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Thursday newspaper round-up: BP, RBS, Scotland

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30/01/2014
BP should 'remain barred' from US contracts; RBS set to sell US trading business; Scottish govt accepts currency union means loss of powers.

BP should remain barred from winning any new contracts with the American government because it has not demonstrated that it is a “responsible” contractor following the 2010 Gulf of Mexico oil spill, the US Department of Justice has said. The oil giant is fighting to overturn a decision made by the US Environmental Protection Agency in 2012, which banned all BP subsidiaries from pitching from any new contracts to supply or lease oil to the US government. – Daily Telegraph

Royal Bank of Scotland is preparing to sell its American trading business as it struggles to raise capital after this week’s shock profit warning. The bank, 81 per cent-owned by the taxpayer, has been under pressure from the Government to sell RBS Securities, formerly called RBS Greenwich Capital, because it ties up a lot of RBS’s capital and has an aggressive investment banking culture. The latest row about RBS bonuses has hardened officials’ attitude that the business should be sold because it employs about half of the bank’s 11,000 investment bankers, including some of its highest-paid individuals, according to analysts’ estimates. – The Times

The Scottish Government last night admitted it would have to “pool” sovereignty with the rest of the UK if it wanted to keep the pound after independence. The admission came after Bank of England Governor Mark Carney warned an independent Scotland would have to surrender key economic levers to join in a currency union. It is understood the UK authorities could retain control over interest rates and exchange rates, and that limits could be applied to taxation and spending. – The Scotsman

The Bank of England has blocked Santander UK’s plans to hand its incoming deputy chief executive responsibility for risk management. The British arm of the Spanish lender has been forced to rethink its appointment of Nathan Bostock, currently finance director of Royal Bank of Scotland, to the joint role of deputy chief executive and chief risk officer. Mr Bostock is expected to join Santander later this year, but will only take the deputy chief executive job, while the lender looks for a new head of risk after the Prudential Regulation Authority, the Bank of England-run regulator of Britain’s largest lenders, said he could not perform both jobs. – Daily Telegraph

Vince Cable is demanding an urgent meeting with the boss of Lloyds Banking Group after the bailed-out bank made deep cuts to the number of its small business experts. The business secretary wrote to António Horta-Osório on Wednesday night after Lloyds said half the relationship managers handling small business queries that their roles were being made redundant as part of a long-running strategic review. – The Guardian

The Industrial and Commercial Bank of China, the largest bank in the world by assets, is to take the country’s first foothold in London’s wholesale banking market. The state-backed bank is to buy control of Standard Bank’s London commodities and currencies arm in a deal worth as much as $1.275bn (£770m). – Daily Telegraph

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