Monday newspaper round-up: Lloyds, Barclays, Ferrexpo

8th Jun 2009 06:17

Lloyds Banking Group is expected to repay about £2.3 billion to the Government this week, becoming the first lender in Europe to return bailout money to the taxpayer.The £2.3bn cheque addressed to the Treasury could not have come at a better time for Gordon Brown. The repayment is being made far sooner than either the City or the Government could have expected, just eight months after the Treasury had to bail out Lloyds, the Times reports.Barclays will on Monday confirm it is close to the $13bn (£8.1bn) sale of its fund management arm to American financial group BlackRock - the biggest ever such deal and a move that will trigger a potential $585m windfall for employees. A completed deal to sell Barclays Global Investors (BGI) could be announced as soon as Wednesday as part of a complex transaction which would leave the British bank with a stake in BlackRock, the Telegraph reports.The FT adds that BlackRock was on Sunday scrambling to seal the purchase and see off an 11th-hour challenge from Bank of New York Mellon. Barclays is expected to take a decision early this week on who should buy the BGI unit. On Sunday, it was understood to be locked in discussions with BlackRock.Gordon Brown faces a showdown with his MPs Monday after a humiliating night at the polls, as a slump in Labour support helped allow the far-right British National party win its first European parliament seat. Early results showed Labour's vote share collapsing to below 20%, pushing the party into fourth place in some regions. In Wales, the Conservatives beat Labour into second place, the first time that had happened in decades, reports the FT.The turmoil engulfing Gordon Brown's government risks creating a "fiscal crisis" by choking off the political will required to repair Britain's battered public finances, City experts have warned. The possibility of Mr Brown being ousted before a general election may reduce the scale of a likely Conservative victory at the next general election or even leave a hung parliament, according to Michael Saunders of Citigroup, reports the Telegraph.Four City investment banks have charged the Treasury at least £9m in fees for advising the Government on how to stop the financial system from imploding, The Times has learnt. In addition, UK Financial Investments (UKFI), the body set up to handle the Government's bailed-out bank shares, spent £1.2m of taxpayers' money in the first five months of operation.Half of the UK's regions may have enjoyed a return to modest growth last month, according to an influential survey, which suggests a further boost to hopes of recovery from the slump. Southern England led a revival in economic activity in six out of twelve regions during May, the latest poll of purchasing managers nationwide from Royal Bank of Scotland reports, the Times writes. Meanwhile, Lloyds Banking Group's monthly "Business Barometer" shows that business confidence improved in May for the third month running, reports the Independent.The chief executive of London-listed Ferrexpo has hit back at dissident shareholders, suggesting that if they do not like the iron ore producer, they should simply sell up. Kostyantyn Zhevago said: "If you think the company is not doing well, just sell it. There is sufficient liquidity as a FTSE company." The suggestion comes amid a deepening rift between the Ukrainian billionaire, who is Ferrexpo's biggest shareholder with a 51% stake, and rebel investors, reports the FT.The English Premier League and the NBA are exploring a marketing and commercial tie-up that would draw on the strengths of the world's two most popular sports leagues as they expand into new international markets. Representatives from the football and basketball organisations have met in London to discuss how they might work together. They have also compared notes on their respective media rights strategies - particularly in Asia, which is a huge and still largely untapped market for western sport, reports the FT.