As part of what is becoming a surprise leadership overhaul at the bank, a statement released Monday also suggested that former investment banker Robin Budenberg will be put in place as the lenders new chairman. If this happens, Budenberg will replace Norman Blackwell, who had discussed leaving the bank this year.
The surprise departure of Horta-Osorio scheduled for the end of June next year, poses more problems for Britain’s biggest mortgage lender as it wrestles with the economic recovery from Coronavirus pandemic and potentially one of the deepest recessions in centuries. The 56-year-old from Portugal, was seen by many as a steady hand at Lloyds, steering the Bank to profitability and full private ownership following a bailout during the financial crisis. Although his pay may sometimes have caused some negative column inches and discussions, the 56 year old will leave with a stellar reputation in the banking community.
In announcing the departure a year in advance, Lloyds will hope that this will leave plenty of time for the board to secure an experienced successor and ensure a smooth transition. The annoncement touched upon the fact that the banking giant will be considering internal and external candidates as they begin their search for a new chief executive in the near future.
During his tenure, Horta-Osorio cut thousands of jobs and managed a long-running and costly response to a scandal where British banks mis-sold insurance to consumers. He also pushed into wealth management and insurance as a way to diversify a revenue stream heavily dependent on the British economy and mortgage borrowers.
Lloyds booked a provision of 1.4 billion pounds ($1.75 billion) for soured loans in the first quarter as the coronavirus lockdown crushed economic growth and caused the bank to scrap previous targets. Its shares have also suffered as the Bank of England pushed lenders to scrap their dividends amid the pandemic.
Lloyds have been due to announce their new strategic plan early next year, as their current one directed by outgoing CEO Horta-Osorio, which involved heavy investment in technology and cost-reductions comes to an end. It is unclear whether this will change their plans.
Although Horta-Osorio has suffered a few setbacks during his decade long stint at the bank, most notable when Lloyds cut his pay by 28% to 4.73 million pounds for last year and his handling of a recent whistleblower report into a fraud case, Lloyds will be disappointed to lose a chief executive who has broadly delivered excellent results throughout what has been a tumultuous time in the economic sector.
Lloyds shares rose about 2% in London trading, one of the smallest gains in a broad rally by the Whether by Horat-Osorio or the new CEO, Lloyds have some ground to make up, currently sitting 49% down this year, which ranks as the worst performance among Britain’s five major banks.
As the stock markets fluctuate and countries head into recession, we're starting a series looking at the stocks with the most potential for good returns with analysis and expert from the Finance Monthly team. This week, we're looking at Countryside Properties and Royal Dutch Shell:
Covid-19 has severely hit the housing market in the UK and this morning FTSE 250 company Countryside Properties PLC (CSP) reported that it lost completions and land sales in March which has impacted profit by £29 M and increased debt by £83 M. As of writing the share price had dropped 10% at the opening. With the housing market key to any economic recovery I would expect to see developers to do much better in the coming months as the lockdown is eased.
With the world’s economies grinding to a halt oil prices have hit new lows in recent weeks. Royal Dutch Shell Plc (RDSA: LON) has seen its share price drop by over 52% from its 12 month high but there is no doubt that oil will be in great demand once the economic recovery finally gets underway. It seems to me that the world’s biggest players in the energy/petrochemical sector have enough in reserve to weather the storm and Shell, in my opinion, did the right thing but cutting its dividend – the first cut since WWII. No doubt it will be a bumpy ride ahead, but Shell stock looks like good value as things stand.
Please invest responsibly. Views expressed on the companies mentioned in this article are those of the writer and any investment undertaken should be independently investigated by the investor. Finance Monthly accepts no responsibility for any investment. For more information visit our stock disclaimer
Today marks the day that the UK finally leaves the EU. It also marks the day where all self-assessment tax returns are due, and many in the accountancy sector are concerned that focus on Britain's exit from the European Union might lead to huge delays in tax returns being submitted in time.
Last tax year, 704,000 returns were submitted on the deadline day, while another 477,000 returns were filed late. Even though the time is running out, there are still some things that taxpayers can do before the clock hits midnight on Friday. TaxScouts, a specialist tax returns company, gave us their advice for anyone who still needs to get their returns done during the Brexit melee:
Although it might not seem that Brexit and delays in tax returns are linked, historically many tax returns are filed late and HMRC struggled to cope with the workload in 2019, something experts foresee happening again this year. Previously HM Revenue and Customs (HMRC) has issued warning letters in February following each January deadline. However, in 2019, many of the warnings weren’t sent until late April. The delays were being caused by the heavy workload currently being shouldered by civil servants due to Brexit preparations.
If this happens again, HMRC claimed last year that no one will be “unfairly penalized” and accountants hope this will be the case once more despite Brexit Day and Deadline day sharing the same January 31st calendar space.
Financial markets seem to have embraced the results of the UK general election with the pound recording its biggest rally in almost 3 years. Shares also saw huge surges following the news that Boris Johnson’s Conservative party had secured a majority victory.
Shortly after the exit polls were announced around 1opm GMT, Sterling saw a jump of 3 cents against the dollar pushing it up to $1.35 and marking the the currency’s highest level since early 2018 and its biggest gains since 2017. Although Sterling did slip back a little later, both analysts and businesses have noted a much stronger position. In addition to a strong performance against the dollar the pound also enjoyed a surge against the Euro that hasn’t been seen since before the Brexit vote. Many are predicting that the pound will continue to rise and could hit $1.40.
Nigel Green, Chief Executive of Devere said, “Many traders were caught off-guard by the size of the majority and this may push the pound even higher than previous predictions. We could see bullish traders now take it to $1.38 or maybe even as high as $1.40.”
Johnson’s victory was welcomed with open arms by investors who have suffered years of uncertainty ever since the EU referendum took place in the summer of 2016. The hopes are now that with a majority the parliamentary gridlock that has plagues UK business will now be a hurdle that the Government can overcome.
The news also saw the FTSE 100 index rise more than 110 points (1.5%) to 7,386. Domestically, the increase was even bigger for the FTSE 250 hitting a high of 21,9101, a new all time record with a gain of over 1000 points.
Many businesses suffering from the fears of a hard Brexit saw double-digit gains throughout the evening as investors flooded back into UK businesses. Housebuilders including Berkeley Group, Taylor Wimpey, Barratt and Barratt all enjoyed a significant resurgence. As did several of the utilities companies as the rumoured threat of nationalisation if Labour had overturned the Conservatives. Centrica was up by 8% on the FTSE 100 and Energy Group SSE saw a 10% gain. Telecommunication giant BT who had also been under threat had Corbyn been victorious also made similar gains.
Banking also enjoyed some respite from a bruising couple of years with Virgin Money heading the pack with a 17% increase, followed by Royal Bank of Scotland (11%) and Lloyds (7%) to make it an evening to savour.
There are now renewed hopes that as the political uncertainty subsides, consumer spending will see a significant boost. This was reflected in the surge on many retail and leisure stocks with Marks & Spencer (9%), Tesco and Sainsbury’s all seeing gains.
Analysts said Johnson would now be in a better position to negotiate Brexit trade deals. David Lamb, Head of Dealing at Fexco International Payments, said:
“Sterling and stability for three and a half years are words that have seldom been seen together. Now finally they might. As the sleep-deprived incredulity of the morning after fades, the Pound is drifting. But nevertheless it shows no sign of giving up the gains it made as last night’s momentous exit poll came in.
“Breathless talk of a Brave New World for sterling maybe overblown, but two fundamental factors that had been holding down the Pound have changed.
“Firstly the scale of the Conservatives’ victory means Boris Johnson’s withdrawal deal should sail through Parliament, finally breaking the Brexit deadlock that has so tortured the markets.
“Equally the size of Mr Johnson’s majority will give him a freer hand in the nitty gritty of trade negotiations next year. He will no longer need to pander to Britain’s hardcore leavers – meaning the end result could potentially be a softer, more market-friendly Brexit.
“The threat of a chaotic ‘no deal’ has not gone away but it has receded, and for now the Pound is likely to cruise in a higher trading range than it has done for years.”
As investors and businesses enjoy the morning after, hoping for a brighter Brexit-based future, it still remains to be seen what Boris Johnson’s new government will be able to achieve. But for the first time in several years, there is a genuine sense of optimism in the markets.
If you bought property while living abroad for a few years for example and did not want to immediately sell up, you could test the water to see if any tenants may be keen to occupy it as you move back home. Furthermore, you may have purchased a holiday home and renting it out may be more advantageous than ultimately leaving it empty for months on end.
Of course, there are many things to consider once you do decide to establish a rental business, with a key one being just how you will receive rent. Here we have pulled together three different approaches you could take on the matter as you look to make a little bit of cash from your property interests.
As AccountingCoach.com explains, a post-dated cheque is essentially a cheque which is written out and includes a date in the future on it. When it comes to paying rent, a tenant would agree with a landlord that the cheques in question would not be cashed or deposited until after the date which is stipulated.
The use of post-dated cheques is quite common in a number of areas across the world. For example, as this property website explains, it may be something people come across if they are looking for flats to rent in regions such as Sharjah. The practice of making rental payments through four to six post-dated cheques is used often in the area, which borders Dubai and has become a popular option due to its affordable rents when compared to the neighbouring city.
A more modern approach to the issue of rent payments may be to accept online methods such as PayPal or more specialist services. Payments through such services tend to be processed very quickly, while a major benefit is that their use is common across the world.
For example, as this website outlines, there are a host of online rent payment services available for landlords with property interests in the US. The likes of Cozy, Avail and PayYourRent include a range of features designed to ensure payments are received swiftly and easily.
Alternatively, you could simply ask tenants to transfer rent from their bank account into one which you have established in the country or region where your property is based. The method is popular in many areas and, as this website explains, is commonly used to pay rent on property in Spain.
This may be a straightforward step to take as it would mean there could be the option of direct debits and standing orders too. However, that approach would, of course, mean you would need to manage and decide on how you access those funds, which would be held abroad.
Renting out property can be a real money-spinner for those who are fortunate to have homes in a host of desirable and in-demand locations. Furthermore, having access to the right payments can help to take a lot of stress or concern out of managing or owning such properties.
The approaches listed above should hopefully give you some ideas on how you could address this issue as you get started with your own rental business.
There are several reasons to buy gold, all of which can differ from person to person dependant on their current position and experience in trading. While some tend to consider gold for a long-term investment, others might turn to the commodity as a way to make money before cashing in their investment. Regardless, political uncertainty can affect the success of any trading intention drastically. However, an investment in gold can actually work out in three different scenarios:
Hedges are essentially a form of investment made to offset potential losses in another class of asset. In other words, an investor may buy gold to hedge against the potential decline or volatility of a currency or stock. Gold can act as a defence against inflation for this reason, but often requires fast movement to truly reap the benefits. For example, if a stock market began to crash, an investor could sell their stocks and buy gold. From here, as the stock market began to recover, they could sell the gold and move back to the stock market with their profits.
Those who are investing in risky ventures can benefit from having a safe haven and gold acts as precisely that. An investor would buy gold, even as the prices continued to skyrocket, and could go on to sell this when needed. Alternatively, it acted as a way to either make a profit, or hold onto potential profit in the future if things began to recover. Essentially, buying gold as a safe haven gives you a financial buffer, even when stock markets are volatile or crashing.
While buying gold as a direct investment isn’t as common, those wanting to buy gold for jewellery, technology or just as a finite valuable substance, as well as those who are investing solely for the future increase in the price of gold, direct investors often have their reasons for doing so. Of course, gold is held by governments and some individuals as a show of wealth.
Gold’s position as a hedge or safe haven means that when political uncertainty comes around, the price of gold shoots up. More and more people will invest in gold as an immediate reaction to political turmoil, leading to increased demand and, of course, increased price. One example of this is the Eurozone crisis that has affected Europe since 2009. This debt crisis has wreaked havoc on the continent, but it was in 2011 when gold hit an all time high, at $1,895 per ounce. The sudden drop in value of the Euro devastated countless countries, plummeting them into debt. Investing in gold allows for bigger profits in the long run, due to its considerable stability when compared to other forms of asset.
If the price of gold is decreasing, this typically means that the stock and commodity markets are performing relatively well. With the economy in a good financial state, those thinking of long-term investments or a hedge or safe haven for the future could consider purchasing gold while the price is at its lowest. Currently, gold sits at around £33.70 per gram, offering investors the perfect opportunity to purchase gold at a lower price as a safeguard for the future, or a potential long-term investment opportunity.
While gold may not be right for every investor, those looking for a profitable investment for the long-term future could benefit from purchasing this particular commodity while it’s at a relatively low price. Direct investments with not only gold, but oil, mining and other hard assets can build up a strong portfolio for any investor.
A default is incurred following multiple consecutive missed payments on a credit agreement that you have entered into. Once you get to between 4 and 6 payments behind the lender may register your account as `defaulted`. This can occur on most kinds of finance including: credit cards, personal loans, store cards, car finance agreements, home owner loans and mortgage agreements. It basically means that you have not kept to the terms of the credit agreement you entered into with your lender. One thing you can do to shed a more positive light on your credit profile if you have already incurred the default is to settle it as soon as possible. At least then any lender can see that you managed to pay the debt off - as it will show as `status satisfied` on your credit report.
Negative Impact Of Receiving A Defaults
In most cases you will receive a penalty charge for missing a payment on any credit agreement. If your account goes into` Default Status` it can also have a big impact on your credit rating - limiting any future finance options. Continuing to miss payments can also result in a county court judgement on unsecured debt and continuing to miss payments on a mortgage or car finance loan could result in repossession of the home or vehicle respectively. These are the short term impacts, unfortunately the trouble does not stop there because credit reference agencies will leave the default showing on your credit record for 6 years before it can be removed.
“There are still plenty of loan and mortgage providers who will consider lending to people who have missed payments or even defaults."
Paul Carley MD of First Choice Finance
What To Do If You Get A Default?
If you miss a payment you need to ensure you get caught up on your debt and not miss any other payments in the future. People have missed or late payments for all sorts of reasons. It may have been an administrative mistake on your or the lenders part part, if this is the case consider setting up an automated payment such as a direct debit.
If you have incurred a default because of a problem with affordability then you need to consider your finance in more detail, if it is a short term cash flow problem, call your creditors and discuss the problem with them, if it is a bigger affordability problem you may consider restructuring your finances with the use of a debt consolidation remortgage or a larger loan to refinance your debts. Extending the debt term could reduce your monthly debt payments but you will normally end up paying more in interest overall.
Can I Get Additional Finance Or A Mortgager If I Have A Defaults?
If you are having trouble meeting current payments additional debt should be considered very carefully, although you may consider restructuring your existing debts, with the use of a debt consolidation loan or mortgage. Defaults will have an impact on your finance options - many high street lenders will not approve applications from borrowers with recent defaults. However some specialist lenders are still offering competitive mortgages for people with recent defaults. Loan to values are restricted to about 80% maximum for clients with between 1 and 5 defaults in the last 24 months, these plans are also subject to credit scoring.
Paul Carley MD of First Choice Finance says; “There are still plenty of loan and mortgage providers who will consider lending to people who have missed payments or even defaults. However the key is to gather all the facts and figures before you accept any offer of finance. The most important areas to consider are you being able to afford the loan and making sure that the new finance puts you in a better position overall.”
The company that owns Hong Kong's main stock exchange, Hong Kong Exchanges and Clearing, has made a surprise £32bn bid to buy it’s London rival and counterpart, the London Stock Exchange.
The Hong Kong company said in a statement that it hoped combining the two exchanges would result in the creation of "the largest and most significant financial centres in Asia and Europe."
Shares in the London Stock Exchange Group rose by more than 11% as the news broke, but the initial flurry cooled and fell back as the financial world adjusted to the news.
The bid marks a bold move for Hong Kong Exchanges and Clearing, as it comes just after the LSE's £22 billion ($27 billion) deal to acquire financial data company Refinitiv; a deal the London Stock Exchange is hoping transforms it into a global markets and information powerhouse with the express aim of competing with rival Michael Bloomberg's financial data empire. However, the bid from HKXCF is reported to be dependent on the LSE scrapping its plans to buy Refinitiv.
Charles Li, Chief Executive of the Hong Kong company expressed his desire for the deal to come to fruition, and proclaimed the deal would "redefine global capital markets for decades to come. Together, we will connect East and West, be more diversified and we will be able to offer customers greater innovation, risk management and trading opportunities."
Following the bid, the London Stock Exchange confirmed it had received what it described as an "unsolicited, preliminary and highly conditional" offer from Hong Kong Exchanges and Clearing and released a statement adding that "the board ... will consider this proposal and will make a further announcement in due course".
Analysts have described the deal as a potential “non-starter,” highlighting the London Stock Exchange share price staying well below the offer price as a sign that investors aren’t confident in the deals chances of success.
Some have noted that political factors may come into play in what will be seen as the first real test for a post-Brexit Britain and how, without the EU, it’s high value financial services industry could become fair game. In the past the EU have blocked mergers between the LSE and it’s rivals including one in 2017 which would have resulted in a merger between the London Stock Exchange and Germany’s Deutsche Boerse.
As the political battleground in the UK is played out around the perceived independence Brexit is designed to deliver, this could be a huge reason for the bid to fail. Neil Wilson, an analyst at Markets.com told the BBC: "The UK government may not wish to see such a vital symbol of UK financial services strength, and indeed a strategic asset, to be owned by foreigners. Effectively it would hand it over to the Chinese through the Hong Kong back door."
The London Stock Exchange seems to be committed to its original plan, stating it would be continuing with its own proposed acquisition of Refinitiv.
Starting a business can be very intimidating. Not only that, but it can also present various challenges that can be very difficult to navigate on your own with limited experience. This is why investing in professional coaching is key. However, we have come up with a list of tips that you can utilise in order to give your start-up the best chance to succeed.
One of the biggest issues that start-ups are faced with is not doing enough research beforehand. Have you demonstrated a proven market for your product or service? It is critical to do research before entering the marketplace. Ask questions to your target market. What are their pain points? What are the toughest challenges they face? Figure this out and you should be able to solve a real problem that exists.
When it comes to starting a business, leadership is everything. You will need to put in the work and dedication if you expect your team to do so as well.
When you are starting a business, it is important to really ask for and utilise the input from the team of individuals that you have in your corner. Try to surround your business with people that fit your culture and that understand your business and your vision. That way, you can have people there to bounce ideas off of and to really gain valuable input from.
Every start-up should have a mentor of some kind. You want to try to get at least one, if not a few mentors that you will be able to get valuable guidance from. You would be surprised how many people would be willing and able to offer you mentorship. Simply ask successful people around you if they would mentor you and utilise their guidance on your path towards success.
One of the roadblocks that a lot of start-ups run into eventually is not managing their cash flow accordingly. You want to ensure that you are constantly monitoring your cashflow to avoid running into cash flow issues.
You want to have a roadmap in place for your business which will allow you to align your goals with your vision and help you avoid anything that might otherwise distract you or get in your way. This will also allow everyone involved to see where you are heading as a business.
You will want to constantly ask your customers and your target market for potential improvements. Just because you release a product or service doesn't mean that the work stops there. You should be continually asking for feedback on your product, service, and even your customer service. That way, you can continually do things to improve.
Don't be afraid of the competition that you will ultimately face. If you notice more and more competition cropping up in your space, you are on the right track. Competition is not something that you should fear. Competition breeds excellence and it will continue to keep you on your toes. You want to embrace the competition and continually strive to be better than them.
Overall, there is a lot that you can do in order to increase your chances of succeeding as a start-up business. By following some of the tips above and utilising them accordingly, you should be able to successfully launch a start-up positioned to succeed in an increasingly competitive marketplace.
About the author: Stevey McGeown is one of Ireland’s leading business mentors and is well-known for assisting businesses both through effective start-up and later accelerating profit for more mature businesses.
Signing up for a mortgage in the UK is demanding.
With the help of a trusted mortgage advisor, it's possible to organise your thoughts and find the right option for you. Before signing on the dotted line, it's important to ask the right questions.
Here's what you should be asking when it's time to sit down with a reliable mortgage advisor.
1) What is the Best Interest Rate for My Situation?
Start with the interest rate because this is going to have a significant impact on your payments. You don't want something higher than what your situation demands. A mortgage advisor will shed light on how low you can feasibly go while applying. There are times when you are going to find high rates that are out of your budgetary needs. It's okay to ignore those lenders and stick to what you have discussed with your mortgage advisor.
2) What are the Costs Going to Be?
There are expenses associated with mortgages and it's important to dive into the costs as soon as possible. Knowing the underlying interest rates, monthly payments, and more can go a long way in helping you figure things out. A mortgage advisor will help shed light on what may happen when you start applying on the open market.
3) Are There Penalties Involved?
This is an important question because penalties are possible when you break the agreement. Being able to learn about these penalties in advance can save you the trouble later on. Plus, you are not going to be surprised while negotiating with the lender. Otherwise, they can slip these penalties into the agreement.
4) What's Required to Gain a Quick Approval?
This is one thing all clients want. You hope to get the situation taken care of as soon as possible. If that is the case, it's important to put yourself in the best possible situation.
A mortgage advisor will go through your information and put together a plan of action that leads to quick approvals. This is how you're able to push past potential hurdles quickly.
5) Are There Ways To Get Discounts?
Getting a discount is possible depending on certain variables. An example of this would be going to the bank and having all of your accounts in one place. The lender is more likely to provide discounts when they know you're bringing in more assets. This adds value to the deal and ensures you become an attractive client in their eyes.
Don't be afraid to ask about potential discounts and see what the advisor has to say. They will know what lenders can offer and this will shape the approach you take.
Sitting down and speaking to a mortgage advisor means asking the right questions. These questions can set the foundation for a properly customised agreement where both sides are content. Of course, there are several details to ponder over and being able to speak to a professional advisor goes a long way in alleviating your fears.
With the questions listed here, you'll be well on your way to a great deal. Financial advisors can be vital in assisting with any mortgage application so it's well worth giving a trusted financial advisor a call if you're in need of any help.
The Business Show, which is sponsored by Yell, Dell & American Express is Europe’s largest B2B exhibition. The show attracts over 20,000 visitors from all over the world who are looking for new & innovative products and services, which will help them to maintain, grow & develop as a business.
The Business Show will be taking place on the 27th & 28th of November at The London ExCeL. They have 400 exhibitors from the likes of Cranfield School of Management, Intellectual Property Office and Your Business Community Ltd. As well as this, we have a great list of masterclasses one of which is hosted by Barclaycard this year.
This November will see over 200 seminar sessions and our best keynote line-up to date take the stage for 2 days. Make sure you don’t miss out on this world-class event and register here for your free tickets today.
This Customer Experience Exchange for Banking, Financial Services & Insurance (BFSI) is an outstanding opportunity for you to learn lessons from the most successful financial institutions in the field. In just two days out of the office you’ll save months and potentially years of strategy heartache. You'll hear from leaders from across North America talk about their winning strategies in Financial Services, Banking and Insurance.
To ensure the Exchange offers the highest degree of relevancy, only senior executives responsible for strategic customer experience development and investment are invited to attend. This exclusive format allows you to connect with those peers whose insights you respect most – through exceptional networking, business meetings and strategic information sharing sessions.
For more information visit the Customer Experience Exchange for Banking, Financial Services & Insurance website