Top stories

  1. Businesses signal fears of a ‘bad Brexit’
  2. Banks recognise climate change risk

Stat of the day

7.4 per cent – The increase in lending to manufacturers in the last 12 months, to August 2018, according to the latest UK Finance’s August Business Finance Update.

Businesses signal fears of a ‘bad Brexit’

The Financial Times (page 3, £) reports on leading UK investors warning Prime Minister Theresa May of their worries about Britain leaving the EU, with the prospect of a “bad Brexit” being “daunting” for business. At a Bloomberg event held in New York yesterday Steve Schwarzman, chief executive of Blackstone, the world’s largest private equity firm, told the prime minister that he feared Brexit could lead to a change of government in the UK.

Meanwhile, The Times (p1, £) reports that Theresa May is losing cabinet support for her plan to revert to a no-deal Brexit if Europe rejects the Chequers proposals. Sky News (online only) focuses on the leader of the opposition, Jeremy Corbyn, meeting the EU’s chief negotiator, Michel Barnier. Corbyn is expected to say a “no-deal” Brexit is not acceptable, as he seeks to break the impasse in the negotiations (The Guardian, online only).

In other news, the Chancellor has confirmed the autumn budget will take place on October 29 to avoid it becoming embroiled in the ‘Brexit endgame’. It’s expected Mr Hammond will use the budget to reassure financial markets that the public finances are on a solid footing as the government enters the final Brexit negotiations (Financial Times, p2, £).

Banks recognise climate change risk

The Bank of England is preparing new guidelines for how banks and insurers should manage climate change, the Financial Times (p2, £) reports. It comes after a survey of the UK banking sector by the Bank’s Prudential Regulation Authority which found that while 70 per cent of banks recognise the financial risks posed by climate change, too few are planning for the long-term impact (Sky News, online only).

In comments reported in the Daily Telegraph (online only £), Chief Executive of UK Finance Stephen Jones responded: “Tacking climate change is a global priority and today’s report highlights the critical importance of the transition to a low carbon economy.  The majority of banks already recognise the need to anticipate and manage this transition. This commitment is evidenced by the support given by banks to the FSB-backed Taskforce. We will liaise closely with the Bank of England and UK regulators on this important issue in the months ahead.”

Latest from UK Finance

Grant McKenzie, Programme Director for the New Payments Architecture at the New Payment System Operator, puts a request out for developers for a new payment sector opportunity in today’s guest blog.

News in Brief

The high cost of living in the capital means Londoners’ real spending, on average, is below the national norm, ONS data shows (The Financial Times, p2, £).

London’s property market appears subdued, with the number of mortgages approved for house purchases five per cent lower in August compared to last year, UK Finance figures reveal (City AM, p.13).

Fraudsters are increasingly using online scams involving modelling, cryptocurrencies and fake tickets to scam consumers, National Trading Standards has warned (BBC News, online only). For more information on how to combat fraud, Take Five.

Exempting small firms from the European Market Infrastructure Regulation (EMIR) on clearing could significantly reduce the burdens on them, according to an FCA study, reports Politico(online only, £).

Global debt has risen by a third since 2008, with developing nations particularly worse off, says a report by the United Nations Conference on Trade and Development (The Guardian, p, 31).

What the commentators say

Philip Stephens of the Financial Times (p15, £) claims that Britain is simply not ready for Brexit, given the current state of negotiations with the Article 50 deadline looming. Stephens instead proposes a ‘timeout’ – a protracted period during which Britain remains in the EU while politicians, businesses and citizens reconsider the options. He concludes that a timeout is the only way to halt the current political paralysis.

Greg Clark, Secretary of State for Business, Energy and Industrial Strategy, writes in City AM (p21) that technological advances such as automation and AI could help Britain lead the fourth industrial revolution. Clark states that these developments could add more than £450bn to UK manufacturing by 2030, with the potential creation of 175,000 jobs, but only if the UK embraces and adopts industrial digital technologies.

Calendar

  • Jeremy Corbyn and Keir Starmer meet with Michel Barnier in Brussels
  • European Systemic Risk Board Annual Conference
  • Jeremy Hunt chairs Commonwealth Foreign Ministers meeting in New York
  • Hometrack UK Cities House Price Index

For a full list of upcoming UK Finance statistics releases, please click here.

News in brief – 27 September 2018