Economy

HSBC, Goldmans in the morning news

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Economy
Written by Gary Howes   
Friday, 03 July 2009

Morning Business News, Friday, 03 July: HSBC, Goldmans, rogue trader in the oil market.

 

HSBC (LON:HSBA) Chairman Stephen Green has told the BBC that banks cannot be subject to the same legal processes for failure as other companies.

Speaking to Carrie Gracie on The Interview on BBC World Service he said that banks are too important to the lifeblood of an economy to treat as though they are just another industry.

Green made the comments as the Financial Services Authority (FSA) is to be restructured, with two new divisions added as part of an overhaul that Hector Sants, the chief executive, says will complete the "radical internal reforms" he initiated.

Under changes to take effect on October 1, an international division will be added in a move that the FSA says will "significantly increase" its engagement with counterparts abroad and other foreign bodies. The watchdog's financial stability team will also be hived off into its own division to focus on macro-prudential issues, the Telegraph reports.

Goldman Sachs


Bankers at Goldman Sachs (NYSE:GS) could be in line for record bonuses as compensation on Wall Street looks set to rebound in spite of problems in the wider economy.

Goldman Sachs, which continues to attract the very best investment bankers and is chaired by Lloyd Blankfein, is on track to pay staff more than it did in 2007, itself a record year, the Telegraph reports.

Rogue Trader


The startling spike in oil prices to their highest level this year on Tuesday was caused by a rogue broker who placed a massive bet in the Brent oil market, triggering almost $10m (€7m) of losses for his company.

PVM Oil Associates, the world’s largest over-the-counter oil brokerage, said on Thursday it had been the “victim of unauthorised trading”. The privately owned company said that as a result of the unauthorised trades it had been forced to close substantial volumes of futures contracts at a loss, the FT reports.

France Power Crisis


France is being forced to import electricity from Britain to cope with a summer heatwave that has helped to put a third of its nuclear power stations out of action. With temperatures across much of France surging above 30C this week, EDF’s reactors are generating the lowest level of electricity in six years, forcing the state-owned utility to turn to Britain for additional capacity, the Times reports.

Economic Growth


The worst of the recession and the housing slump is probably over but Britain is set for an “anaemic” recovery with little chance of returning to buoyant growth, the newest member of the Bank of England’s rate-setting committee warned yesterday.

David Miles, who joined the Bank’s Monetary Policy Committee last month and is a former top adviser to the Treasury on the mortgage market, fuelled growing speculation that the plunge in house prices is now coming to an end, the Times reports.

 

 
 
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