Rate rise coming?
US hint
Will they, won't they? The debate rages on as to whether the US Federal Reserve will finally start to edge interest rates upwards later this year. Further fuel was added this week by board member Jerome Powell, who said the Fed could raise rates twice this year if conditions were right. Wobbly economic data has led some analysts to push back predictions for a September rate rise, but Mr Powell said September could signal the first move in interest rates in years, but that right now the likelihood of the economic stars aligning to provide the right conditions was only 50-50.
Bonuses targeted
Clawback extended
Despite it being four years now since then-Barclays boss Bob Diamond suggested regulators should lay off bankers, there is no sign of a let-up. This week, the Prudential Regulation Authority and Financial Conduct Authority issued a joint statement detailing plans to extend their ability to claw back bankers' bonuses out to seven years with the potential to push this out to 10 years for the top tier of bank management. Bonuses for the most senior staff can also be deferred for up to seven years where they are deemed to have taken a "material risk".
Rainmakers revival?
Deals rise
It looks as though the traditional pre-summer rush of corporate activity has kicked in. The City's rainmakers have been busy in recent weeks as activity in the IPO market has picked up further, particularly at the lower end of the market, and a number of notable M&A deals have emerged. This week European confectionery giant Ferrero made a move on UK-based chocolatier Thorntons at a mooted knockout price of 145p a share, while in the telecoms world Fidelity made a pitch to buy out the remaining third of the shares in telecoms business Colt that it does not already own in a deal that values the company at just shy of £1.7bn. Meanwhile, bookmaker Ladbrokes has admitted it is in talks over a possible merger with rival Gala Coral.
Swift change
Apple about-turn
This week US pop star Taylor Swift took on and beat the biggest company in the world when she prompted a rapid change in the terms Apple was proposing for its soon-to-be-launched music streaming service. An open letter to her 59m Twitter followers complaining about Apple's decision to pay no royalties to artists during its three-month trial period prompted a rapid climbdown from the company and confirmed her status among pop music's upper echelons.
Queen’s shilling
Property boom
As one of the UK's biggest property owners, it is no surprise that the Queen is enjoying bumper returns as the UK property market booms. The Crown Estate, the independent property company owned by the monarch, has a portfolio worth in the region of £11.5bn, ranging from vast swaths of central London to remote farms and the seabed around the coastline. The estate made a profit of £285m in the year to March 2015, a 6.7 per cent improvement year on year, and the Queen is due 15 per cent of this as a payout, made two years hence, which means she can look forward to a £43m 'dividend' in March 2017. The payout could be reduced in future years as the Scottish parliament has indicated it wishes to retain the payment linked to Scottish lands in the Crown Estate.
RBS revived
In four years' time
It will be more than a decade after its bailout by the UK government before RBS returns to normality. That is the verdict of chief executive Ross McEwan who this week admitted that it will be 2019 before the bank has managed to shake off all of its troubled legacy assets and reduced itself to a UK- and Ireland-focused retail and commercial bank. In the week that the Treasury dripped more of its Lloyds stake on to the market, taking it below 17 per cent, Mr McEwan said the IPO of the Williams & Glyn unit was still on track for next year and targeted a 12 per cent return on equity by the end of the decade.
