break-up of its business at its annual meeting, arguing that a split would result in a “material loss” and lower dividends.

In response to calls for the split from its largest shareholder, the Chinese insurer Ping An, HSBC warned on Wednesday that spinning off its more profitable Asian business from the rest of the bank would also require approval from regulators in approximately 25 jurisdictions, and force it to make changes to customer services.

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EY plan to break up consultancy and audit divisions blocked by US office

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Accountancy firm confirms work has stopped on radical scheme after internal concerns about structure

EY has scrapped plans for a radical breakup of its global operations after internal disputes over the potential structure of the new businesses.

The company started laying the groundwork for separating its audit and advisory businesses – under the codename Project Everest – last year, as the big four accounting firms faced mounting criticism about conflicts of interest between the two divisions.

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Furious Credit Suisse investors say bank’s board should be ‘put behind bars’

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Shareholders lash out during final AGM as boss apologises for crisis that led to takeover of lender by UBS

Furious Credit Suisse investors at its final ever annual meeting blocked executive pay plans and called for board members to be “put behind bars”, as the Swiss lender’s chair said he was “truly sorry” over the bank’s demise.

Shareholders used most of the nearly five-hour annual general meeting in Zurich – the last in the 167-year-old bank’s history – to voice fury over poor management, hitting out at excessive pay for “incompetent and greedy” bankers who they said took too many risks and endangered Switzerland’s economic prosperity.

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Deadline to sell off UK government’s NatWest shares extended to 2025

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Recent banking turmoil fuels decision to delay offloading portions of its remaining 41% stake

A plan to whittle down the government’s stake in NatWest has been extended by another two years, after weeks of banking turmoil that hit the lender’s shares and temporarily fuelled fears over a fresh financial crisis.

UK Government Investments (UKGI), which manages the shares on behalf of the Treasury, said the scheme to strategically sell portions of the British taxpayer’s shareholding – after NatWest’s near-£46bn state bailout in 2008 – would now run until August 2025.

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Head of Credit Suisse talks of his profound sadness over UBS takeover

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Ulrich Körner acknowledges an ‘emotional and challenging week’ after deal was forced through by Swiss authorities

The chief executive of stricken Credit Suisse has said that he shares its employees’ “profound sadness and disappointment” after its emergency takeover by rival UBS earlier this week.

UBS took over Credit Suisse on Sunday in a £2.65bn deal forced through by Swiss authorities amid fears that a failure to protect depositors would kickstart a global banking crisis.

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UK and US shares climb as banks and ministers aim to calm Credit Suisse fears

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FTSE 100 rises and European banking shares are up after early jitters over what UBS takeover deal means for bondholders

Stocks climbed on Monday in London and New York after central bankers and politicians sought to soothe jitters triggered by the emergency rescue of Credit Suisse during the weekend.

Central banks in the UK and eurozone issued statements aimed at reassuring investors that – unlike the controversial approach taken by the Swiss authorities in the Credit Suisse deal – their jurisdictions would follow a hierarchy in which equity holders would lose out before bond holders.

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UBS agrees takeover of stricken Credit Suisse for $3.25bn

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Swiss government forces through takeover at well below market value amid fears of global banking crisis

The Swiss government has forced through the takeover of stricken bank Credit Suisse by rival UBS for almost $3.25bn (£2.65bn) – well below its market value – amid fears that a failure to protect depositors would trigger a new global banking crisis.

After a weekend of frantic talks, the Swiss government and the banking regulator brokered a deal once it became clear a $54bn loan to Credit Suisse from the Swiss central bank had failed to halt the precipitous slide in its share price.

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Credit Suisse shares continue to fall despite efforts to calm nerves

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Lifelines handed to Swiss bank and US regional bank First Republic fail to ease investor concerns

Credit Suisse shares came under renewed pressure on Friday, despite fresh attempts by central banks and politicians to calm fears about a crisis in the global banking industry sparked by the collapse of two US banks this week.

Shares in Credit Suisse, Switzerland’s second largest bank, fell 8% on Friday despite securing a £45bn emergency loan from the Swiss National Bank just days earlier to shore up its liquidity after a week of panic.

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Credit Suisse takes $54bn loan from Swiss central bank after share price plunge

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After largest shareholder was unable to provide backing, Europe’s 17th largest lender says it will use government help to become ‘simpler and more focused’

Credit Suisse has announced that it will take a CHF50bn ($53.7bn) loan from the Swiss central bank, in an action it says will “pre-emptively strengthen its liquidity” as it moves to stem a crisis of confidence a day after its share price plummeted.

This additional liquidity would support the bank in taking the “necessary steps to create a simpler and more focused bank built around client needs”, its statement said. The bank said it was also making buyback offers on about $3bn worth of debt.

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