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Tuesday newspaper round-up: Bank bonuses, HMV, JP Morgan…

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15/01/2013
Govt under pressure over bank bonuses; HMV to call in administrators; JP Morgan under fire to tighten risk controls.
Tuesday newspaper round-up: Bank bonuses, HMV, JP Morgan…

George Osborne is facing pressure to take action in the Budget on bank bonuses after it emerged that Goldman Sachs is considering delaying big payouts to UK staff until after the 50p top rate of tax is abolished in April. The bank is looking at pushing back the payout date for deferred bonuses awarded in shares in 2009, 2010 and 2011 until after 6 April when the top rate of income tax drops to 45p. This mirrors behaviour at the turn of the the year, when Goldman Sachs organised payments to staff on the US on 31 December, amid fears the fiscal cliff negotiations would rise personal taxation rates. [The Times]

HMV, the high-street music and DVD store, is set to collapse into administration today, putting 4,000 jobs at risk. The looming failure of the entertainment chain, which was founded in 1921 and has 235 stores, emerged tonight as directors held a last-ditch meeting after failing to reach a new deal with the company’s banks. HMV has been battered by the rise of digital downloads and the flight of physical DVD and CD sales to the internet. [The Times]

US regulators on Monday night ordered JP Morgan to improve its control functions after multimillion-dollar losses on trading positions. After the losses, which eventually reached $6bn (£3.7bn), were first announced by the US bank in May, it became known as the “London Whale” incident and was said to have taken place in a trading operation known as the bank’s “chief investment office”(CIO).

The Financial Services Authority said it had referred the matter to its enforcement division as regulators in the US ordered the Wall Street bank to strengthen its internal systems and controls. The FSA, the City regulator, said: “In addition to its extensive supervisory agenda, the FSA is continuing to conduct a formal enforcement investigation into the trading losses. Conclusions will be reached in the enforcement investigation in due course and any further appropriate action determined at that time”. [The Guardian]

Up to 1,000 independent forecourts could be “wiped out” by 2017 as they lose custom to new supermarket petrol stations, the Petrol Retailers’ Association (PRA) has warned. An average of 40 super-market forecourts were granted planning permission each year since 2009, a study by Christie & Co on behalf of the trade body found. Steve Rodell, head of retail at Christie & Co, said: “If applications continue at the same rate, and there is no reason to believe that will not be the case, there will be another 160 supermarket sites by the end of 2016.” [The Telegraph]

The European Commission has concluded that China is providing illegal subsidies to its steel manufacturers, paving the way for European companies to seek higher import tariffs on a wide range of Chinese products. The EU executive arm said Beijing was helping makers of organic coated steel – used in construction and to make household appliances – to obtain materials at below market prices, according to a report obtained by the Financial Times.[Financial Times]

An influential cross-party committee of MPs accused the Government of environmental hypocrisy for refusing to push for a moratorium on drilling for oil and gas in the Arctic. Two weeks after Shell reignited concerns about the safety of Arctic exploration when its offshore Alaskan rig Kulluk ran aground, the Government rejected a call by the Environmental Audit Committee for a blanket ban on drilling around the North Pole. Joan Walley, who chairs the committee, said: “A few years ago the Prime Minister rode with huskies in the Arctic to demonstrate his commitment on environmental issues, but now he is being asked to protect that pristine wilderness for real he has refused to take a lead on the issue.” [The Independent]

Abu Dhabi’s national oil company has set a North Sea record by delivering first oil from the Cormorant East field to the east of Shetland just 85 days after it was discovered. Taqa Bratani operates the Cormorant East well and the nearby North Cormorant platform, from where the oil will be pumped to the Sullom Voe terminal on Shetland. The discovery was made in October and its name was subsequently changed from the Contender exploration well to the Cormorant East production well. Taqa entered the British sector of the North Sea in 2009 after buying assets from BP, including the Brent system, which delivers oil from 20 fields to Sullom Voe. [The Scotsman]

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