In brief: RBS results to show £100m computer glitch cost, and lack of action from Draghi makes markets fall.
FINANCIAL TIMES
Draghi kills hope of instant action
By Claire Jones in Frankfurt, Miles Johnson in Madrid and Mary Watkins in London
Financial markets recoiled on Thursday after Mario Draghi demanded eurozone governments use existing rescue funds before any intervention by the European Central Bank in bond markets to shore up Europe’s monetary union.
But a determined Mr Draghi also said the ECB would devise a plan to buy bonds to combat “exceptionally high” risk premiums for some eurozone countries, while easing private investors’ fears about the ECB putting itself at the back of the queue for absorbing any losses on investments.
bbc.co.uk
Eurozone crisis: ECB's Draghi disappoints markets
European markets have fallen after the European Central Bank president Mario Draghi said the bank would come up with ways to assist struggling eurozone countries "over the coming weeks".
Help from the ECB would also only be given if the governments themselves made certain commitments, he said.
The Spanish and Italian stock markets fell about 5% and both countries' borrowing costs rose sharply.
THE SUN
HMV boss quits as big losses rock chain
By Rhodri Phillips
The boss of HMV quit yesterday after heavy losses at the High Street chain.
Simon Fox is leaving the music, DVD and games company after six turbulent years.
His time as chief executive has seen profits hit by the relentless rise of digital downloading.
Mr Fox will leave in September and be replaced by Trevor Moore, former head of camera chain Jessops.
THE GUARDIAN
RBS computer failure to cost bank £100m
By Jill Treanor, City Editor
Royal Bank of Scotland is expected to set aside more than £100m to cover the cost of compensating customers who lost out when the bailed-out bank's computer systems crashed in June.
The cost of the computer failure comes amid fresh speculation about the future of the ownership of the bank ahead of its results on Friday, which will also be scrutinised for any extra provision for payment protection insurance mis-selling. An extra £125m was set aside in the first quarter of the year, taking its total PPI mis-selling provision to £1.2bn. The major banks have already set aside more than £8.5bn for the mis-selling of the insurance. Other provisions could be made to compensate any customers who lost out as result of mis-sold interest rate swaps, which were intended to help small businesses protect themselves against interest rate rises.
CITY A.M.
Cameron says Osborne will stay until 2015
By Katie Hope
George Osborne will remain as chancellor until the next general election in 2015, David Cameron insisted last night.
In a bid to quash speculation that Osborne would be moved in his September reshuffle, the Prime Minister insisted that the chancellor had his “full support”.
Pressed on whether Osborne would be chancellor at the next election, due in 2015, Cameron told Sky News: “He’s not going anywhere … yes.”
DAILY MAIL
Builders return to growth but optimism over economic recovery is still lacking
By Hugo Duncan
Britain’s battered builders unexpectedly returned to growth last month, but it was not enough to lift the gloom hanging over the UK economy.
The closely-watched Markit/CIPS index of activity in the construction sector – where 50 marks the cut-off between decline and growth – rose from 48.2 in June to 50.9 in May.
However, the report warned that the latest reading was well below the long-run average of 54.2 and pointed to ‘only marginal expansion’ in output.
THE TELEGRAPH
Time Out London to relaunch as free title
By Andrew Trotman
The title's owner, Oakley Capital, expects the move to increase circulation from 50,000 to 300,000, in a bid to fight against an increasingly digital media marketplace. The group has recently launched an iPad app to sit alongside its mobile and online presence.
The free publication, which will replace the £3.25 version, will be given away at London Underground stations, "major transport intersections within Zones one and two".
DAILY EXPRESS
Sell home to pay for care
By Sarah O’Grady
Up to 100,000 pensioners have been forced to sell their homes to pay for ¬medical care that should have been free.
Huge numbers of senior ¬citizens in nursing homes had been entitled to have their bills met by the NHS. But because of blunders by ¬officials they missed out and were forced to quit properties they had worked a lifetime to buy in order to cover costs.
THE INDEPENDENT
Half a million disabled people may lose benefits under reforms
By Sarah Cassidy
Charities reacted with horror as the Government announced that Atos and another private company, Capita, had won three contracts to run a new work-capability check for disabled people being brought in next year.
The Government has suggested that half a million people could lose their benefits as part of the reforms, which affect working age disabled people from April next year. Children and pensioners will not be affected.
THE SCOTSMAN
George Osborne’s allies slam talk of plan to nationalise RBS as ‘nuts’
By Eddie Barnes
The Treasury last night sought to pour cold water on claims it was preparing to nationalise the Royal Bank of Scotland as part of a bid to push lending into ¬Britain’s flat-lining economy.
Sources close to Chancellor George Osborne were forced to dismiss the plans – believed to be backed by Liberal Democrat members of the coalition – for a £5 billion public takeover of the bank that was reportedly being considered and had been tabled at Cabinet.
Such a move would hand taxpayers full responsibility for RBS’s toxic debts, but Whitehall insiders were quoted as saying it would also give the Treasury more clout to force out loans to help stimulate growth.
THE TIMES
Ukulele strikes a chord with the new generation
By Marcus Leroux
Some 50 years after George Formby was leaning against his last lamppost, the humble ukulele is experiencing a renaissance.
Musicroom, Britain’s biggest musical instruments retailer, has reported a 33.9 per cent rise in like-for-like sales of the guitar family’s most eccentric member over the past year. The chain ended the year with positive like-for-like sales partly due to a “popularity boom” in the ukulele.
