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BARCLAYS ADDS TO UK BANKING SHAME
By Hugo Duncan And James Salmon
The reputation of the City of London was dealt another blow Wednesday after a probe was launched into the deal which kept Barclays afloat at the peak of the financial crisis. The beleaguered bank, which is still without a chief executive following the exit of disgraced boss Bob Diamond, revealed that the Serious Fraud Office is investigating a cash injection by Qatar.
SFO LAUNCHES INVESTIGATION INTO BARCLAYS PAYMENTS TO QATAR
By Harry Wilson
Barclays is facing a criminal investigation into payments made to Qatar’s sovereign wealth fund at the time of its investment in the bank four years ago. The Serious Fraud office has launched an investigation into Barclays 2008 fundraising, amid concerns at some of the fees paid by the bank in connection with the deal. The SFO investigation into Barclays ups the pressure on the bank after the fraud watchdog confirmed last month that it considered there were ground to prosecute banks and bankers over the alleged manipulation or Libor.
DRAGHI REBUFFS GERMANS OVER EURO PLANS
By James Wilson in Frankfurt and Claire Jones in London
Mario Draghi rebuffed German criticism of his attempts to stem the eurozone debt crisis on Wednesday, as the European Central Bank drafts plans to intervene in sovereign bond markets. The ECB president said it was justified for the bank to use “exceptional measures” as part of its mandate to keep prices stable in the eurozone. “Fulfilling our mandate sometimes requires us to go beyond standard monetary policy tools,” said Mr Draghi, who is expected to outline the ECB’s intervention strategy on September 6.
DEMOCRATS BETTER FOR WALL STREET THAN REPUBLICANS, RESEARCH SHOWS
By Larry Elliott, economics editor
Analysis of stock market returns under every president since 1900 shows Democrats do almost twice as well as Republicans. As ever, the economy will be the key issue in the US presidential race. Mitt Romney’s aim will be to brand Barack Obama a failure for his stewardship and to argue that Americans would be better off electing a Republican who knows something about business. The team at CMC Markets set out to test this assumption by analysing stock market returns under every president since 1900. As far as Wall Street is concerned, it is better to vote Democrat. The average monthly return on the stock market has been 0.73% under Democrat presidents, almost double the 0.38% under Republicans.
HI-TECH STORE IS THE WAY AHEAD FOR M7S
By Peter Cunliffe
Marks & Spencer boss Marc Bolland unveiled his new flagship store yesterday, showcasing high-tech features and new formats that are a key part of his turnaround plans. The 151,000 square feet shop at Cheshire Oaks, Ellesmere Port, is the company’s largest outside London. It is the first to feature all of Bolland’s ideas to kick-start growth and its opening comes just weeks after the group reported its worst sales performance for three years and its first profits fall since 2008. Among the features are free wi-fi access, so-called “browse and order” terminals for online shopping and iPad-equipped staff.
RYANAIR DETERMINED TO PURSUE AER LINGUS AS EC STEPS INTO FRAY
By Gareth Mackie
Ryanair said it plans to make a fresh bid for rival Aer Lingus next year after European regulators raised concerns that its takeover approach could reduce competition. The European Commission (EC) said it will carry out a full review into the deal and announce a decision on whether to clear or block the takeover by 14 January. However, the budget airline responded by saying its €694 million (£550m) offer for Aer Lingus had lapsed as a result of the EC’s move and it will launch a fresh approach if regulators give it the go-ahead.
US ECONOMY EXPANDS MORE THAN ESTIMATED
The US economy grew more than first estimated in the second quarter, according to official figures. The US grew at an annualised pace of 1.7% from April to June, more than the 1.5% previously estimated, the Commerce Department said. This is a slowdown from 2% in the first three months of the year. The US Congress’s budget office last week warned that spending cuts and tax rises could trigger a sharp economic slowdown in 2013.
CITIGROUP PAYS £370M SHAREHOLDER SETTLEMENT
A victory for shareholders of a US bank earns them a £370m return following the financial crisis.
The US bank Citigroup has paid $590m (£370m) to settle a shareholder lawsuit accusing it of hiding tens of billions of dollars of toxic mortgage assets at the height of the financial crisis. The payment resolves claims that shareholders ended up with massive losses after the bank failed to take timely write-downs on debt obligations – many backed by subprime mortgages – and engaged in self-dealing transactions that hid the risks. In their 547-page lawsuit, the shareholders described those losses as “ticking time bombs that eventually exploded back onto Citigroup’s balance sheet.”