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Thursday Papers: Lloyds and RBS face £90m in fines

Thursday Papers: Lloyds and RBS face £90m in fines

Top stories

  • Financial Times: Lloyds Banking Group and Royal Bank of Scotland were hit with a combined £90 million of fines from regulators in the UK and US on Wednesday as another round of past misdeeds came back to haunt Britain’s state-backed banks.
  • Financial Times: Peter Praet, a top official at the European Central Bank, has signalled it will try to force eurozone banks to hold capital against sovereign bonds, in an attempt to stop weak lenders using its cash to hoover up the debts of crisis-hit countries.
  • Financial Times: Jamie Dimon, chief executive of JP Morgan Chase, signalled the bank planned to pay penalties over allegations that it failed to notify US authorities that it was worried Bernard Madoff was running a Ponzi scheme.
  • Financial Times: Nokia faces a potentially damaging escalation in its tax disagreement with India’s government, as the country’s revenue department threatens to levy a further charge and bring the telecom group’s total liability to about $1.1 billion, according to people familiar with the situation.
  • Financial Times: Rio Tinto’s chief executive has signalled that he is not afraid of a downgrade by credit rating agencies, saying that he will not run the company according to their demands, in spite of possible consequences for borrowing costs at the indebted miner.
  • The Daily Telegraph: Snapchat, the mobile photo-sharing service popular among teenagers and twenty-somethings, has raised another $50 million, according to a Securities and Exchange Commission filing.
  • The Guardian: Bus and train company FirstGroup has dismissed a plan from one of its biggest shareholders, Sandell Asset Management, to sell one of its US businesses to pay down debt.
  • The Independent: Bernie Madoff's right hand-man, Frank DiPascali, has revealed that the disgraced financier broke down in tears as he confessed the scope of his ponzi scheme.
  • Financial Times: Avon, the troubled cosmetics company, said it would cut 650 jobs and freeze a technology overhaul that has gone badly as its turnround efforts continue.

Business and economics

  • Financial Times: US Congress appeared on track to approve a bipartisan budget deal designed to provide stability to America’s fiscal policy for the next two years and spur its economic recovery.
  • Financial Times: The White House is considering nominating Stanley Fischer as vice-chair of the US Federal Reserve in a move that would add one of the world’s most respected economists to the central bank under new head Janet Yellen.
  • Financial Times: Cuts to the UK’s annual £1 billion criminal legal aid budget could stymie alleged Libor manipulators’ attempts to secure expert lawyers as the overhaul particularly targets complex economic crime cases.
  • Financial Times: Facebook became one of the youngest public companies to join the S&P 500 on Wednesday, sealing the comeback of the social network stock which was shunned by investors after listing last year.
  • The Guardian: Bernie Ecclestone's chances of winning a $140 million high court trial were boosted when the judge cast doubt on allegations that the Formula One boss paid a $44 million bribe to undervalue the motor racing series.
  • The Daily Telegraph: EU investigation into new £16 billion Somerset plant could delay development for a year.
  • Financial Times: Shares in EADS jumped more than 8% on Wednesday as Europe’s biggest aerospace and defence company surprised the market by predicting that its newest passenger jet would be less of a drag on profit margins in the coming years than had been expected.
  • Financial Times: PSA Peugeot Citroën and China’s state-owned carmaker Dongfeng Motor have agreed the main terms of an industrial and commercial partnership that will include a large capital injection into the French group in return for technology sharing.
  • Financial Times: Blaming the strong currency and small local market General Motors will shutter its production facilities in Australia; the closing of its manufacturing operations will result in 2,900 jobs being axed at Holden, GM’s Australian business unit.
  • Financial Times: Johnson & Johnson and Novartis are considering appealing against EU antitrust fines of €16 million imposed this week for their agreement to defer generic competition.
  • Financial Times: Andrew Kearns, a former Glencore trader who sued the commodities company for wrongful dismissal, has lost his High Court lawsuit after testimony that he was repeatedly late or absent and “consumed excessive amounts of alcohol” while on a business trip.
  • Financial Times: Inditex, which owns the Zara clothes chain, reported net profits of €1.67 billion for the first three quarters of this year, a 1% increase annually, on revenue that rose by 5% to €11.93 billion.
  • The Daily Telegraph: Film producers sue Time Warner for at least $75 million over its decision to divide The Hobbit into three parts.
  • Financial Times: As shares in microchip designer Imagination Technologies dived 20% on Wednesday, investors seemed to think that the title said less about laudable ambition and more about undue optimism over the company’s decision to take the battle to Arm.
  • Financial Times: The patchy record of US private equity group Blackstone in India has been further dented by its holdings in Financial Technologies, a trading software maker for stock exchanges, whose sister company is mired in allegations of fraud.
  • Financial Times: Triumph Motorcycles, a British brand forever linked with Steve McQueen’s heroics in the film The Great Escape, reported a pre-tax loss of £12.8 million for the year to 30 June after an unrealised foreign exchange loss of £4.8 million.
  • Daily Mail: PZ Cussons’ overall revenues are up 4% for the six months to 30 November and operating profits are up 6%.

Share tips, comment and bids

  • The Daily Telegraph (Questor share tip): Avoid PZ Cussons on challenging markets; the FTSE 250 listed consumer products company has offset sluggish emerging markets with Kate Moss inspired tanning products.
  • The Daily Telegraph (Questor share tip): Imagination Tech hit by slowing smartphone sales; the microchip designer has seen the value of the company halve as smartphone sales slump.
  • Financial Times: Six years after one of the largest leveraged buyouts ever, Blackstone is set to return Hilton Worldwide to the US market after raising $2.35 billion in an initial public offering of the world’s biggest hotel chain by number of rooms.
  • The Daily Telegraph: Spain's Ferrovial, the biggest investor in Heathrow, has expressed an interest in buying Aberdeen, Glasgow and Southampton airports.
  • The Independent: Partners at one of London’s oldest legal firms, the 280-year-old Lawrence Graham, have approved a merger with Birmingham-based rival Wragge & Co.
  • Daily Mail: Safestyle is the largest retailer and manufacturer of uPVC windows and doors for the homeowner replacement market and raised £77.7million in the float on AIM.
  • The Guardian (Comment): The Barclays bike fiasco should be a wake-up call to politicians about the limits of private enterprise at the heart of public life.
  • The Guardian (Comment): Focusing on individual success stories is far easier than changing the way business operates – but doesn't actually improve women's working lives.
  • The Daily Telegraph (Comment): ‘Peanuts': Lloyds Bank's £28 million fine is less than 10% of executives' bonus pool.
  • The Daily Telegraph (Comment): Britain's negotiating hand in Europe has never been as strong before.
  • Daily Mail (Comment – Alex Brummer): It is right to point out Lloyds wrongful selling began before Horta-Osorio took the helm in March 2011. But it went on for almost a year after he took over.
  • Financial Times (Lex): MasterCard: shares are pricey but the group is in a long-term growth market.
  • Financial Times (Lex): China’s banks: unclear whether new rules solve investors’ dilemma.
  • Financial Times (Lex): FirstGroup: activist investor identifies operational and managerial weaknesses.
  • Financial Times (Lex): European carmakers: a sustained upward trend, but pricing pressures persist.

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