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LONDON BRIEFING: UK Regulator Rebukes RBS, Santander On PPI Reminders

(Alliance News) - The Competition & Markets Authority on Friday said it has taken action against ...

Alliance News 23 August, 2019 | 8:00AM
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(Alliance News) - The Competition & Markets Authority on Friday said it has taken action against Royal Bank of Scotland and Banco Santander after both banks failed to send reminders for payment protection insurances.

The UK regulator has issued both banks with directions, requiring them to appoint an independent body to audit their PPI processes, as well as put procedures in place to ensure that such incidents do not happen again.

RBS has not issued reminders to 11,000 of its customers for up to six years, while Santander sent out annual remainders containing incorrect information to 3,400 of its mortgage PPI customers from 2012 to 2017, CMA said.

"For now, we expect RBS to repay all affected customers quickly, and for both RBS and Santander to make sure that similar breaches do not happen again," said Adam Land, senior director of Remedies, Business & Financial Analysis.

The deadline for claiming PPI is on Thursday next week.

Here is what you need to know at the London market open:

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MARKETS

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FTSE 100: called up 0.5% at 7162.50

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Hang Seng: up 0.5% at 26,190.07

Nikkei 225: closed up 0.4% at 20,709.56

DJIA: closed up 0.2% at 26,252.24

S&P 500: closed down 0.1% at 2,922.95

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GBP: down at USD1.2215 (USD1.2250)

EUR: down at USD1.1065 (USD1.1075)

Gold: down at USD1,494.59 per ounce (USD1,499.20)

Oil (Brent): up at USD60.17 a barrel (USD59.77)

(changes since previous London equities close)

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ECONOMICS AND GENERAL

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Friday's Key Economic Events still to come

US Fed's Jackson Hole economic policy symposium continues

0830 EDT Canada Retail trade

1000 EDT US New Residential Sales

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French President Emmanuel Macron backed holding further talks to avoid Britain crashing out of the EU without a deal but rejected major concessions, as he hosted Prime Minister Boris Johnson just over two months ahead of the planned British exit. Echoing comments by German Chancellor Angela Merkel, Macron supported allowing another month to find a solution to the vexed issue of the Irish border which has bedevilled negotiations since 2017.But he also said the so-called Irish backstop that has caused such controversy in London was "indispensable" and said all talks had to be based on the withdrawal deal negotiated by Johnson's predecessor Theresa May repeatedly rejected by the British parliament. "We need to try to have a useful month," Macron said alongside Johnson, adding that France was nonetheless planning for all scenarios and "notably that of no deal" when Britain exits the EU on October 31.

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Italian President Sergio Mattarella says he will give political parties a few more days to solve a government crisis, but insists he wants quick decisions."The crisis must be resolved with clear decisions and in a short time," Mattarella says after two days of consultations with political party leaders. The president says he will hold a new round of consultations on Tuesday, after which he will "draw up conclusions and take the necessary decisions." This gives the anti-establishment Five Star Movement and the Democratic Party some time to pursue negotiations on a tentative coalition.

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The US expressed "strong concern and disappointment" after South Korea announced it would end a military intelligence sharing pact with Japan amid a trade and diplomatic dispute. "The Department of Defense expresses our strong concern and disappointment that the Moon Administration has withheld its renewal of the Republic of Korea's General Security of Military Information Agreement (GSOMIA) with Japan," Pentagon spokesman Lieutenant Colonel Dave Eastburn said in a statement.

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Hong Kong was set to face another weekend of mass protest as anti-government demonstrations approach the three-month mark with little sign of ending. Protesters were due to gather on Friday night to form a human chain reminiscent of 1989's Baltic Way demonstration in Estonia, Latvia, and Lithuania to protest then-Soviet rule. Plans were underway to disrupt transportation links to Hong Kong International Airport early Saturday morning. The airport was the scene of mass protests last week but a court injunction has kept most protesters from returning. Protesters were then due to march to through the eastern district of Kwun Tong later in the day on Saturday. Two marches are also planned for Sunday. Protests began on June 9 against a legislative bill that would have allowed for criminal extradition to mainland China, which has a separate legal system from Hong Kong. Hong Kong leader Carrie Lam said earlier this week that she was open to creating a "platform for dialogue" with protesters although she offered few details on how to carry out the plan.

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BROKER RATING CHANGES

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RBC CUTS ENTERTAINMENT ONE TO 'SECTOR PERFORM' ('OUT PERFORM') - TARGET 560 (470) PENCE

JPMORGAN CUTS ULTRA ELECTRONICS TO 'NEUTRAL' ('OVERWEIGHT') - TARGET 2300 (2200) PENCE

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COMPANIES - FTSE 100

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GlaxoSmithKline reported positive headline results from its Dreamm-2 study of belantamab mafodotin in multiple myeloma. The study, which involved 196 patients with relapsed multiple myeloma - a type of bone marrow cancer - "met its primary objective and demonstrated a clinically meaningful overall response rate". The safety and tolerability of belantamab mafodotin was consistent with Dreamm-1, the first time in human trial of the drug. Dreamm-2 data will be used fore regulatory filing starting later in 2019.

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COMPANIES - FTSE 250

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US toy and board games maker Hasbro has agreed to acquire Peppa Pig children's TV show owner Entertainment One for GBP3.3 billion in cash. Under the terms of the agreement, Entertainment One shareholders will receive GBP5.60 in cash for each share, which represents a 31% premium to the company's 30-day volume weighted average price as of Thursday. Entertainment One shares closed 1.0% higher in London on Thursday at 442.62 pence each. The board of directors of Entertainment One has recommended that Entertainment One shareholders vote in favour of the deal. The transaction is expected to close during the fourth quarter of 2019.

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IT services provider Computacenter said its outlook remains in line with its expectations as it reported a rise in interim earnings. For the half year to June 30, revenue rose 21% to GBP2.43 billion from GBP2.00 billion last year, but pretax profit slipped 2.3% to GBP50.8 million from GBP52.0 million last year. The company said pretax profit took a hit from exceptional and other adjusting items relating to the acquisition of FusionStorm. On an adjusted basis pretax profit rose to GBP53.5 million from GBP52.1 million last year. The company raised its interim dividend to 10.1p from 8.7p last year.

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COMPANIES - OTHER MAIN MARKET AND AIM

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Irish insulation and building services company Kingspan Group said it delivered a record first half of revenue growth, buoyed by a solid performance in the UK and strong performances in the Americas and Ireland. For the half year to June 30, revenue rose 12% EUR2.24 billion from EUR2.01 billion last year and pretax profit rose 18% to EUR208.9 million from EUR177.6 million. The company lifted its interim dividend 8% to 13.0 cents from 12.0 cents last year.

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Stilo International proposed a cancellation of its shares on AIM as the company swung to an interim loss. The company expects the de-listing and cancellation of admission of the ordinary shares to trading on AIM on October 8. For the six months to June end, the company swung to a loss of GBP29,000 from GBP42,000 profit last year and sales revenue fell to GBP638,000 from GBP707,000. Stilo also proposed a buyback of 15.3 million shares and launched a tender offer of 14.7 million shares.

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Friday's Shareholder Meetings

Ashmore Global Opportunities

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By Tapan Panchal; tapanpanchal@alliancenews.com

London Briefing is available to subscribers as an email newsletter. Contact info@alliancenews.com

Copyright 2019 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Stilo International PLC 1.00 GBX -20.00 -
Ultra Electronics Holdings PLC 2,092.00 GBX -0.38 -
Entertainment One Ltd 571.50 GBX -0.87 -
Computacenter PLC 1,286.00 GBX -0.62 -
GlaxoSmithKline PLC 1,640.00 GBX 0.00
The Royal Bank of Scotland Group PLC 206.70 GBX -1.01
Kingspan Group PLC 43.92 EUR -1.04 -
Kingspan Group PLC 43.90 EUR -1.66 -
Banco Santander SA 3.82

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