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Friday Papers: Bank of England limits mortgages to protect recovery

Friday Papers: Bank of England limits mortgages to protect recovery

Top stories

  • Financial Times: Mark Carney announced a cap on the proportion of large mortgages that a bank can issue compared to a borrower’s income as he warned that he would not stand another credit-fuelled housing boom; but the BoE carefully designed the cap so it will not restrict the ability of banks to lend or homebuyers to borrow if house price growth is in line with its central scenario of a 20% rise over the next three years.
  • The Guardian: Damning allegations that Barclays cheated and defrauded its customers pushed shares in the besieged bank to their lowest levels in 18 months on Thursday and set back attempts by its boss Antony Jenkins to turn around its troubled reputation.
  • Financial Times: Big banks have started pulling their business out of Barclays’ “dark pool” after the British bank was sued by New York’s top securities regulator for allegedly misleading institutional investors over its anonymous trading venue.
  • Financial Times: Berlin has terminated a contract with Verizon over concerns about the security of its systems in the first sign of serious commercial repercussions in Europe from the Snowden revelations of mass US government spying on its allies.
  • The Guardian: Tesco, the UK's largest supermarket chain, is hoarding land and buildings covering an area big enough to build 15,000 homes.
  • Financial Times: Google, which was founded with the aim of indexing “all the world’s information”, took a grudging step back from its principles on Thursday as it started removing search results in Europe to comply with new rules on the “right to be forgotten”.
  • Financial Times: Alcoa, the US aluminium maker, on Thursday took a significant step in its efforts to diversify out of commodity smelting when it announced a $2.85 billion takeover of Firth Rixson, a UK-based supplier of aerospace parts.
  • The Daily Telegraph: Chinese firm Alibaba indicated $1 billion will be raised in the public offering, but that amount is expected to rise as it chose to list at NYSE over Nasdaq.
  • The Independent: Philip Morris has snapped up one of Britain’s fastest-growing electronic cigarette-makers, Nicocigs, as it warned profits from its traditional business will be lower than expected.
  • Financial Times: Standard Chartered Bank warned that profits this year would be lower than in 2013, after a 20% slump in the first half, driven by a sharp slowdown in its financial markets business.

Business and economics

  • Financial Times: Leading US business groups are going public with their opposition to the unilateral imposition of new sanctions by the White House against Russia, saying they would harm American workers and cost jobs.
  • Financial Times: The UK’s big six energy companies have been formally referred to the Competition and Markets Authority for a full investigation, regulator Ofgem announced on Thursday; the probe, which is the first major referral to the new competition agency, is expected to take up to two years to complete, and will examine accusations of excess profitability in the sector, pricing practices and whether energy companies should be broken up.
  • Financial Times: Britain’s successful carmaking and aerospace sectors will lose out to international rivals unless ministers tackle a shortage of engineering skills and boost research spending, a report warns.
  • Financial Times: A tax on fizzy drinks and an advertising crackdown are among a range of measures being considered by the government’s health agency to tackle the mounting problem of obesity in the UK.
  • Financial Times: UK homes and businesses vulnerable to flooding are struggling to secure affordable insurance, according to a study compiled for ministers, despite the industry’s insistence that cover is widely available.
  • Financial Times: The Bank of England’s suggested future rise in interest rates would nearly double the amount of interest British households pay on their mortgages, according to a data analysis for the FT.
  • Financial Times: The Russian government is working on measures to help replace imported industrial goods with domestically manufactured ones as Moscow seeks to shield its economy from the fallout of its stand-off with Ukraine and further western sanctions.
  • Financial Times: A longstanding creditor in American Apparel has demanded repayment of a $10 million loan, putting fresh pressure on the indebted US fashion chain which narrowly avoided bankruptcy in 2011.
  • Financial Times: With the smartphone wars entering a new phase, Google and Apple are about to take their battle to a wider range of connected, everyday objects.
  • Financial Times: Shares in GoPro soared as it made its stock market debut on Thursday, leaping more than 30% to close at $31.34 on its first day of trading.
  • Financial Times: Lidl is poised to step up pressure on the big supermarkets, investing £220 million over the next nine months on opening 20 new stores and creating 2,500 new jobs.
  • Financial Times: Glencore has ended its pariah status as the only FTSE 100 company without female boardroom representation with the appointment of Patrice Merrin, a Canadian mining veteran.
  • Financial Times: Mercedes will build cars at a Nissan factory in Mexico and give the Japanese carmaker access to its designs and components in the deepest partnership between the two companies.
  • Financial Times: Gazprom is considering issuing bonds in Asian currencies and is “ready in principle” to receive payment from China in renminbi, in the latest evidence of a shift away from the dollar by Russian companies.
  • Financial Times: Fastjet, the London-listed start-up trying to crack low-cost flying in Africa, said it was close to winning rights to fly to three more African countries as it reported a near doubling of losses.
  • Financial Times: Shareholders in JD Sports marked their displeasure over executive pay at the retailer after its executive chairman’s pay jumped 54% last year to £3.1 million.
  • Financial Times: Accenture , the global technology and outsourcing company, reported solid performance on Thursday driven by a rebound in demand for its consulting services.
  • Financial Times: A third dry exploration well drilled off Gabon has brought to a disappointing end an exploration campaign by Ophir Energy off the west African country.
  • Financial Times: Mark Wilson, chief executive of Aviva, has drafted in yet another of his former colleagues to a senior management position, hiring the head of Singapore and Malaysia’s oldest life assurer; Chris Wei, chief executive of Great Eastern, who previously worked with Mr Wilson at the pan-Asia insurer AIA, is to become head of Aviva’s global life business.
  • Financial Times: UK film studio Pinewood Shepperton has reported strong growth in full-year profits and revenues, thanks to productions such as Disney’s Cinderella and Marvel’s Guardians of the Galaxy.
  • Financial Times: Gatwick airport said it expects to pay £250 million in dividends to shareholders over the next three years, as it posted a swing into profit.
  • Daily Mail: Investors piled into housing stocks and sterling yesterday after Bank of England moves to cool the property market were less aggressive than was feared.
  • The Guardian: Britons are feeling more optimistic than at any time for nine years according to the latest snapshot of consumer confidence, as economic recovery becomes more established.
  • The Guardian: AstraZeneca has suffered a setback after a panel of US health experts rejected its request for accelerated approval of a new ovarian cancer drug.
  • The Guardian: Supermarkets need to confront the "brutal reality" of the changes taking place in their market and fight back or pay a huge price, the chief executive of the struggling Morrisons chain has warned.
  • The Guardian: Vital parts of UK infrastructure are being neglected, with potentially severe impacts on national competitiveness and quality of life, according to a new study by engineers.
  • The Independent: The government contractor Capita has made more than £100 million in just two years for a delayed army recruitment project scarred by IT disasters and missed enlistment targets.
  • The Independent: Consumer groups were furious tonight as police said they would not investigate Wonga for sending threatening letters to customers in the names of fake legal firms.
  • The Daily Telegraph: Fashion retailer, Phase Eight, is considering to move into North America as sales and profits increase.

Share tips, comment and bids

  • Financial Times: Dixons and Carphone Warehouse published their merger prospectus late on Thursday after both unveiling strong full-year results, with Dixons reporting “early glimmers” of a consumer recovery and bumper TV sales ahead of the World Cup.
  • Financial Times: Shares in chipmaker Dialog Semiconductor PLC, a supplier to both Apple and Samsung, jumped to a fresh 12-month high after the German-based company confirmed merger talks with Austrian peer AMS, in a deal that would value the combined businesses at just under $5 billion.
  • Financial Times: The London Stock Exchange Group has agreed to buy Russell Investments, the index compiler and asset manager, for $2.7 billion in a move that will launch Europe's oldest independent exchange deeply into the US capital markets.
  • Financial Times: Kenmare Resources has rejected a paper-based takeover approach pitched at £470 million from its larger Sydney-listed rival, Iluka Resources.
  • Financial Times: Clipstone Logistics Reit, a new logistics real estate investment trust is seeking to raise £150 million by floating on the London Stock Exchange to capitalise on the recovery in Britain’s retail market.
  • Financial Times: Punch Taverns is on the brink of a £2.3 billion restructuring deal after it reached an agreement with its biggest group of bondholders.
  • Financial Times: Logista, the logistics division of Imperial Tobacco, will float with a market capitalisation of up to €1.9 billion when it comes to market in Spain next month.
  • Financial Times: Stobart Group said on Thursday that it had returned £31.1 million to shareholders and was in a net cash position after the sale of a controlling stake in its transport and distribution business that included its famous green trucks.
  • Financial Times: Shares in AirAsia, the region’s largest no-frills carrier, and Rakuten, Japan’s biggest online retailer, rose on Thursday on reports they had agreed a joint venture to run a low-cost airline in Japan.
  • Financial Times (Lex): Alcoa: name-changer.
  • Financial Times (Lex): Standard Chartered: seeking clarity.
  • Financial Times (Lex): Reliance Industries: love and hate.
  • Financial Times (Lex): LSE / Russell: passive aggressive.
  • Financial Times (Lex): Barclays: dark behaviour.
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