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FTSE 100 4,944.44 -131.06 DOW 10,808.71 +153.41 NASDAQ 2,404.82 +68.99 /$ 1.54 unc / 1.16 -0.01 /$ 1.33 +0.01
Industry to
get carbontax breaks
THE CHANCELLOR is set to unveil apackage of tax relief for energy-inten-sive firms in his autumn statement,after he was criticised for hittingindustry with a 3.2bn carbon stealthtax in his last Budget.
City A.M. understands the package will help those firms that use largeamounts of energy, such as cement,aluminium and steel makers. A
Treasury source confirmed the chan-cellor was working on a package forenergy-intensive industries.
John Cridland, the director-generalof the CBI, told City A.M. he had been indiscussions with the Treasury aboutexempting some energy-intensivefirms from the carbon floor price and
was hopeful the chancellor wouldfind a resolution.
If youre going to do a carbon floorprice in the UK then you have to besensitive who you target. Some busi-ness cant bear the cost and thosefirms should have been exempted
when the chancellor announced a car-bon floor price in his Budget. Its stillnot too late to exempt them.
Asked if he thought the chancellorwas looking at exemptions for energyintensive firms, Cridland said: Yes Ido. I have been talking to the Treasuryabout energy-intensive industries atthe carbon floor price and I am hope-ful we will see a resolution in theautumn statement.
The chancellor shocked industry
when he announced a carbon floorprice in his Budget last March, whichwill raise 3.2bn for the exchequer by2016.
Worries over Franco-Belgian bank Dexia helped fuel the widespread plunge in markets yesterday, though the US saw a late rally
THE EUROZONES escalating financialcrisis hammered European stocks yes-terday, with markets also dampened
by growing concerns over the fragilityof the global recovery.
The bad news was compoundedafter hours as Moodys downgradedItaly by three notches, from Aa2 to A2.
The prospect of a Greek default washeightened by an apparent delay inthe struggling peripheral states nextpackage of aid.
Eurozone authorities are reviewingthe level of losses that private banksshould take on Greek debt, yet financeminister Evangelos Venizelos lastnight insisted that its finances couldsurvive until mid-November.
Nonetheless, the FTSE slumped 2.6per cent to its lowest close since July2010. In France the CAC closed down2.6 per cent; the German DAX shednearly three per cent; the Euro Stoxx50 ended 2.2 per cent down.
Banks took some of the heaviesthits, with Franco-Belgian financialgroup Dexia coming into sharp focuson worries about its high exposure toGreece. Its shares fell 22.5 per cent.
Barclays shed 7.6 per cent yesterday,while Lloyds Banking Group and Royal
Bank of Scotland also took knocks.The Eurozone crisis is now so seri-ous it will plunge the region into reces-sion by the end of the year, analysts at
SHARES SLUMP ASEURO FEARS GROWBY JULIAN HARRIS AND ALISON LOCK
WORLD ECONOMY
www.cityam.comIssue 1,482 Wednesday 5 October 2011 FREE
LONDONSBEST MEALFRENCH LAUNDRY
AT HARRODS
PROVES EPIC P31
APPLE UNVEILS ITS NEWAND IMPROVED iPHONE...BUT DISAPPOINTS FAN BOYS P5
BUSINESS WITH PERSONALITY
both Goldman Sachs and credit ratingagency Standard & Poors warned.
Goldman is now predicting a reces-sion in the short term and stagnationnext year for Europe, and warnedthat the US economy will also sufferfrom the crisis.
S&Ps analysts said they still do not
expect a genuine double dip to occurin the Eurozone, but added that west-ern Europe is vulnerable to a slide
back to economic contraction.
Goldman and S&P said they see theUS as having a 40 per cent chance ofslipping back into recession, despitethe Federal Reserves efforts to restartthe economy. Goldman expects USGDP growth of 1.4 per cent next year.
Credit default swaps (CDS) were hitfor both banks and sovereigns yester-
day, as fears escalated. German five-year CDS rose to 121 basis points whileBelgiums five-year CDS gained 14 bpsto 286 bps, nearly a record high.
US stocks flirted with a bear marketin early trading, yet a late rally saw theDow Jones spike by 3.5 per cent, as bar-gain-hunters snapped up cheap sharesamid the turbulence. The VIX volatilitymeasure hit a two-month intradayhigh of 46.88 yesterday.
Earlier in the day Federal Reserve
chief Ben Bernanke said it was pre-pared to take further action as appro-priate to promote stronger economicrecovery. MORE: P2, P3, P4, P26
Certified Distribution
01/08/11 till 28/08/11 is 92,745
ANALYSIS l DAX
28 Sept 29 Sept 30 Sept 3 Oct 4 Oct
5,800
5,600
5,400
5,200
5,216.714 Oct
ANALYSIS l FTSE
28 Sept 29 Sept 30 Sept 3 Oct 4 Oct
5,400
5,200
5,000
4,944.444 Oct
BY DAVID CROW
EXCLUSIVE
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News2 CITYA.M. 5 OCTOBER 2011
LOOKING at the chaos in the marketsand the Eurozone yesterday, it would be tempting to claim that the sover-eign debt crisis is nearing its endgame.But that would be the wrong call tomake. The crisis is intensifying, obvi-
ously, but political incompetence inthe European Union, as well as itsfaulty political institutions, meansthat it is going to drag on and on. There will be no quick resolution,merely a prolonged, horribly slowdeath.
Despite Greeces inability to meetany of its deficit targets or actuallyintroduce promised reforms, theEurozone insists that the Athens gov-ernment wont technically default. ButEU finance ministers have rightly and belatedly decided to reconsider theabsurdly low level of the haircut thatprivate bondholders are going to face.It is currently just 21 per cent. A figureof 50 per cent is being discussed buteven that would still be too low.Something closer to 70 per cent wouldmake more sense.
But when that eventually happens,the pressure will then becomeimmense for financial institutions tomark down substantially otherEurozone debt held in their availablefor sale portfolios. Those who dismissthe credit default swap (CDS) markets which suggest massively higher risksof default for many countries, especial-ly in the Club Med as meaninglessbecause of their illiquidity have a par-tial point but only a fool wouldentirely ignore such a key financialindicator, especially when it is accom-panied by rocketing bond yields.
Belgiums basket case bank Dexias
EDITORS LETTER
ALLISTER HEATH
7th Floor, Centurion House,24 Monument Street, London, EC3R 8AJTel: 020 7015 1200 Fax: 020 7283 5334
Email: [email protected] www.cityam.comEditorialEditor Allister HeathDeputy Editor David HellierNews Editor David CrowActing Night Editor Marion DakersBusiness Features Editor Marc SidwellLifestyle Editor Zoe StrimpelSports Editor Frank DalleresArt Director Jo SimpsonPictures Alice HeppleCommercialSales Director Jeremy SlatteryCommercial Director Harry OwenHead of Distribution Nick Owen
Distribution helplineIf you have any comments about the distributionof City A.M. Please ring 0207 015 1230, or [email protected]
biggest problem is that it has a largeexposure to dodgy sovereign debt;writing it down properly will prove tobe a bitter blow (hilariously, this wasn'tdetected by the Eurozones stress tests).Many French banks have also furtherto go in terms of writing down Greekdebt (though Socit Gnrale has verylittle exposure left so would be fine onthat front). But the entire financial sys-tem and that includes insurers andpensions funds would be in trouble ifthey have to start writing down sub-stantially the value of their Italian andSpanish debt.
But the Eurozones woes are not justdue to idiotic, profligate governmentsor to the single currencys internalcontradictions. The massive, almost
nuclear impact of the capital and espe-cially liquidity provisions of Basel IIIare a crucial component of the story.While the reforms were meant to bephased in over time, worried investorsare forcing Eurozone banks to speedup their implementation. Some banksare contracting their balance sheets;others are withdrawing credit lines; allare reducing their loans to otherbanks (which are much costlier underBasel III) and all are desperately scram-bling to reduce their dependence onwholesale markets.
Meanwhile, wealth destruction willcontinue apace. Equity investors are being trashed everywhere, commodi-ties are down (even gold is way off itsrecent peaks, partly because of marginselling), real house prices are down,emerging markets are suffering, infla-tion is slashing savers cash (a problemwhich is bound to worsen if and whenthe Bank of England launches anotherround of quantitative easing, possiblyas early as this week) and only a fewsupposedly safe (in reality bubble-like)bond markets are generating good butentirely unsustainable returns forinvestors. The last thing everybodyneeds is a long, drawn-out crisis in theEurozone, overshadowing the next 18months at least.
Tragically, however, that is exactlywhat we are going to get.
[email protected] me on Twitter: @allisterheath
Crisis across theEurozone is just
getting started
Printed by Newsfax International,Beam Reach 5 Business Park,Marsh Way, Rainham, Essex, RM13 8RS
STOCK markets officially dipped intobear market territory yesterday, afterUS stocks tumbled during morningtrading.
The S&P 500 traded as low 1,074.77at the start of yesterdays session, morethan 23 per cent down on its 52-weekhigh of 14,330. It later recovered toclose at 1,123.95.
A bear market is usually definedas one that has fallen 20 per cent ormore over a period of at least twomonths.
The FTSE 100 is now just 200 pointsaway from falling into the same terri-tory: it closed 2.6 per cent down at a 15-month low of 4,944.44 yesterday over1,000 points down from a high of 6,106in the last year.
The Dow Jones Industrial Average is
also only a couple of hundred pointsaway from entering bear market terri-tory, having lost some 2,500 pointssince its summer high of 12,876.
Investors are fleeing equities asEurope goes to the brink of disasterwith its debt crisis.
On Monday, Eurozone leaders againfailed to reach a resolution on releas-ing Greeces next tranche of bailoutmoney, without which the countrywill go bankrupt in two weeks.
S&P 500 indexdives into bearmarket territory
MARKETS
MORGAN Stanley is considering rais-ing $5bn (3.25bn) from a Japanese bond sale as concern grows over itsexposure to the Eurozone.
Yesterday it filed a shelf registrationat Japans finance ministry, which would allow it to sell bonds toinvestors. Sources indicated MorganStanley could launch a uridashi bond but an issue would not take placeimmediately.
The bank, which took a US FederalReserve loan at the height of the 2008crisis, has recently faced rumoursabout its investments in French banks.
However it has a net exposure of zero,City A.M. understands.Morgan Stanley received a boost
from one major investor yesterdaywhen Mitsubishi UFJ Financial Groupgave its backing to the bank.
In a statement it said: In responseto recent market volatility MUFG wish-es to reiterate that we are firmly com-mitted to our long-term strategicalliance with Morgan Stanley. The spe-cial relationship we have formedremains core to our global businessstrategy.
Shares in Morgan Stanley closed up12 per cent last night, but its shares arestill off 48.5 per cent this year.
Separately Greg Fleming, the headof its wealth management arm, told aReuters summit that achieving a 20per cent pre-tax operating margindepends mainly on market conditions. The brokerage aims to achieve mar-
gins in the mid-teens over the next sixto eight quarters, he said.
Morgan Stanleymulls bond issue
amid turbulenceBANKING
DEUTSCHE Bank yesterday blamedthe European debt crisis for the scrap-ping of its annual profit targets asstruggling UBS said it would stay inthe black in the third quarter despiteits rogue trading losses.
Shares in Deutsche Bank fell nearly
four per cent after it said its
10bn(8.62bn) pre-tax profit target is nolonger within reach.
Chief executive Josef Ackermann (right) said: Theintensifying European sovereigndebt crisis led to sustained uncer-tainties among market partici-pants in the third quarter andthus to significantlyreduced volumes andrevenues.
Bank shareshave seen majorfalls in recent weeks as fearsgrow over slow-ing markets.Deutsche Bank, which did not give arevised profit figure, washit especially hard in itscorporate banking and
securities division in thethird quarter.
Ackermann said, however, thebank had boosted liquidity buffers tomore than180bn from150bn previ-ously and did not face a fundingsqueeze.
Deutsche Bank had absolutely norefinancing problems, neither in2008 nor in 2011.
It will also take impairment
charges on Greek sovereign debt ofabout 250m and cut about 500 jobs,mainly outside its home mar-ket. Shares closed down 3.98per cent at 24.72p.
Meanwhile UBS said gainson credit derivatives wouldhelp it record a modest third-quarter net profit and said
there had not been amass pulling offunds since the dis-covery of Kweku Adobolis alleged$2.3bn fraud andthe resignation ofchief exec OswaldGruebel.
It came asUniCredit chief
executive FedericoGhizzoni said thebank, Italys largest by
assets, has its fundingneeds covered.
Deutsche Bank
blown off courseby euro troublesBANKING
ANALYSIS l A turbulent day in the markets
2007 2008 2009
6,724
5,109
3,493
ANALYSIS l A turbulent day in the markets
BIGGEST FTSE 100 LOSERS
EUROPEAN BANKS
Socit Gnrale -4.9%
Deutsche Bank -4.31%
Raiffeisen Bank -4.41%
Brent crudeoil futures fall
1.9% to
$99.79a barrelEurostoxx
50 falls 2.2per cent2091.09
Hargreaves Lansdown -7.88%
Barclays -7.62%
IMI -7.15%
Weir Group -7.03%
GKN -6.55%
TASTE FOR SCOTS ALES LIFTS WELLSAND YOUNGS INTO TOP THREETwo of Scotlands best-loved ales willbe marketed to English beer drinkers and further afield after theBedford brewer Wells and Youngsswallowed the McEwans andYoungers brands yesterday in an esti-mated 20m deal. The purchase fromHeineken UK propels the firm intothe top three premium ale brewers.
WHAT THE OTHER PAPERSSAY THIS MORNING
BLACKROCK JOINS CALL FOR ACTIONON ETFS The worlds leading provider ofexchange traded funds, BlackRock,has backed calls for tougher safe-guards for the investment productsto deflect the rising tide of regulatoryconcerns about the systemic riskposed by the fast-growing market.
The firm has called for higher stan-dards of disclosure.
FTSE 100
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News 3CITYA.M. 5 OCTOBER 2011
BELGIAN lender Dexia lost a fifth ofits market cap yesterday as Franceand Belgium said that they wouldtake all necessary measures tostop the bank from collapsing.
It is not clear what that meansfor shareholders, but Luxembourgfinance minister Luc Frieden yester-day insisted that the banks sub-sidiary in that country is sound and
will not be nationalised.Investors are discussing the possi-
bility that a joint governmenteffort could split the lender into agood and bad bank and winddown the latter. The good/bad splitis the key plank of most resolutionplans that aim to wind up a failing
bank, but markets expect Dexia tobe saved rather than wound up.
If it is recapitalised, Dexia will bethe first Eurozone bank to be bailedout due to its exposure to sovereigndebt.
Yesterday Dexia, along with BNPParibas and Socit Gnrale, facedcalls to write down their holdingsof Greek debt further than the 21per cent hit they have alreadytaken.
Many other lenders have insteadassumed a 50 per cent haircut ontheir Greek bonds. Bloomberg hasestimated that a similar write-down by the three banks wouldgenerate a3bn loss between them.
Dexia finally admitted that it hassought help from government on
Monday night after its sharesclosed down 8.5 per cent. Moodyshad warned that it could slash the
banks credit rating due to itsincreasing reliance on short-termfunding, which is freezing upamong Eurozone banks.
Dexia has been in the process ofrestructuring since being bailedout to the tune of6.4bn in 2008
but said that the size of the non-core portfolio it is trying to sell has
weighed on its balance sheet due tocurrent low valuations.
UK chancellor George Osbornelast night said that Eurozone gov-ernments have not done enoughto convince markets that the crisis
will be resolved.Dexia has got itself into trouble
and there is a feedback loopbetween weak banks, weak sover-eigns and whether those sovereignscan stand behind the banks,Osborne said.
ANALYSIS l Dexia SA
28 Sept 29 Sept30 Sept 3 Oct 4 Oct
1.50
1.40
1.30
1.20
1.10
1.10
1.00
0.90
1.014 Oct
France and Belgium injoint effort to preventthe collapse of Dexia
EUROZONE CRISIS
DEXIA now looks certain to be the first bigcasualty of this years bank funding freeze.
Already part-owned by three govern-ments due to a prior bailout in 2008, the
bank now faces the prospect of being fur-ther nationalised, broken up and restruc-tured. But for all the talk of solving thetoo big to fail problem in the four yearssince the last crisis, the bank resolutionprocedures that should keep taxpayers offthe hook are nowhere near ready.
Eurocrats are not talking about how towind up teetering lenders, but how andwhen to get more public money into them.This week, JP Morgan analysts revised uptheir estimate for exactly how muchshould be pumped into banks: they nowreckon European governments mustthrow180-230bn into the hole left by animpending Greek default.
Banks need to seize the initiative. Thechances of a disastrous disorderly default in which Athens simply runs out of money are rising. But rather than waiting forpoliticians to organise private sectorinvolvement, lenders must use their com-mon sense and take a realistic haircut, as
soon as possible. Sticking to the 21 per cent write-down agreed by euro leaders, asDexia and Frances two biggest banks aredoing, only exacerbates uncertainty ratherthan stemming panic.
Politicians have shown they cannot betrusted to manage Greeces bankruptcy.
Banks must make their own plans.
BOTTOMLINEAnalysis by Juliet Samuel
Banks must show
realism over crisis
2010 2011
FTSE closeddown 2.58per cent
4944.44
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THEY could not have timed it any bet-ter or should that be any worse?Some of the biggest names in bank-ing came together in London yester-day as industry shares fell over fearspoliticians are failing to tackle theEurozone crisis.
Bob Diamond, chief executive ofBarclays, told the Bank of AmericaMerrill Lynch conference thatshares in the British lender areundervalued and vowed it
would meet targets for returnon equity.
I recognise that our stocktrades at a significant discountto our tangible equity. I do not
believe that that is justified.He said Barclays will hit
its target of a 13 per centreturn on equity by 2013despite new regulationand slowing economicgrowth.
Diamond also told theaudience, whichincluded the chief exec-utives of DeutscheBank, Socit Gnrale,Royal Bank of Scotland
and Lloyds BankingGroup, that Barclays was
in a good position to withstand therisks posed by the Eurozone debt cri-sis, with 44bn of its exposure, themajority in retail banking and muchof that in first homes with low loan-to-value ratios in Spain, Italy andPortugal.
Antnio Horta-Osrio, chief execu-tive of Lloyds, indicated the bank
would improve its capital and fund-ing positions as he contrasted thecredit and banking crisis of 2008
with the current sovereign andpolitical crisis in the Eurozone.
In a presentation he saidLloyds, which is 41 per cent tax-payer-owned, would continueto strengthen our balance sheetand liquidity position.
RBS chief executiveStephen Hester said thebank was reviewing itsinvestor return targetsamid the Eurozone cri-sis. One of the slides inhis presentation statedreturn target underreview in light of chal-lenges.
RBS also said it is like-ly to raise its targetedcore Tier 1 capital ratiodue to the impact of
Basel III rules and theICB report.
Share price is
undervalued,says DiamondBY PETER EDWARDS
BANKING
FEDERAL Reserve chairman BenBernanke accused Chinas currencyinterventions of harming the globalrecovery last night, just hours afterChinese authorities hit out at the USfor stoking the currency war.
An angry China warned Washington that passage of a billaimed at forcing Beijing to let its cur-
rency rise could lead to a trade war between the worlds top twoeconomies.
Chinas central bank and the min-istries of commerce and foreign affairsaccused Washington of politicisingcurrency issues and putting the globaleconomy at risk after US senators
voted on Monday to start a week ofdebate on the bill.
Yet Bernanke fanned the flameswith his comments. I do think thatChinas currency policy ... has been tosome extent preventing global adjust-
ment, he said. A more balancedgrowth path could be achieved if there
was greater f lexibility in currencies.
Bernanke: China affecting globalrecovery by weighing down yuan
WORLD ECONOMY
EUROPES bank regulator yesterdayadmitted its much-lauded stresstests of the regions banks this yearhad failed to stop another crisis, asFranco-Belgian lender Dexia cameclose to collapse less than 12 weeksafter getting a clean bill of healthfrom the European Banking
Authority.City critics blasted the test results
published in July, which found 90per cent of European banks wereable to survive another crisis, but didnot use a scenario in which govern-ments defaulted on their debt.
We have to acknowledge we didnot manage to reassure markets onthe solidity of European banks, espe-cially due to the treatment of sover-eign exposures, EBA chairman
Andrea Enria told an EU parliamen-tary committee.
Syed Kamall, a Conservative MEP
for London, said the EBA had wildlyunderestimated sovereign debt risks.While the markets were warning
of a 50 per cent haircut for Greekdebt, it was wrong of the EBA to onlyassume a write down of 15 per cent,he told City A.M.
The EBA may need to go back tothe drawing board and take a morerealistic view of banks exposure tosovereign debt if we are to have anyreal idea on the health of banksacross the European Union.
Regulator admits bank stresstests failed on sovereign debtBYALISON LOCK
REGULATION
News4 CITYA.M. 5 OCTOBER 2011
EBA chairman
Andrea Enria
Picture:
REUTERS
"We have to acknowledgewe did not manage to reas-sure markets on the solidityof European banks, especiallydue to the treatment ofsovereign exposures"EBA chairman Andrea Enriayesterday"Dexias strong capital basewould enable it to weatherthe set of assumptions of theEBA stress tests...even ifthese assumptions lookvery conservative, notablyfor sovereigns"Dexia's feedback from theEBA in July
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News 5CITYA.M. 5 OCTOBER 2011
APPLE yesterday unveiled an update toits world-beating smartphone but dis-appointed fans by failing to launch theanticipated iPhone 5.
The markets sighed in unison withthe fan-boys, with Apple stock fallingas much as five per cent yesterday, before recovering most of the lostground.
Tim Cook made his inaugural prod-uct launch as full-time chief executiveof the company, ten years on from and in the same room as the launchof Apples first generation iPod.
The iPhone 4S is faster than its pred-ecessor, featuring a dual core A5processor designed by Cambridge-based ARM, improved battery life anda more powerful camera.
Its biggest draw, though, is the newSiri voice recognition feature, whichfinally appears to have succeeded where many other companies havefailed. During the demonstration, anApple executive wrote text messages,asked for the spelling of words andscheduled meetings, all through con-versational voice prompts.
However, the 4S chassis remains thesame as the iPhone 4 Apples most
popular handset to date dashing thehopes of fans dreaming of a completeoverhaul.
And anybody hoping the iPhone 5will be along soon may be disappoint-ed there was a wait of a year betweenthe iPhone 3GS and the 4.
Cook also said Apples grasp on thepersonal computing market is tighten-ing, with sales of its Mac range grow-ing more than 20 per cent quickerthan its rivals and now accounting for23 per cent of the market.
He also said 18bn apps have beendownloaded from Apples App Store,with the number growing at a rate of1bn a month.
The iPhone 4S will be available forpre-order on Friday and ship a weeklater.
Apple sharesfall after newiPhone launch CHANCELLOR George Osborne has backed down on one of his keydemands that all derivatives tradingbe immediately covered by new EU
rules but won some smaller conces-sions on controlling a market oncedescribed as the Wild West.
For Osborne, who interrupted hisattendance at the Conservativepartys annual conference to make
the trip to persuade EU finance min-
ister to change the draft law, the dealallowed him to claim a partial victory.He won concessions, including one
that waters down the power ofEuropean regulators to sidelineBritish authorities.
In another concession, theEuropean Commission, which writesthe first draft of laws for the 27-coun-try EU, also pledged to reflectBritains concerns in a new raft ofmarket rules.
UK compromiseson derivatives bill
CONTROVERSIAL trader GuillaumeRambourg is planning to launch ahedge fund in Paris but without hisformer business partner Roger Guy.
Rambourg, who earlier this yearwas cleared by British regulators of breaking internal trading rules atGartmore, will name the new fund Verrazzano, after the Verrazano-Narrows bridge that connects theNew York boroughs of Staten Islandand Brooklyn.
He has applied for an operatinglicence in France but, if successful, he
will have to build the fund withoutGuy, with whom he ran Gartmores
5.5bn hedge fund business.In March last year Rambourg was
suspended from Gartmore forallegedly directing trades to favoured brokers. It sent the fund managerinto a tailspin, with many of its topperformers leaving, clients withdraw-ing more than 1bn and its shareprice plunging.
Rambourg resigned in July last yearto concentrate on the FSA investiga-tion and four months later Guy sensa-tionally quit as well.
Rambourg was cleared by theFinancial Services Authority in Marchbut by then Gartmore had been sold
to Henderson for a knock-down priceof 335m.
Star trader Rambourg set tolaunch Paris fund without GuyCAPITAL MARKETS
Tim Cook launched the new iPhone to a muted reaction yesterday Picture: Reuters
BYHARRY BANKS
REGULATION
BY STEVE DINNEEN
TECHNOLOGY
NEW YORKS attorney general said yesterday he has filed a lawsuitagainst Bank of New York Mellon for
defrauding clients in foreign curren-cy exchange transactions.Eric Schneiderman said BNY
Mellon misrepresented to customersthe rates for foreign currency trans-actions over a 10-year period. He saidhe is seeking a nationwide recoveryof nearly $2bn.
New York is the latest state to bring claims against BNY Mellon,which has been battling allegationsof forex overcharging for months.
New York bringsBNY Mellon suit
BANKING
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DAVID Cameron will today set thestage for a long-haul recovery thatmight not materialise before thenext election, as he tries to find rea-sons for optimism amid a gatheringeconomic storm.
Speaking on the last day of hispartys conference in Manchester,the Prime Minister will attempt to break a cycle of gloom that he is worried could become self-fulfill-ing.
Right now we need to be ener-gised, not paralysed by gloom andfear, he will say. You hear pes-simism about our economic future,our social problems, our politicalsystem... that our best days arebehind us... Im here to tell you thatit isnt true.
But he will also admit that theeconomic crisis is far worse than
the Tories had thought when theycame into government last year andthat Britains recovery will take along time.
People want to know why thegood times are so long coming. Theanswer is straightforward butuncomfortable. This was no normalrecession, he is expected to say.
In a sign that the government isworried that any positive effects ofits policies will not be felt by thepublic before 2015, Cameron willsuggest that the coalition is layingthe foundations for growth. Itslike building a house. The mostimportant part is the part you cantsee that foundations that make itstable.
The Prime Minister will also sig-nal that the government plans toconfront those vested intereststhat stand in its way, such as unionsand companies that are not provid-ing apprenticeships.
FORUM: P25
Cameron willwarn of longhaul recovery
News6 CITYA.M. 5 OCTOBER 2011
NEWS | IN BRIEF
More investment for LondonBoris Johnson, the London Mayor, yes-terday called on the government tocontinue investing in the capital, whichhe said was the "locomotive" for therecovery in the UK. During his speechto the Tory conference, Johnson arguedthat other parts of the country suchas Manchester, where theConservatives are meeting relied onLondon to ensure their economic suc-cess. He warned the coalition not to cutthe city's transport budget for short-term political gain.
Prisoners must be put to workThe government will put more prison-ers to work in an attempt to rehabili-tate a "growing feral underclass"blamed for the riots that swept
through England two months ago, jus-
tice secretary Ken Clarke said yester-day. Clarke won backing for his planfrom a group of business executives ledby Sir Richard Branson, chairman oftravel and entertainment companyVirgin Group. I want to see hard workflourishing in every single jail in theUK, Clarke said.
Lansley defends NHS reformsHealth secretary Andrew Lansley yes-terday attempted to reassure critics ofplanned reforms to the National HealthService, promising they would meanno decision about me without me forUK patients. Lansley said Labour wouldhave cut 30bn by 2015, whereas theTories will be putting in 12bn. "While Iam secretary of state, the NHS willnever be fragmented, privatised or
undermined," he insisted.
David Cameron is looking for optimism amid economic gloom Picture: REUTERS
CONFERENCE WHISPERS
The cat(s) that got the creamCats abound at this years Tory confer-ence.
First Theresa May, the home secretary,used her speech to claim that a convictedBolivian illegal immigrant had beenallowed to stay in Britain because heowned a British pet cat.
The delegates lapped up this tale of
human rights madness, but was it true?Ken Clarke, the uber-liberal justice secre-tary, thought not, and was happy to puthis money where his mouth is; he chal-lenged May to a bet.
The Tory leadership tried to swingbehind May, with aides giving hacks the"fe-line" to take. For a while, it seemed asthough Clarke was back in his kennel. Butnot for long.
Eventually, it transpired the man had
been allowed to remain in the UK becausehe was in a long-term relationship (whichentitled him to stay).
Because the pair weren't married, thecat was provided along with a host ofother things as proof the pair wereactually living together.
Elsewhere, one Tory wag was doing therounds telling a new joke about the
Liberal Democrats. The Liberals used toshoot your dog, but now they steal yourcat, he said in reference to the Lib DemMP's wife who stole his lover's cat. Sowho was the joker? City A.M.'smoles sayit was a very senior Tory indeed.
An enduring marriageThe Citys major donors were out in forceat the Treasurers party on Monday night:Arbuthnot Securities chairman and CEO
Henry Angest, Cavendish senior partnerHoward Lee, and Christopher Moran, theentrepreneur currently restoring SirThomas Mores former home CrosbyHouse back to its Tudor glory. Hosted byco-treasurers Sir Stanley Fink and PeterCruddas, the reception gave Cameron achance to appeal to donors to build upfunds to help the Tories secure a clear
overall majority in 2015, before rushingoff to drinks with the South EastConservatives.
Here, the guest speaker was LondonMayor Boris Johnson, whom Camerongreeted with a huge hug and a firm armclasp, to cheers from the crowd. Thelast time we gripped each other astightly as this, people thought this wasthe first civil partnership in theConservative Party, he joked.
BY JULIET SAMUEL IN MANCHESTER
CONSERVATIVE
CONFERENCE
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AN EU-WIDE financial transactionstax could be introduced as a VATmeasure, avoiding the UKs veto ontaxation, according to ConservativeMEP Dr Kay Swinburne.
She is reported to have told regula-tors at the Conservative party confer-ence yesterday that MEPs, led byEuropean tax commissioner AlgirdasSemeta, had already started workon the proposals. That could see themeasures passed on a majority vote.
The tax would be devastating forLondon, according to City of Londonpolicy chairman Stuart Fraser. Thisis a tax on London up to 62 per
cent of its revenues will come fromthe UK. he said. The Commissionsown impact study shows it wouldcost more than it would raise.
Semetas spokesman David Boublilstrongly denies Swinburnes claims.
We have proposed the tax at anEU level and it would require unani-mous support to be implemented,Boublil told City A.M. If we cannotget every country to agree, thosewho do want to implement the taxcould choose, independently of theCommission, to put the tax in placethemselves.
We have tried to address the UKsconcerns by lowering the rate, forexample but the UK could not beforced to implement the tax.
MEP: EU mayforce City tax
BY TIMWALLACE
EU ECONOMY
A NEW group of Conservative MPslaunched last night to promote freeenterprise and counter the widespread belief that the financial crisis wascaused by too little regulation.
The 22-strong group, put togetheron the initiative of Elizabeth TrussMP, aims to make the case for eco-nomic freedom.
Free enterprise has got a badname it is less popular in Britainthan in countries like China,Germany and the US, Truss told CityA.M. We need to challenge that.
There is a view that you cannot be both modern and free market atthe same time. But if you take theexample of child care, the last govern-ment increased the regulation ofchild-minders halving their numberand doubling the cost of child care.
Deregulation would be good foreveryone involved. Though most of the group come
from the 2010 parliamentary intake,senior backbencher Andrew Tyrie hasalso joined.
The chairman of the Treasuryselect committee criticised the gov-ernment over the weekend, sayingthat a longer-term growth strategywould improve the chances of successin other areas, like the big society.
22 Tory MPs form group tofight anti-enterprise cultureBY TIMWALLACE
POLITICS
News 7CITYA.M. 5 OCTOBER 2011
Tory MEP Kay Swinburne fears a transaction tax may be forced on the UK. Picture: REX
Should the UK hold a referendumon staying in the European Union?
In association withPoliticsHome.com
Apply to join today atwww.cityam.com/panel
At the Tory Party conference yester-day, Prime Minister David Cameronappeared to completely dismiss theidea of an in-out referendum on theUKs role in the European Union.
Cameron said: I don't think mostpeople in the country want that choicebetween in or out.
But what do you think? This weekour readers panel, in association withPoliticsHome.com, is asking for yourviews on an EU referendum how youwould vote and what would be bestfor the business community.
To apply to join the panel, go tocityam.com/panel
PoliticsHome.comPoliticsHome.comIn partnership
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I dont think it is right,
but I am hoping thatthis will shake a fewthings up and maybeget rid of Skyschoke hold.
A PUB landlady from Portsmouth yes-terday won her legal bid to screencheap foreign coverage of footballmatches, in a giant-killing feat to rival
Wimbledons 1988 FA Cup final winover Liverpool.
The European Court of Justice (ECJ)ruled that Karen Murphy should beallowed to use a Greek decoder toscreen football matches.
Murphy was fined after beingcaught using the decoder, which she
said was to avoid paying BSkyBs skyhigh prices.
BSkyB slipped almost three percent yesterday, with some analystsplacing the potential loss of commer-cial revenue at 70m a year.
Murphys win was not absolutethough, with the court ruling that it
would be a breach of copyright to broadcast Premier League materialsuch as its theme tune and logo. Thisgives the Premier League a new lineof defence, guaranteeing the legal
argument will continue.The ruling could have far-reaching
consequences for the Premier Leagueand other rights holders, includingfilm and TV production companies
who sell their rights abroad.The Premier League, which initial-
ly took action against Murphy, couldnow be forced to sell pan-Europeanrights to its matches to a single
broadcast partner.Sky, the biggest customer for the
Premier Leagues football rights, would be the clear frontrunner. Intheory it could then wholesale
rights in much the same way it doeswith Sky Sports in the UK to BT and Virgin to broadcasters in areaswhere it does not have a presence.
Some analysts have speculated thePremier League could start its own TVchannel, although its close relation-ship with Sky makes this unlikely.
The ECJ ruling, which was expectedafter the advocate general recommend-ed it earlier this year, could yet beignored by the High Court in the UK,although this is extremely unlikely.
Pub landladyhits winner infootball caseBY STEVE DINNEEN
BUSINESS OF SPORT
News8 CITYA.M. 5 OCTOBER 2011
DO YOU AGREE WITHTHE ECJ RULING?
Interviews by Phoebe Torrance
ALAN GYERTSON |ALPHA BANK
Yes, it is brilliant. Skyhas always been incontrol; it has opened anew market for peoplewho couldntafford Sky.
CHRIS WEBBER |FAEGRE & BENSON
Yes, it was rightthat the court ruledit was okay. It is cor-rect application ofthe Europeanlaw.
SHAUN RANDELL |
AMLIN
* These views are those of the individuals above
and not necessarily those of their company.
Karen MurphyThe vindicated pub landlady is nowfree to screen Premier League games
through her Greek encoder, saving hermore than 7,000 a year.
Other rights holdersOther sporting bodies and even filmand TV production companies couldsee the way they sell rights affectedby the ECJ ruling, meaning they could
also lose out.
ECJThe ruling shows the power of theEuropean Court of Justice to influ-
ence high-profile cases in its mem-ber states.
Premier LeagueRichard Scudamores organisation,and therefore top flight clubs,could find their games worth farless in light of the ruling.
BSkyBAnalysts say BSkyB, run by JeremyDarroch, could lose 70m a year incommercial revenuesin the wake of theruling. It may now
bid for pan-European rights.
UEFAMichel Platinis governing bodywill also be affected by the rul-ing. It may have to reassess theway it sells Champions Leaguerights to individual EU membercountries.
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News 9CITYA.M. 5 OCTOBER 2011
INDIAN industrial giant Essar is set toraise about $750m (485m) by floatingits infrastructure assets on the Londonstock exchange next year.
The Mumbai conglomerate isbelieved to have hired JP Morgan andCredit Suisse to advise on the initialpublic offering (IPO), which would pro-vide foreign cash to boost its expansionplans.
The move could see Essars port andconstruction units merged and listedas Essar Infrastructure.
The group, which is controlled by bil-lionaire brothers Shashi and Ravi Ruia,is considering an IPO in early 2012 inthe hope that storms hitting globalmarkets will have calmed by then.
Market turmoil has forced severalmajor listings around the world to putplans on hold, such as those scheduled by Facebook, Groupon, ManchesterUnited and Fitness First.
Last night a spokesman for Essardeclined to comment on the IPO plansbeyond an earlier statement saying it
is always considering options for capi-tal-raising and that no specific transac-tion has been proposed.
Essar has interests in steel, ports andlogistics and telecommunications. AnIPO in Britain would make it easier toraise money to buy assets here and inEurope and would be the largest over-seas listing by an Indian company afterthe groups own Essar Energy floatedfor 1.3bn in London in May last year.
Shares in Essar have been hit, howev-er, by delays to key power projects,caused by battles with Indian regula-tors. They reached a high of nearly 6at the end of last year but closed down3.57 per cent last night at 237.7p
Last month Essar Energy, a powergenerator and refiner, was reported tohave entered talks with firms includ-ing Exxon Mobil, Chevron, andConocoPhilips to acquire oil and gasassets in Africa, Latin America andAustralia.
More Indian companies are goingoverseas for listings because they facehigh borrowing costs and depressedcapital markets in Asias third-largesteconomy.
Essar looks to$750m listing
Essar is hoping to float its infrastructure arm at some point early next year
BY PETER EDWARDS
CAPITAL MARKETS
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SIR FREDGOODWIN
SAGA RUNSAND RUNSJUST when you thought things couldntget any worse for disgraced banker SirFred Goodwin, The Capitalisthears the for-mer RBS CEO was once snubbed infavour of a company that had recentlygiven half of Glasgow diarrhoea.
The story starts in 2003, when BBCScotlands head of news Atholl Duncan,needing a change of scene after exhaus-tively covering the Lockerbie andDunblane tragedies, called in the head-hunters to explore his career options.
As luck would have it, two individualsrequired some public relations assistanceat that time. One, a little-knownEdinburgh banker called Fred Goodwin;
the other, Jon Hargreaves, the CEO ofScottish Water, then Scotlands mostunpopular company after infecting thou-sands of civilians with a virulent bug.
Deciding to pursue both leads, Duncan visited Goodwin in the RBS HQ in StAndrew Square but left distinctly unim-pressed by the shy banker with nocharisma. Even worse, Goodwins PR brief was rather vague: all he was con-cerned about was keeping his remunera-tion out of the press, recalled Duncan,who turned down the now-infamous fin-
According to a BBC mole, the refresh-ing Rastani, who admitted traders dontreally care that much about economiccollapse, was simply saying what every-one else was thinking. Traders onlymake money when there are peaks andtroughs in the market. If the general pub-lic understand the City a bit better as aresult [of Rastani], that is a good thing.
BEARDED LADIESTO THE British Museum for the launch ofThe Tomb of the Unknown Craftsman: the
exhibition curated by cross-dressingcelebrity artist Grayson Perry (above).
The display marks the first arts sponsor-ship by business adviser AlixPartners,whose MD Pippa Wicks said the collectionknocked her sideways and made herblush. This is the first time the British
Museum has sponsored an exhibitionof this kind, Wicks told The Capitaliston regaining her composure.
And with Polynesian fetishes and abust of a bearded Queen Victoria on
display, possibly also the last.
ancier to become corporate affairs direc-tor under Hargreaves.
Of course, its all (Scottish) water underthe bridge now but the moral of thestory still stands. Only work with chiefexecutives you can empathise with, saidDuncan. You have to be able to spendmore than an hour in their company.
BEANS MAKE TOASTS AND SO to the Institute of Chartered Accountants of Scotland (ICAS), whereDuncan is now global comms chief forCEO Anton Colella, the former religiousstudies teacher who made his name lead-ing the Scottish Qualifications Authority.
ICAS wants to become world class,said Colella at the annual CA Dinner at The Savoy on Monday night, where top-level beancounters such as KPMG chair-man John Griffith-Jones and the worlds
most influential accountant Sir David Tweedie raised toast after toast betweenlashings of haggis and single malt.
Stealing the show, however, was ICASpresident Iain McLaren, who held his ownagainst comedian Dara OBriain with hisjoke at the expense of the BBCs businesseditor Robert Peston. The differencebetween Robert Peston and God, of course,
is that God doesnt think he is RobertPeston. Although Peston, who yesterdayannounced his Speakers for Schools initia-tive to help disadvantaged students, is infairness rather saintly at the moment
RECESSION-PROOFSUPPORT from the corporation thathired him for Alessio Rastani (right),the day trader from Kent who creat-ed a media storm with his dream-ing of recession remarks.
DisgracedRBS bankerSir Fred
Goodwin wassnubbed infavour ofScotlandsmost hatedcompany
The Capitalist10 CITYA.M. 5 OCTOBER 2011
EDITED BY
HARRIET DENNYSGot A Story? [email protected] The Capitaliston Twitter: @dennysharriet
Lack of empathy: Fred Goodwin, as he was in 2003, presented an unappealing PR brief Picture: REX
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News12 CITYA.M. 5 OCTOBER 2011
WOLSELEY, the worlds biggest distrib-utor of plumbing and heating prod-ucts, swung back into profit for thefirst time in three years after increas-ing sales and cutting down on costs.
The FTSE 100 group, which operatesthe Plumb Centre and Fergusonchains in Britain and the US, saidunderlying profit in the year to theend of July rose to 622m from 450mthe previous year, driven by a five percent rise in like-for-like sales.
Chief executive Ian Meakins warnedthat the broader picture for the indus-try remained tough as uncertaintyprevailed around the US propertyrecovery.
Recent economic forecasts haveweakened and over time this is likelyto have an impact on our markets, hesaid in a statement, but reassured thatthe group was in good shape.
The company recently sold itsFrench distribution division Brossetteand its UK-based Build Centre business
for 310m to Saint-Gobain, as part of adisposal strategy.
Wolseley will put the proceedstowards its goal of wiping off all of itsdebt by the end of 2012 from a currentadjusted net debt level of 490m.
The group is also planning to spendup to 200m on bolt-on acquisitionsacross 25 countries, Meakins said.
Shares closed down 1.3 per cent to1,516p last night.
Seymour Pierce analyst KevinLapwood said: There was some disap-pointment that the outlook was get-ting worse but I think you have got to
take some comfort that the balancesheet is in much better condition.
Profits returnyet Wolseleystill cautiousBYKASMIRA JEFFORD
CONSTRUCTION
ANALYSIS l Wolseley Plc
p
28 Sept29 Sept 30 Sept 3 Oct 4 Oct
1,600
1,560
1,520
1,480
1,516.004 Oct
ANALYST VIEWS: ARE WOLSELEYS RESULTSON TRACK? Interviews by Kasmira Jefford
CHARLIE CAMPBELL | LIBERUM CAPITAL
Sales growth in August and September was in line with Q4 and while thestatement is somewhat cautious, this is general rather than specific. Fergusons like-for-likes have turned strongly positive and is clearly outperforming the market. Wefind the results reassuring and confirm our positive investment case.
CHRIS ALEXANDER | BNP PARIBAS
The group has seen a slowing in fourth quarter like-for-like salesgrowth to three per cent from the previous quarters up six per cent, and is theslowest rate of growth in the last five quarters. This may give some concern but ishardly unexpected given the deteriorating macro backdrop.
HOWARD SEYMOUR | NUMIS SECURITIESSelf-help has been the mantra of the management since their introductionto Wolseley, and results to date bear witness to the success of this strategy.
Going forward, the uncertain outlook will obviously take its toll... but with self-help inplace we remain convinced that growth initiatives will enable operational out-perfomance in the US market especially.
CEO Ian Meakinssaid Wolseley wasin reasonableshape to tackle adownturn"
UK insurance companies were yester-day granted more time to change their
internal structure ahead of the start ofnew Solvency II regulation in 2014. The Financial Services Authority
pushed back the deadline for insurersto seek its approval for their proposednew internal models from May 2012 tomid-2013.
Its decision comes after Europeanregulators bowed to industry concernsthat they had too little time to preparefor the changes, and delayed SolvencyIIs start date by a year to January 2014.
The FSA billed its change as a com-promise that balances what we needto do to discharge our regulatory obli-gations and bring in the new regime,
with the needs of the industry.The change will give the UKs insur-
ers more time to prepare for SolvencyII, which will force them to hold moreregulatory capital against risks.
Insurers that want to have a new,unique internal structure approved by
the FSA can send it their applicationsfrom 30 March 2012 to mid-2013.
But advisory firms said the changecould lead to a slowdown in prepara-tion for the new rules.
While certain elements of a delay would be welcome, nobody wants aloss of momentum as insurers have
been working towards Solvency II formany years and are eager to startembedding it into their businesses,said PwC insurance partner JimBichard.
Insurers givendeadline delayINSURERS
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News 13CITYA.M. 5 OCTOBER 2011
EUROPEAN regulators will today file alist of formal objections to the block- buster $10.2bn (6.6bn) merger of theNYSE Euronext and Deutsche Boersestock exchanges, perhaps forcing theparties to offer concessions to get thedeal approved.
The European Commission is con-cerned that the merger, which wouldcreate the biggest stock exchange in the world, could hurt competition inEuropes market for trading stocks andother financial instruments such asderivatives.
It has been investigating the effect ofthe merger on competition and City A.M.understands its statement of objec-tions will run to 200-300 pages of evi-dence.
The merger has drawn criticism fromother European exchange operators,including the London Stock Exchange,which fear it will have too great a mar-ket share in some instruments.
Both Deutsche Boerse and NYSEEuronext own large derivatives trading
operations Eurex and Liffe respective-ly which, when merged, will controlabout 91 per cent of the market forexchange traded derivatives.
The European derivatives market isa duopoly, the LSE Group said in itsresponse to the European competitioninvestigation in July. NYSE Euronextand Deutsche Boerse dominate EUderivatives trading as each others clos-est competitors. New entrants havebeen unable to challenge their positionbecause of restrictive licensing practicesand closed clearing pools.
The two exchanges will be able torespond to the objections and can offerconcessions to the regulator to fix theproblems, but have already ruled outselling any part of their derivatives busi-nesses to satisfy the objections.
If that was the case [selling the deriv-atives businesses], there would be nodeal, one source told City A.M.
A NYSE Euronext spokesman said itexpected to win regulatory approval forthe merger. A statement of objectionsdoesnt prejudge the Commission'sfinal decision, he said. We are confi-dent the merger will be cleared.
EU objects toNYSE merger
Deutsche Boerse chief executive Reto Francioni favours global expansion Picture: REUTERS
BYALISON LOCK
CAPITAL MARKETS
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SUKHPAL Singh Ahluwalia was just 18when he spotted the chance to buy acar parts shop in North London thathad gone into bankruptcy for 5,000.
The Wembley-based entrepreneuris now set to pocket up to 280m afteragreeing to sell his business Euro CarParts to US rival LKQ Corporation.
Singh, hailed as a remarkable and
incredibly bright self-made man bythose who know him, moved to theUK aged 13 with his family fleeing IdiAmins Ugandan regime.
After snapping up the Willesdencar parts shop in 1978 using a smallbank loan and funds from his father,he branched into the import and sup-ply of parts for prestige German carbrands such as BMW and Mercedes.
Over the past 30 years, Singh hastransformed Euro Car Parts into the
UKs biggest distributor of replace-ment components for vehicles, with89 outlets staffed by more than 3,500employees.
The firm, wholly owned by Singh,is expected to generate revenues ofapproximately 78-81m for 2011.
Chicago-based LKQ will buy thefirm for 225m and has agreed to payan extra 55m if Euro Car Parts meetscertain growth targets in 2012 and2013.
Euro Car Parts sold toUS rival LKQ for 280m
Euro Car Parts founder Sukhpal Singh will stay on at the firm after its takeover
News14 CITYA.M. 5 OCTOBER 2011
BYKASMIRA JEFFORDM&A
Robert W Baird, the boutique investmentbank, acted as adviser to Euro Car Parts
with David Silver, co-head of investmentbanking, leading the team.
Silver, who will take over as the headof European investment banking next
year, joined Baird in 1998 and is afounding member of the firms M&Ateam in Europe. His team has advised ondeals including FTI Consultings acquisi-tion of public relations firm FinancialDynamics in 2006 and the sale of pro-duction agency Tag Worldwide - led byCrystal Palace football club owner SteveParish - to Williams Lea in July. Silver,
who has advised Euro Car Parts formore than three years, said they fitextremely well culturally with LKQ andhave exciting times ahead.
MEET THE ADVISERS
DAVID SILVER
ROBERT W BAIRD
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LAND Securities, the UKs biggestcommercial landlord, has securedplanning consent for a new mixedoffice and retail development nearSt Pauls Cathedral in the City ofLondon.
The 250,000 square foot schemewill replace three existing buildingson the corner of Shoe Lane andLittle New Street with cafes, restau-rants and premium office space for
Londons midtown market, thecompany said in a statement yester-day.
The site, renamed New StreetSquare, will be designed by RobinPartington Architects, who werealso key designers behind 30 StMarys Axe, better known as theGherkin.
Land Securities opened its cityshopping centre One New Change,
which overlooks St PaulsCathedral, last October.
Colette OShea, head of develop-ment for the firms London portfo-lio said: New Street Square has
become an important London loca-tion and has helped put Midtownon the map.
1 New Street Square will be anatural extension to the area, mak-ing it even more attractive to poten-tial occupiers.
Work is expected to start in 2013and completion is expected in 2016.Land Securities were unavailable tocomment on the cost of the scheme
last night.Companies are flocking to reno-
vate the area around St Pauls cathe-dral.
Axa Real Estate partners last weeksubmitted planning application fora similar commercial propertyscheme opposite St PaulsCathedral.
Some 60,000 sq ft of new officespace, along with 20,000 sq ft forrestaurants, is included within
Axas plans.
Land Sec getsplanning forSt Pauls build CITY law firm Norton Rose has sealedits second Canadian merger, announc-ing a tie-up with resources specialistMacleod Dixon less than a year after it
took over Montreal-based OgilvyRenault.
Norton Rose said yesterday it hadinked a deal that would see it team up
with Macleod Dixon from January2012, in a move that will boost its min-ing and energy practice and help itexpand into South America andCentral Asia.
This is another very exciting movefor the group, said group chief execu-tive Peter Martyr. This merger deliversreal strength in energy and mining inCanada, as well as in emerging mar-kets such as Latin America and Central
Asia.Bill Tuer, managing partner of
Macleod Dixon, will join the executivecommittee of Norton Rose, which willhave a total of 2,900 lawyers across 43offices once the merger is completed.
Once the firms are joined, NortonRose will add 60 lawyers in Caracas,
Venezuela and Bogota, Chile, as well as13 in Kazakhstan.
Norton Rose Canada, as the groupsCanadian operation will be branded,
will have almost 700 lawyers, placing itin the top three Canadian legal prac-tices by headcount.
New Canadianlink for law firmNorton Rose
Moultons Enigmatic vehicles bid was described as opportunistic Pic: Micha Theiner
BYKASMIRA JEFFORD
PROPERTY
LEGAL SERVICES
News 15CITYA.M. 5 OCTOBER 2011
Jon Moulton sees 9.7moffer for Clarity rejected
JON Moulton has seen his 9.7m bidfor Clarity Commerce rejected, after
the offer was branded highlyopportunistic by the firms board.
Clarity said the unsolicited bid byEnigmatic a vehicle controlled byMoultons buyout company BetterCapital undervalues the compa-ny and its prospects, adding the
board decision to recommend itsrejection was unanimous.
The firm, a provider of softwaresolutions to the entertainment,retail, hospitality and leisure sector,posted a loss in its last financial
year, which it blamed on reduceddemand in the retail sector.
Clarity, chaired by Sir ColinChandler, the former chairman ofeasyJet, said it has since restruc-
tured its operations and hasachieved significant cost reduc-tions. The cost reduction pro-gramme and a round of UKredundancies, which completed lastmonth, are expected to remove afurther 1m from its cost base.
Venture capitalist Moulton holdsa 9.4 per cent stake in BetterCapital, which he founded in 2009
with a focus on turnaround invest-ments after quitting AlchemyPartners.
BY STEVE DINNEEN
TECHNOLOGY
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News16 CITYA.M. 5 OCTOBER 2011
MORE NEWSONLINE
www.cityam.com
Kindle Fire could lead the two-man tablet race
AMAZONS Kindle Fire entry into theUS tablet market has caused a flurry ofspeculation around its impact ontablets. It seems that the Kindle Fire
will now lead Amazon and Apple intoa two-horse race, potentially eliminat-
ing all other competitors.YouGovs TabletTrack suggests that
250 is the price point where thetablet market will take off. Tablets willfail as a mass-market product until the
price comes down to this point. TheKindle Fire launches at $199 versus theiPad2 at $499, so if we expect the samepricing differential in the UK, thatprice point will have easily been hit.
Apple is the current UK marketleader in terms of awareness, prefer-ence and price. The latest YouGov
TabletTrack data shows 72 per cent ofhot prospects, consumers looking to
buy a tablet, will consider an iPad2with a further 61 per cent saying theyexpect to buy one. Competitors only
reach single figures of these hotprospects. However, the Kindle Firecompetes in terms of price and specifi-cations, and also in the trust con-sumers have in the Amazon brand.
Amazon consistently achieves aRecommendation index score in YouGovs BrandIndex at around 60points. Apple however fluctuates
between the 25 and 35 point mark.BrandIndex shows that Apples
brand and Apples iPad Buzz indexscores have risen rapidly since
Amazons Kindle Fire announcementlast week. Yet, Apples overall and iPad
Value scores have both fallen by some14 and 16 points in the last nine days.
Yesterday, some 49 Value index points
separated Amazon and Apple. If the battle is to be fought on price thenAmazon starts with a clear advantage.
It has to be said that yesterdaysApple launch will impact the iPhone
brand line. Buzz for iPhone remainsfairly static but one would expect thisto rise considerably in the comingdays. Stephan Shakespeare is the chiefexecutive of YouGov
BRANDINDEX
STEPHAN SHAKESPEARE
NEWS | IN BRIEF
Rio will not change Mongolia dealRio Tinto and Ivanhoe Mines have reject-ed moves by the Mongolian governmentto increase its stake in the vast Oyu
Tolgoi copper and gold project located inthe resource-rich country. Mongolia lastweek invited the miners to renegotiatethe terms of a 2009 deal that includedboosting Mongolia's share in the $10bndeposit from 34 to 50 per cent.
Sugar firm Cristal buys rival stakeFrench sugar cooperative Cristal Unionagreed to take control of SocieteVermandoise yesterday in a deal valued
at nearly 1bn (863m) that would cre-ate the number two sugar group inFrance after Tereos. The exclusive dealcovers a 51 per cent stake owned by theDelloye family in Vermandoise, which hasa market capitalisation of 262m.
ANALYSIS l Brand index: Buzz
07 Sep 17 Sep 25 Sep 03 Oct
40.0
30.0
20.0
10.0
0.0
AmazonAppleAmazonApple
Apple iPadApple iPhoneApple iPadApple iPhone
ANALYSIS l Brand index: Value
11 Sep 17 Sep 25 Sep 03 Oct
60.0
40.0
20.0
-20.0
0.0
AmazonAppleAmazonApple
Apple iPadApple iPhoneApple iPadApple iPhone
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DUBAI-BASED ports operator DP World expects its new LondonGateway deep-sea container port to beoperational by the fourth quarter of2013, it said yesterday, with spendingon the project set to continue apacedespite the economic gloom.
London Gateway, located about 25miles east of central London on thenorth bank of the river Thames, is astaged 1.5bn development embrac-ing the container port itself as well as
what is expected to be Europeslargest logistics park.
The worlds third-largest port oper-ator said that it would invest another$1bn on the project over the nextthree years, having already spent$600m, with construction in progresssince January last year.
The funds for the project are com-ing from the resources of the compa-ny and international financialinstitutions. They are already inplace, said Sultan Ahmed bin
Sulayem, chairman of DP World.These projects are not something
that would be affected by the[Eurozone debt] crisis. They are longterm.
The port will have an initial con-tainer capacity of 1.6m twenty-footequivalent units and DP World said it will contribute 3.2bn to Britainseconomy every year.
Business secretary Vince Cable saidthe new port would transform theUKs maritime port infrastructureand save millions of pounds everyyear in land transport costs.
DP World sees2013 Londonports launch
HERITAGE Oil has bought control of aBenghazi-based oil services firm, strik-ing the first upstream deal in Libyasince the overthrow of MuammarGaddafi and building on the Britishexplorers reputation as a first moverinto political hot-spots.
Heritage said yesterday it had bought 51 per cent of Sahara OilServices Holdings for $19.5m (12.7m).
It was reported last month it was tout-ing for business in Libya.
Heritage said that as well as havingnecessary permits to provide onshoreand offshore oil field services, SaharaOil Services had the rights to own andoperate oil and gas licences in Libya.
Also yesterday, the head of Frenchoil company Totals Libyan joint ven-ture Ahmed Abulsayen called for theformerly all-powerful National OilCorp to leave smaller companies withmore operational independence.
Heritage deal marks firstmove on Libyan oil market
ALGERIA
TUNISIA
NIGER CHAD
L I B Y A
EGYPT
Benghazi
Mediterranean Sea
Tripoli
Sirte Basin Holds about80% of Libya's proven oilreserves and responsible formost of Libya's oil output
Oil GasPipeline: Oil Field: Gas
200 km
BYHARRY BANKS
INDUSTRY
NewsCITYA.M. 5 OCTOBER 2011
BYHARRY BANKSENERGY
17
ANALYSIS l DP World LLC
p
28 Sept 29 Sept 30 Sept 3 Oct 4 Oct
690
670
650
655.504 Oct
SUPPORT services provider Carillion,said yesterday that it was on track to
deliver substantial growth in 2012,helped by the 306.5m acquisition ofenergy-saving firm Eaga and anincrease in government sector out-sourcing.
In its third-quarter update, the FTSE-250 group said it had won work worthup to 670m since the half-year andreiterated its aim to double revenue inthe Middle East and Canada to 1bninthe next three to five years.
Carillions Eagadeal lifts group
SUPPORT SERVICES
BRITISH printing firm St Ives posted a28 per cent rise in annual profits yes-terday, helped by its shift towards thehigher-margin marketing servicesunit, adding that it will look at moreacquisitions in the business.
The group, which prints 160m books each year from the Bible to bestsellers like Harry Potter, alsoraised its total dividend for the year by 50 per cent to 5.25p, helping tosend shares up 9.78 per cent to 75.75plast night.
St Ives enjoysearnings jump
MEDIA
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News18 CITYA.M. 5 OCTOBER 2011
EUROPEAN airline shares followedUS counterparts in a downward spi-ral yesterday as investors confi-dence in the sector ebbed away.
International passenger numbersacross airlines dropped in August, amonth that traditionally provides a
boost with summer holidays in fullswing.
Air France-KLM was down morethan nine per cent as the sectortook a hammering amid gloomyforecasts on world growth.
International Airlines Group which encompasses BA was off bymore than three per cent as thegrim trend spread across the majorcarriers.
Even budget carriers were hit,with Ryanair dropping close to fourper cent and easyJet falling 1.5 percent.
Shares in American Airlines par-
ent company AMR nosedived by athird on Monday amid fears thatthe carrier may be forced intoChapter 11 bankruptcy protection.
Under Chapter 11 a company canenter bankruptcy on its own terms.
Yesterday its shares recoveredslightly from a 41 per cent slump onMonday, which triggered automatichalts in trading.
Rumours about a possible restruc-turing appear to have sparked thesell-off, including reports that alarge number of pilots were retiringearly in case a filing affected theirretirement plans.
Fears of a second recession in theUS also contributed towards theshare drop, which affected other air-line shares.
Delta Air Lines shares rosearound four per cent yesterday,after an 11.3 per cent fall, whileUnited Continental was flat in the
wake of Mondays 11.7 per centdrop.
AMR said there was no company-driven news that caused the volatili-ty and described market about
bankruptcy as rumours and specu-lation. The Texas-based carriermaintains that it does not want tofile for bankruptcy protection.
Earlier in the week theInternational Air Transport
Association said the total passengermarket was down 1.6 per cent whilecargo was down 1.3 per cent com-pared with July.
Europes airlines hit
by turbulence in USBY JOHN DUNNE
AVIATION
Air travel has been dented by the global slowdown in recent months, IATA figures show Picture: REUTERS
ANALYSIS l International Consolidated
Airlinesp
28 Sept 29 Sept 30 Sept 3 Oct 4 Oct
162.50
157.50
152.50
147.50
149.304 Oct
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News 19CITYA.M. 5 OCTOBER 2011
MULBERRY AIMS TO BE BIG IN JAPAN WITH A RAFT OF NEW OPENINGS
MULBERRY has clinched a dis-tribution deal that will see its
products sold in Japanesedepartment stores and flagshipshops opened in Tokyo andOsaka. The company said yes-terday it had agreed a dealwith a joint venture owned by
Club 21 and Mammina, a unitof Japanese department storechain Isetan Mitsukoshi
Holdings. The 10-year dealanticipates the opening of mul-tiple department store shop inshops within the IMH networkas well as new f lagship storesin Tokyo and Osaka in duecourse. Mulberry said in June itexpected overseas sales to over-take those in its home marketin two years. The firm said ithad also agreed with Club 21 toextend its existing distributiondeal for South East Asia to
2021. This deal covers the dis-tribution of Mulberry productsinto China, Singapore,
Malaysia, Taiwan, Indonesia,Thailand, the Philippines,Vietnam and Australia. It willsee flagship stores open in
Singapore, Hong Kong,Shanghai and Beijing as wellas further openings in the othercountries.
Picture: REUTERS
PROFITS at Aldi have jumped asBritish shoppers increasingly huntingfor ways to cut their shopping bills.
Discount supermarkets Aldi andLidl have stolen market share fromthe likes of Tesco, as the squeezedmiddle which Tesco believes consti-tutes 80 per cent of its customer base look to cut down on household expen-
ditures.Accounts filed at Companies House
suggest that Aldi Stores, the Britisharm of the retailer, reported an oper-ating profit of 18.7m in the year,compared with an operating loss of21.2m the previous year, on salesincreasing 4.6 per cent to 2.14bn.However, the groups pre-tax losses
widened after a string of impair-ments.
Aldi revenues up asshoppers eye dealsCONSUMER
NEWS | IN BRIEF
Gucci and Tiffany in China bank spatEuropean luxury-goods conglomerate GucciGroup and American jewellery house Tiffanyhave each alleged in federal court that majorChinese state-owned banks are maintainingbank accounts for counterfeiters in China whoare shipping fake designer goods into the US.The banks Bank of China, China MerchantsBank and the Industrial and Commercial Bankof China all have branches in New York. Theluxury-goods makers have petitioned to havethe banks freeze assets in accounts owned bythe alleged counterfeiters and turn over infor-mation about the clients. Our strategy is topursue the assets you follow the money,said Robert Weigel, a lawyer at Gibson Dunn& Crutcher in New York, which is representingthe designers. None of the banks involved inthese cases responded to requests through
their New York branches for comment.
Volvo revamps truck businessSwedish truck maker Volvo said yesterday itwill shake up its truck business. Under therevamp, sales and marketing of all of the truckcompanies will be put into three regionalunits. Responsibility for the groups joint ven-tures will be organised in a new unit, TruckJoint Ventures, under the leadership of ParOstberg, who is currently responsible forTrucks Asia. Truck Joint Ventures will alsoreport directly to Persson. Hakan Karlsson,president of Volvo Bus Corp, will becomechairman of Volvo Aero, Volvo Buses andVolvo Penta and of a new business area, gov-ernmental sales, the company said in a state-ment. Karlsson will also be chairman of theboard of Volvo Construction Equipment.
LUXURY wallpaper and soft furnish-ings group Walker Greenbank yester-day reported a 13 per cent rise inprofits thanks to expanding interna-tional sales.
The group held two big launchesearly in the year for Morris & Co andthe Harlequin Momentum collection,
which fuelled a rise in sales.Group revenues rose 11 per cent to
37.4m, with pre-tax profits up to2m.
Russia, Japan and China were thefastest growing markets for the com-pany, which employs 300 people.
City analysts raised their forecastsfor the full year to next January andthe following year.
Chief executive John Sachs said thegroup had kicked off the autumn sell-ing season when people redecorate
in time for Christmas confident ofanother strong year.
The company said it had invested intechnology to improve its productionprocesses. It raised its dividend from0.15p to 0.20p a share.
Overseas salesboost WalkerGreenback
RETAIL
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News20 CITYA.M. 5 OCTOBER 2011
PRICES rose at their highest levelsince October 2008 in the twelvemonths to August, the Organisationfor Economic Cooperation andDevelopment (OECD) revealed yester-day.
Consumer price index (CPI) infla-tion accelerated to 3.2 per cent overthe year across the 34 member coun-tries, up from 3.1 per cent in the yearto July.
Energy and food price inflation
again came in above the average forall goods, at 13.5 per cent and 4.6 percent respectively.
Soaring energy prices were a par-ticularly large component in pushingthe CPI up by 3.8 per cent in the US,coming in at 18.4 per cent.
At 4.5 per cent the UKs inflationrate is one of the highest in the rich
world, exceeded only by Turkey, at6.7 per cent, New Zealand, at 5.3 percent, Iceland at five per cent andEstonia at 5.3 per cent.
However, the CPI increased by just0.2 per cent in August on a month-by-month basis, down from a high of 0.7per cent in March. Some analysts
believe inflation will fall towards theend of the year.
Inflation has nearly peaked in theUS, and although it came in higherthan we expected in the Eurozone,
we think most pressures are dip-ping, Andrew Kenningham fromCapital Economics told City A.M..
The lowest rates of inflation wereseen in Japan and Switzerland (both0.2 per cent) and Slovenia (0.9 percent).
Inflation hitsa three-yearhigh in OECD
THE SLOWEST growth in job vacanciesfor two years was recorded inSeptember by the KPMG/Recruitmentand Employment Confederations(REC) monthly report on jobs, outtoday.
For permanent staff placements thereports index has fallen to 51.2, downfrom 60.6 in April.
REC boss Kevin Green is calling onthe chancellor to pause national insur-ance contributions to boost jobs. Weare urging the chancellor to introducea National Insurance holiday for at
least a year to encourage SMEs to takeon young people, he said.
The index is compiled from surveysof recruiters in which they are asked ifthey have placed higher or lower num-
bers of staff in permanent roles com-pared with the previous month. Anyfigure above 50 shows an increase in
vacancies filled.Septembers small positive figure
means numbers of placements filledhave risen for 26 consecutive months,
but that the rate is slowing because ofa lack of confidence over the econom-ic outlook, the report explains.
Construction flat-lines onstagnant housing market
FLAT activity in the construction sec-tor in September was revealed yester-day by Markits purchasingmanagers index (PMI).
A sharp fall from 52.6 in August to50.1 in September was recorded,
bringing the sector closer to the 50threshold that separates growth fromcontraction.
UK construction companies con-tinued to struggle in the face of grow-ing concerns about the widereconomy, with weaker client confi-dence leading to a reduction in new
business received during September,said Markit economist Sarah
Bingham.Businesses are relying on existing
contracts to support output, which bodes ill for growth in comingmonths.
Analysts are also blaming cuts ingovernment spending for the sectorspoor performance.
The latest deterioration in the con-struction PMI was mainly a result offalls in housing and civil engineeringactivity, said Barclays CapitalsBlerina Uruci.
Both sectors had been expected toperform poorly this year as a result ofthe continued weakness in the hous-ing market and the government cutsin infrastructure spending.
Pause tax to boostjobs, say recruiters
BY TIMWALLACE
WORLD ECONOMY
FACTORY orders in the US fell 0.2 percent in August, figures released yes-terday from the CommerceDepartment showed.
The decline marks a sharp turn-around from the 4.2 per cent increasein new orders measured in July.
Inventories increased for the 20thconsecutive month, led by transporta-tion equipment which increased by1.3 per cent.
Analysts had expected the figuresto show the sector flat-lining and
were disappointed by the decline.
Manufacturingslow as factoryorders decline
UK ECONOMY
US ECONOMY
UK ECONOMY
TAXMAN TAKES QUARTER OF PENSION INCOME
TWENTY-SEVEN per cent of pensioners income is taken in direct and indirect taxation,according to a report out today from MetLife. Taxes such as VAT are the worst offenders,taking 2,966 from the average pensioners 18,834. Income tax comes next, the study found, taking 1,300, with councils accounting for a further 850. Picture: REX
NEWS | IN BRIEF
Bailey calls for clearer aimsClear public policy objectives must belaid down if regulators want to createthe best chance of achieving financialstability, executive director at the Bankof England Andrew Bailey told a confer-ence at the Said Business School inOxford yesterday. Bailey who is also
deputy head of the Financial ServicesAuthoritys prudential business unit pointed to the Bank of Englands targetof keeping inflation low and steady as anexample of a strong policy frameworkwith a well-explained key objective. Hesaid the regulators objective should beclear and well explained, and seek toprotect the wider financial system fromthe collapse of any individual institution.
Producer prices down across EUIn a sharp turnaround from the situationin July, producer prices fell across theEurozone and wider EU in August,Eurostat announced yesterday. Theindex fell by 0.1 per cent across the 17countries in the currency union inAugust, while they dropped 0.2 per centacross the 27-nation EU as a whole.Over the year, however, prices rose by5.9 per cent in the Eurozone and 6.7 percent in the wider EU. Energy prices
were responsible for the largest turn-around, rising by 13.2 per cent over the12-month period, but falling by 0.9 percent in August alone. Greek producerssaw the largest monthly fall, of 1.2 percent, whilst Latvia experienced thelargest rise in August, of 0.8 per cent.
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SOME of Berkshire Hathaways largestunits will post record profits this year,but the conglomerate's housing-relat-ed businesses are doing as poorly asthey ever have, chief executive WarrenBuffett said yesterday.
Speaking at a Fortune event, Buffettsaid Berkshires Burlington Northernrail unit, its MidAmerican energyunit, manufacturer Iscar and diversi-fied group Marmon will all postrecord profits this year.
On the other hand,Buffett said BerkshiresShaw Carpet unit is downabout 25 per cent of itsstaff, while the AcmeBrick business has idledhalf its factories.
As of today ourhousing-related busi-nesses are as bad astheyve ever beenduring this period,Buffett said.
The one large business Buffett didnot mention was Berkshires insur-ance business, which ranges from autoinsurer Geico to reinsurer NationalIndemnity. He has previously saidBerkshires insurance arm might postan underwriting loss for the year.
Buffett also brushed off concernsover the sharp drop in Bank of
America shares,The Sage of Omaha made a
$5bn investment in the banklast month with warrants tobuy more at $7.14 per share,
but the bank has slumped
below $6 recently.We agreed to hold
it for at least five years, so what Imthinking about is where Bank of America will be infive years; andnothing in the last24 hours or 48hours haschanged myviews on that.
Buffett firmsto post recordannual profits
TWO of Russias most powerful oli-garchs are set to compete with eachother in a multi-billion dollar auctionfor state-owned rail group Freight One,which goes up for sale at the end ofthis month.
Steel magnate Vladimir Lisin,Russias richest man with a $24bn for-tune, will bid for the Russian Railwaysunit via his transport arm UniversalCargo Logistics Holding (UCLH), aspokesman for UCLH said yesterday.
The spokesman added he expectedthe biggest threat to Lisins success tocome from mining supply group Transoil, controlled by GennadTimchenko, a billionaire oil trader andlongtime associate of Prime MinisterVladimir Putin.
The battle for control of Freight Onewas reduced to a likely straight battle between the two oligarchs after
Globaltrans, the only publicly listedcontender, pulled out of the race lastweek.
Globaltrans, which like Transoil ispart-owned by transport holding com-pany N-Trans, said it would pull out ofthe auction due to volatile globalfinancial conditions despite havingsecured financing.
Russian Railways has been prepar-ing the sale of around 75 per cent ofFreight One as part of a long-term planto raise cash for new infrastructure.
Oligarchs fightfor control ofRussian railway
The countrys historic banking laws are the most secretive in the world
BYHARRY BANKS
US ECONOMY
INFRASTRUCTURE
News 21CITYA.M. 5 OCTOBER 2011
Switzerland is still worldstop tax haven says report
SWITZERLAND, despite bank settle-ments with the US to disclose taxevaders, remains the top refuge for
financial secrecy, according to a newinternational ranking of tax havencountries.
Switzerland is the world leader infinancial opacity, only grudginglyconforming with disclosure agree-ments among developed countrieswhile courting tax evaders in develop-ing nations, said a report released bythe nonprofit, nonpartisan TaxJustice Network.
Steeped in a long tradition of banksecrecy, Switzerland has recently
signed information sharing agree-ments as part of a reporting programwith the Organisation for EconomicCo-operation and Development.
But these efforts have been inef-
fective, the report said.Switzerlands widespread involve-
ment in the administration and useof trusts, foundations and offshorecompanies remain a major barrier totackling tax evasion and illicit finan-cial flows, the report said.
Officials at the Swiss embassy in Washington were not immediatelyavailable for comment yesterday. TheUS ranked fifth, behind Switzerland,the Cayman Islands, Luxembourg andHong Kong.
TAX
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News22 CITYA.M. 5 OCTOBER 2011
New West End CompanyHarold Tillman, the owner of Jaegerand Aquascutum and chairman of theBritish Fashion Council, has been
appointed as the fourteenth memberof the business improvement districtsstrategic board at the New West EndCompanys annual general meeting.
Williams de BroNathan Dosanjh has been hired as abusiness development executive, sup-porting the private banks Birminghamoffice. Dosanjh joins from Coutts & Co,where he was a private banker.
Truestone Asset ManagementThe wealth manager has launched anew employee benefits business,Truestone Corporate Solutions, to beled by Robert MacGregor, formerly acorporate development director atAlexander Forbes. Also joining TCSfrom Alexander Forbes is Tim Whiting,who will lead a new defined benefit de-risking team at TCS.
DeloitteThe business advisory firm hasappointed Matt Peers as chief informa-tion officer in the newly formed inter-nal client services leadership team.Peers joins Deloitte from The Carphone
Warehouse, where he was managingdirector of IT.
CouttsThe private bank has appointed MaryHaly as senior investment director inthe tailored portfolio services team.Haly joins Coutts from KleinwortBenson Private Bank, where she wasco-head of the London portfolio man-agement team.
AtriumAtrium European Real Estate hasappointed David Doyle as chief finan-cial officer, effective from 1 January2012. Doyle will replace Robert Bolier,who is leaving the company to pursue
other business interests.
Anello Asset ManagementThe alternative investment managerhas hired Stavros Loizou to managethe companys newly launchedMantis Program. Loizou was mostrecently a founder and chief execu-tive of Lewis Charles Securities;prior to this, he was head of strate-gic trading
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