Hong Kong stock fell almost 17% amid default fears that are beginning to have a knock-on effect on other markets
Shares in the embattled Chinese property company Evergrande have plunged 17% as investors weigh up whether the group’s massive debt problems could trigger a broader sell off across all financial markets.
Related: ‘China’s Lehman Brothers moment’: Evergrande crisis rattles economy
Continue reading...ShareAction says lack of plans to tackle climate crisis and biodiversity loss casts doubts on banking’s sustainability pledges
Europe’s 25 largest banks are still failing to present comprehensive plans that address both the climate crisis and biodiversity loss, putting their sustainability pledges in doubt, campaigners have warned.
While some lenders such as NatWest are demonstrating leadership on specific issues – such as net zero targets and policies restricting financing for new fossil fuel – research by investment campaign group ShareAction found none of the banks it reviewed were taking action across all key areas.
Continue reading...Barclays and HSBC among banks booking money equivalent to 14% of annual profits in offshore entities
Leading European banks are booking around €20bn (£17bn) a year – equivalent to 14% of their total profits – in tax havens, with Barclays, HSBC and NatWest Group among those enjoying the lowest tax rates, according to a new report.
The figures emerge from an analysis, conducted by the EU Tax Observatory, of 36 big banks required to publicly report country-by-country data on their activities.
Continue reading...The year 2020 exposed the risks and weaknesses of the market-driven global system like never before. It’s hard to avoid the sense that a turning point has been reached
If one word could sum up the experience of 2020, it would be disbelief. Between Xi Jinping’s public acknowledgment of the coronavirus outbreak on 20 January 2020, and Joe Biden’s inauguration as the 46th president of the United States precisely a year later, the world was shaken by a disease that in the space of 12 months killed more than 2.2 million people and rendered tens of millions severely ill. Today the official death tolls stands at 4.51 million. The likely figure for excess deaths is more than twice that number. The virus disrupted the daily routine of virtually everyone on the planet, stopped much of public life, closed schools, separated families, interrupted travel and upended the world economy.
To contain the fallout, government support for households, businesses and markets took on dimensions not seen outside wartime. It was not just by far the sharpest economic recession experienced since the second world war, it was qualitatively unique. Never before had there been a collective decision, however haphazard and uneven, to shut large parts of the world’s economy down. It was, as the International Monetary Fund (IMF) put it, “a crisis like no other”.
Continue reading...Despite chequered history the 329-year-old private bank has secured the sought-after B Corp status
Private bank Coutts will offer carbon credits and green mortgages to its ultra-wealthy clients after becoming one of the largest UK banking brands to secure B Corp status.
Coutts, known as the Queen’s bank for having served every member of the royal family since George IV, is trying to bolster its environmental and social reputation after being dogged by a series of scandals in recent years, including sexual harassment allegations against its former star banker Harry Keogh, who was sacked in 2018. The bank was also fined by Swiss regulators in 2017 over alleged money laundering and for illegally profiting from transactions associated with the 1MDB scandal.
Continue reading...EU forecast to reap extra €50bn per year with UK expected to gain €200m from BP alone
A proposal to be tabled by the US president, Joe Biden, at the upcoming G7 meeting for a 15% global corporate tax rate could reap the EU €50bn (£43bn) a year, and earn the UK nearly €200m extra alone from the British multinational BP, according to research.
Should the tax rate be set higher at 25%, the lowest current rate within the seven largest world economies, the EU would earn nearly €170bn extra a year – more than 50% of current corporate tax revenue and 12% of total health spending in the bloc.
Continue reading...World’s poorest nations saddled with ‘imprisoning’ debt, hampering responses to the pandemic, say activists protesting HSBC meeting
Activists at a demonstration outside the annual general meeting of HSBC in London have demanded the bank and other financial giants provide debt relief to African countries hit hard by the coronavirus pandemic.
In an attempt to highlight the role of private creditors in the debt crises of the world’s poorest countries, campaigners with “drop the debt” banners gathered outside HSBC’s AGM at the Southbank Centre.
Continue reading...The crypto asset is down more than 30% this week but is still up by more than 1,000% from the start of 2021
A senior manager at Goldman Sachs in London has quit the US investment bank after making millions from investing in Dogecoin, the joke crypto asset which has risen by more than 1,000% in value this year.
City sources said Aziz McMahon, a managing director and head of emerging market sales, had resigned from the bank after making money from investing in the digital currency based on the Doge internet meme.
Continue reading...Witnesses will be asked to respond to claims the ’Ndrangheta has laundered billions of euros in City of London
In a high-security, 1,000-capacity courtroom converted from a call centre, Italy’s largest mafia trial in three decades is under way in Lamezia Terme, Calabria. About 900 witnesses are set to testify against more than 350 defendants, including politicians and officials charged with being members of the ’Ndrangheta, Italy’s most powerful criminal group.
Several of the defendants will be asked to respond to charges of money laundering over establishing companies in the UK with the alleged purpose of simulating legitimate economic activity.
Continue reading...Directors’ bonuses scrapped as chief risk officer and investment bank chief exit
Credit Suisse has cancelled the bonuses of its directors, slashed its dividend and announced the departure of two senior executives as the bank revealed £3.4bn in losses from the collapse of the Archegos investment fund.
The Swiss bank is reeling from heavy exposure to Archegos and the business bank Greensill, which suffered successive but unrelated financial blow-ups.
Continue reading...Collapse of Archegos has reportedly prompted SEC and FCA inquiries into Credit Suisse, Goldman Sachs, Nomura and others
UK and US regulators are looking into whether global investment banks breached rules by holding group discussions shortly before launching a fire sale of nearly $20bn worth of assets belonging to the distressed hedge fund Archegos Capital Management, according to reports.
The Securities Exchange Commission is said to have requested further information from major US banks Goldman Sachs, Wells Fargo and Morgan Stanley, as well as Japan’s Nomura and Swiss lender Credit Suisse about a meeting with Archegos founder Bill Hwang on Thursday.
Continue reading...Liquidation of Bill Hwang’s Archegos Capital Management sparked a fire sale of more than $20bn assets
Financial regulators across the world are monitoring the collapse of the New York-based billionaire Bill Hwang’s personal hedge fund.
The sudden liquidation of Hwang’s Archegos Capital Management sparked a fire sale of more than $20bn assets that has left some of the world’s biggest investment banks nursing billions of dollars of losses.
Continue reading...Younger staff in London follow revolt in US offices over remote-working conditions
The reputation of Goldman Sachs as the most desirable employer for aspiring investment bankers is at stake. Legendary for its pulling power with the best graduates, the bank is now facing a rebellion in its lower ranks.
Junior staff who used to tolerate long working hours thanks to office camaraderie have been forced to manage burnout at home, alone, throughout the pandemic. Some have started demanding change, while others are plotting their exit. What began as a little local trouble at a US office in February has now spread to the UK.
Continue reading...Coal, oil and gas firms have received $3.8tn in finance since the Paris climate deal in 2015
The world’s biggest 60 banks have provided $3.8tn of financing for fossil fuel companies since the Paris climate deal in 2015, according to a report by a coalition of NGOs.
Despite the Covid-19 pandemic cutting energy use, overall funding remains on an upward trend and the finance provided in 2020 was higher than in 2016 or 2017, a fact the report’s authors and others described as “shocking”.
Continue reading...First-year US analysts complete internal survey, describing ‘sleep deprivation’ and workplace ‘abuse’
Junior bankers at Goldman Sachs say they are facing “inhumane” conditions at the investment bank, including 100-hour work weeks and “abuse” from colleagues which has severely affected their mental health.
The responses from the poll participants – 13 investment banking analysts in the US – have shed light on the gruelling demands on first-year analysts, a cohort that features some of the brightest recruits hired annually by Goldman.
Continue reading...Data from EY highlights last-minute transfers in order to hold on to European business
City firms revealed in the final months of 2020 that they planned to shift nearly £100bn in assets to the EU, taking the total value of assets lost to the bloc since the Brexit vote to £1.3 trillion, according to a new survey.
The data from consulting group EY pointed to a last-minute push by firms before 31 December after the UK-EU trade deal did not offer concessions for the UK’s dominant financial services sector. It forced companies to move staff and assets to the continent in order to continue serving EU customers.
Continue reading...Why there may be more to the announcement of Covid-inspired cuts than meets the eye
Here comes another bank that has decided, apparently definitively, that working practices will not return to their pre-pandemic norms. Lloyds Banking Group says it plans to shed 20% of its office space. Earlier this week, HSBC said it would get rid of 40%.
These figures are so dramatic that they invite suspicion. Have managements really come to the firm view that working from home is so popular that employees’ demands for flexibility must be granted? Or did these banks have too much office space in the first place and now wish to save a few quid?
Continue reading...More executive roles are expected to relocate to home base of Hong Kong as part of Asia shift, where most of its earnings come from
HSBC, Britain’s biggest bank, has recorded a 34% drop in profit for 2020 as it prepares to double down on its operations in Hong Kong and China despite concern about the political crackdown in the former UK colony.
The bank said on Tuesday that pre-tax profit was down from $13.3bn (£9.4bn) in 2019 to $8.8bn in the 12 months to 31 December, while the adjusted profit before tax of $12.1bn (£8.6bn) fell 76% on the year before.
Continue reading...The bank, which is due to reveal its annual results this week, faces more challenges than the impact of Covid-19 on profits
HSBC’s chief executive Noel Quinn has had an unenviable first year on the job. In 2020 alone, Quinn rolled out a major restructuring plan that will involve at least 35,000 job cuts, battled the financial impact of Covid in both Asia and Europe, and steered the bank through a geopolitical storm over its response to democracy clashes in Hong Kong.
Now he is set to preside over the bank’s second straight year of declining annual profits.
Continue reading...The former chief of staff to the CEO was motivated by greed, personal gain and self-gratification, prosecutors argued
A former NAB executive who fraudulently enjoyed $5.4m worth of benefits unwittingly paid for by the bank has been jailed for at least four years and nine months.
Rosemary Rogers, 45, became so used to “enjoying the benefits of her fraud” she was unable to stop over a four-year period, acting judge Paul Conlon told the New South Wales district court on Wednesday.
Continue reading...