HSBC’s extra capital can help keep investors loyal 4 May 2017 Europe's largest bank by assets posted better-than-expected quarterly results. Growing revenue remains a challenge. But rising capital ratios make HSBC's generous dividends look more sustainable, and could point to more buybacks ahead. That should keep shareholders onside.
Shell nears midway point in turnaround 4 May 2017 Recovering prices boosted the Anglo-Dutch group’s first-quarter earnings. Judging by the downstream performance of Shell’s chemicals unit and improved efficiency, its diversification is paying off. The second half of the challenge is to convince markets to look beyond crude.
Make Britain’s Brexit bill performance-related 3 May 2017 The EU may demand 100 bln euros from the UK for leaving the bloc. Some Britons want to pay nothing. Investment bankers ease impasses between companies by making part of the cost contingent on future performance. Linking the bill to UK GDP might enable both sides to claim victory.
Sainsbury over-seasons a stale retail recipe 3 May 2017 The supermarket’s full year like-for-like sales fell 0.6 percent, despite help from recently acquired Argos. Rival Tesco is diversifying too through its purchase of wholesaler Booker. Greater complexity masks problems caused by a long price war, but doesn’t fix them.
ITV boss picks prime time to duck out 3 May 2017 Adam Crozier is leaving the UK’s largest free-to-air TV firm after seven years as CEO. His strategy of building up ITV’s production arm has been vindicated, but the vulnerability of ad revenue and the rise of digital giants like Netflix and Amazon will vex his successor.
Coach’s luxury shopping habit risks distraction 2 May 2017 The high-priced handbag maker’s good third quarter is a bright spot amid struggling retailers. It doesn’t justify buying Jimmy Choo or Kate Spade, however. CEO Victor Luis vows no poor deals, but most are likely to be a tougher fit than his 2015 acquisition, Stuart Weitzman.
Barclays chief learns silence is golden 2 May 2017 Jes Staley vouched for his brother-in-law in a spat with buyout group KKR, a client of the bank. Helping out friends is a good quality in a human being, and a boss. A CEO’s job, though, is to keep a clear line between life and work. Investors have reason to expect it.
EU clearing spat epitomises perils of hard Brexit 2 May 2017 Brussels may try to restrict euro-denominated clearing in the UK, a report says. European regulators have long fretted over the fact that most of it occurs outside the euro area. A compromise is more than possible – but is harder to achieve if Britain leaves the single market.
Cheap boss is a luxury Bovis can’t afford 2 May 2017 The troubled UK homebuilder's investors approved a hefty pay package for its new boss. He could earn over 100 times the average UK construction worker, up from 76 times for his predecessor. A politically incorrect salary is the price Bovis pays for a much-needed turnaround.
BP is pumping its way out of trouble 2 May 2017 After several years of pain the oil giant has almost recovered from its near-death experience in the Gulf of Mexico. Earnings tripled in the first quarter, helped by favorable prices and higher output. Even its hefty debt pile is manageable provided it keeps production flowing.
Theresa May has a way out of UK pension pickle 28 Apr 2017 The prime minister is dithering over whether to keep guaranteeing above-inflation hikes to pensioners. The triple-lock is nonsensical, inequitable and unfit for an era of Brexit and stagnant wages. May has the political capital to adopt a fairer single-lock, tied to earnings.
UBS valuation lead over Barclays looks too wide 28 Apr 2017 The Swiss bank trades at 1.3 times tangible book value, while its UK peer languishes at 0.7 times. First-quarter results, which saw UBS beat expectations and Barclays disappoint, support investors’ logic. But Barclays is on the mend, while wealth management is not trouble-free.
RBS return goal hinges on ambitious cost cuts 28 Apr 2017 The state-owned UK bank reported its first quarterly profit since 2015. To reach its target of a 12 pct return on tangible equity by 2020, however, it will need to push through further savings. Given many of the obvious efficiencies have been found, that seems a stretch.
Viewsroom: Europe’s electoral frenzy 27 Apr 2017 France is about to choose a new president. The UK has called a surprise election. Germans head to the polls soon and Italians and Greeks could be close behind. As Brexit gets in motion and President Trump settles in, Europe’s election season will bring risks and opportunities.
Lloyds hits peak Horta-Osorio 27 Apr 2017 The UK bank is outperforming on things investors care about: costs, net interest margins and capital generation. Its recovery under boss Antonio Horta-Osorio has been impressive. From here, his efforts start to matter less in relative terms than what happens to Britain’s economy.
AstraZeneca reaches point of maximum pain 27 Apr 2017 The drugmaker's revenue fell 10 percent in the first quarter, despite a boost from non-recurring sales. Losing patents has hurt Astra's pricing power. Winning approval for new drugs would help boss Pascal Soriot rebuild. Investors are not fully factoring in that possibility.
Santander tames its troublesome triplets 26 Apr 2017 Brazil and Spain have become less of a challenge for the Madrid-based lender. The UK, which could turn problematic, hasn’t yet. Santander is treading cautiously despite a 14 percent quarterly earnings increase – which is wise, because the benign environment is still fragile.
StanChart’s springtime revival is premature 26 Apr 2017 A sharp drop in bad loan charges helped the emerging market bank double pre-tax profit in the first quarter. Revenue growth was less impressive, though. Shaky assets and intense competition mean the lender is still some way from hitting CEO Bill Winters' modest return target.
All-in gaming mergers will echo banking tie-ups 25 Apr 2017 The UK gambling industry faces a new wave of regulatory costs that favour bulking up, like in banking after 2008. A few big betting firms will probably emerge, with a long tail of me-too mass-market players. Online savvy should keep smallish peers Sky Bet and 888 in the hunt.
Theresa May channels Margaret Thatcher in reverse 25 Apr 2017 The 1980s Conservative prime minister did unpopular things in the name of market forces, and wound up a middle-England hero. By pledging to cap fuel prices, her 2017 successor is being unashamedly interventionist. It’s hard to square with May’s vision of a “truly global Britain”.