Subscribe Feed (RSS)Bonuses or no bonuses, UK taxpayers to lose out according to RBOS chief
August 10th, 2009 by admin | 0 Comments | Filed in Daily News, UK Bank Accounts, UK Banks
According to Royal Bank of Scotland its chief executive, Stephen Hester UK Taxpayers will lose out if the bank unable to pay bonuses, in what some could construe as a veiled threat o what could happen if the intense public scrutiny faced by the bailed-out bank is not eased and bonus hungry staff continue to seek greener pastures.
When the bank released their half year profits, an uninspiring increase in profits of £15 million was offset by “poor” net attributable loss to shareholders of £1.1 million.
Hester, whose £9 million pay deal only delivers if the shares reach 70 pence within three years, said the bank had suffered a “damaging but not yet destructive” exodus of staff. He said some guaranteed bonuses were being paid, but that they complied with the demand by the Financial Services Authority of being for no longer than 12 months.
Meanwhile Spanish bank, Santander has shown RBOS the meaning of profit, with an increase of 41 per cent in the first half of this year, totaling £790 million for their UK businesses.
Santander, who owns Abbey, Alliance & Leicester and part of Bradford & Bingley, reported revenues had also increased by 20 per cent, aided by increased cost savings, as also increased their deposits by 66 per cent, following the integration of Alliance & Leicester and Bradford & Bingley.
Santander’s gross mortgage lending through its UK brands totalled £10.8 billion in the first six months of the year, giving it a 16 per cent share of the market. António Horta-Osório, chief executive of Abbey, announced that the first half of the year has been a very good one for the bank.
Company liquidations and individual insolvencies in England and Wales soared to record levels in the second quarter as the economy was throttled by recession and the global credit crisis, data from the government’s Insolvency Service showed Friday.
There were 33,073 individual insolvencies in the second quarter on a non seasonally adjusted basis, the highest level since records began in 1960. That compared with 30,253 in the first quarter of this year
Company failures remained at a 16-year high in the second quarter, but figures on Friday revealed a marked slowdown in the rate of firms falling victim to recession. The Government’s Insolvency Service recorded a 39 percent rise in liquidations in England and Wales.
The Office of Fair Trading has approved Centrica’s bid to buy a 20 percent stake in British Energy from EDF. The £2.3 billion deal will allow Centrica a share in both electricity as well as future profits from four soon-to-be-built nuclear power plants, in addition to claiming 20 percent of British Energy’s un-contracted power output. The OFT granted the approval after concluding that a Centrica-EDF tie-up would be unlikely to create volatility in energy prices,
BAA Aviation has announced that they will be raising their annual cost cuts target by £14 million to £30 million as it continues to identify acquisition opportunities during the economic downturn. The aircraft-servicing company continued to outperform the market despite posting a two percent drop in half-year revenues to £550 million and a similar fall in pre-exceptional operating profits to £50.6 million.
Pre-tax profits declined from £46.7 million pounds to £25.8 million pounds after taking £12.6 million of exceptional charges into account, partly for restructuring. The company’s debt dropped from £554 million to 449 million, while the dividend remained static at 2.3 pence.
Health and beauty retailer Superdrug reported a pre-tax loss of £7.4 million pounds in 2008, compared with a profit of £21.6 million in 2008 For the year to December 27 2008, revenue at the AS Watson-owned group declined marginally by two percent to £1.07 billion.
Signet the jewellery group, has announced that its outlook on both sides of the Atlantic remains “uncertain” after it reported a four percent drop in total sales. The group said like-for-like sales in the UK declined by 4.2 percent in the six months to August 1, with H Samuel falling by 2.2 percent and Ernest Jones down 6.5 percent
Shares in Smith & Nephew edged 0.8 per cent higher at 474 pence on renewed speculation it might become a takeover candidate for US giant Biomet. The speculation follows a period of underperformance for S&N stock, which has slipped 14 per cent from its 2009 high as the weakening economy led patients to delay hip surgery.
Shares in sporting goods retailer, Sports Direct lost 2.5 per cent to close 89 pence on news that the Competition Commission are liable to examine its purchase of 31 stores from rival JJB Sports. If the commission arrives at the conclusion that competition was lessened by the sale. It could bar trading at five overlapping stores, or even place an embargo on the entire sale.
In the banking sector Royal Bank of Scotland fell for the first session in eight, losing 12.1 per cent to 47 pence after it provided a downbeat outlook statement with wider underlying losses than analysts had expected. Lloyds Banking Group, whose more optimistic view of 2010 led its stock to surge this week, took a minor retreat on Friday falling 2.6 per cent. However Barclays continued to remain supreme, gaining 3.1 per cent to close on 365 pence.
The UK’s FTSE 100 index finished for the weekend up 41 points, or 0.9%, at 4,731.56 – its highest close since early October. The FTSE 100 has rebounded 34 percent since March 3 Meanwhile the FTSE 250 continued to climb, rising on Friday by a further 43.91 points to close on 8,421.46
The pound continued to wobble against the other major currencies on Friday.
Pound/US dollar 1.6717
Pound/Euro 1.1761
Pound/Japanese Yen 162.2643
Pound/Swiss Franc 1.8033
Leading US and UK shares closed at their highest levels since last year after better-than-expected US jobless data boosted investor confidence. On the news, the Dow Jones index jumped 114 points, to close for the weekend at 9,370.07, its highest level since November of last year. The NASDAQ also did better, up 27.09 points to close at 2000.25
US President Barack Obama said over the weekend that the fact that the US economy lost only 247,000 jobs in July meant “the worst [of the recession] may be behind us”.
The unemployment rate fell to 9.4%, down from 9.5% in the previous month, the first drop since April 2008.
After reporting a rare loss in the first three months of the year, US financier Warren Buffett’s investment firm has reported a jump in profits.
Between April and June, Berkshire Hathaway made a profit of £2 billion up 15% on the same period a year ago, although revenues fell slightly too around £20.5 billion
In the first quarter, the company made a loss of around £1 billion.
According to official figures, German exports have risen by 7% in June, the fastest pace in nearly three years. In the latest sign of recovery in Europe’s economy, exports for the period totalled 67.4 billion Euros (£57.8 billion) which, while imports of 56.4 billion Euros, brought the country’s trade surplus to 11 billion Euros. These figures are the latest positive signal from the export-focused economy. At the same time, France reported that its trade deficit widened to 4 billion Euros in June, from 3.137 billion Euros for May.
Joining the ever increasing chorus that recovery is just around the corner were the European based Organisation for Economic Co-operation and Development,
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Tags: Abbey, Alliance and Leicester, BAA, Bank, Banking, Barack Obama, Barclays, Bradford & Bingley, Centrica, EdF, Financial News, Financial Services Authority, JJB Sports, Royal Bank of Scotland, Smith & Nephew, Superdrug, UK Banks
