BRITAIN: Osbourne to Court Bankers at Mansion House with #Brexit on the Cards

#AceFinanceNews – Featured Report:BRITAIN:June.10: Despite a spate of record fines of bankers rigging international rates, miss-selling people insurance policies and bagging huge bonuses, UK Chancellor George Osborne is set to use his annual Mansion House event in the City of London to keep his friends happy.

Against the growing lack of trust in the City, Osborne is set to keep his banking friends sweet. The theme of the chancellor’s speech is the need for a new settlement with the EU, with the City, and in the way the public finances are managed. 

Having won electoral success in May, the Conservative government is keen to use its majority to press on with traditional Tory financial policies, which often means fawning to its City backers and friends. 

The annual Mansion House speech is given by the chancellor to black-tied bankers, the City elite and other grandees – many of whom are Conservative Party donors. Osborne himself has an estimated personal fortune of around $6 million, as the beneficiary of a trust fund that owns a 15 percent stake in Osborne & Little, the wallpaper-and-fabrics company co-founded by his father, Sir Peter Osborne. 

However, the City has been rocked in recent years by rows over huge bankers’ bonuses, despite the global economic crash caused by toxic debt flying around and the credit crunch. In the UK the taxpayer had to bail out both Lloyds and RBS in 2008 in order to keep them afloat. 

The government also had to support Northern Rock and Northern Rock (Asset Management), as well as Bradford & Bingley. The total support package for the ban bailout during 2008-9, according to the National Audit Office, came to an eye-watering $1.85 trillion. 

Bonuses and Record Fines

Not content with having had to bail out the bankers, taxpayers have been angered at their bonuses. This year it was reported that bankers were set to be awarded $7.7 billion in bonuses. Bailed bank RBS handed over $770 million, and Lloyds paid $580. 

In the latest scandal, London-based HSBC is being investigated in several countries for operating a secret bank in Switzerland used by rich people and companies to avoid tax in other states in an ‘aggravated money laundering’ operation. 

Meanwhile record fines have been handed over by banks who admitted rigging international rate systems. In 2012, Barclays Bank was fined $200 million by the Commodity Futures Trading Commission, $160 million by the United States Department of Justice and £59.5 million by the UK Financial Services Authority for attempted manipulation of the Libor and Euribor rates.

All eyes will be on whether George Osborne cuts the bank levy, which has been used to swell the government coffers by taking a charge on the financial sector. Stuart Gulliver, chief executive of HSBC, will be listening very carefully, having threatened to move his headquarters out of London and move back to Hong Kong.

Osborne, however, is unlikely to do anything that will upset his City mates too much. He has too much to lose.

@acenewsservices

#barclays, #citigroup, #commodity-futures-trading-commission, #deutsche-bank, #federal-reserve-system, #financial-conduct-authority, #foreign-exchange-market, #the-royal-bank-of-scotland, #ubs, #united-states-department-of-justice

` Bank of England faces growing criticism of its response to possible manipulation of the Foreign Exchange Rates’

#AceFinanceNews (Reuters) – The Bank of England announced an overhaul of the way it works with banks and financial markets on Tuesday as it faced growing criticism of its response to possible manipulation of foreign exchange rates.

Bank Governor Mark Carney answered questions from lawmakers for four-and-a-half-hours, a large part of which was devoted to the Bank’s response to allegations that key currency benchmarks had been rigged.

Carney said a new deputy governor position, responsible for banking and markets, will be created as part of the shake-up.

“One of the first tasks of that individual is that he or she will conduct a root-and-branch review of how we conduct market intelligence,” Carney said.

Details of the new structure will be announced on March 18.

As lawmakers seized on the case to revive their demands tougher oversight of the Bank, Carney stressed the seriousness of the foreign exchange case and compared it to the Libor interest rate-rigging scandal. This resulted in criminal charges against traders, the resignation of Barclays’ chief executive and $6 billion in settlements paid by banks.

“This is as serious as Libor if not more so because this goes to the heart of integrity of markets, and we have to establish the integrity of markets,” Carney told legislators.

The Bank suspended an employee last week as part of its internal investigation into whether staff turned a blind eye to signs of manipulation in the $5.3 trillion-a-day global market, for which London is the main hub.

London Reuters 11 March

#AFN2014

#bank-of-england, #barclays, #libor, #london, #mark-carney, #reuters

Barclays Scandal Continues

LONDON (Reuters) – Barclays, already rocked by an interest rate rigging scandal, unveiled new U.S. regulatory investigations into the bank’s financial probity on Wednesday and said its profit was hit by charges for mis-selling insurance.

#ace-finance-alert, #banking, #barclays, #reuters

Barclays A New Dawn

English: Barclay's Bank, Jerusalem, circa 1940.

English: Barclay’s Bank, Jerusalem, circa 1940. (Photo credit: Wikipedia)

Barclay’s has a new centurion: David Walker will take over from Marcus Agius as Barclay’s chairman on November 1. Walker is a former regulator who served in the UK Treasury and Bank of England. That background will give Walker’s credibility as he tries to overhaul the bank’s culture, operations and reputation in the wake of the Libor scandal.

As lead author of the eponymous 2009 report on corporate governance at UK banks, Walker has already committed to the standards he – and other board members – should act on:

The most critical need is for an environment in which effective challenge of the executive is expected and achieved in the boardroom before decisions are taken on major risk and strategic issues. For this to be achieved will require close attention to board composition to ensure the right mix of both financial industry capability and critical perspective from high-level experience in other major business. It will also require a materially increased time commitment from non-executive directors … In all of this, the role of the chairman is paramount, calling for both exceptional board leadership skills and ability to get confidently and competently to grips with major strategic issues. With so real an expectation and obligation, the chairman’s role will involve a priority of commitment that will leave little time for other business activity.

So far, Walker is following his own advice by committing to work a minimum of four days a week as chairman. Anything short of full-time may sound slight, but none of his peers have made their time commitment similarly transparent nor can credibly argue that theirs is greater. For that work, he’ll receive £750,000 ($1.17 million), of which £100,000 will be in Barclay’s stock.

Additional transparency may be coming to Barclay’s in other forms, as well: the Walker report called for disclosure of the number of employees earning more than £1 million in salary and bonus and a tally of those “earning between £1m and £2.5m; £2.5m and £5m; and over £5m”. Walker also called for the head of the board’s pay committee to automatically face re-election if their proposals are supported by less than 75% of shareholders.

Walker also thinks boards should hear directly from risk officers, and should have final say over their hiring and firing. He wants the chief risk officer to report to other executives, but the CRO also “should report to the board risk committee, with direct access to the chairman of the committee”.

These and Walker’s many other recommendations add up to a view of the relationship between the chairman and the CEO at financial institutions very different from what we’ve recently seen. UK board oversight is more rigorous than in the US, and the chairman and CEO roles are invariably separate.  It’s hard to imagine Jamie Dimon working under Walker’s structure. In Walker’s view, chief executives cannot be allowed to become indispensable or inscrutable: “If the embedding of authority… makes the CEO become effectively unchallengeable (and possibly a control freak), the CEO will be a major source of risk and will probably need to be removed”. That should make for some interesting interviews as Walker takes up his first prominent task, finding a new CEO.

#bank-of-england, #barclays, #chief-executive-officer, #david-alan-walker-banker, #hm-treasury, #list-of-banks-in-the-united-kingdom, #marcus-agius, #walker

Who Is Really Responsible For The Libor Scandal

Who Is Really Responsible For The Libor Scandal

This report issue by the ” Treasury Committee” makes for interesting reading if you have the time! It shows how contradiction after contradiction of evidence given was so easily made to be misinterpreted by the three parties! In their own words and as this extract shows ,we could be led to believe that no one person was responsible or that everyone was aware and thus was responsible!

EXTRACT:

The evidence that Mr Tucker, Mr Diamond and Mr del Missier separately gave about this manipulation describes a combination of circumstances which would excuse all the participants from the charge of deliberate wrongdoing. If they are all to be believed, an extraordinary, but conceivably plausible, series of miscommunications occurred.

This was unambiguous to say the least and told us nothing more than we already did not know!

Personally l believe the connection goes back a lot further and a lot more must be revealed before we are able to know, where it started.          

#banking, #barclays, #libor, #report, #treasury-committee