TODAY’S HEADLINES IN BRIEF: SECRET TAX DEALS REVEALED. JP MORGAN IN $2BN ERROR. CHINA STOPS HELPING EURO AND THE DOGS THAT YAWN.
WWW.BBC.CO.UK
MAJOR UK COMPANIES CUT SECRET TAX DEALS IN LUXEMBOURG
Major UK-based firms cut secret tax deals with authorities in Luxembourg to avoid millions in corporation tax in Britain, the BBC's Panorama has found. The programme obtained confidential tax agreements detailing plans to move profits off-shore to avoid what was a 28% corporate tax rate at the time. Those involved include pharmaceutical giant GlaxoSmithKline (GSK) and media company Northern & Shell
FINANCIAL TIMES
JPMORGAN LOSES $2BN IN ‘EGREGIOUS’ ERROR
By Tom Braithwaite in New York
JPMorgan Chase announced a surprise $2bn trading loss on credit derivatives trading, which chief executive Jamie Dimon blamed on “errors, sloppiness and bad judgement” and warned “could get worse”. The shock disclosure, made after the market closed in a regulatory filing, sent shares in the bank down by about 6 per cent and prompted renewed calls for tougher regulation.
DAILY TELEGRAPH
CHINESE SOVEREIGN WEALTH FUND STOPS BUYING EUROPEAN GOVERNMENT DEBT
By Louise Armitstead
The eurozone has lost a crucial lifeline as China's biggest sovereign wealth fund said it no longer wanted to buy European government debt. Amid resurgent political and financial crisis in Spain and Greece, Gao Ziqing, head of the China Investment Corporation (CIC), said the $440bn (£273bn) fund was "looking at opportunities in Europe" but added: "We don't want to buy any government bonds."
FINANCIAL TIMES
MOODY’S ISSUES CAPITAL WARNING TO GLOBAL BANKS
By Tracy Alloway and Tom Braithwaite in New York
Moody’s has warned that the tendency of global banks to avoid new capital requirement rules and load up on debt will continue to put pressure on their creditworthiness. The credit rating agency announced it was placing 17 banks on review for a downgrade earlier this year, citing “vulnerabilities” in the companies’ vast and volatile capital markets businesses. Three of the banks, Credit Suisse, Morgan Stanley, and UBS, face as much as a three-notch downgrade; 10 face a two-notch slide and four a one-notch drop.
DAILY TELEGRAPH
COMPANIES MUST RAISE £28 TRILLION TO FINANCE 'WALL' OF DEBT
By Harry Wilson
Companies across the world face a "perfect storm" as they have to raise more than £25 trillion to finance an upcoming "wall" of debt. Businesses will need to secure as much as £28.5 trillion to refinance old borrowings and fund new spending, raising major questions over the ability of the world economy to avoid a recession, according to a report from Standard & Poor's. British companies will have to find between £220bn and £268bn of new financing to fund their growth plans on top of refinancing hundreds of billions of pounds more of existing debt, according to the ratings agency.
GUARDIAN
THOMAS COOK BOSS ATTACKS GOVERNMENT FOR PROMOTING HOLIDAYS AT HOME
By Gwyn Topham, transport correspondent
The Culture department's TV campaign featuring Stephen Fry was condemned as 'absolutely wrong' for jeopardising foreign travel's contribution to Britain's GDP. On Thursday the culture department's intervention – a spring TV campaign featuring Fry and other celebrities with the punchline "No passports. No jabs. No visas. No euros" – was attacked by the head of Thomas Cook as "absolutely wrong" in persuading Britons not to bother travelling abroad. The chief executive of Thomas Cook's UK business, Ian Ailles, said that the economic contribution of the outbound tourism sector matched that of the inbound sector, making a huge contribution to GDP as well as to the Treasury's coffers.
THE SCOTSMAN
BROADBAND LEADS BT BACK TO THE LAND OF RISING DIVIDENDS
By PETER CRIPPS
BT has hoisted dividend prospects for shareholders over the next three years and promised a £300 million share buyback in this financial year as the telecoms giant’s financial health is boosted by accelerating broadband roll-out. Britain’s biggest fixed-line telecom firm yesterday recommended a 14 per cent increase in the final dividend to 5.7p to its army of over a million small shareholders, giving a full-year payment up 12 per cent at 8.3p from 7.4p in the previous year. That was on the back of underlying annual earnings up 3 per cent at £6.1 billion as BT’s Scots-born chief executive Ian Livingston said strong cash flows meant dividends would rise 10 to 15 per cent per year for the next three years.
THE SUN
WHSMITH SENDS HOPE TO CLINTON CARDS
By Steve Hawkes, Business Editor
WH Smith is eyeing a deal to rescue part of the failed Clinton Cards chain. The high street stationer is one of several interested parties to have contacted administrators. A source last night warned any rescue was likely to save only 350 stores at best — meaning HALF of Clinton’s network could close within weeks.
DAILY MAIL
ROW OVER 'FAT CAT' PAY ERUPTS AGAIN AS LEGAL & GENERAL LAVISHED £3.27M 'GOLDEN GOODBYE' ON CHIEF EXECUTIVE
By Ruth Sunderland And Peter Campbell
The row over ‘fat cat’ pay erupted again as Legal & General lavished a £3.27m ‘golden goodbye’ on its chief executive and two more companies suffered shareholder rebellions. The gold-plated retirement package of 54-year-old L&G chief Tim Breedon raised eyebrows as the insurer has styled itself as one of the UK’s leading exponents of corporate governance. Breedon is also chairman of the Association of British Insurers, a shareholder group that has lobbied against excessive pay at banks and elsewhere.
DAILY EXPRESS
PENSION PAIN FOR MILLIONS
Pensioners could be hit hard by the Bank of England's low rates
By Sarah O'Grady
Millions of pensioners will be made permanently poorer because of the Bank of England, it was claimed yesterday. Record low interest rates have left those who rely on savings to boost their income in retirement struggling to make ends meet. And the Bank’s policy of printing extra money has driven down the value of the annuities workers buy with their pension pots – a decision that sets the size of their retirement income for life. With the Bank’s Monetary Policy Com¬mittee keeping the base rate at an all-time low of 0.5 per cent for the 38th month in a row yesterday, campaigners warn the crisis is only going to get worse.
….AND FINALLY …
DAILY TELEGRAPH
REVEALED: WHY CANINES YAWN AFTER THEIR 'DOG TIRED' OWNERS
Dogs are compelled to yawn if they hear their owners do the same, a study has suggested. Researchers claimed that dogs responded only to an audio cue such as a yawn even if they didn’t see the action taking place. The study found this was particularly noticeable when the dogs were listening to the yawns of people they knew. Scientists suggested the findings, presented at the National Ethology Congress in Lisbon, showed canines had empathy to human behaviours.
