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Tuesday Papers: Lloyds share sale plan suffers double set-back

Tuesday Papers: Lloyds share sale plan suffers double set-back

Top stories

  • Financial Times: Fund managers based in Scotland face a multimillion-pound bill to pay for a new financial regulator if Scots vote for independence in the September referendum, the trade body for Scotland’s financial services industry has warned.
  • Financial Times: The UK government’s plan to sell more shares in Lloyds Banking Group has suffered a double setback as the bank took a £1.8 billion provision for mis-selling payment protection insurance and delayed its resumption of dividend payments; Lloyds’ unscheduled update takes the total set aside by the state-backed lender to cover PPI mis-selling to £9.8 billion.
  • The Daily Telegraph: The government could authorise a first sale of Lloyds Banking Group shares to the general public as early as next month.
  • Financial Times: Autonomy, the once high-flying UK software company at the centre of fraud allegations, massively overstated its revenues and profits in the year before its $11 billion acquisition by Hewlett-Packard, the US technology company has claimed.
  • Financial Times: Britain’s financial watchdog has for the first time used a controversial new power to signal publicly that it is preparing to take action against two bankers allegedly linked to the Libor manipulation scandal; the regulator did not name the bank or banks at which the individuals worked.
  • The Guardian: Janet Yellen was sworn in as the first woman to head the Federal Reserve on Monday, ascending to the top job at the central bank at a time when the US economy seems on a firmer footing but investors are worrying about China and other emerging markets.
  • Financial Times: Barclays’ chief executive Antony Jenkins said on Monday that he would waive his bonus for the second year in a row, highlighting the contrasting fortunes of top-earning bankers as their pay has yet again shot up high onto the public agenda.
  • Daily Mail: Invesco Perpetual Income, one of Britain’s biggest income funds, has lost more than half a billion pounds in a day as spooked savers whipped out cash ahead of the departure of star manager Neil Woodford.
  • The Daily Telegraph: BP will become the latest oil and gas major to report falling profits and production next week when it unveils full-year profits - though there should be no repeat of the recent nasty surprises from Shell and BG Group.
  • Financial Times: Smith & Nephew has stepped up its hunt for growth by agreeing to pay $1.7 billion for ArthroCare, a Texas-based medical devices company, in a deal that will strengthen the UK group’s position in the US and its expertise in sports medicine.

Business and economics

  • Financial Times: Jack Lew, US Treasury secretary, issued an urgent call for Congress to raise the borrowing limit this month, ratcheting up the pressure on Republicans to abandon brinkmanship and stave off a new fiscal crisis in America.
  • Financial Times: The European Central Bank on Monday countered attacks on the credibility of its crucial health check of the eurozone’s biggest lenders, saying its clean-up operation would leave no doubts over the financial system and help boost the currency bloc’s weak recovery.
  • Financial Times: Brazil in January reported its biggest monthly trade deficit in history of $4.1 billion as the depreciation of the nation’s currency has yet to translate into a sharp improvement in exports.
  • Daily Mail: Cash-strapped families are less than two weeks’ wages away from being forced to rely on government hand outs or tap friends or family financial help, new figures from Legal & General reveal.
  • Financial Times: UniCredit, Italy's largest bank by assets, has sold €700 million of non-performing loans to specialist private equity group AnaCap Financial Partners – joining a trend of Italian banks seeking to offload the risky loans they built up during Italy's two-year recession.
  • Financial Times: Mathew Martoma found a “canary in the coal mine” in a top doctor who gave him secret experimental drug trial data that allowed SAC Capital, the hedge fund where he worked, to make hundreds of millions of dollars in the largest insider trading scheme on record, a prosecutor said.
  • The Guardian: Pursuing carbon capture and storage (CCS) technology in the UK could create a new industry worth £15 billion to £35 billion by 2030 employing tens of thousands of people, according to the study by an independent consultancy for the CCS Association, which represents the industry, and the TUC.
  • Financial Times: US cable billionaire John Malone has approached CVC Capital Partners, the principal shareholder in Formula One, about buying a stake in the motor racing series, in a move that could radically alter the relationship between media companies and the owners of live sports rights.
  • The Guardian: Travelodge, a hotel chain, is to create 1,000 jobs across the UK this year under a £100 million investment programme.
  • The Independent: Ryanair boss Michael O’Leary’s attempts to woo back passengers by shedding its image for poor customer service and imposing punitive charges at every turn appears to be working as the airline saw customer numbers rise by 6% to 18 million.
  • Financial Times: FireEye is issuing a secondary offering of $700 million, after shares in the cybersecurity company have soared more than 50% in the month since it made a $1 billion acquisition.
  • The Daily Telegraph: Around 1,100 staff at Costa Coffee and Premier Inn-owner Whitbread have collectively made more than £6 million from two share save schemes.
  • The Guardian: The Co-operative Bank is offering new current account customers a £125 "golden hello" in an attempt to restore people's faith in the business following its annus horribilis in 2013.
  • Financial Times: Yum Brands struck a bullish tone for 2014 even after the fast food group reported a 5% drop in fourth-quarter earnings which showed food safety concerns continued to weigh on its China division.
  • Financial Times: Shares in General Motors and Ford, the US’s two biggest carmakers by revenue, fell sharply on Monday after their January domestic sales figures raised questions about the robustness of the US auto boom; General Motors’ US sales for the month were down 11.9% in January 2013, while Ford’s domestic sales for the month were 7% below last year’s figure.
  • The Daily Telegraph: Amazon's sales growth in Britain slowed last year to $7.29 billion – a 12.5% rise that was just over half the 21% growth seen between 2011 and 2012 - amid calls from MPs and consumer groups to boycott the online retailer over its low UK tax payments.
  • Financial Times: India’s struggling telecoms industry is due to kick off its latest round of spectrum auctions on Monday, after the nation’s Supreme Court on Sunday rejected a last-minute petition from Vodafone and Bharti Airtel to delay the contest.
  • Financial Times: AT&T’s statement last week that it had no plan to bid for Vodafone – at least for now – was treated as a technicality by many analysts, but some are now asking whether domestic challenges are affecting its appetite and resources for a big overseas adventure.
  • The Guardian: Morrisons, the supermarket chain, launched its home delivery service in Yorkshire on Monday in the latest phase of its bid to grab a share of the fast growing online grocery market.
  • Financial Times: Herbalife raised its profit forecast and expanded its share buyback programme in a further riposte to Bill Ackman, the hedge fund manager who has been waging a campaign against the nutritional supplements company.
  • The Guardian: A recent piece of research by VideoInk and video analytics firm Tubular Labs claimed that music videos account for 38.4% of all views on YouTube, reinforcing the Google subsidiary’s position as the world’s biggest streaming music service.

Share tips, comment and bids

  • Financial Times: Elliott Advisors has amassed a 99% stake in Game Retail, the UK video game chain that came close to collapse two years ago, putting the activist hedge fund on course for a huge windfall if plans for a £300 million float are successful.
  • Financial Times: Lenta, the Russian hypermarket chain part-owned by private equity group TPG, is planning to sell up to $1 billion worth of shares through a dual listing in London and Moscow, as companies from Russia’s so-called new economy queue up to list overseas.
  • Financial Times (Comment): Not since 2008 has there been a greater need for policy co-ordination among major central banks to harmonise monetary and bank regulatory policies.
  • The Guardian (Comment): Britain is in the middle of a housing crisis, with thousands of people sleeping rough. We should use the tax system to penalise under-occupation
  • The Daily Telegraph (Comment): The central bank mandate just keeps on growing; these latter day lords of finance are progressively moving in where governments fear to tread.
  • Daily Mail (Comment – Alex Brummer): If Labour wins the May 2015 election then Lloyds would be the most vulnerable franchise in the case of a competition inquiry. That will be a key risk for investors wanting to be part of the bank’s revival.
  • Financial Times (Lex): US banks: The pool of potential loan loss reserves is shrinking
  • Financial Times (Lex): Oil: Services groups offer a way in to national oil companies
  • Financial Times (Lex): Lloyds: Can UK bank’s valuation survive the drip, drip of bad news on mis-selling claims?
  • Financial Times (Lex): Ryanair: On the ascent once again but the airflows are not exactly stable
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