Sunday newspaper round-up: Tesco, RBS, Morrisons

26th Oct 2014 16:31

Tesco's new Chief Executive Dave Lewis is in talks with the group's board over a new bonus deal because its problems have undermined his original package, the Mail on Sunday reported. "If you are doing a turnaround, then maybe you'd want some shorter-term targets for the leadership team," he said. Share awards Lewis received to compensate him for those built up at Unilever, his previous employer, have lost about a quarter of their value since he joined last month. The Financial Conduct Authority has told Tesco to stop its probe into its £263m accountancy scandal to leave the regulator to decide how it happened.The Bank of England is about to publish new rules requiring banks and building societies to raise billions of pounds of new capital, the Sunday Times reported. The Bank's Prudential Regulatory Authority (PRA) division could restrict banks' dividend pay-outs and might force them to restrict lending to households and businesses. The PRA is expected to raise the leverage ratio - a measure of a bank's capital to total assets - to between 4% and 5% from 3%.Royal Bank of Scotland will commit itself to Ulster Bank after a turnaround at its Irish business, the Sunday Telegraph said. RBS, which reports results on October 31st, had been tipped to sell Ulster Bank or seek outside investment but a recovery in the Irish property market has increased the value of the division's loan book.Morrisons is increasing prices on some of its "I'm cheaper" lines less than six months after vowing to cut prices permanently on more than 1,000 staples, the Sunday Times said. The paper said it had seen analysis showing that Morrisons had quietly raised the prices of battered cod and golden delicious apples. The supermarket group told the paper prices were still lower than before it launched its price-cut promotion. Chief Executive Dalton Philips said in May that prices would fall "not just for the next week or the next month".Dave Lewis, Tesco's boss, has indicated that a third of the retailer's hypermarkets are failing, the Sunday Times said. Lewis told investors two-thirds of the giant Extra stores were "to die for", suggesting the remainder were underperforming. Clayton Dubilier & Rice, the private equity firm advised by Tesco's former boss Terry Leahy, is at an early stage in mulling an approach for Tesco's £2bn Dunnhumby data business, which was behind the success of its Clubcard loyalty programme.Ophir Energy and Spain's Cepsa are preparing rival takeover bids for Salamander Energy that could value the company at more than £275m. The Sunday Times said the suitors' interest had been sparked by the potential failure of a $280m deal Salamander struck in July to sell its stake in an oil field in Thailand to an acquisition vehicle called Sona Petroleum. That deal has been thrown into doubt by the heavy fall in the price of oil.Ireland's C&C is thinking about joining with a partner to make an all-cash bid for Spirit, the pub company, according to the Sunday Times. C&C's counter-offer, made up of cash and shares, to Greene King's agreed bid for Spirit unnerved C&C investors, sending its shares down. Stephen Glancey, C&C's Chief Executive, is considering hooking up with an ally to make a cash offer. The paper did not list any potential partners for the offer.Ian McCafferty, a member of the Bank of England's (BoE) Monetary Policy Committee, has told the Sunday Times an early rise in interest rates is needed. McCafferty said increasing rates now would allow the BoE to adjust monetary policy gradually over the next few years. His comments indicate McCafferty is sticking to his pro-increase position after speculation that he and fellow "hawk" Martin Weale could shift their views after economic growth weakened in the third quarter.Reckitt Benckiser is expected to send a circular to shareholders on November 17th outlining plans to spin off its pharmaceutical arm, the Sunday Telegraph reported. The listing will not be open to new investors or used to raise new money. Big drugs companies did not want to buy the business because it only had one drug on the market, a heroin addiction treatment facing generic competition.