Wednesday newspaper round-up: Santander, Euro crisis, Tesco...

1st Dec 2010 06:39

Santander in the UK has been seriously weakened after its outgoing chief executive António Horta-Osório raided its management team for two senior bankers, who will join him at Lloyds.The departures, which mean that Santander has lost three key board directors within a month, has prompted speculation that the bank will have to abandon plans for the flotation of its British business, which would have raised more than £3bn. Santander, which owns Abbey and Alliance & Leicester, said last night that Antonio Lorenzo, its UK chief financial officer, and Juan Colombas, the chief risk officer, were stepping down immediately, the Times reports.Jean-Claude Trichet, European Central Bank president, has left open the possibility of the bank significantly expanding its government bond purchases and warned markets not to underestimate Europe's determination to resolve the escalating eurozone crisis. The hint that the ECB could recalibrate its response to the unfolding crisis came as the premiums that Italy and Spain pay over Germany benchmark interest rates hit fresh highs since the launch of the euro. The euro's monetary guardian had already stepped up purchases of Portuguese bonds, traders reported, the FT reports.The President of the European Central Bank also tried yesterday to calm the turmoil in the eurozone. Jean-Claude Trichet said in a speech to the European Parliament that markets were underestimating the "soundness" of the single currency area and the determination of its member governments to cut debt, the Times reports.Portugal's central bank has given warning that the country's banking sector faces "intolerable" risk unless its government implements planned austerity measures, as continuing fears for the health of the eurozone dragged the euro to a 10-week low against the dollar. Failure to consolidate the public finances will put the country's banks in danger, the Bank of Portugal said in a report, which followed Prime Minister Jose Socrates last week pushing through an austerity budget, the Telegraph reports.While much of the eurozone remains gripped by crisis, Germany is powering ahead, and the gap between her and the peripheral EU economies is growing. Unemployment in Europe's largest economy fell again last month, to a headline rate of 7.5%, compared with 7.7% in the UK, the Independent reports.A pledge by Britain's big banks to rein in bonuses is to be limited to their domestic operations, leaving them free to pay unfettered sums to thousands of overseas staff, The Times has learnt. Critics fear that the banks are creating a loophole allowing them to say that their star earners are based abroad.Scotland could have almost as many jobs in financial services by the end of next year as before the financial crisis after an announcement by Tesco Bank that it expects to have 2,300 people working for it by late 2011. The financial services offshoot of the supermarket group said yesterday that it had bought a second headquarters building in Edinburgh to house the new staff it is recruiting, the Times reports.European regulators have launched an anti-trust investigation into Google over whether it "has abused a dominant position in search", in what some experts have called a "crucial moment" for the internet giant. A similar investigation was launched in the US by the attorney-general of Texas a few months ago, the Independent reports.Meanwhile, Google is in advanced talks to buy fast-growing electronic coupon company Groupon in what could be its largest acquisition. If completed, a deal would put the US search group in the lead in one of the hottest new areas of online marketing and give it an edge in its rapidly expanding rivalry with Facebook, the FT reports.Royal Dutch Shell and Gazprom have formed a strategic alliance little more than three years after an acrimonious dispute in which the multinational was forced to cede control of the giant Sakhalin II oil and gas project to the Russian company. he deal will pave the way for two of the world's biggest gas companies to deepen co operation in Russia and work together in other countries, the FT reports.A former Deloitte partner and his wife face civil charges in the US for insider trading over allegations that they tipped off her London-based relatives about seven mergers planned by his clients. he Securities and Exchange Commission alleged in a court filing in California that Arnold McClellan and his wife, Annabel, leaked confidential information to her sister, Miranda Sanders, and her husband, James, between 2006 and 2008. Please use the link to reference this article. The Sanders and three other people associated with Blue Index - the specialist brokerage firm Mr Sanders co-founded - were charged last week by the UK Financial Services Authority with criminal insider dealing, the FT reports.A scheme to trade chunks of the world's rainforest on the financial markets will sell its first credits to Gazprom and Vitol, two of the world's biggest commodity companies. The REDD (Reducing Emissions from Deforestation and Forest Degradation) scheme is currently being negotiated at the United Nations climate change conference in Cancun, Mexico. UN officials hope that energy and major industrial companies affected by the European Union carbon-trading scheme will ultimately buy permits covering areas of rainforest to offset their emissions, the Telegraph reports.