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▲ ▲ BUSINESS WITH PERSONALITY Find out more about our Masters in Finance www.london.edu/mif/cityam/ CAPELLO’S
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Find out more about our Masters in Finance

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Issue 1,194 Monday 9 August 2010

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BANKS TO FIGHT LENDING CRITICS

BANKING

BY STEVE DINNEEN

BANKS are clubbing together in a bid to end claims they are starving small businesses of credit. The banking taskforce comprises chief executives from the major UK financial institutions and the British Bankers’ Association (BBA). The BBA has drafted a letter to chancellor George Osborne setting out a raft of proposals it says will ensure the industry plays its part in the econom- ic recovery. The letter, signed by the BBA and HSBC chairman Stephen Green, says the banking industry is committed to fuelling the economic recovery by extending credit to “viable business- es”. Banks have maintained that net lending has fallen or remained flat because SMEs are choosing to repay loans, not because institutions are unwilling to supply them with credit. The taskforce says it will carry out research in several key areas includ- ing:

• A detailed analysis into demand for funding by small and medium- sized enterprises (SMEs). •Suggestions to improve the wholesale banking sector. •An investigation into ways to work more closely with SMEs. The taskforce claims it will “oper- ate to a short timetable and be com-

claims it will “oper- ate to a short timetable and be com- BBA chief executive Angela

BBA chief executive Angela Knight said the taskforce would aim to end the “allegation culture” on lending

Picture: GETTY

prehensive in its coverage”. It expects to publish initial findings as early as October and is seeking a meeting with the chancellor to coincide with this. The launch of the study comes after a wave of criticism over bank lending practices, including from Bank of England governor Mervyn King. Angela Knight, chief executive of the BBA, told City A.M.: “There is a lot

of information about supply of finance but almost nothing about demand. The taskforce can help clear up the allegation culture by provid- ing hard data. It is vital we have actu- al numbers rather than hearsay. “We can’t have banks lending to people who aren’t credit-worthy. However, as the recovery takes hold there will be a grey area around who is worthy of credit and who is not. The taskforce should help to shine a

light on this.” One senior adviser to several top banks said the move is unusual, with banks normally content to take swipes at one another. He said: “Unlike the private equity industry, which quickly formed an alliance to fend off criticism after the financial collapse, the banks have been happy to sit back. “This move may be late but it is a significant step in their fight back.”

FTSE 100 5,332.39 -33.39

DOW 10,653.56 -21.42

NASDAQ 2,288.47 -4.59

£/$ 1.59 +0.03

£/¤ 1.20 +0.03

¤/$ 1.33 -0.00

BlackBerry gets boost in Bahrain

TELECOMS

BY STEVE DINNEEN

BAHRAIN yesterday ruled out ban- ning BlackBerry mobile phones just hours before a crunch decision is expected by nearby Saudi Arabia. The Persian Gulf island says it main- tains concerns over the security risk posed by the device, made by Canadian firm Research In Motion (RIM), but would not make sharing information using the phone illegal. Last week the UAE took the drastic step of banning the smartphone’s email and instant messaging services after an ongoing row over the way RIM encrypts users’ data. The encryp- tion makes it difficult for security forces to read messages and emails but RIM says it is simply respecting the privacy of its customers. Saudi has deferred a decision on whether to follow suit until tonight while mobile operators test a system that could keep both sides happy. This would allegedly allow Saudi authori- ties some access to users’ data. However, RIM has publicly main- tained it will not bow to pressure to share the information. The UAE ban will officially come into play in October but some net- work providers are already restricting the services available on BlackBerrys. An estimated 1.2m users – or 2.6 per cent of RIM’s user base – will be affect- ed by the ban. The encryption row overshadowed the launch of the firm’s latest hand- set, the critically acclaimed BlackBerry Torch, last week.

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2

Economics News

CITYA.M.

9 AUGUST 2010

ECONOMIST VIEWS: WILL THE BANK REVISE ITS FORECASTS THIS WEEK?

Interviews by Sam Shepherd

JONATHAN LOYNES | CAPITAL ECONOMICS

I

expect the growth forecast to be similar since the second

quarter was strong, and it may even rise in the near term. The inflation

forecast will have to rise, partly as a result of the VAT increase. Yet the Bank may see inflation at or below the target rate in the longer

term.

SIMON HAYES | BARCLAYS CAPITAL

If

you incorporate the VAT hike, then we may see an inflation

forecast rise of up to one percentage point. We should however see it go below the target by 2012. Growth is a little less clear. The second half may be weaker than expected, but the second quarter was good.

The medium forecast may fall.

GEORGE BUCKLEY | DEUTSCHE BANK

Both inflation and growth will be revised up in the near term.

Inflation will go up because of the VAT increase, but should remain flat in the longer term. We should see an increase in growth in the short term because of the strong second quarter. But this will fall in the

longer term through 2011 and 2012.

this will fall in the longer term through 2011 and 2012. ” City: Bank looks too
this will fall in the longer term through 2011 and 2012. ” City: Bank looks too
this will fall in the longer term through 2011 and 2012. ” City: Bank looks too

City: Bank looks too bullish on forecasts

UK ECONOMY

BY JESSICA MEAD

THE Bank of England needs to revise down its optimistic growth forecasts and hike its expectations for the path of inflation to bring them into line with other forecasters, City econo- mists have warned ahead of the quar- terly Inflation Report on Wednesday. In its May Inflation Report, the cen- tral bank forecast that real economic growth would hit 1.6 per cent in 2010 before surging to 3.4 and 3.6 per cent in 2011 and 2012 respectively. Commerzbank’s Peter Dixon said:

“Although the 2010 estimate does not appear to be way out of line – particu- larly in view of the strength of second quarter GDP - the forecasts for 2011

and beyond were viewed as overly optimistic. Back in May, the consen- sus estimates for GDP growth in 2011 and 2012 were 2.1 per cent and 2.4 per cent respectively. Now the Bank’s projections appear off the scale.” Indeed, the level of GDP is now 7 per cent below but inflation is 1.2 per cent higher than the Bank expected in August 2008, as Fathom Financial Consulting’s Erik Britten pointed out last week. The Bank of England is not

Britten pointed out last week. The Bank of England is not Growth and inflation forecasts from

Growth and inflation forecasts from the Bank of England, led by Mervyn King, now look overly optimistic

expected to upgrade its growth fore- casts in light of the stronger growth recorded between April and June due to the deterioration in the global out- look and the impact of the fiscal tightening. However, City economists say the Bank can no longer ignore the persist- ently-high level of inflation and the impending VAT hike that will push up the consumer price index (CPI) even further from January 2011. Investec’s David Page said: “The increase in VAT in January will likely keep CPI above target for much of 2011. A firmer near-term inflation outlook is likely to give way to a softer outlook in the medium-term (reflect- ing expected weaker growth).” •Allister Heath is away

ing expected weaker growth).” • Allister Heath is away 7 t h Floor, Centurion House, 24

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US Fed predicted to unveil more easing

US ECONOMY

BY OLIVER SHAH

WEAK US employment figures have spurred speculation the Federal Reserve will announce a return to “unconventional” quantitative easing (QE) at tomorrow’s policy meeting. After figures on Friday showed 131,000 Americans lost their jobs in July, more than double the number expected, analysts at Goldman Sachs said the Fed could begin using the proceeds from maturing mortgage- backed securities to buy other debt instruments or Treasury bonds. A similar programme between March 2009 and March this year saw the Fed purchase $1.7 trillion (£1 tril- lion) of mortgage and government debt. Goldman Sachs predicted at least $1 trillion of activity should the Fed decide to re-activate the policy. “This would be a ‘baby step’ in the direction of renewed unconventional

easing, although it would probably be packaged as a decision to prevent a gradual tightening of the overall stance,” analysts led by chief US econ- omist Jan Hatzius wrote in a note. US Treasury prices rose and yields fell at the end of last week in anticipa- tion of such a move. Yields on 10-year notes fell eight basis points to 2.83 per cent, with yields on two-year notes falling three basis points to 0.51 per cent, close to a record low. Fears over the sustainability of the US economic recovery have grown since housing starts suffered the sharpest one-month decline for more than a year in May. Despite a season of strong corporate earnings, observers believe a shift in the Fed’s language points toward further mon- etary intervention. The dollar weakened against the euro and sterling on Friday as mar- kets absorbed the poor jobs data and the prospect of more QE.

absorbed the poor jobs data and the prospect of more QE. US Federal Reserve boss Ben

US Federal Reserve boss Ben Bernanke may bring back bond buying

Picture: REUTERS

WHAT THE OTHER PAPERS SAY THIS MORNING

Picture: REUTERS WHAT THE OTHER PAPERS SAY THIS MORNING US TO PAY BIG FOR WALL ST

US TO PAY BIG FOR WALL ST TIPS

New US whistleblowing incentives within the Dodd-Frank financial reform bill – that could net inform- ants multimillion dollar pay-outs – are likely to generate a surge in allega- tions against US-listed companies and Wall Street banks, lawyers say. The SEC is expecting a sharp increase in tip-offs from senior employees and third parties.

NON EXECS IN SHORT SUPPLY

British companies are facing an acute shortage of non-executive directors, as new corporate governance rules demand the more frequent replace- ment of board members, according to research by Norman Broadbent. Aimed at encouraging greater scruti- ny of companies by their owners, the new rules are part of the most com- prehensive overhaul of corporate gov- ernance in almost 20 years.

KORN/FERRY POACHES RIVAL STAFF

Korn/Ferry Whitehead Mann, the world’s largest listed headhunter, has poached key members of the finan- cial services team from rival Heidrick

& Struggles, in the latest sign of a

recovery in the banking recruitment

market. With hiring in the City returning to pre-downturn levels Korn/Ferry Whitehead Mann has

mounted an aggressive pitch for tal- ented consultants who can bring in

as much as £1m in fees a year.

FSA EXODUS ADDS TO CONCERN OVER CITY REGULATION

Staff resignations doubled at the Financial Services Authority in the second quarter as the government announced plans to split up the

embattled regulator and as revived private sector recruitment lured away managers and frontline supervisors.

A total of 121 employees resigned

from the FSA between the beginning

of April and the start of July – up 138

per cent from 53 last year.

and the start of July – up 138 per cent from 53 last year. ORGANISED CRIME

ORGANISED CRIME INFILTRATES EU WIND INDUSTRY

Europe’s booming wind energy industry is being exploited by crimi- nals who see the opportunity to tap into billions of euros’ worth of EU subsidies, according to Kroll, the cor- porate investigations and security group. Organised groups linked to

the Italian mafia are among those to have infiltrated the industry, Jason Wright, senior director of Kroll’s con- sulting group, told The Times.

NOMURA TO MARRY JAPAN’S HUNGER FOR FISH AND INVESTMENT

Nomura Securities will invite punters today to sign up to a fund that, from the outset, will spend its life under- water. The launch of the world’s first

investment trust focused entirely on the global business of seafood and fish comes as fisheries race to perfect the technique of tuna farming.

as fisheries race to perfect the technique of tuna farming. CONFIDENCE BOATS AND CARAVAN' MARKET Consumer

CONFIDENCE

BOATS AND CARAVAN' MARKET

Consumer confidence is returning across Europe, according to a new index that tracks “discretionary” spending on big ticket items such as motorboats, caravans and snowmo- biles. Demand for high value leisure items has been recovering since last September, after collapsing for almost two years, but has only recently start- ed to show a sharp improvement in what may prove to be awkward new data for the Bank of England.

RETURNS

'MOTOR-

TO

CROSSRAIL GETS DOWN TO DETAIL TO SURVIVE CUTS

Terry Morgan would be forgiven for feeling like the fattest turkey on the farm in the week before Christmas. With the Treasury axe about to fall, many are predicting that his £15.9bn Crossrail project is primed to be one of the first victims.

ECUADOR RENEGOTIATES WITH
ECUADOR
RENEGOTIATES
WITH

FOREIGN OIL FIRMS

Ecuador’s populist president Rafael Correa wants to take a big slice of profits away from foreign oil compa- nies operating in the Andean nation, which is facing protracted economic problems. This week, Mr. Correa and his socialist government will force Spain’s Repsol, Italy’s Eni and other foreign oil companies to redesign existing contracts in a process likely to result in diminished profits for firms that accept the new terms.

CITY RESORTS TO PAC-MAN FOR A REBOOT

In hard times, cities often look for an edge to generate buzz and draw new businesses. Ottumwa — a fading man- ufacturing town far from the high- tech glitz of Silicon Valley — wants to be the Cooperstown of video games. A four-day festival has been launched.

CITYA.M.

9 AUGUST 2010

News

3

Virgin Media set to sell its stake in UKTV

MEDIA

BY DAVID CROW

VIRGIN Media is poised to sell its stake in UKTV, the digital broadcast- er it jointly owns with BBC Worldwide. Chief executive Neil Berkett expects to net at least £350m from the sale of the firm’s 50 per cent share, as he seeks to offload non-core assets and focus on Virgin Media’s cable business. Berkett is said to have appointed UBS and Goldman Sachs to sound out prospective buyers over the next few weeks. UKTV owns ten digital channels, including Dave, the male-orientated channel that shows repeats of Top Gear and comedy panel shows like Have I Got News for You, and Gold, which airs classic dramas. Some analysts think the profitable business could fetch as much as £500m if a bidding war breaks out. BBC Worldwide, the commercial arm of the BBC that owns the other

50 per cent of the business, will get first refusal when the channels go on the block. Previously, it has expressed interest in owning the venture out- right. But it could come up against stiff competition from Channel 4, which desperately needs a profitable crutch to prop up its loss making channels. BSkyB is also likely to kick the tyres. In June, it snapped up a smaller package of channels from Virgin Media, including Bravo and Living, for £160m. Virgin sources said the highly- geared firm was under no pressure to sell, dismissing suggestions that it needs the cash to pay down debt as “utter bunkum”.

FAST FACTS | UKTV

Was formed as a 50/50 joint venture between

Flextech (now owned by Virgin Media) and BBC Worldwide in 1997

Dave and Yesterday are available on Freeview.

The other channels are only on Sky and Virgin

Freeview. The other channels are only on Sky and Virgin Virgin Media chief Neil Berkett is

Virgin Media chief Neil Berkett is offloading non-core assets

Picture: GETTY

ANALYSIS l UKTV Channels
ANALYSIS l UKTV Channels

Bankers: further pay curbs will cripple the City

BANKING

BANKERS are warning politicians and regulators they risk an exodus of tal- ent from London if they put further curbs on pay in response to rising bonus levels. New ONS figures show financial sector bonuses in the five-month peri- od between December and April in the last financial year were £10bn, up from £8bn in 2008. The figures come after RBS, HSBC and Barclays announced they had set aside a com- bined £5bn for pay and bonuses in their investment banking operations for the first six months of the year. Angela Knight, chief executive of the British Bankers’ Association, is warning against a knee-jerk reaction by politicians to the headline figures. “British bank staff already find their pay more closely monitored and controlled than in any other major banking centre. Our banks work under tight rules set by the Financial Services Authority and it should also be remembered individuals pay tax on everything they earn,” she said. Knight fears that further restric- tions on pay will harm London’s abil- ity to keep hold of its top talent. “Those people who get the big bonuses are part of a tiny, highly mobile group who are liable to move elsewhere,” she warned.

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News

CITYA.M.

9 AUGUST 2010

Connaught ponders debt for equity swap amid more losses

PROPERTY

BY MARION DAKERS

BELEAGUERED housing maintenance firm Connaught will press ahead with talks with lenders this week to thrash out a last ditch refinancing. Among the options being consid- ered is a debt for equity swap, which would hand control of the FTSE 250- listed company to its creditors. A person familiar with the situa- tion said yesterday it would be “very

surprising” if the company were not forced to surrender at least some con- trol in exchange for a financial life- line. Connaught has already arranged payment deferrals in August, but will come under pressure from creditors again in September. Another option is a rights issue, but with shares changing hands at just five per cent of prices seen before a surprise profit warning in June, insiders believe the firm would strug- gle to raise enough cash.

Shares were suspended nine times on Friday, as investors flocked to dump the stock following Connaught’s announcement that it would write down assets and suffer “material losses” this year. The firm lost half its remaining value, closing with a market cap of just £21.7m. New chairman Sir Roy Gardner pleaded with investors on Friday to stick with the ailing firm. “This is a business worth fighting for and I ask for your continued support,” he said.

for and I ask for your continued support,” he said. Prudential chief Tidjane Thiam is repairing
for and I ask for your continued support,” he said. Prudential chief Tidjane Thiam is repairing

Prudential chief Tidjane Thiam is repairing relations with investors

Picture: GETTY

Pru to boost payout after £760m profit

INSURANCE

BY OLIVER SHAH

PRUDENTIAL will smash profit fore- casts and hike its dividend this week as it tries to win back investors’ confi- dence following its disastrous $35.5bn (£22bn) attempt to buy AIA. The insurer is expected to report first-half operating profits of more than £760m, the top end of City con- sensus, boosted by strong perform- ance in Asia. Prudential has already said sales for the first five months of the year soared 27 per cent to £1.4bn. One analyst said the FTSE 100 giant would “throw everything it’s got” at the interim figures after the collapse of its bid for AIG’s Far Eastern arm in June left investors fuming. Prudential will increase its first-half payout by at least five per cent to 6.6p and try to placate shareholders by revealing advisory costs for the transaction came in at less than the £450m previ- ously published, thanks to last- minute haggling with Credit Suisse.

Chief executive Tidjane Thiam and chairman Harvey McGrath have faced calls to resign since the fiasco. They are expected to say they are still lis- tening to shareholders. Although nei- ther man will announce his departure, it is thought McGrath could leave before the end of the year. One large investor said: “I would like there to be change at the board level and I would be supportive of [McGrath exiting]. The numbers are good but over the next three years it’s going to be much more competitive.”

ANALYSIS l Prudential p 600 571.50 580 6 Aug 560 540 520 500 10 May
ANALYSIS l Prudential
p
600
571.50
580
6 Aug
560
540
520
500
10 May
28 May
18 Jun
8 Jul
28 Jul

Questions over strategy remain

SHAREHOLDER demands for a head on a spike may have subsided, but top man Tidjane Thiam knows there is no room for complacency. He is lucky to have wind in his sails for these results: by some esti- mates, sales have risen 30 per cent in Asia and 40 per cent in the US, with a modest uptick even in the slow-moving UK. Analysts reckon Prudential’s embedded value – a key measure of an insurer’s worth – has increased by up to eight per cent to 653p per share. In normal times, a consensus

tion of the business under ex- Prudential boss Mark Tucker. The shadow of an increasingly aggres- sive competitor in the Far East looms over these numbers. Thiam is also under pressure to unlock value from Prudential’s shares. Brokers have price targets north of 800p on the stock. On Friday, it closed at 571.5p. Prudential insists an initial public offering (IPO) of its Asian arm, worth around £13bn, is not on the cards. In the medium term execu- tives may want to re-think that.

beat of the kind Prudential is head- ing for would delight investors. But the most dangerous element of the AIA debacle is the impending flota-

BOTTOM LINE

Analysis by Oliver Shah

6

News

CITYA.M.

9 AUGUST 2010

BP achieves success with Gulf leak plug

BP IN CRISIS

BY RACHEL STEVENSON

BP yesterday confirmed a pressure test on the cementing operation to plug its leaking Macondo well off the Louisiana coast had been successful. “[The test] following the cementing operations indicates we have an effec- tive cement plug,” the company said. The news came as the US coast guard said clean-up efforts from the BP oil leak in the Gulf of Mexico must continue despite claims that much of the oil had vanished. “We need to keep the clean-up going,” coast guard Admiral Thad Allen said. “It’s a catastrophe for the Gulf and we need to keep up with it.” The US government released a report last week showing nearly three quarters of the oil that gushed into the Gulf had all but disappeared. BP will this week resume drilling a relief well in a bid to finally put an end to the worst oil leak in history. Meanwhile, new figures emerged showing the cost of the disaster to BP’s top executives. Analysis of the group’s accounts show the plunge in the company’s share price has wiped £30m from the value of shares and share options granted to BP’s five executive directors. According to a report by pay con-

sultants Patterson Associates, finance director Byron Grote has suffered a paper loss of £8.6m on the shares and options he received on top of his nor- mal pay and bonuses. Tony Hayward, who is stepping down as chief execu- tive, has seen his holdings fall by £8.5m in value. Andy Inglis, who runs the division responsible for the well, is down £6m on paper, and head of sales Iain Conn has seen his shares and options fall by £5.7m in value. Bob Dudley, who is taking over from Hayward in October, has seen a £2.4m fall. BP shares have lost a third of their value since the explosion at the Deepwater Horizon rig, which killed 11 people and led to millions of bar- rels of oil pumping out into the Gulf of Mexico. The share price has been steadily improving over the past month and closed on Friday at 425p.

ANALYSIS l BP p 550 500 425.35 450 6 Aug 400 350 300 10 May
ANALYSIS l BP
p
550
500
425.35
450
6 Aug
400
350
300
10 May
28 May
18 Jun
8 Jul
28 Jul

ZARA BACK IN THE BLACK

10 May 28 May 18 Jun 8 Jul 28 Jul ZARA BACK IN THE BLACK HIGH-street

HIGH-street retailer Zara UK has declared a pre-tax profit of £618,692 over the financial

year to January, its first since the onset of the financial crisis in 2007. The figures com- pare to a £20m loss for the previous year. Spanish owner Inditex has warned the market

is still volatile but plans to launch online sales next month.

Picture: GETTY

Rail cuts could harm recovery

TRANSPORT

BY STEVE DINNEEN

THE British Chambers of Commerce (BCC) has warned business secretary Vince Cable that rash cuts to the rail network could harm the economic recovery. The strongly-worded letter, also sent to transport secretary Philip Hammond, said cuts to the transport network would strangle growth in the private sector and have a knock- on effect on the rest of the economy. BCC director-general David Frost said rail transport is essential for sup- porting the future of the UK econo- my. He said: “In tackling the deficit, the government must be careful not to damage future growth and pros- perity. “Government must support initia- tives that enable the free and easy movement of people and goods.” Frost singled out three projects which he claimed should not be affected at all by the swingeing spend- ing cuts. These were the Northern Hub scheme, designed to drastically increase the number of trains run- ning in the north of England; the electrification of the rail network; and the addition of extra rail car- riages to increase passenger numbers.

of extra rail car- riages to increase passenger numbers. BCC director-general David Frost says the government

BCC director-general David Frost says the government must be careful over cuts to the transport network

GDF Suez and International Power poised to announce merger plans ▲ ENERGY BY HARRY BANKS
GDF Suez and International Power
poised to announce merger plans
ENERGY
BY HARRY BANKS
FRENCH utility GDF Suez and
British peer International Power
could announce plans to merge as
early as tomorrow.
The two companies are both due
to report first-half results tomor-
row but the figures will likely be
overshadowed by any update on
the progress of tie-up talks.
The two said last month they
were working on a deal that would
see GDF take a majority stake in
International Power after transfer-
ring some of GDF’s non-European
assets into the British company.
International Power’s directors
are set to meet today, to discuss
whether or not to recommend a
deal that would include a special
dividend of £1.2bn to £1.3bn for
the company’s shareholders.
The lack of cash on offer for
International Power’s shareholders
was the main stumbling block
when a tie-up was first discussed
back in January.
GDF, which is 36 per cent owned
by the French government, is one
of the biggest energy companies in
the world, with over 200,000 staff.
It is expected to own around two-
thirds of the new company follow-
ing the merger. The remainder of
the shares will still be listed in
London.
International Power chief execu-
tive Philip Cox is expected to keep
the top job at the enlarged firm,
which will likely be chaired by Dirk
Beeuwsaert, GDF’s international
vice president.
The merged firm would have an
investment grade rating, allowing
it to borrow more cheaply and
ramp up plans to roll out more
power stations.
A spokesman for GDF said it had
no comment beyond the official
statement when the talks were
announced in July. International
Power declined to comment.
NEWS | IN BRIEF
EY to launch cleantech arm
Liverpool race hots up
Jimmy Choo may prep for sale
Accountancy giant Ernst & Young is
planning a hiring spree to create a new
cleantech advisory group, mainly
focused on raising capital for entrepre-
neurs looking to set up clean energy
businesses. Over 300 people are
expected to join the division, which will
be headed by corporate finance part-
ner Steve Lang in the UK. Around 100
existing staff from across EY’s various
tax, audit, consulting and corporate
finance arms will join forces to launch
the new group.
Liverpool Football Club will receive at
least two bids by the end of the week,
according to sources close to its chair-
man Martin Broughton. The sources
said there are up to six plausible bids
in the offing, with none currently lead-
ing the charge. Speculation has
reached fever pitch after a string of
foreign backers have been linked with
the Anfield club. Its American owners
put the club up for sale after running
up debts of around £351m. A resolu-
tion is expected next week.
Designer shoe-maker Jimmy Choo
could soon change hands for as much
as £500m. The firm’s shareholders are
understood to be sounding out a
potential deal after the luxury retailer’s
value has continued its meteoric rise. A
string of private equity firms have
owned stakes in the firm, most selling
back out within a few years, making a
tidy return. The brand, which also pro-
duces handbags and accessories
including sunglasses, has 100 stores in
32 countries.

8

News

CITYA.M.

9 AUGUST 2010

iPhone faults force Apple exec to leave

TECHNOLOGY

BY ALAIN TOLHURST

ONE of Apple’s top executives has left the company in the wake of antenna problems that marred the release of the iPhone 4. The firm refused to say whether Mark Papermaster, who was senior vice president of devices hardware, was ousted or whether he left of his own accord. However, he would have been responsible for the phone’s problematic antenna. A statement from Apple confirmed Papermaster’s departure, and said Bob Mansfield, senior vice president of Macintosh hardware engineering, would assume his responsibilities. Apple launched the iPhone 4, its lat- est must-have smartphone, to much fanfare in June. But almost immedi- ately after it went on sale customers said the phone would lose signal and even cut out if they held it in a partic- ular way. The firm’s response to the fault was widely criticised, after it recommend-

ed that users buy a case or hold the phone differently. Apple boss Steve Jobs eventually had to call a press conference on 16 July to defend the iPhone 4 and prom- ise a free case to fix the problem. Papermaster was conspicuously absent from the press conference, leading to speculation over his future. Apple hired Papermaster in October 2008 from IBM, where he had worked for 25 years. At the time, IBM stalled his appointment, arguing that he had signed a non-compete agreement that prevented him working for rivals.

ANALYSIS l Apple $ 275 260.01 6 Aug 270 265 260 255 250 245 240
ANALYSIS l Apple
$
275
260.01
6 Aug
270
265
260
255
250
245
240
10 May
28 May
18 Jun
9 Jul
29 Jul
255 250 245 240 10 May 28 May 18 Jun 9 Jul 29 Jul Mark Papermaster

Mark Papermaster was responsible for the much-criticised iPhone 4 antenna

APPLE may have overtaken Microsoft

as the world’s largest tech firm by mar- ket cap, but the fallout from antenna-

gate has been a costly wake-up call for the golden boy of the geek world. Steve Jobs will hope the departure of Mark Papermaster will help to draw a line under the problems with its lat- est launch. But the saga has highlight- ed a fundamental shift in the way Apple as a firm is viewed. No longer an underdog, it now has a vast, aggressive flock of vultures circling in the hope of spotting even the slightest mistake. The impact this can have was demon- strated in no uncertain terms when a negative review from an influential US consumer magazine cut $6bn (£3.8bn) from the firm’s share price overnight. With its famously small product range, Apple is especially exposed to attack if problems arise. Antenna-gate will pass but this is a stark warning. By Steve Dinneen

GOLDEN APPLE SUFFERS A GLITCH
GOLDEN APPLE SUFFERS A GLITCH

Lehman art to raise £2m at auction

BANKING

ARTWORKS that once adorned the British and European offices of for- mer banking powerhouse Lehman Brothers are to be auctioned off next month, according to the bank’s administrators. Works by the likes of Lucian Freud and Gary Hume and the sign that hung outside the bank’s office in Canary Wharf will be among the pieces up for sale, said PricewaterhouseCoopers (PwC), which is in charge of the collapsed bank’s main European operations. The auction is expected to raise about £2m to help pay back creditors. PwC partner Barry Gilbertson said the 29 September auction date was chosen to coincide with the second anniversary of the collapse. He said: “We think that there are many people around the world who would like to acquire some art with a Lehman connection.” The diverse selection of items includes post-war and contemporary pieces, maritime pictures and sport- ing works of art. The bank filed for bankruptcy in September 2008 with debts of $613bn (£384bn), making it the largest bank- ruptcy filing in US history. Lehman’s collapse deepened a global economic crisis and paralysed markets.

largest bank- ruptcy filing in US history. Lehman’s collapse deepened a global economic crisis and paralysed

CITYA.M.

9 AUGUST 2010

News

9

▲ ▲ ▲ CITY A.M. 9 AUGUST 2010 News 9 Business secretary Vince Cable said he

Business secretary Vince Cable said he was “not aware” of a government pledge to protect Lloyds Banking Group

Picture: REUTERS

Union boss plays down strike threat

POLITICS

BY DAVID CROW

ONE of the country’s most powerful union bosses has refused to call for widespread strikes in the face of swingeing public spending cuts. Derek Simpson, joint general secre- tary of the Unite union, said: “The gov- ernment would love me to say there’s going to be a winter of discontent. That would move the emphasis onto

union militancy and away from cuts.” Simpson’s comments put him on a collision course with Bob Crow, the militant leader of transport workers’ union RMT, who has consistently called for a coordinated general strike. Any strike action is likely to follow a comprehensive spending review due in the autumn, which will detail the extent of cuts, leading to fears that the UK could face another winter of dis- content.

Cable: Lloyds not immune to break-up

POLITICS

BY DAVID CROW AND VICTORIA BATES

LLOYDS Banking Group will not be protected from any plans to break up Britain’s banks – despite being told it would be rewarded for buying HBOS in its darkest hour, business secretary Vince Cable has warned. Eric Daniels, Lloyds’ boss, has claimed that government officials said Lloyds would be allowed to hold on to HBOS assets because of the “short-term financial pain” it experi- enced when it snapped up the ailing bank in 2008. Sources close to the deal, which was masterminded in the depths of the banking crisis, said the government had proved its commitment to a merged Lloyds and HBOS “superbank” by changing competition law to allow the merger to go through. They also said that it is hard to believe that the government will try and divide it up again after making such a commitment, saying: “It’s not as if it’s an uncompetitive market as it stands at the moment”. However, Cable fired a warning shot across the bow of Lloyds yester- day, insisting that any guarantees

given by the last government would not necessarily be honoured by the coalition. “I’m not aware of any such reassur- ance,” Cable said in a Sunday newspa- per interview. The coalition has recruited a Banking Commission to investigate whether the banking system should be restructured to boost competition and reduce systemic risk. Many fear the commission will recommend that large banks are broken up. Cable said: “My position is that the Banking Commission will operate from a clean sheet of paper and pro- duce a set of proposals to make a safer banking system and provide maxi- mum competition.” Meanwhile, Cable appears to have won a major victory in the cabinet, after the coalition signalled it would back a graduate tax. Universities min- ister David Willetts, a Tory and long- time opponent of a graduate tax, was forced into a climbdown on the issue. He said: “The government [is consid- ering] a graduate contribution, an option that involves graduates after they have got into work making a con- tribution to the benefits of the univer- sity education they’ve received.”

Cameron performs U-turn on plans to scrap free school milk

POLITICS

DAVID Cameron has scrapped plans to cut free milk for schools, amid fears voters would associate the Tory-Liberal coalition with the “Thatcher milk snatcher” episode of the 1970s. The government is unconvinced that the £60m-a-year scheme has any real health benefits, and thinks the money would be better used in a scheme targeted at the poorest pupils. However, the Prime Minister per- formed a screeching U-turn when he learned of the plans yesterday, instructing Downing Street aides to brief the media that the plan was

dead – even as universities minister David Willetts was live on television defending the proposals. The remarkable volte face shows how the reign of Margaret Thatcher continues to loom large over the Tory party. Cameron is determined to “detoxify” the Tory brand and consign its “nasty party” reputation to history. The plans, hatched by junior health minister Anne Milton, were uncovered in a letter to the Scottish Office in which Milton said the free school milk scheme was an “ineffec- tive universal measure” and should be scrapped “given the state of pub- lic finances and the need to make savings”.

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10 The Capitalist CITYA.M. 9 AUGUST 2010 EDITED BY VICTORIA BATES GOT A STORY? EMAIL
10 The Capitalist
CITYA.M.
9 AUGUST 2010
EDITED BY
VICTORIA BATES
GOT A STORY? EMAIL
thecapitalist@cityam.com

DUNSTONE SWEEPS THE BOARD AT COWES

IT’S been a good year for Charles Dunstone. Not only did the Carphone Warehouse tycoon wed his long-time sweetheart Celia Gordon Shute and deliver robust profits for his shareholders over the past 12 months, he’s also continued to make waves in his beloved sport of sailing. Dunstone took the honours for the super-yacht class zero category at Cowes Week last week for the second year run- ning, winning four out of seven races at the regatta. The mobile phones mogul hosted regular crew-mate Simon Le Bon on his boat “Rio” on Friday, prompting endless puns on Duran Duran’s famous Eighties hit of the same name. Even sweeter for Dunstone, though, must have been the victory over the other moneyed business leaders competing in

victory over the other moneyed business leaders competing in the class – including serial entrepreneur Sir

the class – including serial entrepreneur Sir Peter Ogden at the helm of “Jethou” and Centrica boss Sam Laidlaw, who skip- pered “Bob” – the yacht which is co-owned by Deutsche Bank’s former global head of utilities Robert Gray and Tony Hayward, the outgoing chief of oil giant BP, who drew widespread criticism when he took the boat out for a spin, mid-oil spill crisis.

WHIRL WIND

The exhausting whirlwind of M&A chit- chat in the small cap stockbroking space continues apace. The latest name to enter the fray at the end of last week was, surprise surprise, Astaire Securities – which is now rumoured to have rejected a bid from rival Daniel Stewart. The offer means that the pair of firms have come full circle from last year, when stubborn talk of Astaire buying up Daniel Stewart refused to go away despite repeated rebuttals from then-boss Edward Vandyk. This comes, of course, just a few short months after a failed takeover by Astaire of another rival, Hoodless Brennan (now HB Markets) – which is now, in turn, thought to be in discussions with yet another prospective buyer, Alexander David Securities. It’s all positively incestuous, isn’t it?

BOOK WORM

A breath of career fresh air for UBS worker Samantha Carbon, who’s decided to go all literary on us after 18 years working in the financial services sector. Six years ago, Carbon was on holiday in Africa when she was seized by creative inspiration and wrote 30,000 words of her novel, All That Glitters, before she had even set foot back in the UK. The book fol- lows the tale of Sophie, a trader’s assistant at a bank in the City, who falls in love with an American financier against her better judgment and is then devastat- ed to learn that he has been having an affair behind her back. Carbon, who turns 40 later this year, is also currently working on two other novels inspired by her pro-

currently working on two other novels inspired by her pro- fessional experiences in banking, so expect
currently working on two other novels inspired by her pro- fessional experiences in banking, so expect

fessional experiences in banking, so expect more where this came from.

ON OUR LAURELS

Lloyds boss Eric Daniels has not lost his American twang – or, indeed, his sense of humour when it comes to the rivalry across the Atlantic. Asked in a Sunday newspaper interview whether or not he would be retiring when he hits 60 next year, Daniels retorted:

“Despite having lived in the UK for more of my adult life than anywhere else, I’m still American. I have American roots. The 60 thing is more of a British thing…” AND we get five weeks’ holiday a year? Slackers, the lot of us.

MAD MEN

Hedgie-turned-fashion designer Britt Lintner has been busy recently, whipping up a new collection inspired by TV hit Mad Men which is due to debut next month. Lintner – who manages somehow to juggle a high-octane job at hedge fund GLG Partners with her designing – burst onto the scene a few years ago and has since dressed the likes of the former PM’s wife Sarah Brown. Now, she’s on a one- woman mission to turn up the heat on office wear – which, if her new designs are anything like the figure-hugging cre- ations sported by Mad Men’s buxom Joan, played by Christina Hendricks, should get colleagues in a bit of a lather. “My muse is the femi- nine female – confident, dynamic and powerful – who also isn’t afraid of retaining her girly chic,” says Lintner. “A friend recently called the designs, ‘respectable sexy’, which I quite liked…” The woman’s surely onto a no-brainer, especially in the City.

Main picture: Charles Dunstone’s Rio won its class at Cowes

Above right: UBS worker Samantha Carbon has embarked on a literary career off- shoot

Picture: PA

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www.lastminute.com for full terms and conditions. CITY EYE YOUNG Romy Keller was beaming yester- day after

YOUNG Romy Keller was beaming yester- day after her father Philip, the head of sales at Diagnostic Health Solutions, won a City A.M. competi- tion giving her the chance to walk out with Chelsea foot- baller Ashley Cole at the Community Shield match against Manchester United, sponsored by McDonald’s. A shame for her that Chelsea lost, but nevertheless an occasion she will never forget.

Picture: Matthew

Childs/ACTION

IMAGES

#

CITYA.M.

9 AUGUST 2010

News

11

Ousted HP boss settles with accuser

TECHNOLOGY

BY HARRY BANKS

HEWLETT-PACKARD’S former chief executive officer Mark Hurd has reached a legal settlement with the woman who accused him of sexual harassment, and she has also agreed to release HP from legal claims, according to sources familiar with the matter. The world’s biggest computer maker stunned Wall Street and

Silicon Valley on Friday by announc- ing Hurd’s resignation, accusing him

of falsifying expense reports to con-

ceal a “close personal relationship” with a female contractor. The unidentified woman told HP’s board in June that Hurd had sexually harassed her, but an investigation found no violation of the company’s sexual harassment policy, HP said. The contractor, who did marketing work for HP from 2007 to 2009, did not have sexual relations with Hurd,

according to her lawyer Gloria Allred,

a high-profile attorney who often

works with celebrity clients. “Mark has settled the matter with the woman,” said one source who was briefed on the matter. This person said the settlement included a pay- ment, but the amount was not dis- closed. Another source with knowledge of the matter said HP was given a “release” by the contractor, and that the company had not paid her any money. This person also said Hurd had settled the matter. Both sources spoke on condition of anonymity. Allred declined to comment. According to sources, the contrac- tor helped plan, market and host events for the office of the chief exec- utive. She made the sexual harass- ment charges on June 29 in a letter addressed to Hurd that came to his office. The board then ordered an investi- gation, which found inaccurate expense reports filed by Hurd or on his behalf, and instances where the contractor received compensation for

no legitimate business purpose.

received compensation for no legitimate business purpose. Mark Hurd resigned following allegations of irregularity in

Mark Hurd resigned following allegations of irregularity in his expenses Picture: GETTY

ANALYSIS l HP $ 48 41.85 47.5 6 Aug 47 46.5 46 45.5 2 Aug
ANALYSIS l HP
$
48
41.85
47.5
6 Aug
47
46.5
46
45.5
2 Aug 10
3 Aug
4 Aug
5 Aug
6 Aug

Buffett charity pledge gathers momentum

PHILANTHROPY

FORTY of the world’s richest business leaders have now flocked to sign up to a charity pledge set up by Warren Buffett and Bill Gates. The Giving Pledge, which asks bil- lionaires to give away at least half their fortunes to charity, has, at last count, secured around £150bn from the likes of businessman David Rockefeller, CNN founder Ted Turner, and Hollywood director George Lucas. Buffett and Gates, who have been hosting a series of dinners aimed at persuading their peers to come on board, are both well-known for their philanthropic efforts. Buffett has promised to donate more than 99 per cent of his estimated $47bn (£29.4bn) wealth to charity, while Bill Gates’ foundation has done ground-break- ing work on eliminating malaria and polio in the developing world. The pledge wants businessmen to give away their fortunes in their life- time, rather than creating wealthy dynasties.

in their life- time, rather than creating wealthy dynasties. Warren Buffett hopes the Giving Pledge will

Warren Buffett hopes the Giving Pledge will transform how the world’s richest donate their fortunes to charity

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12

News

CITYA.M.

9 AUGUST 2010

Minerva set to fight board coup attempt

PROPERTY

BY RACHEL STEVENSON

PROPERTY developer Minerva is gear- ing up to fight off another coup attempt from its largest investor. The company, which recently com- pleted landmark City development the Walbrook, will this week issue a circular to shareholders in response to a demand from the South African billionaire investor Nathan Kirsh for an emergency meeting. Kirsh, who holds 29.5 per cent of Minerva’s share capital, wants to oust the property group’s chairman and chief executive and has been trying to drum up support from fellow investors. Kirsh has concerns about the comp- many’s performance, as well as its lev- els of disclosure. In particular, he wants more information regarding the terms of its recent refinancing. A spokesman for Minerva, however, said Kirsh, through his investment vehicle KiFin, was making a “cynical attempt” to destabilise the company,

which the board would strongly defend. “KiFin is effectively proposing a wholesale change to a board, effec- tively gaining control without paying a premium and is acting in pursuit of its own ends rather than in the inter- ests of all shareholders,” he said. “We have given a good level of dis- closure on our refinancing but the disclosure has to be within the con- straints of commercial reality.” This is Kirsh’s third attempt to have chairman Oliver Whitehead and chief executive Salmaan Hasan removed.

ANALYSIS l Minerva p 120 115 101.50 6 Aug 110 105 100 95 90 10
ANALYSIS l Minerva
p
120
115
101.50
6 Aug
110
105
100
95
90
10 May
28 May
18 Jun
8 Jul
28 Jul
110 105 100 95 90 10 May 28 May 18 Jun 8 Jul 28 Jul Flood

Flood refugees form makeshift camps after more than 1,600 die

Picture: GETTY

Military steps up efforts in disaster-hit Pakistan

WORLD

BY STEVE DINNEEN

THE Pakistani army yesterday took a

lead role in rescuing survivors of dev-

astating floods that have killed 1,600

people and left 2m homeless.

The army’s efforts come after the

civilian government has appeared

overwhelmed and President Asif Ali

Zardari has been singled out for criti- cism for not cancelling an official visit to Europe as the country suf-

fered the worst floods in 80 years. Heavy rain is forecast to further lash the country in the next 36 hours. Yesterday the UN increased its esti- mate of the total number of people affected by the floods from 4m to 6m as the waters have spread south. Meanwhile, heavy rain in central Europe has caused floods which killed at least seven people. Poland, the Czech Republic and Germany were all hit by floods powerful enough to wash away bridges.

F&C braced for vote on £1.7bn property deal

FUND MANAGEMENT

F&C ASSET MANAGEMENT is braced for the worst today as investors vote on a merger of the F&C Commercial Property Trust (FCPT) and Ignis’ UK Commercial Property Trust (UKCPT). F&C will be stripped of its mandate to run the £800m FCPT if sharehold- ers agree to join the vehicles together to create a £1.7bn “super-trust”. Although the boards of both funds have agreed to tie up, with the back- ing of their two largest investors, a technicality means small sharehold- ers hold the key in the crunch ballot. F&C, which fiercely opposes the deal, and Ignis, which is in favour, have been sounding out shareholders in recent weeks. The vote is expected to be unusually close. F&C has already lost control of the Eurotrust and Pacific Assets Trust this year, as well as closing its UK Select Trust. Last week, chief executive Alain Grisay told City A.M. the performance of F&C’s team on FCPT did not war- rant a change of management. “It would be pretty hard to make a stand and say it is in the interest of the shareholders to change the fund manager here, not with the track record our guys have,” he said. In return, the board of UKCPT argued merging the trusts would cre- ate a larger, more liquid vehicle.

have,” he said. In return, the board of UKCPT argued merging the trusts would cre- ate
Interview CITYA.M. 9 AUGUST 2010 13 WORDS BY ROGER BAIRD
Interview
CITYA.M.
9 AUGUST 2010
13
WORDS BY ROGER BAIRD

The late-night bank manager is planning a High Street revolution

Metro Bank is hoping to stand out from the crowd by focusing on location and better customer service

T HE revolution in High Street bank- ing has begun. That’s the bold claim of Craig Donaldson, chief executive of Metro Bank, the first

addition to Britain’s retail banking scene in 100 years. And ground zero is the corner of High Holborn and Southampton Row, where its inaugural branch opened a couple of weeks ago. “The revolution has started,” laughs Donaldson. “Banks will now have to fol- low the path that the great retailers in the UK have taken over the last 20 years.” “That means moving with customer expectations and requirements. That means opening early and closing late. It means much higher levels of service and convenience. Banks are a service business now.” The trim, Sunderland-born 38-year-old is waxing lyrical in a smart first-floor meeting room in the bank’s headquar- ters, directly above the Holborn branch. Just below him, the branch’s 100-strong staff are showing customers what the brave new world of banking looks like. The branch will open seven days a week, from 8am to 8pm on weekdays. It will only close its doors for four days a year. It will open an account in 15 min- utes and be able to give new customers debit and credit cards on the spot. “If you lose your credit card on Saturday night, you will be able to pop into us on Sunday and walk out with a new one,” says Donaldson. The bank will also offer online banking and a UK call centre, which promises to answer calls by the third ring. The bank is the brainchild of American vice chairman Vernon Hill, 64, who used to run his US venture Commerce Bank using a similar approach. He founded the bank in 1973 and sold at the top of the market in 2007 for $8.5bn (£5.33bn), pocketing a weighty five per cent cut. His partner in the UK is Anthony Thomson, Metro Bank’s chairman and a City veteran with 27 years experience. He has been trying to convince Hill to trans-

CV | CRAIG DONALDSON

Age: 38

Work: Joined Barclays in the mid-90s as a graduate trainee; worked in a variety of posts, including as a regional manager in Newcastle as well as a posting in Kenya. Joined HBOS in 2002; had a number of posts, including run- ning the Halifax mortgage business. Joined RBS in 2005; left as managing director of retail banking; 2008 chief executive of Metro Bank

Education: Bradford University, read technolo- gy and management

Family: Married with two children and lives in Islington

Sport: Sunderland FC: “A top half finish for us this year will be great.”

FC: “A top half finish for us this year will be great.” fer the customer-centric business

fer the customer-centric business model to the UK for years; Hill finally agreed after he sold up in the US. The venture took 18 months to secure a banking licence from the Financial Services Authority. And it raised £75m from a clutch of investors, including Fidelity, London property moguls the Reuben brothers, and Hill, who is the largest single investor. Metro Bank plans to open another three branches in Earl’s Court, Fulham Broadway and Borehamwood by the end of the year, and eight more next year. The aim is to have 200 branches in Greater London by 2020. It plans to open 10,000 current accounts in its first year. Donaldson says the business plans an initial public offering in three years, hop- ing to raise around £230m for further expansion. He expects there to be anoth- er private round of fundraising before that, however. Metro Bank is what Bank of England governor Mervyn King has described as a “narrow bank”. It will not borrow from the wholesale banking market or carry financial instruments on its balance sheet. It simply plans to lend around 75 per cent of what it takes in deposits. European banking regulators are press- ing for tier one capital ratios of around six per cent by the end of 2011. Donaldson says because of Metro Bank’s conservative lending strategy, it “will be very comfortable with that at all points across [its] business”. The bank might have a strong focus on customer service, but its prices are far from the most competitive on the High Street. Metro’s instant access savings account pays only 0.5 per cent, compared with Tesco Internet Saver, which pays 2.75 per cent. Its three year fixed-rate bond pays three per cent gross, while AA Internet and the Post Office both pay 4.1 per cent. Metro Bank is the first of the new

Metro Bank chief executive Craig Donaldson in the Foyer of the bank’s headquarters at One Southampton Row

banks to enter the market in the wake of the financial crisis that forced Royal Bank of Scotland (RBS) and Lloyds Banking Group to divest hundreds of branches in return for the government backing they needed to keep afloat. Sir Richard Branson’s Virgin Money has obtained a banking licence by buying regional bank Church House Trust and is looking to expand. Tesco Bank has been testing the waters. And a new venture called Project New Bank – backed by Lloyd’s of London chairman Lord Levene and government adviser Sir David Walker – is plotting to buy up to 600 Lloyds branches. But something all new banking entrants will have to face is how to get people to switch banks, which is some- thing people do less often than changing their doctor. Donaldson says between four to six per cent of people switch banks a year. But last year he says this rose to nine per cent, as a direct result of the financial crisis. Donaldson points to recent research by comparison website uSwitch, which found that a third of bank customers said they would switch if they felt there was a genuine alternative out there. “We think we are a genuine alternative.” The look of the branches will play a major role attracting customers. The Holborn branch is 4,200 sq ft, has a spa- cious wood interior and is surrounded by floor-to-ceiling windows. There are no grilles for bank tellers; there is a free coin counting machine at the front of the store; and there are dog treats for people who bring their pets (Hill is a famous dog lover). The branches – which cost £2m each – are designed by Hill’s wife Shirley, who also designed his Commerce Bank branches. “Her firm has developed this style over 30 years. She knows how to make it work,” says Donaldson. “For instance, the

Picture:

Micha Theiner

/City A.M.

 

point of having large windows is to draw people into the bank. To allow them to see this is different to any other bank they have seen before.” Location is also crucial, says Donaldson. “We will buy sites on corners that show at least two sides of the bank. That gives the chance for twice as many people to take a good look at us. Also we will always be close to hot spots like train and Tube stations or key main roads.” He looks over his shoulder and out the window at Holborn station. “Thirty mil- lion people used that station last year. And the busiest times are early in the morning and in the evenings. And the funny thing is, that’s when banks are closed. We are here for the convenience of our customers, not the other way around.” Once Metro Bank has chosen its sites, Donaldson says the way it will generate business is to quickly become part of the local community. He says: “I want my managers out and about talking to local businesses, seeing what they want and creating a buzz. The way we are going to succeed is to build each store one at a time, and put the profits into the next opening.” Donaldson says he studied Hill’s Commerce Bank model at college and again later in his career when he pre- pared a report on it for a rival bank. He says: “I have studied this model. And I went to take a look at it in America. So when I got a call from Vernon about this project I was up for it. I thought other UK banks were all travelling down the same route. But this project was dif- ferent.” Donaldson resigned his post as manag- ing director of retail banking at RBS two years ago to help develop Metro Bank. Vernon Hill has created a billion dollar bank once before. Now he, Donaldson and Thomson are betting they can do it all over again.

14

News

CITYA.M.

9 AUGUST 2010

IHG eyes higher profit

LEISURE

BY ALAIN TOLHURST

HOTEL group InterContinental Hotels (IHG) is expected to reveal a surge in profits tomorrow thanks to the return of the business traveller. Analysts expect the group, which owns the Holiday Inn chain, to unveil first half operating profits of $205m (£128m), a rise of 14.5 per cent. The sharp rise in profits is down to a recovery in the business travel mar- ket and strong growth in China, ana- lysts believe, but it is likely the group will warn its recovery could be put at risk by a lack of bank funding. There are suggestions the company

is having difficulty getting the devel- opment funding required to over- haul its Holiday Inn brand, which is earmarked for a $1bn (£627m) re- launch. InterContinental said plans to upgrade the 3,400-strong hotel chain were on track and would begin later this year, despite a dearth of bank funding. Last week many of Britain’s banks posted billions of pounds in profit, but there are claims that access to credit for small and medium-sized companies is still very difficult. Recently the Barclay brothers, owners of the Telegraph Media Group and the Ritz hotel, sold their

10 per cent stake in InterContinental Hotels for over £335m, sending the firm’s share price down 89p to £11.10. It has since put on 8p to close on Friday at £11.18.

ANALYSIS l Intercontinental Hotels

p 1,250 1,118.30 6 Aug 1,200 1,150 1,100 1,050 10 May 28 May 18 Jun
p
1,250
1,118.30
6 Aug
1,200
1,150
1,100
1,050
10 May
28 May
18 Jun
8 Jul
28 Jul
InterContinental is led by CEO Andrew Cosslett Picture: Micha Theiner/City A.M.
InterContinental
is led by CEO
Andrew Cosslett
Picture: Micha
Theiner/City A.M.
CITY MOVES | WHO’S SWITCHING JOBS in association with Edited by Victoria Bates Oppenheimer Funds
CITY MOVES | WHO’S SWITCHING JOBS
in association with
Edited by Victoria Bates
Oppenheimer Funds
Gartmore
director at the firm, with responsibility
for northern Europe.
The fund manager has hired Nick Anderson as
its new head of research for global equities.
Anderson is to join in September, reporting
to head of global equities Neil Rogan (pictured).
He previously spent seven years at Insight
Investment, where he was head of equity
research, responsible for the UK, European and
international equity research teams. Prior to
that, he was head of pan-European research at
Schroders.
The investment management company
has appointed Kimberly Mustin as head
of strategic accounts and Joseph
Moran as head of wealth management,
both in its distribution group. In mar-
keting, Lori Heinel joins as head of
investment services and Barbara
Reinhard as director of client reporting
and communications.
Mustin joins from Legg Mason and
Moran joins from DWS Investments, a
unit of Deutsche Asset Management.
Heinel joins from Citi Private Bank,
while Reinhard was most recently with
Morgan Stanley Smith Barney.
BNP Paribas
Franklin Templeton
The investment group has appointed
Jamie Hammond as its new managing
director for Europe, succeeding former
managing director Hans Wisser in the
role.
Hammond was previously a senior
The French group’s investment banking
arm has appointed Luiz Beltreschi as its
new co-head of FX options in New York
and head of Latin American and com-
plex FX options.
Beltreschi joins from Deutsche Bank,
where he has worked as head of Latin
American FX options for six years.
To appear in CITYMOVES please email your career
updates and pictures to citymoves@cityam.com
+44 (0)20 7557 7245
SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
morganmckinley.com
pictures to citymoves@cityam.com +44 (0)20 7557 7245 SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT morganmckinley.com

CITYA.M.

9 AUGUST 2010

News

15

It’s time to stop gloomy talk of a double dip

News 15 It’s time to stop gloomy talk of a double dip CNBC COMMENT MAITHREYI SEETHARAMAN

CNBC COMMENT

MAITHREYI SEETHARAMAN

T URNS out, Naomi Campbell is a genius. Before you start think- ing that I have either the IQ of an iguana or I’m on prescribed

hallucinogens for suggesting such a

thing, hear me out. The supermodel claimed her summons to give evi- dence at Charles Taylor’s war crimes trial was an inconvenience to her life. Naomi ensured the world knew she was a hostile witness. What many of us don’t realise is that maybe we need to be hostile witnesses to the likes of Alan Greenspan, fearmongering about a double dip recession. Once upon a time, I was told there was no such thing as a stupid ques- tion. So I’ve been asking CEOs my stu- pid question this earnings season:

will there be a double dip or not? The answer has been an emphatic ‘no’, though they add the caveat of a soft

patch in the second half of this year. A CNBC interview with the world’s most powerful man also got the same response. Barack Obama is confident that we’ll avoid a double dip. So how much stock do we put in Greenspan’s doom and gloom? And should we worry Mohamed El-Erian, chief executive of Pacific Investment Management Company (PIMCO), the world’s biggest bond fund, thinks while deflation and double dip is not the baseline scenario, it is a risk? Therein lies the Russian roulette game being played by the austerity and stimulus camps and their influ- ence on global interest rates.

I’d probably worry a little about the last. But that worry is still an incon- venience to my life, riddled with bill payments and investments that bring little or no return in a volatile mar- ket – a market which gets the jitters every time someone influencing monetary or fiscal policy decides to use the dreaded “DD” words. This is a world where the ‘new nor- mal’ is a jobless recovery. Firms have perfected the art of increased produc-

tivity and low capacity utilisation. So while the private sector is hiring, we have to accept they’re just not hiring

a lot. May I also point to the fact that

a weak labour and housing market

hasn’t stopped the US economy from expanding for four straight quarters? We are seeing economic growth; it’s just not as much as we’re used to. Asia is what’s propping us up, so any little policy move by China sends us into a hysteria-ridden downward spiral. But, the ‘new normal’ also means we have to get used to the idea that China may not want to implode just to make it convenient for us to grow. So, I’ve decided to live by Naomi’s motto and tell the next person who fear-mongers about a double dip:

“You’re inconveniencing my life”.

Maithreyi Seetharaman is a CNBC anchor

Fraud at its highest level in the capital

ENFORCEMENT

BY MARION DAKERS

FRAUD cases in London and the South East doubled in the first half of the year, to make up 81 per cent of all fraud committed in the UK, according to figures out today. Around 88 fraud cases made it to court in the region, worth a total of £493m, compared to 44 cases worth £461m in the same period last year, says research by auditor KPMG. “Unfortunately there doesn’t seem to be any sign of fraud declin-

ing in the region,” said Hitesh Patel, partner at KPMG Forensic. “Although the rate of increase in the value of fraud seems to be eas- ing, the doubling in cases illus- trates our fears that there would be more to come following the eco- nomic downturn.” There were 166 cases across the UK, the highest number since KPMG started its fraud barometer 22 years ago. Mortgage fraud has risen dra- matically, from 18 cases worth £24m in the first half of 2009 to 21 cases valued at £96m this year.

BEST OF THE BROKERSfirst half of 2009 to 21 cases valued at £96m this year. The government was targeted

The government was targeted by fraudsters in 38 cases worth £178m in the six months, though the over- all figure will be higher as KPMG’s research only includes cases worth more than £100,000. Financial institutions often fall victim to fraud, with 48 serious cases worth an average of £3.6m each making it to court in the research period. Investors were also heavily tar- geted. Around 21 cases made it to the criminal courts, worth a total of £184.7m. Five of these were boil- er room scams.

ANALYSIS l Logica 140 p 135 116.70 130 6 Aug 125 120 115 110 105
ANALYSIS l
Logica
140
p
135
116.70
130
6 Aug
125
120
115
110
105
100
95
19 May
9 Jun
29 Jun
19 Jul

LOGICA

Logica continues to trade at a material discount to its IT services peers, accord- ing to Standard & Poor’s. The analysts believe investors have overreacted to the threat of cuts in the UK public sector, and that the gap will close. S&P has trimmed its sales estimates by three per cent, but reiterates its “buy” rating.

ANALYSIS l Royal Bank of Scotland 54 p 51.10 6 Aug 52 50 48 46
ANALYSIS l Royal Bank of Scotland
54
p
51.10
6 Aug
52
50
48
46
44
42
40
38
19 May
9 Jun
29 Jun
19 Jul

ROYAL BANK OF SCOTLAND

Seymour Pierce upgrades its rating to “underperform” with a target price of 47p, saying the bank has proved doubters wrong. RBS expanded interest margins by 11 basis points in the second quarter. However, the broker questions whether the government can sell the bank at a large premium to book value.

ANALYSIS l Catlin Group 370.00 400 p 6 Aug 390 380 370 360 350 340
ANALYSIS l Catlin Group
370.00
400
p
6 Aug
390
380
370
360
350
340
330
320
310
19 May
9 Jun
29 Jun
19 Jul

CATLIN

Execution Noble says to look past Catlin’s disappointing first half results to its strong underlying performance. The broker is pleased with the Lloyd’s insur- er’s improvement in earnings momen- tum, and says excluding currency changes its book value grew five per cent in the last six months. “Buy.”

To appear in Best of the Brokers email your research to notes@cityam.com

Pension deficits fall in the FTSE 100

PENSIONS

THE TOTAL pensions deficit of FTSE 100 companies shrank by £17bn in the last year and now stands at around £73bn, according to research out yesterday. Britain’s largest companies have spent £11.8bn paying down their deficits in the last twelve months,

according to figures from Pension Capital Strategies (PCS) and JP Morgan Cazenove. Charles Cowling, managing director at PCS, said: “More than ever before, pension liabilities are impacting corporate decision-mak- ing at boardroom level, forcing tough decisions to be made to reduce deficits.”

However, one in ten FTSE 100 firms still has pensions liabilities greater than the total market value of the company. Just five of the UK’s top compa- nies reported a pensions surplus in the last year, with insurer Old Mutual topping the table with 117 per cent coverage of its pensions liabilities.

NEWS | IN BRIEF

Business loan complaints rise

Complaints about small business loans jumped 119 per cent in the year to March, with the financial ombudsman receiving nearly 500 complaints on the subject. Small firms also grumbled about their current accounts, with a rise of 32 per cent to 3,300 complaints. Consumer grievances rose by 27 per cent in the same period, to more than 158,000, said specialist lender Aldermore.

CBI calls for clearer energy policy

The government needs to clarify its energy policy before it loses private sector invest- ment in low carbon projects, according to the CBI. The business group said in a report out today the government should speed up development of carbon capture and storage technology and provide more detail on elec- tricity market reform if it is to keep the interest of investors.

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16

News

CITYA.M.

9 AUGUST 2010

We need to enhance London as a business hub

9 AUGUST 2010 We need to enhance London as a business hub CITY COMMENT STUART FRASER

CITY COMMENT

STUART FRASER

L AST week, British Land and

Blackstone agreed a deal to build the City of London’s largest office building to house the new

European headquarters of UBS.

And whilst we are still very early in the planning process – no formal application has been made – the City of London has, as always, been liaising with all of the key stakeholders to ensure the final design proposals not only meet UBS’ requirements but also enhance the Square Mile as a business environment. The fact that such a prestigious financial institution has decided to remain in the City and indeed to open its new European HQ here, almost doubling the existing floorspace of its current offices at the same location, is hugely encouraging. The City’s property market proved

very resilient during the recent finan- cial crisis and this news is indicative of the fact that London has retained its reputation as a leading financial cen- tre, whilst it also reflects a return to growth that has become increasingly apparent in recent months. And it is not just new office space being created in the City. Only a couple of weeks ago, the City’s planning and transportation committee provided planning permis- sion for a new ‘six star’ hotel next to Blackfriars Station – itself currently undergoing extensive redevelopment – that will provide 280 bedrooms, a 500-seat banqueting hall as well as the

POLO

POLO

POLO

POLOPOLOPOLO

INVITATIONAL INVITATIONAL INVITATIONAL HAC ACVVss INFANTRY NFANTRYNFANTRY istockphoto.com artist: isaxar.
INVITATIONAL
INVITATIONAL
INVITATIONAL
HAC
ACVVss
INFANTRY
NFANTRYNFANTRY
istockphoto.com artist: isaxar.

INVITATIONAL INVITATIONAL INVITATIONAL HAC ACVVss INFANTRY NFANTRYNFANTRY istockphoto.com artist: isaxar.
INVITATIONAL INVITATIONAL INVITATIONAL HAC ACVVss INFANTRY NFANTRYNFANTRY istockphoto.com artist: isaxar.
INVITATIONAL INVITATIONAL INVITATIONAL HAC ACVVss INFANTRY NFANTRYNFANTRY istockphoto.com artist: isaxar.
INVITATIONAL INVITATIONAL INVITATIONAL HAC ACVVss INFANTRY NFANTRYNFANTRY istockphoto.com artist: isaxar.
INVITATIONAL INVITATIONAL INVITATIONAL HAC ACVVss INFANTRY NFANTRYNFANTRY istockphoto.com artist: isaxar.
INVITATIONAL INVITATIONAL INVITATIONAL HAC ACVVss INFANTRY NFANTRYNFANTRY istockphoto.com artist: isaxar.

obligatory rooftop swimming pool. Whatever the architectural merits of the design – it has been variously dubbed ‘the Spaceship’, ‘the Slug’ or, in homage to the Mermaid Theatre which used to stand on this site, ‘the Crab’ – there is no doubt the City will be home to yet another iconic building and, more importantly, to a building that will help to service a very real need for more hotel space in the City. All this activity sends out a very pos- itive message about the City’s future as an international financial hub, but we need the government and European policy makers to support these efforts by maintaining a business environ-

ment which allows London to compete in the global marketplace. Competitiveness is a complex issue and here in the City we are doing all we can to create a business environ- ment capable of continuing to attract the leading firms and top talent from around the world. It will require a concerted effort both at home and in Brussels, but I hope any future changes to our regula- tory landscape will reflect these ambi- tions and will enhance – not diminish – London’s reputation as a world-class centre for international finance. Stuart Fraser is the policy chairman at the City of London Corporation

UK oil firms expand after consolidation

ENERGY

BY MARION DAKERS

BRITISH oil firms are stepping up expansion and investment after a year of consolidation, says research out today. Companies are making the most of relatively high and stable oil prices to fast track development, according to Deloitte’s biannual rankings of oil producers. Tullow Oil, the largest oil firm to trade exclusively in the UK with a market capitalisation of £8.9bn at the end of June, has recently ramped up operations in Africa with acquisi- tions in Uganda and a new oil field off the coast of Ghana. Tullow still makes up 33 per cent of the total market cap of the top 25 companies, though this has fallen from 41 per cent six months ago. Ian Sperling-Tyler of Deloitte said:

“It was encouraging to see new entrants during the period, especial- ly when that resulted from a compa- ny being admitted to the main market.” EnQuest Oil entered the rankings in eighth place, after making its mar- ket debut in April. The first half of the year was broad- ly positive for the independent upstream sector, with the market cap of the majority of companies in the league table increasing by 4.6 per

cent over the six months to 30 June, now standing at £26.5bn. The biggest climber was Rockhopper Exploration, rising from 26th place to the tenth largest firm, reflecting positive drilling data in its Falkland Basin assets. SOCO International moved up two places to fourth as a result of a 31 per cent increase in market cap since December, reflecting successful explorations in Asia and Africa. Indus Gas remains the highest ranked Aim-listed company, moving up to seventh place. Dana Petroleum fell out of the top five, now the sixth largest firm, despite shares soaring 37 per cent since the start of the year on the back of takeover talk. Companies moving out of the top 25 include Regal Petroleum, Nighthawk Energy, Fortune Oil and Hardy Oil & Gas.

ANALYSIS l Tullow Oil p 1,300 1,250 1,263.00 6 Aug 1,200 1,150 1,100 1,050 1,000
ANALYSIS l Tullow Oil
p
1,300
1,250
1,263.00
6 Aug
1,200
1,150
1,100
1,050
1,000
10 May
28 May
18 Jun
8 Jul
28 Jul

TOP FIVE OIL COMPANIES BY MARKET CAPITALISATION, AS OF END OF JUNE

Company

BY MARKET CAPITALISATION, AS OF END OF JUNE Company Position end Position end Mkt cap £bn
BY MARKET CAPITALISATION, AS OF END OF JUNE Company Position end Position end Mkt cap £bn
BY MARKET CAPITALISATION, AS OF END OF JUNE Company Position end Position end Mkt cap £bn

Position end

Position end

Mkt cap £bn

June 2010

Dec 2009

1 1

8.9

2 2

5.8

3 3

1.4

4 6

1.3

5 4

1.1

Markets&Investment

Markets&Investment
Markets&Investment 17

17

Markets&Investment 17
Markets&Investment 17

LONDON’STOP250

Tradethesesharesfrom£1.50withInteractiveInvestor - www.iii.co.uk

Company Name

 

Closing Price Price Change

52wk High

52wk low

Company Name

Closing Price Price Change

52wk High

52wk low

Company Name

Closing Price Price Change

52wk High

52wk low

 

(p)

(p)

(p)

(p)

(p)

(p)

(p)

(p)

(p)

(p)

(p)

(p)

3i

284.40

–0.20

314.80

246.90

COLT Group Compass Cookson Croda Intl CSR Daily Mail ‘A’ Dana Petroleum Davis Service De La Rue Debenhams Derwent London Dexion Absolute Diageo Dimension Data Domino’s Pizza Drax DSG Intl Dunelm Easyjet Edinburgh Inv Tst Electrocomponents EnQuest Essar Energy Eurasian Nat Res Euromoney Inst Inv Experian F&C Comm Prop Ferrexpo FirstGroup Foreign & Col Inv Tst Fresnillo

126.10

526.50

484.40

1312.00

336.60

499.70

1708.00

389.00

793.00*

62.05

1378.00

131.20

1079.00

121.10

415.90*

384.90

26.91

391.60

390.60

397.90

215.00

.110.20

407.70

987.50

615.00

623.50

91.95

307.00

371.20*

268.00

1057.00

–0.40

144.20

112.40

Investec

.475.80*

–3.80

565.00

378.20

3i Infrastructure A.B. Foods Aberdeen Asset Man Admiral Aegis Afren African Barr Gold Aggreko Alliance Trust AMEC Amlin Anglo American Antofagasta Aquarius Platinum ARM Holdings Arriva Ashmore Astrazeneca Atkins(Ws) Autonomy Corp Aveva Aviva Babcock International BAE Systems Balfour Beatty Barclays Barratt Development BBAAviation

.

.

.

.

.

.

.

.

.

.

.

 

111.70

–0.10

115.00

89.35

–8.50

574.50

308.10

ITV

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.51.45

–0.45

71.75

40.34

1015.00

137.90

–15.00

–0.20

1096.00

155.60

785.50

111.00

+9.70

–10.00

616.00

1355.00

347.60

581.00

Jardine Lloyd

Johnson Matthey

.584.50

.1710.00

–5.00

–13.00

604.50

1814.00

420.70

1302.00

.

1487.00

.117.10

–11.00

–1.50

1520.00

137.30

955.50

87.90

+2.70

+0.20

524.00

539.00

333.70

325.00

Kesa Electricals Ladbrokes Lancashire Hldgs

 

.1268.00

.134.00

+5.00

–2.00

1634.00

162.00

803.50

98.45

96.95

–0.20

111.00

52.50

+1.00

1729.00

968.50

.212.10

–1.90

255.00

196.50

568.00

+21.00

685.00

520.50

+1.00

442.30

354.00

.144.60

–0.90

174.29

114.60

1563.00

–11.00

1639.00

558.50

+11.50

1021.00

725.50

.516.00

–15.50

545.00

416.70

316.60

–1.90

352.70

281.00

–0.65

91.65

51.95

Land

.615.00

–6.00

743.50

543.00

909.00

–9.50

937.00

693.50

–1.00

1490.00

990.00

Legal & General

.87.10

–2.15

94.70

61.50

425.10

2531.00

–7.60

–49.00

436.20

3015.50

335.70

1777.50

–6.80

–24.00

148.00

1176.00

121.10

914.50

Lloyds Banking Gp

.

Logica

.

.

.

.

.

.

.

.

.

.

.73.72

.116.10

–2.31

+6.70

77.61

149.10

45.30

100.80

1025.00

+2.00

1100.00

680.00

–0.40

125.50

55.00

London Stk

.656.00*

–10.50

949.50

540.50

268.80

–6.80

490.00

211.50

+2.90

431.30

229.00

.1557.00

–83.00

2198.00

1330.00

316.00

–5.50

370.00

120.50

–5.70

496.50

321.50

Man

.

.

.

.

.

.

.

.

.

.

.

.

.226.50

–2.20

373.60

199.60

771.00

782.50

428.20

–0.07

39.75

23.32

Marks &

.343.50

–3.80

412.70

321.90

281.90

+0.10

311.20

211.60

+0.40

438.40

250.70

Meggitt

.

.

.

.

.

.

.

.

.278.10

–5.70

331.00

189.90

3255.00*

–14.00

3376.00

2668.00

–6.30

499.90

307.50

Melrose

.

.

.

.

.

.

.

.

.

.

.

.228.60

–1.40

251.50

122.90

783.00

–7.00

801.00

532.50

–4.60

412.40

315.60

Mercantile

.957.50

–9.00

1002.00

822.50

1635.00

–25.00

2012.00

1195.00

–6.20

245.00

142.90

Michael Page

.401.20

–4.80

461.50

289.10

1354.00

+10.00

1375.00

805.00

–2.10

121.40

87.35

Micro Focus

.421.50

+1.90

550.00

300.90

381.70

–12.60

474.00

290.20

–11.00

475.90

358.50

Millen &

.490.00

–20.00

514.50

297.90

532.50

–32.50

660.50

459.80

+2.00

1276.00

731.00

Misys

.

.

.

.

.

.

.

.

.

.

.261.80

+7.80

281.70

173.90

320.00

–3.40

389.90

294.20

–7.00

630.00

245.00

Mitchells & Butlers

 

.322.80

+4.70

343.90

228.30

265.30

+0.60

328.85

228.60

–5.00

664.50

489.00

MITIE

.

.

.

.

.

.

.

.

.

.

.211.30*

–1.40

281.70

195.20

324.60

+0.60

394.25

253.40

+0.70

96.80

78.50

Mondi.

.

.

.

.

.

.

.

.

.

.

.

.469.50

–2.00

488.00

262.30

104.60

–2.50

193.31

89.10

+7.00

396.20

138.00

Monks Inv Tst Morrison Wm Murray Intl National

 

.292.80*

–2.70

321.20

240.00

202.00

+0.40

220.00

136.60

–6.80

448.80

331.20

.272.40

+0.60

306.30

255.00

 

.116.50*

–1.50

125.80

95.25

–5.40

297.20

229.50

.851.50*

–11.50

893.50

632.00

Bellway Berkeley BG BHP Billiton BlackRock Mining Booker BP Brit Insurance British Airways British Amer. Tob British Empire Tst British Land Britvic Brown(N.) BSkyB BT Bunzl Burberry Cable & Wire Comms Cable & Wire Wwide Cairn Energy Caledonia Invs Capita Capital & Counties Capital Shopping Centres Carillion Carnival Catlin Centamin Egypt Centrica Charter Intl Chemring Chloride Group Close Bros Cobham

631.00

+1.00

927.50

554.00

+14.00

1139.00

539.50

.237.10

–1.60

258.60

155.86

824.50

–7.00

989.50

735.00

G4S

259.70

–1.40

285.70

208.50

National Grid

.527.50*

–11.50

607.65

474.80

1005.00*

–15.00

1248.00

966.90

Genesis Emerging Mkts Fd

473.00

–1.00

484.00

370.00

Next .

.

.

.

.

.

.

.

.

.

.

.2014.00

+12.00

2360.00

1601.00

2022.00

–3.00

2346.00

1481.00

GKN

145.00

–6.10

155.00

100.20

Northumbrian Water

 

.331.10

–4.40

341.30

219.90

577.50

+0.50

654.50

413.00

.1132.50*

+0.50

1347.00

1088.00

Old Mutual

.124.40

+0.80

130.20

85.80

44.42

+1.07

49.50

33.00

Great Portland Estates Greene King Halfords Halma Hammerson Hargreaves Lansdown Hays Henderson Heritage Oil Hikma Pharma Hiscox Hochschild Mining Home Retail Homeserve HSBC Hldgs Hunting ICAP IG Imagination Tech Gp IMI Imperial Inchcape Informa Inmarsat Intercontl Hotels Intermediate Capital Intertek Intl Personal Fin

307.80

442.40

470.50*

281.90*

375.90

371.00

91.90

133.50

445.20

721.00

359.00

320.50

232.20

463.00

661.40

544.00

389.60*

486.60

342.80

710.50

.1797.00*

295.20

398.80

741.50

1117.00

257.00*

1685.00

246.50

–4.30

332.10

236.60

Pace.

.

.

.

.

.

.

.

.

.

.

.

.215.00

+1.00

243.80

145.00

425.35

+1.95

658.20

296.00

–5.40

504.00

372.50

.288.50

+0.10

339.70

205.80

988.00

–7.00

1017.00

709.00

–7.10

562.50

324.00

Pearson

.1000.00

–20.00

1069.00

695.00

228.90

–1.70

255.80

161.00

+2.50

298.70

186.60

Pennon.

.

.

.

.

.

.

.

.

.

.600.50

607.50

434.40

2212.00

–10.50

2335.50

1829.00

–9.50

460.30

332.20

.385.10

–5.80

534.50

340.20

435.10

–5.90

467.90

338.50

–1.80

387.00

214.00

Petrofac

.1302.00

–18.00

1372.00

803.00

449.80*

–7.30

532.00

416.00

–1.15

119.00

88.05

.1079.00

+10.00

1370.00

601.00

479.60

–6.40

518.00

324.80

–0.50

157.80

109.70

Premier Farnell

.235.90

–6.10

252.60

140.60

237.10

+0.10

284.30

204.80

–12.80

587.00

368.70

Premier Oil

.1572.00

+26.00

1610.00

984.00

710.00

+1.50

732.00

521.00

–6.00

746.00

440.00

Provident

.837.50

–1.00

986.00

795.00

143.00

–1.30

151.00

108.40

–1.00

369.30

299.60

.571.50

–10.50

665.00

455.00

688.50

–13.00

784.50

524.00

+1.90

370.60

220.00

PZ Cussons

.339.20

–1.00

373.20

210.10

855.50*

–17.50

891.50

440.20

–1.70

336.50

208.50

Qinetiq

Randgold

.

.

.

.

.

.

.

.

.123.10

–0.40

179.10

113.90

60.45*

–0.25

150.00

53.00

+3.00

488.20

435.40

 

.5410.00

+15.00

6600.00

3351.00

66.10*

–0.90

94.80

64.85

–7.60

766.80

595.20

Reckitt Benckiser

 

.3061.00*

–33.00

3667.00

2686.00

460.40

–4.00

485.30

306.80

–3.00

659.50

423.20

Reed Elsevier

.554.00*

–7.00

566.00

414.00

1608.00

–4.00

1759.00

1496.00

–10.40

478.30

291.70

Regus.

.

.

.

.

.

.

.

.

.

.

.

.

.

.74.50

–0.10

125.50

68.65

700.50

–6.00

829.50

643.50

–4.50

498.90

291.00

Renishaw

.874.50

–15.00

915.50

420.00

.113.00

–0.40

125.40

99.60

+2.80

345.70

149.75

Rentokil

.104.40

–0.90

140.20

94.10

335.10

–4.80

580.00

300.10

–16.00

786.00

357.60

Rexam

.

.

.

.

.

.