Ministers Demand New Bank Lending Data

By Mark Kleinman, City Editor

Britain's banks should publish details of their mortgage and personal unsecured lending on a postcode-by-postcode basis, Government ministers have demanded, as they step up pressure for greater industry transparency.

In a letter to the major high street banks, a copy of which has been obtained by Sky News, Michael Fallon, the business minister, and Greg Clark, his Treasury counterpart, urged them to publish the data in order "to provide a greater level of understanding between the public, SMEs (small and medium-sized businesses) and banks".

Reports last week suggested that the coalition had focused solely on extracting small business lending data from the banks.

However, the letter from the ministers, sent last week, goes further:

"Once the commitment on SME transparency has been delivered, we believe that there is merit in broadening the level of disclosure to encompass other forms of credit, including mortgages and personal unsecured lending," it said.

"Therefore we would ask whether your institution would be willing to show leadership in this regard and enhance the level of your disclosure.

"We are sure that as part of your (year-end financial) results you will be eager to show not just the return your institution offers to its shareholders and employees, but also the utility the banking sector can provide to society and the economy more broadly.

"A commitment to publish your institution's lending by local area will no doubt support this case."

The intensifying pressure from ministers comes amid signs that the Government's Funding for Lending Scheme has begun to channel funds into the real economy, although Vince Cable, the Business Secretary, has urged more action to support SMEs.

In a speech last week, Mr Cable threatened "regulatory action" if banks failed to meet disclosure objectives, although the Government has not outlined the specific sanctions that lenders would face.

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Business Optimism At All-Time Low Says Survey

An index which predicts British business optimism has fallen to its lowest level since the it began 21 years ago, prompting fears of a 'triple-dip' recession occurring.

BDO's Optimism Index, which predicts business performance two quarters ahead, fell to 88.9 in January from a reading of 90.3 in December.

It is the eighth consecutive month that the index has remained below 95.0, the mark which indicates growth.

This suggests the economy will struggle to grow in the first quarter of 2013, following the recently announced negative growth in the final three months of 2012.

As a result, there is an increased risk of a triple-dip recession taking hold.

Meanwhile the report's Output Index, which predicts short-run turnover expectations, also supports this, falling from 93.1 to 92.3 last month, further away from the 95.0 mark indicating growth.

BDO LLP partner Peter Hemington said: "In spite of a strengthening labour market, business confidence continues to weaken, and improved hiring intentions are not translating into growth plans.

"It seems the damaging effects on businesses of five years' zigzagging economic growth has left them wary of making concrete plans for expansion and resigned to the 'new normal' of economic stagnation."

However its complementary Employment Index rose to 95.1 in January from 93.0 in December, taking the index above the 95.0 mark that indicates employment growth.

Last Friday the Recruitment and Employment Confederation, along with KPMG, released a report revealing a salary spike trend based on employers struggling to find enough qualified staff.

The BDO index has also showed hopeful signs amongst the UK's manufacturing sector of possible recovery.

But the report's author warned that coalition policy needs to drive greater economic expansion.

Mr Hemington said: "To end this cycle, it is imperative that the Government implements plans to expedite growth.

"Without growth incentives, we will continue to see UK businesses reluctant to invest and expand, which poses a grave threat to the UK's economic recovery."

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Tech Giants Ordered To Explain 'High Prices'

Three American tech giants have been told to appear before an Australian parliamentary inquiry to explain their "high prices".

The demand for Apple, Microsoft and Adobe to appear comes as MPs seek to understand why local consumers pay so much for their products, despite the strong Australian dollar.

Apple's inclusion furthers a row between the world's most valuable IT company and Australian politicians over corporate taxes paid on Apple's operations.

Apple executives were formally informed on Monday and told to appear in front a parliamentary committee in the capital, Canberra, on March 22.

The inquiry increases international pressure on US multinationals, and follows on from bosses of Amazon, Starbucks and Google being quizzed by MPs in London over corporate tax avoidance structures.

"In what's probably the first time anywhere in the world, these IT firms are now being summonsed by the Australian parliament to explain why they price their products so much higher in Australia compared to the United States," the ruling Labour Government MP Ed Husic, who helped set up the committee, said.

High local prices and soaring cost-of-living bills for basic services are hurting the popularity of the minority Labor government ahead of a September 14 election.

The Labour party is widely tipped to lose, giving political momentum to the inquiry.

All three companies have so far declined to appear before the special committee set up in May last year to investigate possible price gouging on Australian hardware and software buyers.

The Australian dollar is currently above parity with the US currency, at around A$1.03.

The currency has also strengthened significantly against Sterling, with £1 only buying A$1.53. One pound once bought around $2.80.

A 16GB WiFi iPad produced by Apple with Retina display sells in Australia for A$539 (£351), $40 (£25) above the price in the US, despite the stronger local currency.

Microsoft's latest versions of office 365 home premium cost A$119 (£77.55) in Australia versus $99.99 (£63) in America.

IT firms and other multinationals have blamed high operating costs in Australia including high local wages and conditions, as well as import costs and the relatively small size of the retail market in the $1.5 trillion (£997bn) economy.

Failure to appear before the committee as ordered could leave all three firms open to contempt of parliament charges, fines or even jail terms.

"For some time consumers and businesses have been trying to work out why they are paying so much more, particularly for software, where if it's downloaded there is no shipping or handling, or much of a labour cost," Mr Husic said.

Adobe and Microsoft have previously provided separate written statements and submissions to the inquiry, but executives have been reluctant to explain their pricing before a public inquiry.

"The companies have blamed each other for not appearing. One will say 'we're not going to appear if the other is not going to appear'. So we've cut straight to the chase and said we'll just summons you," Mr Husic said.

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BAE Boosts Apprentice Intake To Five-Year High

Defence giant BAE Systems has announced plans to recruit its largest apprentice intake for five years.

The Farnborough-based firm said it would take on 387 engineering and business apprentices in 2013, 60 more than in 2012.

The new level tops the apprentice intake of 2008, which stood at 347.

The company said the new recruits would work across its various divisions of the company.

Last September BAE's apprenticeship intake included 55% aged between 16-18, 39% between the ages of 19 and 24, with 6% over-25.

This year's 'higher apprenticeships' are principally for post-A level applicants and will make up around 10% of the intake.

Nearly two-thirds of the apprentices will join naval programmes and 144 apprentices will join the Cumbrian submarine-building business at Barrow-in-Furness.

A further 105 positions are for employees at shipbuilding and naval support sites at Portsmouth and Glasgow.

The high rate of naval positions comes after BAE won a £1.2bn contract to build the new hunter-killer submarine, HMS Audacious, in Cumbria.

The military aircraft business at Warton and Samlesbury in Lancashire and its aircraft maintenance academy at Robin Hood Airport in Doncaster have been allocated 109 trainees.

The Rochester-based Electronics Systems business in Kent is to recruit 12 staff and the company's cyber security firm in Leeds, Detica, is to employ 10 more apprentices.

BAE has a workforce of 35,000 and is the largest employer of engineers in Britain, but the firm has come under pressure amid global defence cuts and has slashed thousands of jobs since 2011.

Last year a £28bn merger between BAE and European rival EADS collapsed amid demands from big shareholders for better terms and claims of politicisation of the plan.

BAE's first half revenue for 2012 plunged 11% to £8.33bn, prompted by large defence cuts in the US, as pre-tax profits during the period to June 30 sunk 5.2% to £655m.

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Bridgepoint Closes In On Oasis Dental Chain

By Mark Kleinman, City Editor

The buyout firm Bridgepoint is in pole position to take over Britain's second-largest private dentistry provider in a deal likely to value it at close to £200m.

I understand that Bridgepoint has entered exclusive talks to buy Oasis Healthcare, which operates more than 200 clinics around the UK.

A deal is still some way from being completed but people close to the talks said that Bridgepoint had edged ahead of competing bids from Capvest, LDC and Omers Private Equity in recent days.

A change of ownership would be the first for Oasis in more than five years, and comes at an important time for the industry.

Last autumn, the Office of Fair Trading (OFT) announced that it would not refer the private dentistry market to the Competition Commission, ruling that such a move "would not be proportionate".

The regulator did, however, set out a number of recommendations aimed at improving market conditions for users. These included a call for "NHS commissioning bodies, the General Dental Council (GDC) and the Care Quality Commission to be proactive in enforcing existing rules which require dentists and dental practices to provide timely, clear and accurate information to patients about prices and available dental treatments".

The OFT also urged the Department of Health to redesign NHS dental contracts to remove barriers to entry.

In April 2010, Duke Street announced the provision of up to £50m of funding to accelerate Oasis's expansion. Established in 1996, Oasis has more than 1.5m patients on its books and more than 700 dentists.

Duke Street has owned Oasis since September 2007. The chain's sale is being overseen by DC Advisory Partners.

Bridgepoint declined to comment.

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Apple 'Experiments With' Watch-Style Devices

Apple has discussed developing devices that are like wristwatches but operate on its iOS platform, two newspapers have claimed.

The watch-style products would be made from curved glass, according to the New York Times, which cites unnamed sources "familiar with the company's explorations".

They would use Apple's iOS platform - the basis of its iPhones, iPads and iPods - and could be used to make mobile payments through the company's Passbook software, the newspaper said.

Richard Nunn, a digital media analyst at stockbrokers Charles Stanley, said talks of a watch by Apple did not come as a surprise.

"It would fit well with what Apple is about - finding disruptive, new devices that can go global and be volume based," he told Sky News.

"A so-called iWatch would not be a radical departure from Apple's core technologies.

"It could include GPS, music, mobile and payment functions which Apple has already developed."

He added that it would most likely be a "volume-play" product for the company - low-priced and aimed at the mass market.

According to the Wall Street Journal, Apple is in talks with its major manufacturing partner Foxconn over a watch-style device .

The Taiwan-based company has been working on a number of technologies that could be used in wearable devices, the newspaper said.

Apple declined to comment on the reports.

They come just days after an influential investor filed legal action against the tech giant, which is the most valuable company in the world.

David Einhorn, the head of hedge fund Greenlight Capital, demanded Apple hand investors some of its $137bn (£87bn) cash pile, which makes up nearly a third of its stock market value.

Apple is expected to expand beyond the smartphone and tablet market in the face of increasing competition from rivals like Samsung.

Its once rapid growth has slowed and its stock has fallen around by 35% in value since its record high in September.

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Politicians To Question RBS' Stephen Hester

Stephen Hester, the chief executive of Royal Bank of Scotland (RBS), will give evidence to politicians this afternoon, amid reports that he is in line to receive a bonus of £780,000.

The chairman of the bank, Sir Philip Hampton, will also later appear before the Parliamentary Commission on Banking Standards.

The session comes less than a week after the bank was fined £390m by regulators in the UK and US for its part in rigging the Libor inter-bank lending rate.

Around £300m of this penalty will be clawed back from the bonus pool at RBS, which is 82% owned by the taxpayer.

Despite this, Mr Hester will be paid a bonus worth £780,000 next month, according to media reports.

Stephen Hester told Sky News those who fixed Libor were "disgraceful"

The pay-out is likely to anger critics of such schemes across the City, coming so soon after the Libor scandal rocked RBS.

The Sunday Times said the shares-based bonus was awarded in 2010 and deferred for three years.

The outgoing head of RBS' investment banking division, John Hourican, will also face MPs and peers later.

Mr Hourican, who was brought in to rescue the business after it was bailed out in 2008, forfeited around £4m in share options awarded to him based on past performance, but will leave the bank with 12 months' pay worth £775,000.

In a memo to bank staff obtained by Sky News, he said he bore "some responsibility" for misconduct, despite having no involvement in or knowledge of efforts to rig Libor submissions by RBS staff.

The bank's former chairman of global banking and markets, Johnny Cameron, will also appear before the Commission.

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BBC Journalists To Strike Over Redundancies

Journalists at the BBC are to stage a one-day strike unless the corporation agrees to end compulsory redundancies, it was warned today.

The National Union of Journalists (NUJ) said its members at the BBC will walk out on February 18 and launch a work-to-rule from Friday.

The action will go ahead unless talks between the two sides next week resolve a dispute over jobs.

BBC executives have come under serious budgetary constraint, with the licence-fee cap restricting new income.

NUJ general secretary Michelle Stanistreet said: "The BBC is prepared to waste public money on needless redundancies rather than secure redeployment opportunities for those at risk.

"This demonstrates the significant failures of some managers to uphold key aspects of the redeployment agreement, let alone the spirit of the deal.

"In the meantime we have meetings planned with the BBC and we want to engage in meaningful negotiations to resolve this dispute.

"I hope common sense prevails and a sensible solution is agreed which will mean that strike action is not necessary."

The NUJ said the BBC was planning around 30 compulsory redundancies, affecting areas including BBC Scotland, the Asian Network, the World Service and English regions.

A BBC spokesperson said: "We understand how frustrating and difficult situations involving redundancies can be, but it is disappointing the NUJ have chosen to take this action.

"We are working hard to ensure that we succeed in getting staff redeployed wherever we can and will continue to work with the unions to ensure that their members receive the right redeployment support."

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JP Morgan Boosts Branch Targeting Super-Rich

Investment bank JP Morgan has bolstered its private wealth arm in Britain because of the increasing number of multi-millionaires in the region.

The bank has appointed seven top bankers to its British division, poaching five from rivals, amid expansion plans to target the ultra-rich, known as high net worth (HNW) clients.

"The hires within our Private Wealth Management business in the United Kingdom highlight our commitment to the increasing number of high net worth clients in the region," division head Tracey Reddings said.

Ms Reddings, who joined last year from Societe Generale, is attempting to lure more of the so-called core millionaires to JP Morgan.

These are HNW clients with assets of between £2m to £16m.

Last year the Sunday Times Rich List revealed that the richest continued to amass wealth.

In recent years Britain has become a haven for wealthy foreigners to invest their money. A number of those at the top of the Rich List were foreign born.

The issue of foreign wealth investment in London property has become a political issue for Chancellor George Osborne.

A so-called mansion tax was ruled out last year against Liberal Democrat wishes but the Finance Bill was drafted to help target super-rich foreign property buyers using partnerships or companies as purchase vehicles.

The Finance Bill confirmed a continuation of hitting the rich with a 15% stamp duty land tax for homes worth more than £2m from "non-natural persons".

Additionally, the rich were targeted with a new annual levy to be paid by corporate vehicles, capital gains tax for purchases through companies, and a hike in stamp duty to 7% for "ordinary" purchases of homes over £2m.

The stamp duty loophole has allowed an estimated £1bn in tax to be avoided annually by rich foreigners.

Although HNW clients can return greater margins for banks, further expansion of tax vehicles for the super-rich are set to spark fury from both the public and politicians.

US multinationals have recently felt the wrath of MPs after they were grilled about corporate tax structures that potentially denied the Exchequer of funds.

Planned expansion of the UK HNW business by JP Morgan follows a similar push in Asia led by the former head of Standard Chartered, Peter Flavel.

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HP's Autonomy's Accounts To Be Investigated

The Financial Reporting Council (FRC) has opened an investigation into the accounts of Autonomy before its takeover by Hewlett-Packard (HP).

The UK's accounting watchdog will study the Cambridge-based company's financial reporting between 1 January 2009 and 30 June 2011 - three months before it was bought by the US software giant for $11.1bn (£7.1bn).

HP subsequently accused Autonomy of lying about its finances, as it announced a write-down of $8.8bn (£5.5bn) relating to its purchase of the company.

It blamed "serious accounting improprieties, misrepresentation and disclosure failures" at Autonomy for the financial hit, and referred the matter to the Serious Fraud Office.

But the company's former chief executive Mike Lynch, who founded the company in 1996 and made around £500m from the HP deal, has always denied the allegations.

In November he told Sky News he "flatly refuted" HP's comments, and refused to be the US company's "scapegoat ".

In a statement, Autonomy's former management team said it welcomed the watchdog's investigation.

"As a member of the FTSE 100 the accounts of Autonomy have previously been reviewed by the FRC, including during the period in question, and no actions or changes were recommended or required," it said.

"Autonomy received unqualified audit reports throughout its life as a public company.

"This includes the period in question, during which Autonomy was audited by Deloitte.

"We are fully confident in the financial reporting of the company and look forward to the opportunity to demonstrate this to the FRC."

FRC, which has the power to impose fines and other sanctions, said it opened the investigation following consultation with the Institute of Chartered Accountants.

Before HP's allegations, Autonomy was considered one of the UK's biggest technology success stories, developing technologies discovered at the University of Cambridge.

It pioneered software that helps companies across the world to search through data taken from databases, audio and video sources.

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