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Wednesday Papers: Co-op capital hole threatens Lloyds deal

Wednesday Papers: Co-op capital hole threatens Lloyds deal

Top stories

  • Financial Times: The Co-operative Bank is facing a capital hole of up to £1 billion, equivalent to half its capital, which is further undermining the lender’s planned acquisition of more than 600 Lloyds Banking Group branches.
  • The Daily Telegraph: The Bank of England is considering the “extraordinary” idea of negative interest rates as one of a number of radical policies to encourage more lending to businesses and households.
  • Financial Times: JP Morgan Chase said it was cutting 17,000 jobs over two years, with the bulk of losses falling on the consumer and mortgage businesses.
  • Financial Times: The average cash bonus paid to Wall Street employees has jumped 9%, thanks to rebounding financial industry profits and dramatic job cuts that spread the rewards across a smaller pool.
  • The Guardian: Barclays is expected to reveal next week that as many as 600 of its staff are paid more than £1 million, in the most detailed disclosure yet about how much its 140,000 employees take home each year.
  • The Independent: Five of the $2 trillion hedge fund industry's biggest names each took home more than $1 billion last year, according to Forbes magazine's latest Rich List for the industry.
  • Financial Times: BP’s failure to implement effective safety systems led to the 2010 Deepwater Horizon disaster in the Gulf of Mexico, according to an expert called as the first witness in the civil trial over the accident.
  • The Daily Telegraph: Ivan Glasenberg, head of commodity giant Glencore, has launched an extraordinary broadside against fellow chief executives, condemning mining's record as “catastrophic”.
  • Financial Times: The chief executive of Cisco said on Tuesday he was looking to invest some of the network equipment company’s $46.4 billion gross cash pile in Europe and Canada, after abandoning lobbying efforts to change US tax policy on foreign cash holdings.
  • Daily Mail: Coca-Cola has taken over Innocent after the ethical smoothie maker's young founders decided to sell up their remaining stakes - for a dizzying £100 million according to reports.
  • The Guardian: Parents who have been shocked to find their children have run up massive bills – some of up to $1,400 – by making "in-app purchases" on their Apple iPhone or iPad will get cash or an iTunes Store credit as part of a settlement that could cost the company up to $100 million.
  • The Independent: Redrow's founder Steve Morgan has appeared to rule out another attempt to take the housebuilder private after the Takeover Panel thwarted a £610 million attempt last autumn.
  • Financial Times: Greg Tusar, head of electronic trading at Goldman Sachs, is leaving the investment bank, according to an internal memo obtained by the Financial Times.

Business and economics

  • Financial Times: Ben Bernanke on Tuesday soothed market concerns that the US Federal Reserve will cut short its asset purchases before the labour market improves.
  • Daily Mail: British Chancellor George Osborne is facing a Cabinet revolt over demands for deeper spending cuts.
  • The Guardian: Italian banking sector fell 7% on Tuesday, with stock markets down owing to fears stalemate in Rome could reignite eurozone crisis.
  • Financial Times: Jim Millstein, the former US Treasury official who led the restructuring of AIG, has been hired by creditors of Energy Future Holdings, the former TXU, to begin talks with the company aimed at restructuring almost $46 billion in debt, creditors say.
  • The Guardian: Tesco will pay a reduced £6.5 million fine for its part in a dairy price fixing scandal after an appeal ruling that ends a more than decade-long investigation.
  • The Daily Telegraph: Beer lovers across the US have filed $5 million class-action lawsuits accusing Anheuser-Busch of watering down Budweiser, Michelob and other brands.
  • The Guardian: Mike Ashley, the founder and deputy chairman of Sports Direct International, has raised £100 million by selling part of his stake in the retailer.
  • Financial Times: Visa and Samsung have announced an agreement designed to make it easier for smartphone users to use their devices to make mobile payments, and accelerate the adoption of NFC ‘tap-and-pay’ technology.
  • The Daily Telegraph: Shares of GKN rose 4% after group sales rose to £6.51 billion last year from £5.75 billion in 2011, while pre-tax profit jumped to £503 million from £306 million.
  • The Independent: A dramatic slump in the number of banking jobs in the City has sent annual profits at the recruitment firm Robert Walters crashing by half to £7.7 million in an ominous sign for London's financial industry.
  • Financial Times: A pandemic flu vaccination from GlaxoSmithKline greatly increased the risk of children developing narcolepsy, a rare sleep disorder, according to the UK Health Protection Agency.
  • The Guardian: Morrisons has snapped up six HMV stores from the failed music company's administrators as part of its continuing drive to expand its convenience store operation.
  • Financial Times: Global recorded music industry revenues rose 0.3% to $16.5 billion last year, the first since 1999, thanks to the rapid expansion of digital download and subscription services.
  • Financial Times: Europe’s top telecoms regulator has pledged to use EU treaty powers to force through plans to create a single market for mobile services across the region as part of attempts to drag the industry from “near collapse”.
  • Financial Times: Tom Nides has rejoined Morgan Stanley two years after leaving the investment bank to become deputy to Hillary Clinton, the former US secretary of state.
  • The Independent: Provident Financial's credit-card business, Vanquis, saw a surge in profits last year, up by 61% to £71 million.
  • The Daily Telegraph: Imperial Tobacco, owner of the Davidoff and Gauloises Blondes brands, has set out plans to grow dividends by at least 10% a year for the “medium term”.
  • Financial Times: Management has applied the red pen at accountancy group RSM Tenon: four offices and 400 staff have been cut, with another 100 posts not being replaced.
  • The Daily Telegraph: Nearly 1.4 million complaints were made to Lloyds Banking Group during 2012 about payment protection insurance, figures released on Tuesday showed.
  • The Independent: The specialty chemicals maker Croda International has reported a 6.6% jump in full-year profits to £253 million, helped by a strong performance at its consumer care business.
  • The Independent: St Modwen has tapped shareholders for £49 million to help fund the £2 billion overhaul of the UK's biggest fruit, vegetable and flower market in south London.

Share tips, comment and bids

  • Financial Times: Repsol, the Spanish oil company, has sold a collection of liquefied natural gas assets to Shell for an enterprise value of $6.7 billion in its most significant divestment since its YPF unit was nationalised last year by the Argentinian government.
  • Financial Times: Top fund managers have warned Esure against overpricing its initial public offering as the motor and home insurer prepares to launch London’s latest float as early as Wednesday.
  • The Guardian (Comment): Policy-making elites would have us believe a smaller workforce spells the end of prosperity. Actually, it spells redistribution.
  • The Guardian (Comment): Coalition austerity has delivered depression and a lost decade. Labour has to avoid locking itself into more of the same.
  • The Daily Telegraph (Comment): Don't worry: the Bank of England will never allow negative interest rates.
  • The Daily Telegraph (Comment): New regulator must stop insurers ripping off unwary pensioners.
  • Financial Times (Lex): Chesapeake: energy group is stuck between mountain of debt and low natural gas prices, which explains why the price Sinopec paid for shale assets is on low side.
  • Financial Times (Lex): Risk-weighted assets: like it or not, banks have to accept that there are suspicions around internally-generated risk weights. More openness is a must.
  • Financial Times (Lex): Vivendi: French media and telecoms group has clear direction to travel but progress towards achieving its goals is proving slow and investors may not wait.
  • Financial Times (Lex): QBE: Australian company’s shift under new chief from growth-dependent insurance holding company to well-functioning global group is long overdue.

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