Weekend Round-Up 17 January 2010
Sunday Times
Wall Street giants pay staff $100bn Four of the biggest banks in the US are together planning to pay close to £62bn to staff in bonuses The move by Goldman Sachs, Morgan Stanley, Citigroup and Bank of America Merrill Lynch is sure to raise hackles over excessive bonus payouts further and comes days after the Barack Obama administration revealed a windfall tax on bank payouts.
More hedge fund traders join rush to Geneva The UK's number three hedge fund, Bluecrest, is to transfer 50 of its best performing traders and fund managers to a new office in Switzerland. The move signals an exodus of hedge funds overseas in reaction to the windfall tax on high-earners due to kick in at the beginning of April.
Humble pie for Eurostar chief Richard Brown The CEO of Eurostar has written a personal letter to the thousands of passengers affected by the cancellations shortly before Christmas, outlining the improvements planned to the service. An independent review of the fiasco that had passengers trapped in the Channel tunnel is expected to be published at the end of this month.
Sir Fred Goodwin banks on old pal for new job Disgraced former RBS boss Sir Fred Goodwin appears to easing himself back into the business world by relying on old friends. Architectural practice RMJM has hired him as an advisor. The divisions of the company are headed by Fraser Morrison and his son Peter. Morrison Snr sheltered Goodwin and family in the French Riviera when the banker's Edinburgh house was besieged by credit-crunch protesters last year.
Independent on Sunday
Redundancy wait at Cazenove Staff at the investment bank will receive more details this week of job cuts in the first stages of full integration with JP Morgan, which bought it out fully last November. It is expected that back-office staff will bear the brunt, but one departure that is assured is Naguib Kheraj, the chief executive of JP Morgan Cazenove, who will leave once the integration process is completed.
Anger as Bosch cuts 900 Welsh jobs Union officials have vowed to fight the decision by the manufacturer to close an automotive parts plant near Cardiff. The plant's work will be transferred to another Bosch facility in Hungary. The Cardiff plant was set up 20 years ago with money from the Welsh Development agency.
The Observer
Politicians weigh in on behalf of the pubs All three parties are set to intervene on behalf of pub group Mitchells & Butlers's smaller shareholders in a boardroom spat that pits some 60,000 small shareholders against the "Sandy Lane Set", which includes Barbados-based billionaire Joe Lewis and Irish racehorsing magnates JP McManus and John Magnier.
Politicians including Vince Cable are concerned that a "small group of friends and minority shareholders domiciled outside the UK appears to be seeking to gain control of the company to advance their own interest at the expense of others".
UK economy faces 10 years of pain. Forecasters at Ernst & Young's Item Club have predicted a slow climb out of recession, with growth struggling to reach one percent this year. Item also predicts the Bank of England will hold interest rates at their current low of 0.5 percent despite rising inflation. And a story in sister paper The Guardian today warns that insolvencies are set to rise as 140,000 businesses face financial hardship.
Is China flying too close to the sun? China may've topped recent export figures, but is its economy glowing too hot? Bubbles are said to be inflating the stockmarket and housing, with cheap cash pushing up domestic asset prices. Sound familiar?
The Sunday Telegraph
City damaged by banking mistakes Standard Chartered boss Peter Sands warns that London's City needs to re-think its place in the wider economy and redefine itself as a "values laden" industry if it wanted to regain public trust. Sands, who is the co-chair of this week's World Economic Forum, also cautioned against relying too heavily on China to save us.