Osborne Scratches State's Seven-Year RBS Itch

It was the Government’s version of a seven-year itch.

Since the autumn of 2008, ministers in successive Labour, Coalition and Conservative administrations have wondered how to resolve the biggest legacy of Britain's banking crisis: the sale of its 78% stake in Royal Bank of Scotland (RBS).

Now, more than five years after becoming Chancellor, George Osborne has bitten the bullet and fired the starting gun on what will eventually be the largest privatisation in UK history.

Mr Osborne has long abandoned any pretence that he could break even when offloading the initial tranches of the shareholding; he commissioned a report from Rothschild earlier this year which recommended that a sale would offer value for money, while benefiting the bank, the Government and the UK economy.

More importantly, Mark Carney, the Governor of the Bank of England, offered his support for the sale process to begin.

Yet their collective endorsement does little to disguise the bald facts of Tuesday morning’s share sale: the taxpayer has lost more than £1bn on the sale of a 5.4% stake in RBS to institutional investors.

Treasury sources argue that that is the wrong way to look at the trade. The rescue of RBS in 2008 was not an investment, they say, but an emergency measure to prevent Britain’s banking system collapsing into the abyss.

They have a point. Yet the same Treasury officials have been quick to point out each time that taxpayers have made a profit on the sale of shares in Lloyds Banking Group.

It is also the case that RBS shares were trading above 400p as recently as February; it doesn’t take a conspiracy theorist to conclude that a loss-making sale less than three months before the General Election would have been far more politically toxic for Mr Osborne.

And it is difficult to find much evidence to support the Chancellor’s argument that the state’s shareholding in RBS is acting as a drag on the wider UK economy.

After all, taxpayers still hold nearly 73% of its shares following Tuesday’s £2bn sale, and they will continue to own a majority stake for at least the next couple of years.

As for the investors which took the shares off the Treasury’s hands, officials refuse to disclose their identities.

However, Sky News understands that 60% were sold to hedge funds and the remainder to ‘long-only’ investors (who can only benefit economically when the share price rises).

The buyers who plan to wait for RBS’s value to increase could be in for a long ride; the bank is still going through a painful restructuring, and the sins of the past will continue to haunt it for some time.

For the bank and Ross McEwan, its chief executive, the sale is a vote of confidence. He will hope that annual rows over bonuses, mis-selling and small business lending diminish in volume in proportion to the Government’s shrinking stake.

Mr McEwan will also be thankful that his pay, unlike that of his counterpart at Lloyds, is not tied to taxpayers recouping their investment in the bank.

And for Mr Osborne, make no mistake: this was a decision motivated by politics rather than prudent economics. Expect it to face tough scrutiny in the months ahead.

Travis Perkins Ups Dividend As House Prices Rise

Renewed confidence in the recovering construction market has prompted builders' merchant Travis Perkins to raise its dividend by over a fifth.

Travis Perkins' half year results show that profit before tax rose 3.2% to £158.6m as the firm said the housing market was benefiting from "solid mortgage availability, continuing Government support for first-time buyers and rising house prices".

These financial results come alongside a separate Nationwide data release which showed that UK house prices have returned to growth in July.

Following a surprise blip in June, where house prices fell 0.2% in the month, July saw a recovery with prices jumping 0.4% which equates to a year on year increase of 3.5%.

The average UK house price is now £195,621, equivalent to a two-year rise of 14.5% according to Nationwide's statistics. 

Commenting on the figures, Robert Gardner, Nationwide's chief economist, said: "After moderating over the past 12 months, there are tentative signs that annual house price growth may be stabilising close to the pace of earnings growth, which has historically been around 4%."

Last month the UK's biggest bank, HSBC, raised its UK house price growth forecast for 2015 - from 2% to 5%, to 5% to 10%.

Travis Perkins' investor release also pointed towards further house price growth as supply side constraints take hold:  "In the UK, demand for housing continues to outpace supply.

"Population growth, immigration and a trend towards smaller family units is creating around 225,000 new households per year, while only 141,000 new homes were built in 2014."

The builders' merchants optimism means that it has raised its dividend per share by 20.4% to 14.75p.

Despite the increase to the dividend investors opted to dump its stock sending shares 3% lower. Over the last 12 months, however, shares are nearly 30% higher.

City Trader Guilty Of Fixing Libor Rate

A city trader has been sentenced to 14 years in jail for fixing the rates of interest at which banks lend to each other - the so-called Libor rate.

Tom Hayes had been accused of eight counts of conspiracy to defraud between 2006 and 2010 for setting the rate on which trillions of dollars of financial deals are based.

The Briton worked in Japan for a Swiss and an American bank where he was accused of manipulating the British financial markets.

The Serious Fraud Office said that Hayes bribed traders across 10 lenders into fixing the Libor rate so he could make a profit in a bid to boost his own salary and bonus of up to seven figures.

After a nine-week trial at London's Southwark Crown Court he was found guilty by a jury, meaning he is the first person to be convicted by a British jury of rigging Libor rates.

Banks, including Barclays and Britain's part state-owned banks RBS and Lloyds, have paid billions in fines for manipulating Libor but until now no individuals had been convicted of a criminal offence.

The 35-year-old former banker with UBS and Citigroup was found guilty of all the eight charges he faced.

Hayes, of Fleet, Hampshire, stared straight ahead emotionless as the verdicts were read out.

His wife, who has accompanied him to court on several occasions, and his parents sat with their heads bowed while verdicts were delivered.

Around £220trn of financial products are linked to Libor rates around the world, including the majority of household mortgages, credit card bills, car loans and saving rates. 

The judge Mr Justice Cooke described Hayes as "by nature a gambler" who was driven by a thirst for money.

Prosecuting QC Mukul Chawla said Hayes built up a network of contacts in an attempt to find bankers who could help him manipulate the Libor rate to his advantage.

He would "cajole", "beg" and "bribe" brokers, the jury was told.

Mr Chawla said: "On an almost daily basis he set out to dishonestly manipulate or rig Libor at his bank and other banks."

Before joining UBS in 2006, Hayes worked for Royal Bank of Scotland and Royal Bank of Canada.

Described as "extremely intelligent", he was paid £1.3m before tax in salary and bonuses by UBS between September 2006 to December 2009.

In 2009, he joined Citi after feeling "that UBS were not paying him enough" and went on to receive £3.5m before tax for just nine months' work.

Even after he was sacked, he was allowed to keep his £2.2m bonus.

He made money for his paymasters by betting against the future value of the Libor rate offered by banks lending Japanese yen - rates he had arranged to be set - but was sacked after his methods were formally reported to senior management.

Hayes claimed that his trades made more than £186m for UBS.

His arrest took place in the UK in December 2012 after his return from Tokyo.

The trader admitted responsibility for what he did but claimed it was not dishonest as his bosses knew what he was doing.

The US is also seeking his extradition for offences connected to the American financial system.

Where Are Holidays Cheapest As Pound Soars?

British tourists finally have something to be grateful for after delays in Kent and strike action in France as the soaring pound has pushed down the price of holidaying in the eurozone.

Holidays to the 19 eurozone countries are now nearly 12% cheaper than they were at this time last year, after the value of the euro plummeted. 

Given that the average Briton takes around £450 of spending money on holiday, this equates to a currency cost saving of over £50 for those heading to Spain, France or Italy this summer.

The euro fell below 70p for the first time in eight years on 16 July, making travelling to Europe cheaper than at any other time over the last eight years.

For holidaymakers heading to Turkey the gain is even greater, with holidays costing 20% less than they did in August last year.

The Turkish lira fell victim to the political uncertainty associated with its domestic elections this year together with concerns surrounding its neighbour, Syria. 

And for those really looking for a bargain there is no better place to go than the Ukraine where the currency, the Hryvnia, has weakened nearly 75% against sterling following sanctions imposed by Russia. 

For tourists heading to Orlando or Geneva this summer, however, the news is less positive. A strengthening US dollar and Swiss franc means holidays to these areas will cost 7% and 1% more respectively, from a currency perspective that is.

The Swiss franc has had a tumultuous year following the central bank's decision in January to  scrap a three-year-old cap on the franc. The cap had meant that the Swiss franc could not strengthen beyond the 1.20 level against the euro, but when this was dropped it surged to parity against the euro.

And the strong pound is not good news for everyone.

A report by the British Chamber of Commerce (BCC) this morning showed that the UK is set to miss the Government’s target of hitting £1tn worth of exports by 2020 by 14 years.

A strong pound makes UK exports more expensive which in turn means sales volumes decline.

The UK is the number two exporter of services in the world, behind only the US, but both regulatory and language barriers are curtailing further growth according the the BCC. 

The BCC's survey also highlighted service export hot spots for the next five years. In addition to the usual destinations of Germany, France and the US, the BCC believe China and the United Arab Emirates will become key customers for the UK's professional services.

Finally, the relative strength of the pound may dampen the Bank of England's enthusiasm for an early interest rate rise. Any rise would send the pound further north so it would be in Mark Carney's interest to carefully consider the export implications of such a rise.

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Why Customer Loyalty Programs Work

The customer loyalty program is as universally recognized and accepted as sliced bread. It's practically a household fixture. In fact , you can't even buy anything at a store nowadays without being asked what your customer loyalty program member ID or a corresponding phone number is so you can get your loyalty rewards. Grocery stores, airlines, car dealers, and even movie theaters love keeping their customer loyalty program, and thus their brand, fresh in your mind so you return, get your loyalty rewards, and continue spending your money with them. At Incentive Solutions we understand that customer loyalty programs are ingrained into our cultural fabric now, and they're here to stay.

Still not sold? Here's a little hard data on customer loyalty programs:

Customer loyalty program membership rates have grown at a rate of 26. 7% over the past 10 years. There are roughly 2 . 65 billion loyalty memberships that are active in the United States alone.

84% of consumers are more likely to visit the website of a company} with a customer loyalty program than one without.

Customer loyalty programs increase brand market share by up to as much as 20%.

Customers, just like every other "buyer" in the world, have what's called a decision funnel they move down when deciding who to buy from. They do research, they evaluate, and they decide. Having a well thought out, well executed, and well marketed customer loyalty program in place simply helps them decide to go with your brand over your competitors. It makes the decision funnel flow your way, which is what your end result should always be.

Depending on costs and the size of your business, sending a personalized note of gratitude to valued customers is a great way to show appreciation. Especially in today's digital world, these methods are effective and help the customer remember your business before your competition.

Appreciating customers is a valuable and necessary part of owning a business. To find out how your company can excel in this area, contact an agent at Incentive Solutions today!

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Business Cards etiquette is closely adhered to, which includes the way you exchange them, with some countries having specific ways to do so. This put you at an advantage if you wish to give focus and look at business cards as important tools to generate goodwill, build the brand as well as leave lasting impressions. While there are many varieties of cards available today, UV business cards seem to climbing the popularity charts steadily. This is due to their string benefits, long lasting impressions and the overall impact value they bring.

So what are they exactly? These professional business cards contain a special ultraviolet coating on the surface that is applied to the cardstock via a special machine. The same coating hardens when they undergo the process of ultraviolet radiation. This is a special printing technique increasingly being used by companies of all sizes. The coating enhances the appeal and adds a new dimension to its functionality too, making it legendary|succeeding in the|letting it|making it possible for|allowing it|this|enabling|allowing|making it very|allowing for} a smart investment. The result is dramatic, visually attractive and very professional on touching and feeling. After all business cards act like your personal billboards to advertise your important company} details to prospective clients or customers.

UV business cards stand miles apart from the other categories that are available. Let us go through some of their discerning features and benefits as follows:

Glossy & Shiny

These cards have a glossy and shiny finish which is very attractive and looks regal. If done on dark colored surfaces, the effect is stunning. It will bewitch the recipient in minutes, making it legendary|succeeding in the|letting it|making it possible for|allowing it|this|enabling|allowing|making it very|allowing for} an unforgettable memory and all this with the small business card.