Investors To Deliver Peace Time Ultimatum

By Mark Kleinman, City Editor

Two leading shareholders in Standard Chartered, the emerging markets bank, are poised to issue an ultimatum about the future of Sir John Peace, its chairman, following an embarrassing climbdown over US sanctions-busting offences.

Sky News has spoken to major investors in the bank - which has continued to trade strongly through recent difficulties with US regulators - who said yesterday's humiliating retraction of comments made by Sir John earlier this month meant that changes to his portfolio of interests had now become "essential".

Standard Chartered yesterday issued a statement in which it apologised for Sir John's suggestion that its breach of US sanctions rules which meant it processed prohibited trades with Iran were "clerical errors" and had not been "wilful".

Sir John is the only person to chair three companies in Britain's blue-chip share index, sitting at the helm of both Burberry, the fashion group, and Experian, the credit checking organisation.

His comments at a press conference earlier this month angered the US authorities to such a degree that Sir John was summoned to a meeting in Washington yesterday along with Peter Sands, the bank's chief executive, and Richard Meddings, its finance director. It followed a $667m settlement between Standard Chartered and the regulators late last year.

The remarks appear to have crystallised a view among some Standard Chartered shareholders that juggling three demanding roles has left Sir John with too little time to devote to the chairmanship of one of the world's largest banks.

"We would prefer the conversation to be held in private before we go public, but there is little doubt that the time has come for him to either focus on the bank role or keep the others and leave Standard Chartered," one major investor said.

"It is essential that he [Sir John] gets a grip on things, and this week's events compound our sense that he cannot do that when he is chairing three FTSE companies," said another.

The two investors said they would press to hold discussions with Standard Chartered shortly about the issue.

The growing hostility towards Sir John from a number of influential shareholders raises the prospect of a revolt against him at Standard Chartered's annual meeting, although a person close to the bank said that soundings from shareholders in the last 24 hours had been "positive" about his chairmanship.

"It [Sir John's workload] has never been an issue that has been raised with us by our major shareholders either in the past or in the last 24 hours," a Standard Chartered spokesman said.

The disgruntled investors are City institutions and do not include Temasek Holdings, the Singaporean state investment company that is Standard Chartered's largest shareholder with an 18% stake.

An ally of Sir John's said that the performance of each of the companies that he chairs had been strong throughout his time on those boards.

00.02 | 0 komentar | Read More

Queen's Wine Merchant To Sell Chinese Tipple

The Queen's wine merchant has announced it will be the first UK retailer to permanently stock Chinese wines.

The 314-year-old firm of Berry Bros & Rudd (BBR) said it would sell four wines from a state-controlled chateau alongside the finest offerings from Bordeaux and Burgundy.

BBR, which has royal warrants from both the monarch and Prince Charles, is to market bottles from China's Chateau Changyu.

They include cabernet, merlot and so-called ice wines made from frozen grapes.

BBR buying director Mark Pardoe said: "China is already the eighth largest producer of wine in the world so it was only a matter of time before it entered the international market.

"And its huge geographical size and range of climates mean that there must be regions capable of producing good wine."

China's burgeoning middle class finds Western luxury items highly desirable

As a result, China is now expected to become the world's sixth biggest producer within three years.

On a per capita basis the Chinese barely touch wine, but they still manage to down 1.6 billion bottles a year through the sheer size of the population.

Its drinkers are now expected to increase consumption by 62.5%, downing another one billion bottles annually, by 2015.

Mr Pardoe added: "Until now the country's focus has been on its volume-driven domestic market, and other export efforts have been based on external investment.

"Changyu's strategy represents a change, with home-grown investment in partnership with international expertise."

A Chinese woman at a wine tasting session

The chateau has been headhunting top talent abroad, seeking wine and brandy oenologists, stating it prefers applicants with experience in the Bordeaux and Cognac regions of France.

With wine now seen as a status symbol by the burgeoning middle class, consumption of top Claret in China is now ranked second in the world, behind Germany.

Although Waitrose temporarily trialled Chinese wine last year, BBR says this is the first time a UK retailer has sold it on a permanent basis.

In 1997 Changyu Group restructured the assets of its four wine-making divisions and five other branches for a flotation on the Shanghai exchange as the Changyu Pioneer Wine Company Ltd.

It issued 140 million state-owned shares and 88 million B shares, becoming the first listed winery in China.

00.02 | 0 komentar | Read More

Spain: Eviction Orders Top 75,000 In 2012

Eviction procedures in Spanish courts for unpaid mortgages and rent hit a fresh record last year, averaging more than 200 per day.

Amid the sharp economic downturn and record unemployment, Spain's legal system executed 75,605 eviction orders in 2012, a 16.7% increase over the previous year.

According to the General Council of Judicial Power, 64,770 eviction orders were carried out in 2011.

The eviction suicide of Amaia Egana sparked outrage in Spain

That brings to 252,826 the total number of eviction orders executed by courts since 2008 when a decade-long property bubble burst and Spain sank into recession, throwing millions out of work and unable to keep up mortgage or rent payments.

The jump in evictions has become a political hot potato due to a series of suicides by people who were about to be thrown out of their homes and television images of weeping families forced out on the street.

Anti-eviction graffiti has hit Madrid and the regions

It has also sparked a protest movement which sends activists to block the entrance to homes of people about to be evicted in order to prevent police from forcibly removing them from their homes.

Prime Minister Mariano Rajoy's conservative government passed a decree in November which freezes evictions of the most vulnerable homeowners.

The two-year freeze on evictions applies to families earning less than 1,600 euros (£1,365) per month that also meet other conditions such as having a child under three, at least three children, a disabled dependent or being unemployed without benefits.

Youth unemployment is now above 50% in Spain

Spain is also grappling with a double-dip recession which has caused the unemployment rate to soar to a record 26%, with the jobless rate for those under 25 now above 55%.

00.02 | 0 komentar | Read More

Horsemeat Found In Beef From Hungary

Lancashire County Council has found 100kg of horsemeat in a consignment of beef from Hungary, with 30kg of it already sold to the public.

The meat was imported by Hungarian Food Ltd in Preston and sold on its market stall in the town and a shop in Liverpool called Taste of Hungary, the Food Standards Agency (FSA) said.

It said the horse flesh was being sold in 1kg bags labelled as "diced beef". The remaining unsold meat has been withdrawn from sale.

A FSA spokesman said the European Commission and the Hungarian authorities had been informed and the meat will be tested for the veterinary drug bute as part of the council's investigations.

The manager of the Taste of Hungary deli ate some of the horsemeat he bought, thinking it was beef, he said.

Attila Fabian, who runs the Eastern European store in Waterloo, Merseyside, said he was shocked to have discovered he had been selling the meat when environmental health officers visited the shop.

He said he had bought 20 1kg bags of what he thought was diced beef from Hungarian Food Ltd in May last year, rather than import it directly, but it sold so badly that he took four or five bags home for his family.

"I didn't know about it," he said.

"It tasted like beef, it looked like beef.

"I was shocked today when environmental health told what happened exactly."

He said they sold 12 or so bags of the horsemeat, and there were still three bags in the freezer which were taken away today for tests.

He said the shop had ceased trading with Hungarian Food Ltd after they "fell out" in July last year.

The food scandal erupted in January with horsemeat DNA being found in school dinners and supermarket products across the country.

00.02 | 0 komentar | Read More

Gas Stockpile Drain Prompts Price Rise Fears

Britain has drained its gas reserves so much after weeks of bad weather that fears have been raised of a looming spike in energy prices.

Households have been forced to increase their heating usage as the freezing weather continues, pushing the demand for gas to 20% higher than normal in March.

Gas stocks were reportedly just 10% full at Britain's largest storage facility on Thursday night, compared to 49% this time last year.

Energy prices will soar if Britain is forced to make up the shortfall by importing more liquefied natural gas from elsewhere, an energy expert has warned.

Graphical comparison year-on-year of gas in the UK (graph: Utilyx)

Andrew Horstead of the energy consultancy Utilyx told the Times: "There is immense pressure on the existing infrastructure.

"We are almost maxed out from imports through pipelines. The big concern is that there is very little flexibility left in the system."

He added that Britain would struggle to cope if a technical problem caused an unscheduled North Sea gas field to shut down.

Matt Osborne, risk manager at energy consultancy and brokerage firm Inenco, told Sky News that wholesale prices had spiked about 20% overnight, prompting the industry to respond quickly.

County Durham after the latest batch of snow

On Friday morning gas prices for within-day delivery then jumped more than 50% above Thursday's close following the closure of the pipeline linking Belgium to Britain after a pump failed at Bacton, Norfolk.

Downing Street said Prime Minister David Cameron is "confident" that the UK's gas needs will continue to be met.

A spokesman said:  "The absolute key thing on this is that supplies are not running out.

It was so warm last March people flocked to beaches and parks

"The gas market is how we source our supplies and that market continues to function well.

"The Prime Minister's key concern is that gas supplies continue. It is absolutely clear that supplies are not running out."

Asked if the Prime Minister was confident that this would remain the case, the spokesman replied: "Absolutely confident."

Scrub fires near Newport in Wales last March

Britain is more vulnerable than other countries to gas shortages because of its limited storage capacity, which holds just 15 days' worth of energy supplies.

But a Department of Environment and Climate Change (DECC) spokesperson insisted that "gas supplies are not running out".

The Chancellor's Budget revealed further gas fracking support

The spokesperson said: "Storage levels are low at the moment - as you'd expect towards the end of winter - and the UK gas market is tight.

"But the market is responding as it is designed to do - gas prices are rising and supply is being maintained accordingly.

"Gas storage would never be the sole source of gas meeting our needs, so it is misleading to talk purely about how many days' supply is in storage."

However, the gas fears come as the head of the energy giant SSE warned of the "very real risk" of the lights going out in Britain.

Ian Marchant said the Government was underestimating the problem, as he announced plans to cut back on power generation at five sites because the stations are either uneconomic or coming to the end of their lives.

He said: "It appears the Government is significantly underestimating the scale of the capacity crunch facing the UK in the next three years and there is a very real risk of the lights going out as a result."

He said the energy watchdog Ofgem had recently expressed real concern about the reduction of the UK's generation capacity margin that would follow expected plant closures in the next few years, predicting a 1-in-12 chance of the lights going out.

Mr Marchant added: "It is unlikely that the majority of the reductions in generation capacity and the delays to new investment we have announced today will have been included in this analysis.

"(This) highlights that the situation is likely to be even more critical than even they have predicted."

The DECC spokesperson added: "We are in close contact with National Grid, who are able to step into the market to source gas and increase incentives on gas suppliers if they think there is a risk of a supply shortfall."

00.02 | 0 komentar | Read More

Immigration: Lib Dems Call For Security Bonds

Liberal Democrat leader Nick Clegg has called for a bail-like system of security bonds to tackle visa abuse.

The bonds would be paid as a cash guarantee from visa applicants coming from high-risk countries and would be repaid once the visitor leaves Britain.

In his first speech on immigration as Deputy Prime Minister, Mr Clegg unveiled the radical plans at the liberal think-tank, the Centre Forum.

He also scrapped controversial proposals for an immigrant "amnesty". The Liberal Democrat leader said plans to allow illegal immigrants to stay in the UK if they have been in the country for 10 years, which were seen as key to the party's manifesto in the run up to the 2010 general election, risked "undermining public confidence".

Taking a harder line on immigration, he pledged to "lay the foundations for an immigration system that embodies this nation's instincts and its values" as he attacked the previous Labour government for "grossly" mismanaging the issue.

Earlier this month, Labour leader Ed Miliband admitted his party failed on immigration.

Mr Miliband said his party was wrong to relax controls - a move that allowed hundreds of thousands of foreigners to move to the UK.

Mr Clegg said: "We are grappling with the difficult challenges in our immigration system.

Mr Miliband said Labour failed on immigration

"Brick by brick, we are rebuilding it. Day by day we are making sure, quite simply, that it works.

"All the British people ask is for a system they can have confidence in. We hear that, and we are delivering it."

The Deputy Prime Minister said that visa "overstayers" are one of the biggest challenges faced by the immigration system and the UK Border Agency (UKBA).

"The challenge isn't just stopping people coming into Britain illegally, it's about dealing with individuals who come over legitimately, but then become illegal once they're already here," he said.

To tackle this issue, Mr Clegg has asked the Home Office to run a pilot of so-called security bonds, which echoes an Australian system applied to family visas.

It is understood the cost of the bonds would vary but are likely to be in the region of four figures.

Mr Clegg added: "The bonds would need to be well targeted - so that they don't unfairly discriminate against particular groups.

"The amounts would need to be proportionate - we mustn't penalise legitimate visa applicants who will struggle to get hold of the money."

But UKIP, which came second to the Lib Dems in the recent Eastleigh by-election after focusing its campaign on tightening immigration controls, ridiculed Mr Clegg's plans.

Party leader Nigel Farage said: "Nick Clegg now joins the cavalcade of party politicians who have suddenly noticed a simple fact, that they are not trusted with our country's borders.

"Since the Eastleigh by-election they have thrown initiative after initiative at the headlines, but to no serious effect. The bottom line is, there is nothing that he, or they, can do about mass migration into this country while our borders are controlled by the European Union."

Mr Clegg says Labour left the immigration system in "disarray"

Labour was also sceptical, pointing to figures showing an increase in people absconding from Heathrow airport and decreases in the number of people stopped and the number of foreign criminals deported under Mr Clegg's watch as DPM.

Shadow immigration minister Chris Bryant told Sky News: "I think people probably get a bit sick of MPs and politicians making lots of grand speeches about immigration but not getting the basics right."

Mr Clegg also revealed plans to increase cash penalties for "unscrupulous" employers who knowingly hire illegal immigrants because they are cheaper.

The maximum fine is £10,000 per illegal worker - Mr Clegg called for the penalty to "double" and has asked the Home Secretary to "look into the right amount".

And the Deputy Prime Minister hit out at the Labour party for leaving the immigration system in "disarray".

"The problem is that the system has not been well managed. It has been grossly mismanaged. I cannot stress enough just how chaotic it was."

The speech came as the Government toughens its stance on immigration with a range of new measures aimed at bringing down net migration to the tens of thousands.

UKBA officials will conduct interviews with more than 100,000 student visa applicants from "high-risk" countries outside the EU to crack down on bogus students.

And a "genuine entrepreneur" test has been introduced to tackle the rising number of foreign nationals attempting to enter Britain by fudging their bank accounts.

But in the wake of criticism from politicians and the higher education sector, some immigration rules were recently loosened in a bid to give additional flexibility to businesses and allow top international students to pursue careers in Britain.

00.02 | 0 komentar | Read More

City Titans Back Crunch Stock Market Probe

By Mark Kleinman, City Editor

The City's most powerful investor group is launching a probe into the effectiveness of Britain's stock markets amid deepening concern that 'short-termism' is damaging the country's wider economic interests.

I have learnt that the Association of British Insurers (ABI), whose members own about 20% of the blue-chip FTSE-100 index, has begun consulting with leading City firms over what is set to be one of the most important inquiries in its history.

People close to the ABI said the investigation would examine a string of issues which have provoked controversy in the City in recent years, including the functioning of the market for new share sales.

The number of initial public offerings (IPOs) has dwindled since the financial crisis of 2008, partly because of mistrust between the private equity groups attempting to sell their portfolio companies and stock market investors.

The ABI inquiry is being headed by Robert Talbut, chairman of its investment committee and a senior fund manager at Royal London Asset Management, and Robert Hingley, the group's director of investment affairs.

Sky News understands that the ABI has drafted in Angus Bogle, a former executive at Citi, the investment bank, and Fidelity, the fund management giant, to oversee the probe.

Meetings have been scheduled with leading fund managers and investment banks in the coming weeks, with the aim of producing a series of recommendations in a report later this year.

The ABI, whose largest members include Legal & General, Prudential and Standard Life, will also look at the tax treatment of debt and equity; assess ways to improve the market for equity investment in support of longer term growth; and examine shifts in the composition of investors' portfolios in recent years.

Perceptions of investor short-termism have become a hotly-debated political issue, particularly after a spate of foreign takeovers of major listed UK companies, culminating in the takeover of Cadbury by Kraft Foods of the US in 2010.

Last year, John Kay, an economist, published a report commissioned by Vince Cable, the Business Secretary, in which he recommended an end to quarterly company reporting and the establishment of an investor forum to encourage more effective engagement with public companies.

Mr Cable said at the time: "Many of us feel that in the past, our public companies and investors have focused on short-term profit at the expense of long-term value.

"The behaviour of many banks in the run up to the financial crisis is an extreme example of this quick buck mentality, but there is clearly a wider problem."

Some senior ABI figures are understood to have felt that Professor Kay's review did not go far enough, prompting the lobbying group to launch its own probe.

Earlier this month, Labour published a separate review which recommended reforms to executive pay packages and changing the rules governing overseas takeovers of British companies.

The ABI, which declined to comment on its investigation, is one of the most influential lobbying groups in British business. Late last year it published a report in which it warned that reforms to the regulation of the banking industry risked making the UK's biggest lenders uninvestable.

00.02 | 0 komentar | Read More

Apple Boosts iCloud And iTunes Security

Apple has boosted security on iCloud and iTunes accounts with a new password system designed to stop hackers.

The technology giant has followed Google's example with a system that sends a code to a user's mobile phone whenever they sign in from a new computer or make a purchase.

The "two-step" authentication should stop hackers accessing private information even if they have the password.

The move comes amid the high-profile hacking of government agencies and major companies.

The popularity of Apple's iTunes and Amazon, as well as storage services like iCloud, Dropbox and Google Drive are an incentive for companies to provide more advanced protection for personal and financial data.

Apple, along with Facebook, Twitter and Microsoft, was hit by a security breach in January after hackers exploited a weakness in Oracle's Java web-browsing software.

The iPad maker holds credit card details for some 500 million iTunes and App Store customers, making it a rich target for hackers who are becoming ever more proficient at using information from social networks to phish for passwords.

Apple users can update their profile to the new two-step system on the Password and Security section of Apple's website.

The company said: "Apple takes customer privacy very seriously. Two-step verification is an even more robust process to ensure our users' data remain protected."

Services that already use the two-step system include Facebook, Google, PayPal and Microsoft's Xbox Live.

Apple's move may put pressure on Amazon to introduce similar technology.

Some 24 million customers with Zappos, an Amazon-owned shoe company, had their details compromised by a hack in 2012.

00.02 | 0 komentar | Read More

Cyprus Leaders Head To Brussels For Talks

Cyprus Bailout: Threat To Savings

Updated: 7:36am UK, Saturday 23 March 2013

By Ashish Joshi, Sky News Correspondent

Finally late into Friday night - an agreement on Plan B, meaning Cyprus has moved one giant step towards securing a Brussels bailout.

It includes a solidarity fund pooling together state assets and the granting of power to the Government to control bank capital.

The latter move is to prevent a run on the banks when their doors finally open on Tuesday.

There will also be a restructuring of the country's banks and a savings tax on Cypriot savers.

The details of the tax have still to be finalised, but the framework is in place.

It could mean savings over 100,000 euros held in Bank of Cyprus accounts being taxed up to 20%, according to one source close to the negotiations.

The same source said if that proposal is rejected there will be a plan to impose a tax of around 10% on all Cypriot bank accounts over 100,000 euros.

The threat of savers being hit hangs over the heads of people like Loizos Michael.

The 60-year-old tailor worked hard for 35 years, building up a good business.

He was looking forward to a wealthy retirement. Not anymore. Times are hard.

Speaking from his small tailor's shop in central Nicosia, Mr Michael said: "With the banks being closed, it is hard because I don't have a credit card and so cash flow is a problem.

"Even filling your car with petrol needs thinking about.

"Cypriots have always been workers by nature and nobody could have imagined that unemployment would be so high.

"This has hit us hard in the pockets."

Cyprus is weathering a storm - the likes of which this Mediterranean island has never faced in her young history.

Mr Michael said he knew things were getting bad, but expected solutions to be found to avoid ordinary people having to suffer.

"I expected something better. But now, it looks like the problem has been brewing for some time," he said.

"There used to be some people talking about the crisis, but now everyone's talking about it.

"I think things are harder now than just after the war. After the war of '74 people could still find work. Now, there is just no work so people have no money. What can we do?"

In the 1990s, Cyprus boasted a dynamic, booming economy, but it grew and unchecked.

An overbloated banking sector exposed to Greek debt has crippled the country's economy.

Now people like Loizos Michael must pay the price. He and the rest of Cyprus will soon find out exactly how much that is going to be.

00.02 | 0 komentar | Read More

Thousands Of Jobs Saved As Blockbuster Bought

The troubled DVD and games rental chain Blockbuster has been bought, saving 2,000 jobs and 264 UK stores.

Administrators from accountants Deloitte said restructuring specialists Gordon Brothers Europe had purchased the company for an undisclosed sum.

Blockbuster collapsed in January amid competition from internet firms and the digital streaming of movies and games.

Joint Administrator Lee Manning, said: "Having identified a profitable core portfolio of stores we are pleased to have achieved this sale for creditors.

"Together with the previously announced store sales more than half of the original estate has been secured for ongoing use.

"This transaction provides Blockbuster a future in the UK and we owe a special vote of thanks to all the company's employees, suppliers and customers for helping us rescue the business."

Commenting on the acquisition, Frank Morton, the CEO of Gordon Brothers Europe, said: "We are delighted to announce the acquisition of Blockbuster.

"We acknowledge the industry is in transition; we know that we have a challenge ahead but there is still a market to be served.

"Blockbuster has a strong brand affinity and we believe that with the right mix of new product offering, new technologies, strategic management and marketing, we can bring new life to this high street staple.

"We look forward to working with employees, suppliers, landlords and other stakeholders to make this happen."

Blockbuster had struggled to adapt to the changing market amid rivalry from internet retailers including Netflix, Amazon's LoveFilm and iTunes, which now offers a movie rental service.

The devastating impact of the internet on Britain's high street had already been laid bare by the demise of camera chain Jessops and electricals group Comet, which also cited competition from online players as a major reason for their decline.

00.02 | 0 komentar | Read More