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Tuesday Papers: US banks pay $20bn mortgage crisis bill

And European commission president José Manuel Barroso says euro crisis is a thing of the past.

Tuesday Papers: US banks pay $20bn mortgage crisis bill

Top stories

  • Financial Times: US banks agreed to pay out more than $20 billion on Monday in two settlements to resolve claims arising from the mortgage crisis.
  • The Daily Telegraph: Bank of America has reached a $10 billion settlement with Fannie Mae on residential mortgage loans sold by the bank and its Countrywide unit to the agency ahead of the US 2008 financial crisis.
  • The Guardian: The euro has been saved and the euro crisis is a thing of the past, European commission president José Manuel Barroso has declared.
  • The Daily Telegraph: The US is "seriously" considering creating a $1 trillion platinum coin to write down part of its debt to stop the world's largest economy defaulting as early as next month, according to financial analyst Cullen Roche.
  • Daily Mail: Property values increased by an average of 1.3% last month but are likely to end 2013 at levels close to where they began, Halifax said; the bank reported an average house price of £163,845, up from £161,795 in November.
  • Financial Times: Apple has asserted its leadership in the mobile applications market, revealing 20 billion apps were downloaded on its iPhone, iPad and iPods in 2012.
  • Financial Times: Eric Schmidt, the chairman of Google, the world’s biggest internet search group, arrived on Monday in North Korea, a country which enforces some of the strictest controls on web usage.
  • Financial Times: Michael Corbat has made the first overhaul of Citigroup’s management since he succeeded Vikram Pandit as chief executive of the bank last year.
  • Financial Times: Nat Rothschild, the financier who created Bumi plc, has won the backing of Richard Buxton, Schroders’ head of UK equities and an influential UK fund manager, in his effort to replace the board of the coal miner.
  • The Independent: A recovery team has refloated the Shell oil drilling rig that ran aground last week near an Alaskan island, and began towing it on Monday towards a more sheltered position 30 miles away.
  • The Daily Telegraph: Balfour Beatty's long-standing chief executive, Ian Tyler, is to step down just two months after the construction and infrastructure giant issued a surprise profit warning.
  • Financial Times: Shares in Yum Brands fell more than 5% in after-market trading on Monday after the owner of the KFC fast-food chain warned that a controversy surrounding its Chinese operations would hit fourth-quarter earnings.
  • Financial Times: Anglo American is this week set to name Mark Cutifani, chief executive of AngloGold Ashanti, as its new chief executive.

Business and economics

  • Financial Times: Ireland plans to raise money through a bond sale in the “near future”, which would represent another significant step towards economic and financial rehabilitation following its €67 billion bailout more than two years ago.
  • Financial Times: Trading in European stocks has slumped to a decade-low in volume terms, underscoring the impact of the eurozone debt crisis on investor risk perception.
  • Financial Times: Shares in French and German banks rallied on Monday on the expectation that they stand to benefit most from moves by regulators to weaken the first-ever global bank liquidity standards to a greater degree than expected.
  • The Guardian: Lord Sugar was paid £500,000 to chair YouView, the much delayed internet-based TV service backed by the BBC, as staff costs soared to well over £3 million.
  • The Independent: The City financier Crispin Odey recorded a 24% return in his flagship hedge fund last year, with the Odey European fund seeing its assets grow to $1.8 billion during the first 10 months of the year.
  • Financial Times: JP Morgan Chase sold a third less physical power in the third quarter of 2012; sales from Goldman Sachs, Morgan Stanley, Citigroup and Deutsche Bank were 52.7%, 18%, 36.6% and 3.7% lower on the year, respectively.
  • Financial Times: BNY Mellon has received approval in Europe to launch a central securities depository (CSD) as the regulatory push to safeguard all aspects of the trading cycle reaches into securities settlement.
  • The Daily Telegraph: The controversy over the impending departure of British Gas boss Phil Bentley has intensified after the main union representing workers voiced its support of the outgoing executive.
  • The Daily Telegraph: Financial Times owner Pearson is to close the UK-based apprenticeship business it bought less than three years ago, taking a £120 million hit and putting 500 jobs at risk in the process.
  • Financial Times: Toyota and Nissan, Japan’s top two car companies by revenues, sold more than 100,000 fewer cars in China last year than in 2011, as territorial tensions between Asia’s two largest economies escalated into riots and a consumer backlash.
  • The Independent: More than two million new cars were sold in the UK last year, an increase of 5.3% on 2011 and the highest since 2008, said the Society of Motor Manufacturers and Traders.
  • The Independent: BMW sold 178,854 new BMW and Minis during 2012 – a 7.2% jump on the previous year, which pushed its share of the overall car market to a record 8.8%.
  • Financial Times: HTC’s net profit fell 91% to $34.5 million for the fourth quarter of 2012, from the same quarter in 2011.
  • Financial Times: AT&T, the largest US telecommunications group, plans to extend its new 4G LTE wireless network to reach 300 million people – or 95% of the US population – by the end of next year.
  • The Guardian: Supermarket chain Morrisons, which still does not have a groceries website, said like-for-like sales dropped 2.5% in the six weeks to 30 December.
  • Daily Mail: Soft drinks-maker Nichols, whose brands include Vimto and Sunkist, expects annual profits to smash market forecasts after total sales increased by 9% to £108 million in 2012.
  • Financial Times: Fears of a dividend cut pulled National Grid down 2.4% to 694 pence, its sharpest fall since July, in a weaker London market.

Share tips, comment and bids

  • Financial Times: Interserve, the UK support services and construction group, is buying Willbros Middle East, the Omani oilfield services company, for $41.3 million.
  • The Guardian: Irish businessman Dermot Desmond could be in line for a windfall after Ladbrokes confirmed it was in discussions to buy his betting exchange Betdaq for an estimated £30 million.
  • Financial Times: FedEx has rebuffed informal approaches from its arch-rival UPS to buy a package of TNT Express assets, further complicating UPS’s last-ditch efforts to win EU approval for its takeover of the Dutch delivery group.
  • The Daily Telegraph: Sony is reuniting with BMG to make a joint bid for a slew of EMI music labels including Parlophone, the prestigious British label with Kylie Minogue, Blur and Coldplay on its books.
  • Financial Times: Regulators will meet this month to discuss whether to lift an important hurdle to Royal London’s plan to acquire the life assurance operation of the Co-operative Group.
  • The Guardian (Comment - Joseph Stiglitz): In the shadow of the euro crisis and America's fiscal cliff, it is easy to ignore the global economy's long-term problems.
  • The Guardian (Comment): The export boom may benefit German industry, but wages and living standards have stagnated and poverty is rising.
  • The Daily Telegraph (Comment): Sterling crisis looms as UK current account deficit balloons.
  • Daily Mail (Comment – Alex Brummer): The big question that bosses at Wm Morrison have to answer is why they have been so much slower than their rivals to climb on the convenience store and online platforms.
  • Financial Times (Lex): Anglo American: the miner needs a new boss with hands-on mining experience, M&A execution ability and prowess at schmoozing governments.
  • Financial Times (Lex): HTC: in spite of yet more poor results from the Taiwanese mobile phone maker, HTC’s share price is up more than 50% over the past two months.
  • Financial Times (Lex): Air France-KLM: the Franco-Dutch carrier has plenty on its plate with looking to stabilise its finances without buying more shares in Italy’s Alitalia right now.
  • Financial Times (Lex): Arctic drilling: oil companies hunting for the next big find in the Arctic region must ask if their technology is up to the task.
  • Financial Times (Lex): Junk bonds: US yields have fallen below 6% for the first time: An investment named for its riskiness has been turned into a haven. The question is whether this inversion can persist.

1 comment so far. Why not have your say?

Roger Savage

Jan 08, 2013 at 20:38

The two new car stories above should read registrations, not sales. Very few new cars being driven around are sold or even on conventional 'HP', they are being rented.

BMW has been particularly aggressive in offering cut price personal contracts at low deposits/initial rental and traditionally low interest rates.

This appeals to the sort of 'buyer' who wants to impress their pals with a new BMW, but can't actually afford to buy one.

Over the course of the rental period, they'll spend more in rental payments than the costs involved in buying and running a new car (even after depreciation).

There's nothing wrong with BMW doing this but clearly it's a concerted effort to build market share.

it also shows that the prudent are still being outclassed by the feckless who continue to get access to cheap credit to buy things they don't need to pretend they're doing well. This is the only reason new car *registrations* are increasing.

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