Monday newspaper round-up: Barclays, Tesco, Investec...

20th Sep 2010 06:41

Barclays is working on contingency plans to make radical changes in an attempt to head off more draconian government measures.The high street bank is looking at ways to ring-fence its deposits and is considering whether to put its investment banking arm Barclays Capital into a separate legal entity. The move comes soon after Barclays controversially announced that Bob Diamond, the head of its investment banking division, would become group chief executive next March, the Times reports.High street banks are making huge returns on pricey unsecured loans, despite the base rate holding at a record low of 0.5%, according to research from the Bank of England. Consumers are paying an average interest rate of nearly 11% on new unsecured borrowing, such as overdrafts, credit cards and personal loans, but the cost of wholesale funding is just above 2%, taking the margins to about 9%, a report published in the central bank's Quarterly Bulletin says, the Times reports.Sir Terry Leahy's original vision for Tesco's assault on the US was far more ambitious than the retailer has ever publicly admitted, with the chief executive drawing up plans for a chain of 10,000 convenience stores across America. Colin Smith, the former Tesco executive who led the US research project in 2004 and 2005, has revealed for the first time what Sir Terry had in mind when he backed a £1.25bn, five-year plan to conquer the US, the FT reports.Estate agents have record numbers of unsold properties on their books after asking prices fell for the third month in a row, according to the latest gloomy housing data. The average branch has 79 properties on its books, up 14% on last year, figures from Rightmove show. The property website said that the stockpile of unsold houses was the result of a flood of properties coming on to the market after the abolition of home information packs (Hips), which had added to the cost of selling a home, the Times reports.Retailers are beginning to put up prices before the rise in VAT in January as they brace themselves for significant inflation next year. A survey of 30 leading retail bosses, including Sir Stuart Rose, the chairman of Marks & Spencer, and Lord Wolfson of Aspley Guise, the chief executive of Next, has found that 60% expect to pass the majority of the 2.5 percentage-point rise in VAT on to customers and that a further 17% will pass on at least part of it, the Times reports.More than 9,000 public sector employees earn more than the Prime Minister, according to most comprehensive analysis of state pay levels ever undertaken. In a stark illustration of the financial rewards available to workers in the NHS, schools and police forces, the study found a total of 9,187 earning more than the £142,500 paid to David Cameron. There are also 38,000 who earn more than £100,000 a year. The study, by the Bureau of Investigative Journalism for the BBC's Panorama programme, is the first to put an overall total on the number of state employees earning more than the Prime Minister, the Telegraph reports.The Confederation of British Industry (CBI) will today urge the Government to protect economic growth in the forthcoming spending review, which is likely to result in the most savage cuts for a generation. Amid mounting fears that the recovery is stalling and Britain could face a double-dip downturn, the CBI will say that ministers must prevent this by protecting investment in areas that foster growth, the Independent reports.Investec, the South African bank with a strong presence in the UK, is about to test the market with a £250m ($390m) securitisation of "non-standard" mortgages, including some subprime loans. If successful, the deal would mark the first time that subprime mortgages have been securitised in Europe since the financial crisis, the FT reports.The availability of credit to most British companies has barely improved over the past two months, research shows, and in some cases what borrowing is on offer has become more expensive. The EEF, the manufacturers' organisation, said that a third of companies had reported that credit is more expensive today than two months ago - for new borrowing and for existing facilities such as overdrafts - while only one in 10 has seen any improvement in how much credit is on offer, the Independent reports.The international community has postponed bank stress tests for Greece to give the country breathing space as Athens prepares to test the success of its European roadshow last week by raising more money in the capital markets. The so-called "troika" - the International Monetary Fund, European Commission and European Central Bank - has agreed with Greece's central bank to delay testing the solvency of the country's struggling bank sector by one month to the end of October, the FT reports.