Banks bashed: Vickers hits UK lenders with a raft of new rules and limits September 12, 2011 THE UK yesterday took a radical step towards imposing new regulations that will cost banks billions and risk eroding the competitiveness of the City. The Independent Commission on Banking (ICB) unveiled a report that its chair Sir John Vickers said “goes further” than international regulation. The ICB says that the reforms will cost banks between [...]
French bank shares hammered despite SocGen’s reassurances September 12, 2011 SOCIETE Generale attempted to defend its tumbling stock yesterday, detailing plans to cut costs and sell assets to free up €4bn (£3.4bn) in fresh capital. Yet investors still fled from the bank’s shares, which sank a further 10.8 per cent during the day. French banks were hammered on fears over their exposure to Greek debt, [...]
Hundreds of City jobs to go as BofA cuts costs by $5bn September 12, 2011 BANK of America chief executive Brian Moynihan yesterday said the bank would take drastic action to cut $5bn (£3.1bn) from its annual cost base. Moynihan told a New York conference BofA would sell assets and slash 30,000 jobs in the first phase of an overhaul to put it on a firmer financial footing and convince [...]
Yet again the emperor has no clothes September 12, 2011 SURELY not. I mean, the Vickers Independent Commission on Banking couldn’t possibly be a case of the emperor having no clothes, could it? Yet as I read through the 358-page tome, a conclusion I couldn’t quite believe kept staring me in the face. If Vickers had never existed, many of the biggest reforms his report [...]
ANALYSIS l Lloyds Banking Group PLC September 12, 2011 Of all the main banks, Lloyds is happiest with the outcome of the final report. That is because the Commission performed a U-turn on its recommendation for the bank’s sale of 632 branches. Whereas in its April interim report, the ICB said that Lloyds should “substantially enhance” its sale to include more branches, it has [...]
ANALYSIS l Royal Bank of Scotland Group PLC September 12, 2011 RBS is despondent about the Vickers proposals, which it views as creating an impenetrable barrier between two interlinked parts of its business. It could suffer the most severe impact to its bottom line from the report. The bank is also worried that the policy will give its non-universal banking rivals an unfair advantage because they will [...]
ANALYSIS l HSBC Holdings PLC September 12, 2011 HSBC will suffer less of a hit than RBS or Barclays because its UK investment bank makes up a lower proportion of its total income. It will have to make some structural changes, however. And the bank does not welcome the imposition of a ring-fence because its executives believe it unnecessarily complicates the global regulation agenda. It [...]
ANALYSIS l Barclays PLC September 12, 2011 Barclays could suffer a severe hit from the ring-fence proposed by the Independent Commission on Banking (ICB). In particular, the policy will prove costly for the bank because it prevents lucrative cross-selling between its retail and investment banking arms and requires the two sides of the business to interact as third parties to one another. [...]
WHAT THE OTHER PAPERS SAY THIS MORNING September 12, 2011 FINANCIAL TIMES UNICREDIT CHIEF SIGNALS RIGHTS ISSUE TO INCREASE CAPITAL LEVELS UniCredit has given its clearest signal yet that it will seek to raise its capital buffers as market turmoil continues to hit European bank shares. In his first big interview since becoming chief a year ago Federico Ghizzoni told the Financial Times that details [...]
Lloyds will not be forced to sell more branches September 12, 2011 LLOYDS Banking Group will not be required to get rid of more branches than the current tranche of 632 it is currently selling, the Vickers report said yesterday. The concession to Lloyds marks a departure from the Independent Commission on Banking’s previous position that the taxpayer-backed company should “substantially” raise the number of branches put on [...]
