FINANCIAL TIMES
Barclays chairman poised to resign
By Patrick Jenkins and Brooke Masters in London and Kara Scannell in New York
Marcus Agius will resign as chairman of Barclays on Monday, in the hope that his departure will take the sting out of mounting criticism from politicians and shareholders over the bank’s role in the price-fixing of interbank lending rates.
“The buck stops with me,” Mr Agius will say in an announcement due on Monday morning, as he criticises the “devastating” revelations of last week’s Libor probe by regulators but praises the bank’s “excellent executive team” led by chief executive Bob Diamond.
Mr Agius has been sharply criticised by investors over several issues during his near six-year tenure as chairman – notably in 2008 when they felt he failed to protect their shareholder pre-emption rights by raising emergency financing from the Middle East, then by pushing through last year’s generous pay deal for Mr Diamond. The bank is set to appoint long-serving board member Sir John Sunderland to lead an internal and external search for a new chairman.
bbc.co.uk
Barclays bank chairman Marcus Agius to resign
Marcus Agius is to resign as the Chairman of Barclays in the wake of the Libor lending rate scandal.
BBC business editor Robert Peston says Mr Agius will admit to an "unacceptable standard of behaviour" at Barclays when he makes the announcement on Monday.
It comes after Barclays was fined £290m ($450m) for attempting to manipulate the Libor inter-bank lending rate.
Earlier, it emerged RBS had sacked four traders over their alleged involvement in the Libor-fixing scandal.
The dismissals happened at the end of last year.
Our correspondent says Mr Agius made his decision to quit on Saturday night.
In his resignation statement he is expected to say the scandal had been a "devastating blow to the bank's reputation" and apologise to staff, customers and shareholders.
DAILY MAIL
Barclays chairman falls on his sword: And now a disturbing question, did Bank of England collude in interest rate fiddle?
By James Chapman, Political Editor
One of Britain’s top bankers is to quit over the rate-fixing scandal.
Barclays chairman Marcus Agius may announce his resignation as early as this morning, City sources said.
And his departure comes amid sensational evidence that traders believed they were fiddling the figures with the approval of the Bank of England.
Mr Agius’s move appears designed to try to ease pressure on Barclays’ chief executive Bob Diamond, who earned £18million last year as Britain’s highest-paid bank boss.
THE GUARDIAN
Vince Cable calls for criminal investigation into Barclays bankers
By Andrew Sparrow, Political Correspondent
Vince Cable has called for a criminal investigation into the conduct of the Barclays bankers responsible for rigging key interest rates.
The business secretary said the public would not understand why people were jailed for petty theft while bankers were getting off, "having perpetrated what looks like conspiracy".
And he said he agreed with Lord Blair, the former Metropolitan police commissioner, who said there appeared to be evidence that Barclays employees were engaged in conspiracy to defraud.
In an interview with Sky's Dermot Murnaghan, Blair said: "There have to be police inquiries into this.
"Anybody, the youngest detective, would say this is conspiracy to defraud. It can mean nothing else. And therefore someone has to launch a criminal inquiry into this behaviour."
Speaking on the same programme, Cable said "his instincts" were to agree with Blair, and that members of the public would expect a criminal investigation too.
THE INDEPENDENT
Banks face lawsuits worth billions over Libor scam
By Paul Cahalan
The interest-rate fixing scandal could leave British banks exposed to multi-billion-pound civil actions, experts have warned.
City insiders have raised the prospect of "BP-style" mass litigation against Barclays and other banks implicated in the Libor scam. BP was forced to set aside $20bn (£12.6bn) to just to cover civil compensation claims resulting from the 2010 Gulf of Mexico oil disaster, and still faces a raft of civil litigation.
Some lawsuits have already started in the US, including one filed by US broker Charles Schwab against a number of banks including Barclays, HSBC, Lloyds and RBS.
Fears that Britain's leading banks will face a wave of costly actions were highlighted in a memo from analysts at investment bank Morgan Stanley (MS) following a meeting with Barclays' embattled chief executive Bob Diamond on Thursday. The memo said: "[We believe] shares will continue to drift lower until we have much greater certainty on the following: litigation risk (taking BP as a case in point), political and regulatory backlash [and] management's accountability."
THE GUARDIAN
Government to order review of inter-bank lending rate
By David Batty and Conal Urquhart
The government is to order a review of the operation of the inter-bank lending rate, or Libor, following revelations of its frequent abuse by Barclays and other banks.
The move follows Ed Miliband's call for a public inquiry into the "institutional corruption" of the banking industry after a series of banking scandals.
A spokeswoman for Downing Street said the review would be independent but that details of who would lead it have yet to be worked out.
Barclays were fined £290m for manipulating the inter-bank lending rate, and several other international banks are also under investigation.
The review falls short of the public inquiry demanded by the Labour leader, who said tougher rules and jail terms were needed to tackle the immoral culture and practices committed by a "corrupt elite" in Britain's banks.
THE TELEGRAPH
Bank of England prepares £200bn economic stimulus
By Philip Aldrick, Economics Editor
Details in the Bank’s Financial Stability Report (FSR), released last week, showed that the decision to let banks tap reserves of cash and liquid assets could provide as much as £150bn for new lending – a sum equivalent to the entire stock of loans to UK small and medium-sized businesses.
Rate-setters on the Bank’s Monetary Policy Committee are also expected this week to unveil a further £50bn of quantitative easing (QE). Last month, the Governor Sir Mervyn King voted to increase the £325bn of completed QE by £50bn. He was narrowly outvoted, with the committee split 5-4 in favour of leaving policy unchanged.
Philip Shaw, UK economist at Investec, said the eurozone crisis and the recent sharp fall in energy prices had made its “easier to justify easier policy”. He added: “Given these various dynamics we expect the MPC to restart another £50bn of QE.” Others at Citi and Capital Economics believe the Bank could add as much as £75bn.
THE TIMES
Concern at venture capitalists who make millions out of children in care
By Andrew Norfolk
Private equity firms are making huge profits from the care of damaged children in the UK care system, with one fund making a return of more than 500 per cent in only six years, The Times has found.
Wealthy global investors have bought out smaller care homes and fostering services, leading to accusations that standards are being sacrificed under the guise of efficiency savings.
The head of a leading children’s charity last night questioned the logic of a few large companies playing such a dominant role in the care of vulnerable young teenagers, asking whether it was morally “right for venture capitalists to profit from children who’ve been abused and neglected”.
Local authorities placing children in a private home pay average annual fees of £200,000 per child. Some private investors maximise their returns by clustering homes in deprived areas of north-west England and the West Midlands, where property prices are low.
Companies can further increase the fees they charge by registering a property as both a children’s home and a private boarding school.
FINANCIAL TIMES
L&G to offer social housing loans
By Ed Hammond and Jim Pickard in London
Legal & General is to start providing loans to housing associations, the latest example of a new lender moving to take advantage of the shortfall in bank finance to the property sector.
The insurer, which extended its first loan to the property sector last month, is already in advanced negotiations with at least one housing association and is expected to complete a deal within the next few months. The UK’s 17,000 housing associations have depended heavily on bank loans to finance the development and maintenance of their property portfolios.
However, tough regulatory changes and high levels of exposure to property have caused banks to pull back from lending to the sector, opening the door for a new wave of debt providers.
THE SCOTSMAN
Holy mackerel! We can’t buy that fish, warn supermarket giants
By Rosemary Free
Supermarkets have been urged not to panic over an international crisis threatening the Scottish mackerel industry.
Three of the UK’s largest supermarket chains have revealed they will not buy Scottish mackerel until environmental certification governing its sustainability is reinstated.
The Marine Stewardship Council (MSC) which certifies that fishing is sustainable, suspended certification at the end of March after Iceland and the Faroe Islands breached mackerel fishing quotas in the northeast Atlantic. Overfishing by the two countries meant quotas were exceeded by 25 per cent in the past two years.
Sainsbury’s, Marks & Spencer and The Co-op have all taken the decision not to source more of the oily fish until the situation is resolved.
However yesterday, Ian Gatt, chief executive of the Scottish Pelagic Fishermen’s Association, said mackerel stocks were healthy and called on supermarkets to rethink their policy.
cityam.com
Eurozone summit fails to solve growing debt crisis
By Tim Wallace
Eurozoneleaders made only a few small steps towards easing the pain caused by the sovereign debt crisis, and remain far away from targeting the root causes of the currency area’s problems, economists have warned.
Politicians agreed last week to make plans for a “single supervisory mechanism” for Eurozone banks, probably run by the European Central Bank (ECB) – a key step towards creating a banking union, and a change which could allow the ESM bailout fund to recapitalise troubled banks directly.
Borrowing costs fell for the Spanish, Italian and Irish governments as the plans reduce their liability to bail out failing banks. A €120bn (£96.7bn) package to boost growth was also agreed.
However, the plan remains vague in parts and does not cover the main problems afflicting the Eurozone.
DAILY EXPRESS
Madonna aims to be Britain’s Material Girl
By Geoff Ho
British shoppers will be able to buy clothes from Madonna’s fashion range Material Girl for the first time from September.
German shopping group Otto has snapped up the exclusive European rights to the Material Girl range and plans to make its autumn collection available to shoppers in Britain and the continent through its online fashion stores.
At the moment Material Girl wear is only available in the United States through the department store chain Macy’s. Material Girl is a fast-fashion range designed by the pop legend and her daughter Lourdes.
The collection of tops, jackets, skirts and jeans, are designed to have a “rock edge” and are aimed at 16- to 24-year-olds. Prices for pieces range from £15 to £100. The likes of Gossip Girl star Taylor Momsen and Kelly Osbourne have previously been used to promote the range in the US.
