Category: Securities

Lasting Legacy IT Disruption Can Have In Consumer Banking - TSB Bank
BankingSecurities

The Lasting Legacy IT Disruption Can Have In Consumer Banking

Lasting Legacy IT Disruption Can Have In Consumer Banking - TSB Bank

The Lasting Legacy IT Disruption Can Have In Consumer Banking

Recent statistics show that TSB, whose catastrophic IT transfer meltdown last year is still having lasting repercussions for clients, has come last in a consumer poll on the effectiveness of its online banking solutions. Staff Writer Hannah Stevenson explores how this is the direct result of the bank’s meltdown last year.

Last year, TSB lost thousands of customers when its IT systems switchover caused widespread outages and led to consumers and businesses being unable to access their accounts.

At the time, Paul Pester, TSB Chief Executive Officer, commented on the issues by saying:

“We’re making progress in resolving the service problems customers experienced following our IT migration, and we will continue to work tirelessly until we have put things right.  I know how frustrated many customers have been by what’s happened.  It was not acceptable, and was not the level of service that we pride ourselves on – nor was it what our customers have come to expect from TSB.

“It has been a difficult time for customers and I am grateful to them for their patience. I would also like to say thank you to our Partners for their enormous efforts.  They have done everything in their power to continue serving our customers, and I am proud to see that the values on which the Bank has been built have shone through during this time.

“Our priority in the second half of the year continues to be putting things right for our customers.  Looking further ahead we are determined to get back to bringing more competition to UK banking and ultimately making banking better for consumers and small businesses.”

Shortly afterwards, Paul stepped down from his position, showing how detrimental the issues had been to his career. Commenting on the changes, Richard Meddings made it clear that the IT problems were a key driving force in this decision.

“Paul has made an enormous contribution to TSB. Thanks to his passion and commitment, TSB is today one of the UK’s strongest challenger banks, serving over 5 million customers across the UK. On behalf of the TSB Board, I want to thank Paul for everything he has achieved as CEO and pay tribute to the contribution he has made in bringing greater competition to the UK retail banking market.

“Although there is more to do to achieve full stability for customers, the bank’s IT systems and services are much improved since the IT migration. Paul and the Board have therefore agreed that this is the right time to appoint a new CEO for TSB. Our goal is therefore to allow a full search to commence, without any distractions, enabling TSB to build for the future.

“Meanwhile I have been asked by the Board to take on the role of Executive Chairman on an interim basis. Together with the Executive Committee, we have three immediate priorities: to complete the work of putting things right for customers; to enable the bank to achieve full functionality – including the availability of all product services and launch of a leading Business Banking offer; and appointing a CEO for the next chapter of TSB.”

Later, TSB had a further issue, with smaller problems causing the bank further problems throughout 2018.

Andy Cory, identity management services lead at KCOM commented shortly after TSB’s second issue with authentication, which saw clients locked out of their accounts.

“A broken authentication system has an instant impact on customer loyalty. If a business cannot provide easy access to its services without sacrificing security, it only has itself to blame when its users desert.

“The problem is balancing access with security. Too easy to get in and you risk leaving customers unguarded; too many security measures and it becomes offputting for users.

“Fortunately, there is a way to achieve the best of both worlds. Frictionless customer authentication – where users can access online services with zero input into the identification process – is becoming a reality.

“For example, geo-location and geo-velocity checking allow companies to trace a user’s physical location and how far they have travelled since their last login. Taken together, they verify if the user is who they claim to be and make any manual input from the customer unnecessary.”

The latest results from the Competition and Markets Authority (CMA) showcase the long-term detrimental effect that the IT issues have caused. In the personal banking space the firm was last for its online services, but within the business banking space TSB was last in almost every category including online banking services, highlighting how much more important IT stability is for businesses. 

There may also be other factors at play, including poor interest rates, lack of availability for certain financial products and poor customer service as a whole, but there is clearly a link between the lack of faith consumers and businesses now have in TSB’s IT infrastructure and its poor ratings in this latest poll.

Looking ahead, TSB needs to restore faith through new initiatives and by showing its clients that it has truly put its IT failings behind it. For more of the latest news, insight and banking knowledge, subscribe to Wealth & Finance International Magazine HERE.

Cash ManagementFinanceSecuritiesTransactional and Investment Banking

What is next for cryptocurrency?

The rise of cryptocurrency is to be seen as a democratising force within the global economy. For example, secured token offering, has emerged as a true competitor to the traditional Initial Public Offering (IPO) for growing businesses. Judging from the growing acceptance of cryptocurrency by countries and companies, it is predicted that institutional investors will move towards secure cryptocurrency investments over the next decade, if not earlier. Ana Bencic, President and Founder of NextHash explores this phenomenon in more detail.

 

Uber Technologies Inc.’s large initial public offering launched in May and the ride-hailing app has run into some trouble. Uber proposed to go public with a $120 billion valuation, to be pitched by financiers at Morgan Stanley and Goldman Sachs ahead of its IPO. Nonetheless, the company eventually listed with a $75.5 billion market cap. The New York Times elucidated that institutional investors, many who privately owned Uber stock, would not purchase additional shares at a higher price. Uber had received in excesses of $10 billion from institutional investors and private equity firms, among other investors, according to the report and many bought their Uber shares at valuations below $61 billion.

 

The ride-hailing giant priced its IPO on Thursday 9th May at $45 a share, raising a minimum of $8.1 billion and putting Uber’s IPO well behind some of the other, large offerings on the U.S. market in recent years. Facebook Inc raised $16 billion its offering in 2012, while Visa Inc. raised close to $18 billion in 2008 and Alibaba Group Holding Ltd. brought in around $25 billion in 2014.

 

Initial Public Offerings can offer companies the prospect to raise new equity capital; to monetise the investments of private shareholders such as corporation founders or private equity investors and to enable simple trading of existing holdings or future capital raising by becoming publicly traded enterprises. 

 

Nevertheless, for companies looking to list, there are potential drawbacks. Foremost, there is the risk that the required funding will not be raised. Additionally, the cost for accounting, marketing and legal professionals to get to the point of an IPO can be sizeable. It might also necessitate a significant amount of time and effort from the management team, potentially disrupting them from their primary task of running the business. Furthermore, as in Uber’s case, there is a. While no promises can be made in these circumstances, many may be looking at the recent state of these tech unicorns (privately held start-up enterprises valued at over $1 billion) such as Uber and even Facebook may have people pondering if the next big thing will follow the same path. 

 

Aside from financial sacrifice, the time and effort to get to the IPO stage and the administration required once a company has gone public or floated, is considerable. For companies at the front-line of technological advancements, time is of the essence. According to Street Directory, an IPO typically takes between six and nine months. In some cases, this procedure can take up to 18 months. For high-growth businesses, this kind of interval may well bump potential unicorns off their path to a £1 billion valuation and present their rivals with a huge advantage. So what other prospects do highly scalable businesses have? 

 

The cryptocurrency market provides distinctive opportunities for businesses in need of access to vital growth finance and for investors desiring access to potential unicorn businesses at an early stage. This is made likely by cryptocurrency platforms’ capacity to operate across borders, an advantage that isn’t possessed by conventional markets.

 

In April, the French parliament permitted a ground-breaking financial sector bill which aims to encourage both cryptocurrency traders and issuers to set up in France. Organisations looking to issue or trade both existing and novel cryptocurrencies will soon have the option to apply for official accreditation.  The scheduled certification process exhibits a degree of official acknowledgement of the cryptocurrency marketplace. Bills like this enable French investors to trade and invest cryptocurrencies, as well as facilitating businesses to be traded as a Secured Token Offering which would give investors, traders, and entrepreneurs a way to trade and exchange tokens for cryptocurrencies, bringing the ecosystem into the cryptocurrency world. In exchange for charging tax, France is laying the foundations for the Europe-wide adoption of cryptocurrency trading.

France is pushing for the European Union to adopt a regulatory framework on cryptocurrencies.

 

There has been a largely positive attitude towards cryptocurrency by several countries. Malta, Slovenia and France are strong examples of those who are encouraging the implementation and use of cryptocurrency for trading and investment. The ability to invest or trade freely and across borders is an attractive prospect for businesses, who are able to receive financial investment from foreign parties.

 

New technologies are allowing businesses that are not in a jurisdiction that has cryptocurrency regulation in place yet to be included in the new, second generation of scaling business investment. 

 

With Brexit on the horizon for the UK, economists are making their forecasts about how the worth of the pound will be affected. Due to the interdependence of the pound and euro, some have claimed that in either of the potential outcomes- there will likely be some loss in value to these traditional forms of currency.  Cryptocurrencies offer an alternative to traditional, fiat currencies for both consumers and companies, due to their unique advantages of being decentralised, transparent and wholly unaffected by the Brexit situation

 

With incongruent regulation and legal frameworks throughout the globe, platforms that empower a corporation or investor in one jurisdiction to trade or exchange tokens or currency with another trader in another country with a different statute could open the doors to potential unicorn companies to thousands of family offices, hedge funds and institutional investors in a matter of years. In the medium term, platforms that give businesses access to global growth finance could help developing countries and the wider global economy grow at a truly competitive rate to their Western counterparts. 

 

CONCLUSION

 

Cryptocurrencies have spent the last few years in a stage of growth and maturation. The emergent importance of blockchain-based cryptocurrencies is easy to grasp today. From the snowballing rate of adoption of Ethereum and Bitcoin by conventional institutions, the instituting of digital-assets trading platforms and the implementation of cryptocurrency-specific legislation by numerous countries both inside and outside of the EU- cryptocurrency is seeing far greater adoption by both institutional and private traders/investors. With the ability to invest in a corporation from anyplace in the world, quicker than by traditional means and with a far greater potential for a swift return on investment, cryptocurrency offers manifold unique and substantial advantages that have fortified it a lasting place in society.

 

 

FinanceSecurities

72% of Brits Have Fallen Victim to These Scamming Techniques

Did you know that every year, £190bn of Brits’ money is lost to fraud – a figure which is a little less than both the health and defence budgets combined? Unfortunately, it gets much worse – an investigation by price comparison experts, Money Guru, have revealed that almost three quarters (72%)of Brits have fallen victim to scamming techniques at some point.

In order to help raise awareness of this growing problem, they have created the ultimate guide to spotting and stopping scams.  

30% of Brits Duped into Authorising Access to Their Bank Account – With No Legal Protection

Although we live in an increasingly digital world, you may be surprised to discover that a lot of fraud actually happens face-to-face, over the phone or through postal services. Smart scammers have begun ticking people into handing over crucial details and access to accounts through this method otherwise known as Authorised Push Payments (APP). Out of the £500m lost in the first half of 2018, 30% (£145m) of that was lost through APP.

What’s worse is that currently, people subject to this kind of scam have no legal protection to cover. Under current regulations, if your bank has not taken enough action – such as not reimbursing you or by not responding – then you have no right to complain or escalate your complaints to any authority.

 

72% of Brits Were Scammed Over a Two-year Period

Scamming is something that can happen to any of us – and it does, on a regular basis. A report from Citizens Advice revealed that 3 out of 4 of us (72%) were scammed over a two-year period between 2015-2017. Even if you haven’t personally been scammed, chances are you’ll know someone who has 1 in 10 reported knowing someone who has been a victim of fraud.

Almost Half (44%) of Fraud Victims Do Not Receive a Full Reimbursement

Research from the Office for National Statistics has revealed that a little less than half of those who were a victim of fraud received no or a partial refund. As you can see from the graph below, the majority of reported losses are under £250 (62%) but almost a quarter of Brits (22%) have been scammed out of £500 or more.

39% of Brits are Targeted by Scammers for Oversharing on Social Media

There’s a certain stereotype that fraud is only something that happens to the older generation. Whilst this is partially true – 5 million people over the age of 65 believe they have been targeted by scammers – they are not the only target demographic.

Scammers have begun targeting those who are active on social media. In fact, 39% of Brits are targeted due to oversharing their highlights online. In addition, 51% of us store e-receipts on our phone which again are targeted by scammers due to holding sensitive information.

Top 10 Scams to Be Aware Of

  1. Rogue traders and bogus callers – getting you to set up an account for a catalogue.
  2. Scams by telephone, letter or email – a fraudster pretending to be your bank or telephone provider, and asking you to share your details.  
  3. Pensions – offering unsolicited advice, a pension review or an investment opportunity.
  4. Money mules – someone attempting to use your account to launder funds, whilst promising a fee in return.
  5. Copycat websites – charging a fee to review or process official documents, or selling items that aren’t really for sale.
  6. Tech support – being told your computer has a virus and that it can be fixed – for a fee.
  7. Employment scams – paying for training courses that don’t exist.
  8. Auction sites – buying goods that don’t exist, through auction sites or asking you to pay through a bank transfer.
  9. Ticket scams – selling a fake ticket on an illegitimate site, which unfortunately can’t be refunded.
  10. Phishing – receiving a text or email asking you to log into your account, which will then reveal your password to cybercriminals

 

How to Avoid a Scam

  • Never give away your personal details such as passwords and bank account numbers. Legitimate companies will never ask for these.
  • Never let a stranger into your home.
  • Never download attachments or files from an email pr click any links within an email.
  • Never directly transfer money to someone unless you trust them 100% and always keep track of your transactions.
Securities

Contact Centre Payments – Going Mobile

Rob Crutchington at Encoded looks at how the mobile market is changing the way customers choose to make payments

Over recent years there has been a huge increase in the number of smartphone users, apps downloaded and mobile transactions, presenting new challenges for contact centres. In fact, according to this year’s UK Contact Centre Decision Makers’ Guide (DMG) by industry analyst ContactBabel(i) “Statistics that show the number of smartphone users, volume of apps downloaded and the value of mobile transactions are rising so quickly that they would be out-of-date before the report was published”. An astonishing thought.

The rise of the smartphone
This rise of the smartphone has changed the way customers choose to interact with companies. Not just browsing for goods or services, they are now actively using their mobile devices to check balances, pay bills, order items online or post reviews. This means whether banking, checking utility bills or shopping, customers expect quick, easy access to their favourite transactional websites.

This change has meant that companies have had to make changes to the mechanics of their websites, updating them to make them truly ‘mobile friendly’. According to the ContactBabel report, of the contact centres providing mobile customer service, over 80% now have a mobile version and around 50% offer a smartphone app.

Omni-channel is now all-knowing
The key difference is that customers want to act (such as pay a bill) or make a decision (sign up for a service or buy online), rather than just browse websites. As a result, the contact centre is no longer just managing calls and emails, they must be able to handle customer enquiries and payments via text and social media, such as Facebook Messenger, Twitter and other apps to provide a superior service.

This increase in the use of mobile raises some interesting issues and challenges, highlighted in the DMG report. The nature of a mobile phone is that is can provide a lot of information about the caller including the person’s ID, their location and other stored data such as account and payment details. As ContactBabel states, “Businesses can now know more about their customers and their specific requirements and preferences than ever before”.

The obvious benefits are that the company immediately has customer information during a call, which aside from the necessary security questions, facilitates a smoother customer journey. Background data can also provide opportunities to check a customer’s browsing and purchase history, to enable agents to offer promotions and up/cross sell during the interaction.

Maximising mobile service functionality
A rise in the use of Instant Messaging (IM) where customers can choose to make payments automatically by simply replying to an IM message has also changed the role of customer services. It allows customers to make payments ‘in their time’ and reduces the number of voice calls needed to chase payments. It is also a useful tool for companies to promote products or services or for customer service surveys. ContactBabel claims that; “large operations are more likely to be using SMS to communicate with customers, with 82% of respondents from this size band doing so.” However, where larger companies go now, smaller ones are sure to follow.

Making customer data security a priority
So far so good. However, with these great opportunities also come responsibility and that means ensuring that both the customer’s ID and payment details are protected. Any payments must comply with PCI DSS regulations and the new GDPR mandate to ensure mobile and online security of data (ways to tackle these are discussed in the PCI Compliance and Card Security chapter of the ContactBabel report).

As a PCI-DSS Level One Accredited Supplier, Encoded has for some time provided contact centres and their customers with a secure payment platform to ensure that transactions are fully automated and that confidential data is stored centrally and securely. Our new customer engagement platform now expands the offering to accommodate this mobile world.

The Encoded customer engagement platform works with SMS and other forms of IM including Facebook messenger and Whats App to support outbound dialling and integrates with many other services such as email and voice to enable multi-channel transactions. Designed with PCI DSS and GDPR in mind, it ensures complete security of mobile and online customer data. It also incorporates Artificial Intelligence (AI) technology that simulates human conversations to handle routine parts of customer interactions, which means a smaller number of contact centre staff can handle a larger number of transactions.

True customer engagement reaps benefits
There are many benefits to be gained from embracing this new mobile world – from facilitating faster payments, reducing debt levels with faster resolution of accounts (and less agent time spent chasing), to keeping customers updated via broadcasts of product offers and promotions. If your contact centre hasn’t yet gone mobile, then now is the time to act. Customers will vote with their smartphone, not their feet, and choose the companies that offer true mobile omni-channel customer service.

For more information or to arrange a demonstration of the Encoded Customer Engagement Platform please visit Encoded
(i) The UK Contact Centre Decision-Makers’ Guide (15th edition – 2017-18)

Securities

Ashfords LLP, Apex Airspace and MHA MacIntyre Hudson hosting seminar on Airspace Development

Law firm Ashfords LLPs’ Paul Olliff, a Legal Director in the firm’s Real Estate Team, is collaborating with property firm, Apex Airspace, and Chartered Accountants, MHA MacIntyre Hudson, to host an informative presentation – ‘The only way is up’ – on airspace development.

Ashfords’ Paul who advises both national and international clients on a range of commercial real estate matters is a key speaker at the educational event. Topics will cover why airspace development can make existing assets deliver more, generate new value and save substantial costs.

The event is being held on Friday 1 March at St Paul’s Cathedral in London and is set to attract a wealth of property developers, landlords and investors all looking to enhance their value or collaborate to realise value in airspace across the City.

Pioneers in airspace development, Apex Airspace, convert unused airspace above residential, commercial and public buildings into new homes. The company is passionate about how airspace development can help to solve the capital’s housing shortage and are thrilled that the Mayor of London has approved a £10 million deal with Apex Airspace which will see 500 new homes built, of which 50% will be affordable. It is the first time the Mayor has supported an “airspace developer”. Apex will use the funding to create homes above existing ones or over stations, offices, shops and car parks.

Ashfords’ Paul commented:

“It’s not surprising that developing airspace is becoming so popular, particularly in London, given the lack of space on the ground and the lack of residential housing, coupled with the advances in construction techniques. The funding authorised by the Mayor of London for such a development shows its rise to prominence on a national and political scale. I’m looking forward to speaking at the seminar alongside Apex, who have just secured £10 million from Sadiq Khan and are one of (if not the) leader in this sector.”

For more information please contact Paul Olliff, Legal Director in Real Estate at Ashfords LLP, on [email protected] or call 020 7544 2455.

ArticlesBankingFinanceSecurities

Tiso outdoor pursuits retailer chooses Eurostop connected retail systems to support business growth

Scotland’s leading outdoor pursuits retailer invests in Eurostop stock management and EPOS systems for faster and more accurate management of stock replenishment and promotions

Eurostop has announced that Tiso, Scotland’s leading outdoor clothing & equipment retailer, has selected Eurostop connected stock management and EPOS systems for over 13 stores. Tiso chose Eurostop e-rmis, its stock system, e-pos touch and the business intelligence module, e-cubes, to provide the detailed stock management and replenishment that it requires to manage the variety of items sold in store and online. Over recent years Tiso has increased both its number of outlets and product range, stocking a wide variety of clothing, footwear and equipment for adventurer sports, including alpine biking, climbing, skiing and general outdoor pursuits. The recent investment in Eurostop retail systems supports further expansion plans.

Tiso selected Eurostop’s e-rmis system to enable tracking of items from warehouse to store in detail. Eurostop’s system manages the entire replenishment process, from when items are picked using a wireless scanner, to packing and delivering to stores. Integration with the stock system provides head office with up-to-date sales data of all product lines across all store and online channels. In addition, detailed business insights from sales data using Eurostop’s e-cubes module aids merchandise planning.

Chris Tiso, Chief Executive of Tiso Stores said; “The replenishment facility within e rmis was exactly what we were looking for. It gives us far greater control of store replenishment, so we have an accurate view of the business.
“Customised reporting gives us a handle on the stores’ performance, especially with our expansion plans. Our new Aviemore store will have even greater floor space for customers to try out products and investing in Eurostop systems provides us with the technology in store to provide an even better customer experience from trial to purchase.”

As part of the connected systems for stock management, Tiso has installed Eurostop’s new e-pos touch, with added functionality to manage promotions and offers at the till point.
Eurostop’s e-rmis also enables Tiso to load products easily onto the system in bulk from one spreadsheet, with SKU, colours and sizes. Purchase orders can also be created in the same way, by importing a spreadsheet with supplier details, items, cost prices and quantity saving time and reducing errors in re-keying.

Phillip Moylan, Sales Manager at Eurostop said; “Retailers like Tiso have built successful businesses by staying true to their founding principles of loving the products that they sell and providing great customer service. Eurostop’s connected retail systems have been developed to underpin a retailer’s operations with accurate stock management to support sales and buyersE. Having the information at their fingertips enables them to react to customer demand and provide a great service.”

Are banking biometrics about to take off?
BankingSecurities

Are banking biometrics about to take off?


Are banking biometrics about to take off?

We’ve all been there; sitting at a computer struggling to remember a password, or entering the wrong pin number at a cash point while a queue forms behind you. Thanks to the rise in biometric technology, consumers can look forward to a decreased reliance on remembering alphanumeric passwords.

Through the integration of the technology into smartphones, people around the world have been using their fingerprints to unlock their devices for years and today millions of people are familiar with biometrics and its benefits. The recent unveiling of the iPhone X and Apple’s facial recognition system moves things one step further.

These applications have shown consumers how easy it is to use their biometrics to access their personal devices. This has created a consumer who is comfortable with the technology and have it integrated into other elements of their life, like banking or at the checkout – a point reinforced when looking at a recent study, where 86 percent of consumers said they are interested in using biometrics to verify, identity or to make payments. The financial sector has begun to react to this growing level of acceptance.

MasterCard recently announced its commitment to guaranteeing that every one of its customers will have access to biometric authentication services by April 2019 – a decision made off the back of their own research with Oxford University, which found 92 percent of banking professionals wanted to introduce biometric ID, and 93 percent of consumers would prefer biometric security to passwords. As we have seen before, new technologies challenge traditional business models and transform the way organisations interact with their customers – this is no different.

Many established financial institutions and economies around the world are now getting behind biometrics. In India, NCR has been involved in a nationwide rollout of next-generation ATMs offering biometric user authentication, in addition to cash recycling and other features that could prove beneficial for banks and customers.

Bahraini Fintech firm Eazy Financial Services offers the next step in the evolution of biometrics journey of creating a seamless customer experience. The company has been working with NCR on the region’s first biometric payment network. The system will allow consumers to register their fingerprint with their bank and use this biometric data to initiate ATM or point-of-sale transactions, removing the need for a card. The combination of security and convenience this technology delivers is an attractive proposition for a customer.

Today’s digitally driven consumers want the way they shop and bank to be consistent across every channel, including how they identify themselves when making a payment. As biometric identification increasingly becomes standard across smartphone devices, the combination of these two technologies is starting to win the battle for hearts and minds when it comes to simplicity, convenience and seamlessness across all channels.

However, there are still some hurdles to overcome as far as biometric technology is concerned, particularly when it comes to customer acceptance and security. One of the biggest causes of failure for technology is low adoption, and even though the figures show that consumers want to see more of the concept, the solution must be simple, logical and easy to use it if it’s to be adopted.

Like any burgeoning technology, biometric authentication still has its fair share of challenges to meet and questions to answer. But these obstacles are quickly being overcome, partly through the work of mobile phone manufacturers, which is paving the way for biometrics to become a vital component of the 21st-century payments landscape.

Lloyds Bank trials British Sign Language translation technology
BankingSecurities

Lloyds Bank trials British Sign Language translation technology

New technology provides innovative way of interacting with Bank literature Lloyds Bank has become the first financial services company to undertake a trial with Signly – a British Sign Language (BSL) translation tool. Lloyds Banking Group’s Innovation Labs trialled the technology to understand how Signly could offer an alternative option for up to 250,000 people in the UK who use BSL each day. Since undertaking the trial, the Bank is now looking to test the technology with a wider group of customers.

BSL is a unique language with its own sentence structure and contains a number of key differences to both spoken English, and Signed Supported English (SSE). This means that for customers who use BSL as their first language, many communications are often hard to understand.

Signly enables customers to scan Signly-enabled literature on their smartphone which provides translations into BSL through augmented reality. The trial incorporated Signly’s functionality into both written and online material, enabling hard of hearing and deaf customers to use BSL to understand the financial material they were being shown.

In addition to trialling Signly functionality, Lloyds Bank currently provides a wealth of ways for customers to interact with their bank. These include Text Relay and SignVideo, a signed video service which provides deaf customers with access to an online interpreter. For those with visual impairments, customers can access large print, braille and recorded literature.

Nick Williams, Lloyds Bank’s Consumer Digital director said,

“We are always looking for new ways to support our customers and trialling this new technology is a great example. Alongside SignVideo, Text Relay and our interpreting service, Signly provides a new tool to make it easier to engage with the Bank. Improving our services to make them simple and intuitive for all our customers is key to removing barriers of financial exclusion.”

Mid-Size Businesses Lead from the Front on Job Creation and Wage Increases in 2015
BankingSecurities

Mid-Size Businesses Lead from the Front on Job Creation and Wage Increases in 2015

Against a positive backdrop of continued falling unemployment and wage growth outstripping inflation in recent months, 67% are planning to take on new staff (compared to 62% in 2014) and 82% are set to increase wages, a significant increase on last year (67%).

Amongst businesses of all sizes, half (50%) of those surveyed are looking to increase staff2, and 61% are also planning to increase wages, with 42% saying they will boost wages for their entire workforce. Further good news is that the number of businesses planning to reduce staff over the next year has halved, from 10% last year to 5% this year.

When looking at the types of roles businesses are looking to fill, middle and junior management employees continue to be the most in demand across businesses of all sizes, with 83% of hiring businesses planning to hire at this level. 78% of the largest businesses are likely to hire at a senior level, the highest of all the turnover bands and a significant jump up from 2014, when under half (46%) were looking for senior candidates.

Almost half (48%) of mid-size businesses reported skills shortages, the highest of any turnover bracket surveyed. In contrast, only one in five (21%) of the smallest businesses said skills shortages affected them.

Kevin Wall, Chairman, Barclays Corporate Banking, said: “Skills shortages are most evident amongst the mid-size businesses surveyed, and the increases they are planning in both hiring and wages may be an attempt to address this imbalance. This is positive news for employees as firms compete for talent but also, in the longer term, for businesses themselves as they look to ensure they are well-positioned for future growth opportunities.”

Buoyant hiring trends extend to apprentices, with almost a third (32%) of businesses surveyed planning to take them on this year, an encouraging sign given the focus on bringing down the UK’s broadly flat youth unemployment rate3. The largest businesses offer the most significant opportunity for apprentices, with almost three quarters (73%) saying they plan to take them on this year, up from 57% a year ago. In contrast, just under a quarter (24%) of the smallest businesses surveyed plan to take on apprentices, a small increase from 21% last year.

The survey suggests that, where businesses are hiring apprentices, they may be starting to play a key role in helping to address skills gaps. Amongst businesses reporting skills shortages, almost half (48%) say they are lacking in their main business activity. However, 41% of businesses that are planning to take on apprentices are likely to involve them in this area, a possible move to help resolve this issue. Of the largest businesses reporting skills shortages, 35% are predominately lacking in their engineering departments and the same number (35%) said they were looking to take on apprentices in this area of their business.

Kevin Wall added: “Businesses are becoming increasingly engaged with apprenticeships, hiring more year on year, but it would appear to be the largest businesses that are really ramping up their hiring. Smaller businesses may feel more constrained by resources but grants and support available to help SMEs take on apprentices could open the door to talented new employees, and ultimately bring these businesses tangible commercial benefits.”

UKFI to Sell Further Part of Lloyds Banking Group
BankingSecurities

UKFI to Sell Further Part of Lloyds Banking Group

UK Financial Investments (UKFI) the government-mandated company which manages HM Treasury’s shareholdings in banks subscribing to its recapitalisation fund, has announced its intention to sell a further part of HM Treasury’s shareholding in Lloyds Banking Group plc. The disposal of these shares will be by way of a placing to institutional investors.

The price at which the placing shares are sold will be determined by way of an accelerated book building process. The book will open with immediate effect following this announcement.

The placing is expected to comprise approximately 5.35 billion of the company’s ordinary shares, representing approximately 7.5% of the issued ordinary capital of the company. As a result of the placing, the overall size of HM Treasury’s shareholding in the company will be reduced from approximately 32.7% to approximately 25%. UKFI and HM Treasury have undertaken to the bookrunners named below not to sell further shares in the company for a period of 90 calendar days following the completion of the placing without the prior written consent of a majority (by participation) of the bookrunners.

Bank of America Merrill Lynch, J.P. Morgan Securities plc, Morgan Stanley Securities Limited and UBS Limited have been appointed to act as bookrunners in connection with the placing.

Lazard & Co., Limited is acting as capital markets adviser. Freshfields Bruckhaus Deringer LLP is acting as legal counsel to UKFI in respect of English and US law.

Details of the placing price and the number of placing shares will be announced in due course.

HMRC Receipts Up by £21bn
BankingSecurities

HMRC Receipts Up by £21bn

Increased income tax revenues and a phenomenal rise in Stamp Duty Land Tax (SDLT) receipts have boosted an overall tax take in the last twelve months, which is £21 billion (4.47%) higher than in the year preceding say London chartered accountants Blick Rothenberg LLP.

Frank Nash, partner at Blick Rothenberg, said: “The latest HMRC tax statistics released today (22nd May) showed an extraordinary rise in National Insurance contributions and SDLT revenues, which in the last quarter alone were £680million more (41% higher) than that of the same three month period in 2013.”

The stats showed a 3.15% increase in PAYE receipts and 4.8% increase in National Insurance takings over the same period.

“The Office for National Statistics released figures last week showing that unemployment is at a five year low of 2.21 million, and so clearly the impact of more people in jobs is starting to come through in the PAYE and NIC figures, which are up just over £9bn in the past 12 months,” said Nash.

The figures also indicated that HMRC has collected £100million from the Annual Tax on Enveloped Dwellings (ATED) for 2013/14, which is a third up on the budgeted amount of £75 million. However, initial figures for April collections so far show only £40million collected for 2014/15 charge which was due by the end of that month.

“This will indicate either that residential properties are being removed from companies, which is what HMRC wants, or that further ATED charges have not yet been collected,” added Nash.

Stamp Duty Exemption “Will Encourage Investment in SMEs”
BankingSecurities

Stamp Duty Exemption “Will Encourage Investment in SMEs”

The stamp duty exemption for securities trading on growth markets, coming into effect on Monday 28th April, will give investors a further reason to back ambitious companies but is unlikely to have much impact on where issuers choose to list, says a partner at law firm Hogan Lovells.

The new exemption, announced in last year’s budget, is intended to incentivise investor participation in the UK’s growing small and medium-sized quoted businesses. It is widely viewed as a positive move by the government, particularly amongst the Small and Medium Enterprise community. Shares traded on certain growth markets, including AIM and the new High Growth market, will qualify.

Maegen Morrison, a partner in Hogan Lovells’ London office, says that, traditionally, larger funds and investors have been wary of investing in “start-ups” which are seen as high-risk and whose stock tends to be relatively illiquid, and so the forthcoming exemption gives investors a further reason to back ambitious companies. “But we are unlikely to see any significant impact on where issuers choose to list,” she says. “Investors will want to consider the whole investment story of new businesses – and lower investment costs will be an added bonus, rather than a game changer.”

The exemption is only available to companies trading on growth markets which do not have a full listing elsewhere. This is to allow growing companies to benefit from the exemption, whereas companies with full listings on other markets are likely to be larger and more established.

While this means that there will be companies which do not qualify for the exemption, and therefore will have a competitive disadvantage regarding qualifying companies on the same market, investors will make decisions based on the whole “investment story” of the issuer, rather than be swayed by lower investment costs, says Morrison.

“However, where such companies are fully listed on stock exchanges for historical reasons (for example, on the Johannesburg Stock Exchange) but the majority of their investor base has migrated to a growth market, such as AIM, we may see those companies choosing to de-list from those exchanges but maintain their trading on the growth market in order to afford their investors the benefit of the new exemption,” Morrison adds.

Net Sales of Long-Term UCITS Increase Significantly
BankingSecurities

Net Sales of Long-Term UCITS Increase Significantly

The main developments in February 2014 in the reporting countries can be summarized as follows:

• UCITS enjoyed a second consecutive month of strong net inflows in February amounting to EUR 49 billion, albeit down from EUR 69 billion in January. This drop in net inflows can be attributed to negative net flows out of money market funds during the month.

• Long-term UCITS (UCITS excluding money market funds) attracted net inflows of EUR 51 billion, being the largest net inflows since January 2013, and up from EUR 40 billion in January 2014.

o Net sales of bond funds jumped during February to EUR 24 billion from EUR 13 billion in January.
o Equity funds enjoyed increased net inflows of EUR 12 billion compared to EUR 10 billion in January.
o Balanced funds recorded net sales of EUR 12 billion, down from EUR 15 billion.

• Money market funds experienced net outflows of EUR 2 billion in February, after registering large net inflows in January of EUR 29 billion.

• Total non-UCITS recorded net sales of EUR 11 billion, down from EUR 13 billion in January. Net inflows into special funds (funds reserved to institutional investors) remained constant at EUR 9 billion during the month.

• Total assets of UCITS increased 2.4 percent in February to EUR 7,140 billion.
o Total assets of non-UCITS rose 0.9 percent in February to EUR 2,849 billion.
o Overall, total assets of the investment fund industry increased 2.0 percent to stand at EUR 9,988 billion at month end.

Bernard Delbecque, Director of Economics and Research commented:
“A strong demand for bond funds was the main driver behind the increased net sales of long-term funds in February, reflecting expectations of continued subdued inflation and low interest rates.”

Citigroup to Resolve Repurchase Claims
BankingSecurities

Citigroup to Resolve Repurchase Claims

Citigroup has announced that it has reached an agreement with 18 institutional investors, represented by Gibbs & Bruns LLP, regarding the resolution of certain legacy Securities and Banking private-label securitisation representation and warranty repurchase claims.

Under the agreement, Citigroup will make a binding offer to the trustees of 68 Citi-sponsored mortgage securitisation trusts to pay $1.125 billion to the trusts, plus certain fees and expenses, for which Citi has taken an additional charge of approximately $100 million in the first quarter of 2014.

The 68 trusts covered by the agreement issued in the aggregate $59.4 billion of residential mortgage-backed securities and represent all of the trusts established by Citi’s legacy Securities and Banking business during 2005-2008 for which Citi affiliates made representations and warranties to the trusts. The agreement, if accepted by the trustees, would release Citi’s obligation to repurchase mortgage loans sold into the trusts, or make the trusts whole, for outstanding or potential claims for breaches of representations and warranties on the loans.

The company released the following statement: “This settlement resolves a significant legacy issue from the financial crisis and we are pleased to put it behind us.”

The agreement would not release potential investor claims relating to alleged misrepresentations in the offering documents associated with these private-label securitisations, nor any potential regulatory actions. Further, the agreement does not cover mortgage loans sold through private-label securitisation trusts via Citi’s consumer mortgage business in CitiMortgage, Inc. The agreement is conditioned on, among other things, acceptance by the trustees of the applicable trusts, and court approval, if sought by the trustees.

LuxCSD Cut Custody Fees for Equities
BankingSecurities

LuxCSD Cut Custody Fees for Equities

As part of LuxCSD’s initiative to support the dematerialisation of securities of all types, LuxCSD announced custody fee cuts for equities by 50%, effective from 1 April 2014. This fee reduction results in an alignment of the equity and bond custody fees.

The aim is to encourage corporations to dematerialise existing physical securities and to newly issue securities in dematerialised form. Custody of equities in dematerialised form significantly reduces inefficiencies, risks and costs for the industry and increase the level of transparency regarding the chain of holders of a Luxembourg security.

In March 2014, LuxCSD has successfully handled its first dematerialisation of physical shares – the BIP Investment Partners Luxembourg equities with a volume of EUR 400 million.

Patrick Georg, General Manager of LuxCSD, said: “By cutting the custody fees for equities by 50% we aim to attract more corporates to dematerialise physical shares and to follow the example of BIP Investment Partners. We strongly support dematerialisation as best practice in securities custody and issuance.”

The change in Luxembourg law governing the dematerialisation of physical securities adopted in April 2013 is expected to further enhance the appeal of securities issued and dematerialised in Luxembourg.