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Friday Papers: Banks’ Libor costs may hit $22bn

And Dentsu in challenge to dominant ad groups with £3.2 billion Aegis deal.

 
Friday Papers: Banks’ Libor costs may hit $22bn

Top stories

  • Financial Times: Twelve global banks that have been publicly linked to the Libor rate-rigging scandal face as much as $22 billion in combined regulatory penalties and damages to investors and counterparties.
  • Financial Times: Dentsu, Japan’s dominant advertising group, has agreed to buy Aegis, the UK-listed advertising agency, for £3.2 billion in cash.
  • Financial Times: The Co-operative Group is close to agreeing final terms with Lloyds Banking Group to buy 630 of its branches in a deal expected to be struck at a steep discount to the previously mooted £1.5 billion price tag.
  • The Guardian: Leicester city council on Thursday revealed it was preparing to move £6 million out of Barclays in protest at the Libor rate-fixing scandal.
  • The Daily Telegraph: JP Morgan intends to claw back millions of dollars in bonuses from executives involved in a loss originating from the bank’s London office that is said to have reached $5 billion.
  • Financial Times: PSA Peugeot Citroën has announced the first closure of a big car plant in France for 20 years and took the axe to 6,500 jobs.
  • Daily Mail: Britain will need another £65 billion in tough austerity measures to manage the impact the ageing population has on its already-creaking public finances, the Office for Budget Responsibility has warned.
  • Financial Times: Boeing has fought off a strong challenge from Airbus to win a $15 billion order for 150 narrow-body aircraft from United Continental Holdings, the largest US airline by revenue.
  • The Guardian: The British government's backing for Premier Oil's move to buy a 60% stake in a licence to explore and develop oil prospects off the Falklands will infuriate Argentina.
  • Financial Times: David Cote, Honeywell chief executive, has urged business leaders to press politicians to agree on a solution to the country’s debt problems as concern rises that gridlock in Washington is damaging the economy.
  • The Guardian: The pound hits a near four-year high against the euro; £1 is worth €1.27.

Business and economics

  • Financial Times: Deposits at the European Central Bank have more than halved after the common currency’s guardian cut the rate it pays for overnight deposits to zero, but banks have elected to park them at a different part of the central bank rather than lend them out.
  • The Daily Telegraph: British government measures to cut the budget deficit and reform public sector pensions have improved Britain’s long-term economic prospects.
  • Financial Times: The Obama administration has unleashed a fresh wave of sanctions against Iran, announcing new financial restrictions and accusing dozens of shipping companies of secretly transporting crude oil as Washington seeks to force Tehran to negotiate over its nuclear programme.
  • The Daily Telegraph: Lenders in the US are notifying more property homeowners that they face losing their home, with foreclosures rising for the first time in two years.
  • Financial Times: The lowest-ever five-year fixed rate on a UK mortgage will be announced on Friday – the same day the government reveals details of a scheme to make more cash available for loans to small businesses and households.
  • Financial Times: Oil demand in the developing world will overtake that in industrialised countries for the first time next year.
  • The Guardian: Michael Cherney, the businessman suing Russian billionaire Oleg Deripaska for $1.2 billion, is a criminal who regularly met with organised crime bosses and extorted millions of pounds in protection money, a court has heard.
  • Financial Times: Investigators probing the alleged fraud at futures broker Peregrine Financial Group are intensifying their focus on a customer account held at Iowa where more than $200 million is missing.
  • The Daily Telegraph: Karl-Friedrich Stracke, head of General Motors' European division, has stepped down after less than a year in the role to take on "special assignments" for the chief executive.
  • The Guardian: AstraZeneca is pinning its hopes on developing new treatments for Parkinson's, Alzheimer's and other neurodegenerative diseases as it tries to refill its threadbare pipeline of medicines.
  • Financial Times: Booz Allen Hamilton, the defence consulting firm majority owned by private equity group Carlyle, plans to raise up to $2.25 billion in debt to refinance existing borrowings and fund a $1 billion special shareholder dividend.
  • The Independent: SuperGroup's underlying profits tumbled by 14.7% to £42.8 million over the year to 29 April, although new stores drove a 31.9% uplift in revenues to £313.8 million.
  • Financial Times: SAP’s software revenues jumped by a currency-adjusted 19% to €1.06 billion in the three months to 30 June.
  • Financial Times: Software developer Wandisco reported a 60% increase in subscription bookings to $3.38 million in the first half of the year.
  • Daily Mail: The revenue of Associated British Foods went up 11% for the 40 weeks to 23 June.
  • Financial Times: India-based Infosys expects sales to rise only 5% in the coming year, down from the previous guidance of 8-10%.
  • Financial Times: Wells Fargo is to pay at least $175 million to settle allegations by the Department of Justice that it discriminated against African-American and Hispanic borrowers by steering them into high-cost mortgages.
  • Financial Times: Temenos shares lost more than 20% of their value on Thursday after the Swiss banking software company announced the departure of its chief executive, Guy Dubois, following a sharp fall in sales.

Share tips, comment and bids

  • Financial Times: Centrica has strengthened its North American energy business with an agreement to buy two US gas and electricity suppliers from Iberdrola of Spain for $110 million in cash.
  • The Independent: The private-equity house Permira has sold Valentino to Qatar's investment vehicle Mayhoola in a €700 million deal.
  • Financial Times: Shell extended its £1.12 billion offer for Cove Energy again on Thursday, bringing it one step closer to a showdown with rival bidder PTT of Thailand next week.
  • The Daily Telegraph: Vodafone is to buy the New Zealand operations of Australia's Telstra in a £435 million deal that could threaten the dominance of Telecom New Zealand.
  • The Independent: Mike Ashley's Sports Direct has agreed to buy the Manchester-based fashion chain Flannels; it is thought Sports Direct is paying a nominal sum.
  • Financial Times: An offering to institutional investors of shares in Malaysia’s IHH Healthcare, one of the biggest initial public offerings this year, has been 132 times subscribed as the country’s IPO market continues to defy global uncertainty.
  • Financial Times: Bill Ackman, the activist investor, has received clearance to take a stake in Procter & Gamble in a sign that he could become a new source of pressure on the company, which has lost the faith of some investors.
  • Financial Times: Nomura is working on a potential sale of ING’s Japanese business which could fetch a combined $7 billion.
  • The Guardian (Comment): Demand has not risen. Neither has production. Yet we have been duped into thinking that QE will kickstart the economy.
  • The Daily Telegraph (Comment): A car industry shedding jobs in the thousands after a chronic loss of competitiveness undermined by the dead hand of state aid. Sound familiar?
  • The Daily Telegraph (Comment): Suddenly, this month's diary looks far more arduous for Tim Geithner who, as US Treasury Secretary, sets America's economic policy alongside Federal Reserve chairman Ben Bernanke.
  • Daily Mail (Commentary – Alex Brummer): The fact is that Britain’s open Anglo-Saxon capitalism has claimed another victim.
  • Financial Times (Lex): Peugeot: French carmaker’s restructuring announcement was painful, but necessary. However, it resolves very little for investors as the company continues to burn cash.
  • Financial Times (Lex): Infosys: the Indian outsourcer is exposed in a downturn and although it expects volumes to grow by 9% this year, prices could fall 4%, which will hit margins.
  • Financial Times (Lex): Carrefour: the French retailer’s shares jumped after a sales update did not turn into a profit warning as feared, but the group still faces problems.
  • Financial Times (Lex): Dentsu/Aegis: Japanese advertising agency’s attempt to diversify through the £3.2 billion acquisition of London-listed Aegis has little chance of achieving any synergies.

1 comment so far. Why not have your say?

Roger Savage

Jul 13, 2012 at 10:03

"Britain will need another £65 billion in tough austerity measures to manage the impact the ageing population has on its already-creaking public finances"

I'm sick of reading about the impact of the ageing population whilst the authorities seem happy to spend money on providing public services for ever more immigrants and indigenous spongers who never contribute a bean yet breed more drains on society. Time to look at that methinks.

The ageing population that have actually got off their backsides and worked for a living will have paid more than enough in tax and NI to cover the costs of their old age.

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