Britain’s financial watchdog will not formally oppose Provident’s compensation plan for its doorstep lending unit in court even as it voiced concerns on Wednesday that consumers were being short-changed, Reuters reported. The Financial Conduct Authority (FCA), which successfully argued for a similar proposal by guarantor lender Amigo to be rejected in London’s High Court in May, said in a statement its decision to not oppose Provident’s plan was because the only likely alternative was the insolvency of the business.
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U.K. inflation unexpectedly accelerated to the highest level in three years in June, driven by widespread price increases that challenge the Bank of England’s argument that the surge will be temporary, Bloomberg News reported. Consumer prices climbed 2.5% from a year earlier, exceeding all but two estimates in a Bloomberg survey of 35 economists. Prices rose from May in the vast majority of 12 broad divisions, the Office for National Statistics said Wednesday. The pound advanced.
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Britain's fisheries have been sold out by the post-Brexit trade deal agreed with the European Union, the head of an industry body said on Wednesday, urging the government to do more for the sector when a so-called adjustment period ends in 2026, Reuters reported. Winning back "control" of Britain's fishing waters was one of the main drivers for Brexit, with the industry becoming the poster child for many supporters of the country's departure from the EU during the 2016 referendum and beyond.
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Increased risk taking in global financial markets, particularly in leveraged debt, could worsen future downturns, according to U.K. monetary authorities, Bloomberg News reported. As borrowing in global junk-rated debt markets continues to climb, valuations are vulnerable to changes in growth prospects and the path of interest rates, officials wrote in the Bank of England’s Financial Stability Report. “Elevated asset valuations and compressed risk premia imply a vulnerability to a sharp correction in asset prices,” according to the report.
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The Bank of England signaled it’s not overly worried that the U.K.’s current housing boom, fueled by a temporary tax cut, will lead to an unsustainable buildup in mortgage debt, Bloomberg News reported. In its twice-yearly assessment of financial stability, the central bank said while the share of households struggling with debt increased “slightly” during the the pandemic, it “remains significantly below its pre-global financial crisis level.” The sanguine assessment comes amid a surge in U.K. house prices as buyers race to take advantage of a cut in stamp duty, a levy on transactions.
The U.S. private equity group in talks with Sanjeev Gupta over refinancing his Australian operations, White Oak Global Advisors, is moving deeper into the trade credit business after snapping up one of Greensill Capital’s subsidiaries, the Australian Financial Review reported. White Oak Global Advisors CEO Andre Hakkak, who is in refinancing talks with Sanjeev Gupta, has bought Greensill Capital subsidiary Finacity. White Oak has been named the successful bidder of Finacity, a US firm which helps companies raise cash by acquiring their invoices.
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All remaining lockdown restrictions in England will be lifted in a week despite a sharp rise in coronavirus cases, British Prime Minister Boris Johnson confirmed Monday, the Associated Press reported. He said it was “the right moment to proceed” as schools close for summer vacation but urged people to “proceed with caution.” Johnson said that although risks of the pandemic remain, legal restrictions will be replaced by a recommendation that people wear masks in crowded places and on public transport.
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Aeromexico said on Friday a group of Mexican shareholders and business people had informed the airline they aimed to participate in a major capital raising as part of the company's Chapter 11 restructuring process in the United States, Reuters reported. Aeromexico in a statement said it was unaware that any agreement had been reached so far, but would provide details as and when one was in place. It also noted it expected the investment to be "substantial, controlling and long-term." Delta Airlines, which owned a noncontrolling 51% stake in Aeromexico as of Dec. 31, declined to comment.
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The number of corporate insolvencies seen across Scotland more than halved during the first six months of 2021, as the array of government Covid-19 support measures and a supportive lending community continued to help businesses trade their way through the pandemic, Insider.co.uk reported. Analysis of notices in The Gazette by Interpath Advisory - formerly KPMG Restructuring - reveals that a total of 18 Scottish companies fell into administration or receivership from January to June 2021 – down from 37 in the first half of 2020 and 39 in the first half of 2019.
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Britain's post-lockdown economic rebound slowed sharply in May despite a relaxation of social-distancing rules, according to official data which also showed a hit to carmakers from the global shortage of microchips, Reuters reported. Gross domestic product expanded by a monthly 0.8%, much faster than its typical pre-pandemic pace but down from April's 2.0% surge. It was also a lot weaker than the median forecast of 1.5% in a Reuters poll of economists. "Of course, the pace of the recovery was always going to slow as the economy climbed back towards its pre-crisis level.
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