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GOLD miner Aureus Mining, the jun-
ior mining entity listed on Aim, has
outlined an underwriting agree-
ment with brokers RBC, GMP and
Clarus Securities to place $80m
(50m) of shares to fund Liberias
first commercial gold mine.
The London-listed firm, led by for-
mer Randgold exploration chief
David Reading, is hoping to place a
minimum of 50m with equity
investors and add around another
50m of debt to build the African
countrys first gold mine, which the
company has a licence to mine for
the next 25 years.
The lead underwriters GMP
Securities and RBC Capital Markets
Aureus strikes
share deal gold
BY MICHAEL BOW
and underwriter Clarus have agreed
to sell 84.7m units at 50p per share to
international investors to raise
42.4m.
The pot will be topped up with a fur-
ther 15m shares offered to Canadian
investors at 80 Canadian cents to
raise C$12m (7.52m).
The company will use the funds to
finance the New Liberty Mining
Project in Liberia, which is estimated
to have 910,000 ounces of high quali-
ty grade gold.
It also estimates the mine will pro-
duce 120,000 ounces of gold for the
first four years of production.
Under the share offering, Reading
has subscribed to 75,000 shares at 50p
each, while non-executive director
Luis da Silva is taking 10,000.
THE PUBLIC Accounts Committee
today opens a probe into tax
receipts, with top HM Revenue and
Customs (HMRC) officials to be
grilled ahead of the committee
questioning Starbucks and Google.
Lin Homer, the chief executive
of HMRC, will face the committee
this afternoon, as will other
members of the department.
HMRC faced criticism over the
weekend for offering certain
individuals accused of tax evasion
Public Accounts Committee set
to grill HMRC bosses at hearing
BY JAMES TITCOMB
immunity from prosecution in
exchange for paying a penalty
charge.
The Public Accounts
Committees chair, Labour MP
Margaret Hodge, has vowed
endless questioning over the
subject. She has also called for US
giants Google and Starbucks to
appear in front of the committee,
after they were accused of using
complicated tax avoidance
measures in the UK. The date
when Starbucks and Google will
appear has not been set.
AS well as being joint broker on the placing,
RBC Capital Markets is also acting as the
nominated adviser on the deal. Martin Eales,
European ECM and corporate broking man-
aging director at RBC, helped advise Aureus
on the sterling fundraising part of the deal.
Eales was also involved in RBCs role as joint
broker to another Aim listed oil and gas
explorer, Chariot Oil & Gas, which purchased
an offshore exploration licence from the
Moroccan government at the end of last
month. RBC has a long track record of
fundraising in the mining sector, having
secured the role of joint corporate broker
for another mining rm, African Barrick
Gold, last August.
ADVISERS RBC CAPITAL MARKETS
MARTIN EALES
RBC CAPITAL MARKETS
MONDAY 5 NOVEMBER 2012
17
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IT ALL ENDS HERE
I
N 1814, my ancestors Mary and
William met and fell in love on a
cruise from England to Australia.
It must have been romantic,
sailing the three month ocean
journey, eating fresh fish while
watching the crimson red sunset
merge with the sapphire blue waters.
Except for one thing, of course. They
were convicts. Both were sent to
Tasmania on hard labour. Eventually
freed, they made their way to the
mainland and started the long chain
of sheep shearers, farm workers and
the odd criminal that I was born into,
with my ten brothers and sisters, six
generations later.
We Aussies love to bang on about
the unfair sentences inflicted on
our convict forebears. They were
sent out just for stealing a chicken!
Pommy bastards! But the truth is,
anyone who did anything hideous,
like murder someone or insult the
king, was hanged. So a trip to Oz
might have been a relief. And once
there, according to our version of
history, the English settlers did
the bad things, like the early
mistreatment of the aboriginals,
while the good stuff, like
discovering the
continents interior, were
heroic deeds by early
Australians.
The fellow who
researched my
ancestors told me that
Williams crime was
fraud. He arrived in
Tasmania with a
shilling apparently
a lot of money in
those days. He
suggested further
research into how
William got such an
amount. But I said,
Dont bother mate. Its
obvious. He nicked it.
Despite any genetic
influences, Ive managed to
stay on the right side of the
law, and nowadays in
business I rather find myself
the occasional victim of crime
and dishonesty. In fact I would say I
rate dishonesty as the biggest single
business risk.
In the late 1990s, I bought a small
diamond mine in Sierra Leone. No
blood diamonds, it was a legit
operation doing wonders for the
workers and local community. The
summary is that the business failed.
After months of mining we found
almost no decent sized diamonds.
There was theft going on, but how?
We had tight security. I was
flabbergasted to discover it was the
English manager, who was also
siphoning cash.
Around the same time, I backed a
friend in Monaco into two start-ups.
Graham, a rather nerdy maths PhD,
sat in my living room, while our
sons played together, and told me
outright lies. With the kiddy
connection I trusted him. Later, one
of the businesses lost everything
when five small oil wells all
mysteriously failed. The other, a
listed US software company,
announced a large Microsoft
order that wasnt legitimate.
Graham is now wanted by the
FBI.
Fortunately, these are
probably my worst cases of
being deliberately misled.
More often, the problem has
been more innocent. Its almost
human nature when staff
exaggerate or downplay
developments, particularly
about sales prospects. Maybe if
Tasmania beckoned, theyd be
more careful.
Richard Farleigh has operated as a
business angel for many years,
backing more early-stage companies
than anyone else in the UK.
www.farleigh.com
Why banishing
fraudsters isnt
such a bad idea
German hospitals have stolen a march on 4G cost savings
of a SERIAL
ENTREPRENEUR
RICHARD FARLEIGH
CONFESSIONS
INNOVATION
DIARY
TOM WELSH
B
ATTERSEA saw the launch of
the UKs first major fourth
generation (4G) mobile
service last Thursday. Nicole
Scherzinger of X-Factor chose a
dress made up of live Tweets for
the occasion, while a 4D light
show transformed the grim
exterior of Batterseas derelict
power station into a lively
illumination of what a future
super-fast Britain has to look
forward to.
With promised speeds up to five
times faster than the existing
third generation (3G) network, the
new service holds promise for
both business and consumers. A
study by EE owner of T-Mobile
and Orange in the UK, and the
company that launched the
network suggests that 4G could
help British firms increase
innovation, boost productivity
and cut costs.
By questioning 1,200 business
decision makers in Germany,
Japan and the US which already
have 4G networks the study
threw up interesting results, and
plenty of reasons for optimism.
Some of it was fairly obvious.
Companies without fixed
landlines, or which use cloud
storage, were able to access their
data more quickly. Globe-trotting
executives could also obtain
higher quality and more reliable
video-conferencing services. Less
time waiting for downloads means
more time spent productively.
But other results were more
interesting. The construction
industry wouldnt be top of my
list of sectors waiting to be
transformed by faster network
speeds. But one US-based builder
found a way. It used 4G networks
to send real-time data from its
construction projects back to the
firms headquarters. A
combination of the ability to
constantly track what was
happening on site, with being able
to immediately respond to any
problems, helped reduce project
completion times by as much as
30 per cent.
And there is hope for those
concerned about dire productivity
levels in the UK healthcare sector.
A German hospital trialled a 4G-
enabled ambulance, and used the
high data speeds to transfer CT
images from a moving vehicle to
the emergency room, reducing
therapy times for stroke victims
by 54 per cent.
Hopefully well see some home-
grown examples along these lines
now that 4G has finally come to
our shores. But thats partly the
problem although Britain was
one of the first countries to
auction off its 3G spectrum, itll
be one of the last to do the same
with 4G. EE has already launched
its network in Britain, but only
because it was given specific
permission by communications
regulator Ofcom to use parts of its
existing spectrum.
Its worrying that a
combination of legal delays and a
leisurely government decision-
making process has meant that EE
will be without a competitor in
the super-fast market until next
year. Yes we now have 4G, but no
thanks to this government.
Twitter: @TWWelsh
Shipped out to
Tasmania
MONDAY 5 NOVEMBER 2012
18
R
EGARDLESS of the results of
tomorrows US presidential
election, the next four years
will be a tough act to follow
from Wall Streets standpoint.
The benchmark Standard & Poors
500 Index has rallied 66 per cent since
President Barack Obama took office
one of the most impressive runs ever
for stocks under a single president.
Admittedly, the timing of his inaugu-
ration just before the market hit a
nadir in March 2009 is part of the
reason.
The national polls show a tight race
between Obama and his challenger,
Republican candidate Mitt Romney,
but leaning toward a win by the presi-
dent.
The market might like the fact of an
Obama win since it would mean less
uncertainty, said Ryan Detrick, senior
technical strategist at Schaeffers
Investment Research, in Cincinnati.
Strategists have said the markets pat-
tern of late also suggests status quo
an Obama win. A Romney rally is a 1-
in-3 possibility, taken betting site
InTrades odds of an Obama win at
about 67 per cent right now. Other
prognosticators put his chances of re-
election even higher.
The most recent Reuters/Ipsos track-
ing poll shows both candidates garner-
ing 46 per cent of the vote but
polling averages show Obama with
small but critical leads in swing states
Ohio, Virginia and Iowa.
Theres a conventional line that says
a victory by longtime businessman
Romney would be better for the equity
market, given his predilection for
fewer regulations and lower corporate
tax rates. Still, any move in the market,
no matter the outcome, is likely to be
limited.
T
HE biggest question for UK investors
this week is whether the Bank of
Englands Monetary Policy
Committee (MPC) will opt for more
quantitative easing.
The decision, which will be announced
on Thursday, comes after strong jobs and
GDP data.
Strong third quarter GDP data suggested
that underlying growth was slightly
stronger than previously thought and the
MPC's debate is starting to pay more atten-
tion to the inflationary consequences of
the strong labour market. As such, we
expect the MPC to bide its time and
announce no further easing measures at
the November meeting, said Nomuras
Philip Rush.
A busy reporting week starts today with
figures from HSBC, Ryanair, Hiscox, Weir
Group and Inmarsat.
Tomorrow brings updates from G4S,
InterContinental Hotels Groups, Marks
and Spencer, Associated British Foods,
Babcock International Group, and Mears
Group.
On Wednesday Burberry, Vedanta
Resources, Aer Lingus, Old Mutual and
Randgold Resources will all update the
market while Thursday will bring news
from, among others, Aviva, Bumi, Cable &
Wireless Communications, Dairy Crest,
Experian, Flybe Group, JD Wetherspoon,
Land Securities, Tate & Lyle, Supergroup,
Trinity Mirror and 3i Infrastructure.
Also of note on Thursday is the European
Central Bank interest rate decision and
Eurogroup meeting on Greece.
Friday brings reports from Beazley,
Hornby, Hammerson, Rentokil, Rolls
Royce and Tullett Prebon.
Raft of firms set to release figures
as Bank debates if more QE needed
BESTof theBROKERS
InterContinental Hotels Group PLC
29Oct 30Oct 31Oct 1Nov 2Nov
p 1,570
1,560
1,550
1,540
1,530
1,542.00
2 Nov
INTERCONTINENTAL
HOTELS
Numis rates the hotel chain
add and has a target
price of 18 ahead of third
quarter results tomorrow.
The broker expects to see
slower revenue growth for
now and earnings of
$165m.
DASHBOARD CITY
YOUR ONE-STOP SHOP FOR JOB MOVES,
BROKER VIEWS AND MARKET REPORTS
cityam.com
FTSE
29Oct 30Oct 31Oct 1Nov 2Nov
5,880
5,860
5,840
5,820
5,800
5,780
5,800
5,868.55
2 Nov
GlaxoSmithKline PLC
29Oct 30Oct 31Oct 1Nov 2Nov
p 1,440
1,420
1,400
1,380
1,360
1,351.05
2 Nov
GLAXOSMITHKLINE
UBS has a neutral rating
on the pharma giant but
has cut its target price
from 15.25 to 14.50
after disappointing
quarterly results. The
broker has lowered its
sales forecasts by three to
four per cent.
Pearson PLC
29Oct 30Oct 31Oct 1Nov 2Nov
p 1,260
1,250
1,240
1,230
1,210
1,220
1,200
1,250.03
2 Nov
PEARSON
Liberum rates the publisher
sell with a fair value of
10.50. The broker warns
that an ongoing US lawsuit
over college textbooks, a
sector where Pearson
makes a third of its profits,
could allow cheap imports
to flood the market.
Legal & General Property
Bill Page has been appointed
business space research manager
at the property fund
management firm. He joins from
Jones Lang LaSalle, where he was
most recently head of Europe,
Middle East and Africa offices
research. Page has also held roles
at the Estates Gazette Group.
Quindell Portfolio
Robert Thompson has been appointed group chief revenue
officer at the technology consulting firm. He joins from
Innovation Group, where he was most recently UK
managing director. Thompson started his career at IBM, and
has also held senior roles at Huon.
Clear Channel International
Paul Evans has been appointed marketing director at the
advertising group. He joins from Xbox, where he formed
and led its Europe, Middle East and Africa media planning
and buying function.
Jones Day
The law firm has announced the appointment of Matthew
Skinner as a partner in its Singapore-based global disputes
practice. He has practised in London, Singapore and Sydney
for almost 20 years, and has particular experience of
international arbitration, contractual disputes and
regulatory investigations.
Ropes & Gray
The US law firm has announced two partner promotions in
its London office. Daniel Martin works in its bankruptcy and
business restructuring practice, and Michael Kazakevich
works in its finance practice, focusing on high yield and
leveraged finance transactions.
John Lewis
The department store has announced two appointments to
its IT directorate. Sarah Venning joins as head of IT
relationships from BAA, where she was responsible for IT
performance. Julian Burnett joins as head of IT architecture
from Sainsburys, where he was chief technology officer.
WHOS SWITCHING JOBS Edited by Tom Welsh
+44 (0)20 7092 0053
morganmckinley.com
SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
CITY MOVES
To appear in CITYMOVES please email your career updates and pictures to citymoves@cityam.com
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O
VER 12.6bn was spent on
credit cards in September 2012
alone. Theyre a convenient way
to manage your expenses -- you
can spread the cost of large purchases,
give yourself an extra layer of
protection against fraud, and they
could help you build up a good credit
history if used sensibly.
But given the size of the market, and
the number and variety of products
available, finding the best deal can be
a daunting process. Interest rates, bal-
ance transfers and extra benefits can
cloud your ability to make a clear deci-
sion. So how can you find the best card
for your needs?
STACK UP THE COSTS
The annual percentage rate (APR) is
the easiest way of measuring how
much a credit card will cost you. It
represents the interest rate levied on
purchases, plus any additional
charges.
But should APR alone be influencing
your decision? Michelle Highman,
chief executive of Credit Action advises
caution. If you pay your credit card off
each month, APR is irrelevant. But
this isnt the full story. Your circum-
stances may change, so shop around
for the lowest APR, she says. Often the
more extra benefits a card gives you,
the higher the APR will be. So its
important to do your calculations.
And APR isnt the only charge you
may face. If you have existing debt you
want to move to a new card, a low bal-
ance transfer rate can be useful. Cards
offering 0 per cent on balance trans-
fers for a limited period allow you to
park your debt with no interest.
But this rate will often be accompa-
nied by a fee. This could be added to
the debt you transfer, independent of
any introductory offer. Be sure to work
out whether you can pay off your debts
within the allotted time.
EXTRA BENEFITS
Some cards offer extra incentives.
Cashback cards, for example, give you
back a percentage of the money you
Give yourself
a bit of credit
spend with them. But these cards
usually come with a high APR and
complicated reward systems.
Michael Ossei, personal finance
expert at uSwitch.com, thinks they
could be useful for some. If you are vig-
ilant in paying off your balance, using a
cashback card is a no brainer.
But the deals are invariably fiddly --
the cashback rate may be capped or
could vary by time of year. There may
also be high annual fees. So make sure
you know exactly what the offers entail.
If your annual income is sufficient,
you may be eligible for a premier card
a desirable badge of success. But dont
let social standing get in the way of a
good deal. If you dont use added extras
like spa days or travel insurance, their
high annual fees could be a cost worth
avoiding.
UP YOUR RATINGS
Credit cards represent a line of credit
like any other loan. Your ability to
repay in full and on time is kept on
record and contributes to your credit
score. This means that the way you use
your card could affect your eligibility
when applying for a mortgage or
another significant loan.
Being timely with your repayments is
just one way of boosting your score.
Another method is reducing the num-
ber of cards you have, as each new card
increases the amount of credit you have
access to. External affairs director at
Equifax Neil Munroe warns that finan-
cial providers assessing your history pay
more attention to this total amount
than the actual debt you have to pay off.
Ossei suggests looking at how many
cards you have. Consider consolidating
your debts onto one. Stay on top of
your finances by setting up a direct
debit that surpasses the minimum pay-
ment due on your card each month.
Choosing the right credit card is not
as simple as going for the lowest rate of
APR you can find. Take into account
your financial situation and spending
habits and remember that the way you
use your card now will impact on your
financial standing in the future.
Lines are open Monday to Friday 7.45am 7pm. Calls may be recorded. European Pensions Management Limited (EPM) is the SIPP Trustee and Administrator.
e SIPP dealing account is provided by Talos Securities Limited trading as Selftrade. Selftrade is a trading name of Talos Securities Limited and registered
trade mark of Boursorama. Talos Securities Limited is incorporated in England and Wales (Registration No. 4196325, Registered Address: Boatmans House,
2 Selsdon Way, London E14 9LA), is authorised and regulated by the Financial Services Authority (FSA Register No. 208271), is a member of the London
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MONDAY 5 NOVEMBER 2012
19
cityam.com
PERSONALFINANCE MANAGEMENT WEALTH
Chris Harlow on how to tailor your card to your needs
CREDIT CARD DEALS
Card APR Notes
Barclaycard Platinum
Credit Card with Extended
Balance Transfer
17.90%
Purchases of under 20 can use the contactless payment
technology where you see the 'wave' symbol.
Natwest Platinum
Extended Balance
Transfer Credit Card
17.90%
The balance transfer offer may end early if you do not pay
on time or stay within your credit limit. Must be 18 or over
earning over 10,000pa.
Tesco Clubcard Credit
Card (balance
transfers option)
16.90%
Doubles up as a clubcard, earning one point for every 4 with
a minimumspend of 4. No fee when buying travel money
fromTesco Bank when the total cost is put on your card.
Natwest Private Banking
Credit Card
14.94%
Must have sole income of over 100,000 or joint income of
over 150,000 paid into a NatWest account or 50,000 in
savings with them.
Halifax Credit Card 18.90%
APR and length of the promotional offer are dependent on
your personal circumstances.
W
HEN I took over as lord
mayor 361 days ago, I
half-jokingly said that
my background as an
oarsman would help me
steer a course through the choppy
waters facing the City. As it
happens, the past 12 months have
proved a real test of City fortitude.
The financial services industry has
had to navigate a number of storms
some self-inflicted, others not.
From Occupy to Libor-rigging, issues
and events have pushed the City
onto the front pages.
But despite the stormy headlines,
one overwhelming theme from my
business missions abroad has been
that Londons high standing
remains intact.
A
T A recent debate, the Bank of
Englands Andy Haldane
called for a culture change in
retail banking. He claimed
that a structural separation of
retail banking from investment
banking would end damaging cross-
contamination. Retail banking could
return to its roots in relationship
management and judgement, based
on local knowledge.
But Haldanes comments were based
on a misconception. There is a wide-
spread belief that any changes that
took place in retail banking in the
1980s and 1990s were the consequence
of the liberalisation of investment
banking in the Big Bang of 1986.
But this is wrong. By the time of the
Big Bang, retail was already a low-mar-
gin, cut-throat business and the weak-
er players already found it hard to
make significant profits. Changes in
retail banking arose from the intro-
duction of American-style marketing
and retail sales techniques, allowing
economies of scale in back-office pro-
cessing. This change was identical to
contemporary movements in retail
cityam.com/forum
US marketing and
retail sales techniques
changed the face of
banking in the 1980s
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20
MONDAY 5 NOVEMBER 2012
FRANCES COPPOLA
Retail banks have changed but
dont blame investment banking
shopping the crowding out of small
high street shops by out-of-town shop-
ping malls, and investment in IT for
efficient, low-cost manufacture and
delivery of products. Investment bank-
ing had very little to do with it.
In 1986, I started working at Midland
the first bank to transform its retail
operations into the now familiar sales-
driven model. Midland was dismally
short of money and was going into a
period of retrenchment. It consolidat-
ed its merchant and wholesale bank-
ing activities with its international
businesses to create the Midland
Montagu subsidiary. It thus function-
ally and legally separated its core retail
business from its investment banking
activities.
Driven by the head of domestic bank-
ing Gene Lockhart, the retail part of
Midland embarked on a programme
of automation and centralisation of its
back-office operations. It created huge
dedicated processing centres, highly
automated and thinly staffed. Back-
office functions like cheque process-
ing and payments were removed from
branches and consolidated in these
centres. Branches were redesigned to
be like retail shops, staffed with sales
staff whose job was to sell products.
They were given challenging sales tar-
gets and their pay became partly com-
mission-based. Some branch staff were
made redundant especially the
older, more experienced and more
expensive ones. The rest were
retrained.
Midland did manage to improve the
performance of its core retail business.
But inevitably, other retail banks like
NatWest were quick on its heels and its
competitive advantage was short-lived.
In 1992, Midland was taken over by
HSBC, which was looking for an
escape route from Hong Kong in antic-
ipation of the handover to China in
1997. And HSBC didnt reverse the
changes in retail banking that
Lockhart had driven. The sales model
in retail banking remained.
The final nail in the coffin of tradi-
tional retail banking was the conver-
sion of building societies into banks,
starting with Abbey National. This led
to significant consolidation of retail
banking and the creation of the super-
banks we have today.
The cultural issues that Haldane sees
in retail banking are therefore noth-
ing to do with cross-contamination
from investment banking. They came
from the retail sector itself.
And the model for the future of
retail banking was not investment
banking: it was shopping. Banks creat-
ed one-stop shops where retail cus-
tomers could go to buy all the prod-
ucts they needed, including pensions,
insurance and, for business customers,
derivative products. Banks knew they
could make far more money from sell-
ing these products than they could
from providing core banking services.
And for retail banking the shopping
model is not a bad one. Efficient, low-
cost banking services do require cen-
tralised, automated operations. With
the advent of internet banking, the
need for local provision in ordinary
banking activities is reducing fast.
There is space for diversity in the
retail banking sector, however.
Haldane was right to endorse the
small local branches operated by
Svenska Handelsbanken. But there is
also still a place for supermarket bank-
ing, just as there is a central role for
supermarkets. Not everyone can afford
the higher prices that small shops
tend to charge. Banking is the same:
small scale and personal service comes
at a price.
Frances Coppola is a financial writer and
former banker.
Many of the people I have met over-
seas and indeed across the UK
recognise that our role as a global
financial centre is an asset that gen-
erates real economic benefits. For
example, in Mexico and Brazil
(where I managed to be the first Brit
to row the 2016 Rio Olympics course
just a week ago) there was a very
strong appetite to make use of
London as platform for their world-
wide work. These missions made me
realise that there are huge opportu-
nities for British business around
the world. All we have to do is seize
them.
There was also recognition that
London has moved quickly to make
changes although we must remain
committed to reform. Regulatory
changes have already helped address
many of the issues that emerged.
And, equally importantly, there is a
growing recognition of the need to
focus on instilling a culture where
people do the right thing, rather
than just paying lip-service to the
rules.
Competitiveness should not be for-
gotten. We are not witnessing a
mass exodus the grass is not green-
er in other major centres. But there
are some signs of business moving
or being redirected to other
European centres, notably
Luxembourg.
Over the past year, we have seen
the industry respond to changes in
the business environment. A num-
ber of banks the most recent being
UBS have announced job cuts in
their investment banking opera-
tions as they become less profitable.
Critics are hailing the decline of
the City but I would argue that the
opposite is true. Communication
and technology firms are taking up
an increasing amount of office
space in the Square Mile, while new
business activities in financial serv-
ices, such as renmimbi trading and
social investment, demonstrate con-
siderable growth potential. This
adaptation and renewal some-
thing London has traditionally been
very good at is beneficial for UK
plc.
The Citys economic footprint
extends far beyond the Square Mile,
with over 2m jobs spread across the
country including my native
Yorkshire, Scotland, Liverpool,
Manchester, Norwich and elsewhere.
That is why like Team GB and
Paralympian GB at London 2012 we
must all pull hard in the same direc-
tion to cross these difficult waters
together.
David Wootton is lord mayor of the City
of London until 9 November 2012.
CITY
MATTERS
DAVID WOOTTON
The Citys high standing remains undiminished in spite of recent troubles
21
MONDAY 5 NOVEMBER 2012
The Forum is open for you to take part. Got a sharp comment on
one of todays columns? Do you have another subject you want
to share your opinion on? We want to hear your views.
Email theforum@cityam.com or comment at cityam.com/forum
Risky business
[Re: Financial regulation is worsening
Europes demographic time bomb,
Thursday]
Bruno Pfisters argument that financial
regulation makes things worse is one
that too often gets forgotten in the
current discourse of too big to fail
orthodoxy. This discourse has now
effectively become businesses must not
take any risk they cannot afford in the
day to day application of financial
regulation. The insurance industry shows
how wrong this approach is. Insurance is
about the transfer of risk across
individuals and legal entities. As the
aftermath of Hurricane Sandy shows, this
extends to transferring risk to the
taxpayer. No one is arguing that the
Sandy victims should stand alone. So
why is the notion of risk sharing in
extreme circumstances anathema to
financial regulation? Pfister is right that
as individuals become older they may
want to take less risk to preserve what
they have built up. But society needs
more risk-taking, more people willing to
try new things. The ability to move risk
between economic players is the biggest
innovation that we have had from the last
200 years of financial services
development. But the current approach
to regulation is like outlawing cars
because they cause over 1.2m deaths per
year world-wide. Imagine what that
would do to our economy?
Vincent Baritsch
H
OW do free market
economies respond to
scarcity? They innovate. And
while the presidential
candidates havent said
anything particulary interesting
about energy policy despite mayor
of New York Michael Bloombergs
endorsement of Barack Obama for
his climate policies US businesses
have been showing us just how it is
done. State governments have been
getting out of their way, and have
allowed them to invest and innovate
with incredible success.
The US produced 155m barrels of
oil in August 2008. In August 2012,
the latest month for which data is
available from the Energy
Information Administration, it pro-
duced more than 190m barrels. For
all the talk of fossil fuels running out,
the US has managed to increase pro-
duction by more than 20 per cent in
four years.
In some states the picture is even
more extreme. In North Dakota, oil
production has increased from less
than 6m barrels to nearly 22m bar-
rels a month over the same period.
And, of course, shale gas has revolu-
tionised the market.
Meanwhile, Britain has been debat-
ing whether to build even more wind
turbines to meet an arbitrary renew-
able energy target, with no basis in
the real needs of the UK economy or
the global climate. Instead of press-
ing ahead with developing our own
resources, the government has made
the development of shale gas more
difficult than it needed to be and has
imposed crippling taxes on the North
Sea, thereby deterring investment.
In 2009, Citigroup estimated that
Britain would need to invest 229bn
(183.3bn) between 2010 and 2020 to
meet current environmental targets.
Politicians have vainly tried to reas-
sure investors that returns on that
TOP TWEETS
London banks have seen a 36 per cent
reduction in job vacancies from last year.
Were in a phase of serious staff reductions.
@rsilvalondon
Sad to see the demise of Comet. It was my
first serious trade consumer when I started
my electronics factory in the 1970s.
@Lord_Sugar
Heathrow is unlikely to happen, review or
not. But the Conservatives will be punished
electorally because of the ambiguity.
@ZacGoldsmith
The New Normal is really catching on!
Kylie Minogue has just mentioned it on
Breakfast TV!
@asentance
As RBS again raises its PPI liabilities, are there
reasons for concern about the claims system?
YES
Lloyds now claims that its liability against payment protection
insurance (PPI) misselling will hit 5.3bn, and has set aside a further
1bn, while RBS is expected to confirm that its total bill will increase
by 400m to reach 1.7bn. Have world-ranking financial institutions
grossly underestimated the scale of their original faults, or are many
of the compensation requests received from claims management
companies bogus? Even though the original scandal exposed
terrible problems at retail banks relating to the sale of products by
commission-driven managers, the claims management industry has
since been involved in a feeding frenzy on the back of PPI. We have
good reason to be concerned about the integrity of those who
committed the initial scandal, and of those now seeking to profit
from their conduct.
Stephen Gilchrist is chairman and head of regulatory law at
Saunders Law.
Stephen Gilchrist
NO
Peter Vicary-Smith
The 12.7bn payment protection insurance (PPI) racket has now
become the biggest financial mis-selling scandal of all time. Lets
not forget that the banks got themselves into this mess and were
more than happy to make a profit out of consumers at the time
with some individuals receiving 87 per cent commission for selling
PPI. Its now the banks duty to right this wrong and properly
compensate consumers what they are rightly owed. All major UK
retail banks are profitable despite the PPI payouts. The problem is
that the banks have been in denial about the true scale of the
scandal and their piecemeal approach to topping up provisions is
not good enough. Banks must come clean about how many more
complaints theyre expecting, publish monthly updates on the
amounts that have been paid back, and claw back bonuses from
executives who presided over PPI mis-selling.
Peter Vicary-Smith is chief executive of Which?
RAPIDresponses
massive investment would be safe
from a future government, looking to
satisfy a public angry at rises in prices
and profits in the sector. In reality, a
government will always find a way,
even if it means taking a deeply coun-
terproductive windfall tax.
The creativity of Britains policy-
makers was spent on attempts to find
new and elaborate ways of promising
big subsidies to big businesses for
fundamentally poor investments. By
contrast, in the US there has been
serious thinking about how you can
make low carbon energy cheap over
time, rather than making conven-
tional energy expensive.
There is simply no way that the
major developing economies are
going to replace cheap energy with
the more expensive alternatives on
offer at present. Forcing the deploy-
ment of extremely expensive sources
of energy, like offshore wind, is silly
when we are responsible for barely 2
per cent of global emissions. Directly
supporting technological research is
a much more manageable way to
push forward the development of
more affordable options.
The presidential debate might be
ugly at times. But, for all the simplis-
tic attack ads and institutional dead-
lock, the US system has got the
energy job done far better than we
have. As a result, our manufacturing
industry is now at a punishing disad-
vantage. We can no longer afford to
be left behind.
Matthew Sinclair is chief executive of the
TaxPayers Alliance.
MATTHEW SINCLAIR
Printed by Iliffe Print Cambridge, Winship Road, Milton, Cambridge CB24 6PP
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US energy policy
is thriving despite
a quiet campaign
T
HE Retail Distribution Review
(RDR), which comes into
effect on 31 December this
year, will transform retail
investment. The Financial Services
Authority (FSA) introduced RDR to
better protect consumers. It aims
to help investors understand the
costs associated with financial
advice, and to improve its quality.
However, it will require investors
to be more proactive in both man-
aging their money, paying more
attention to the type of adviser they
use, and in carefully considering
how much they pay for advice.
CONSIDER THE FEES
Previously, advice fees were buried
into the cost of products, and com-
mission was often built into the
price of what was sold. This will no
longer be allowed; the connection
between provision and advice will
be severed. Charges will need to be
transparently outlined and agreed
to in advance.
There are two ways that you will
pay for advice. Either you will be
charged fees directly, or your advis-
er may deduct them from your
investment capital.
Smaller investors, with less than
about 50,000, may be at a disad-
vantage they may be hesitant to
pay upfront fees and may not want
fees to be taken out of their capital.
Allianz Global Investors recently
found that 60 per cent of advisers
believe small investors will be
uneconomic to service, and 16 per
How financial advice
regulation will affect
all UK retail investors
annual statement, demonstrating
that they meet professional stan-
dards. Advisers will also need to
explicitly state the type of advice
that they can offer. There are four
categories: independent advisers
can provide comprehensive mar-
ket-wide advice; restricted advisers
can offer advice on certain prod-
ucts; simplified advisers cant con-
sider individual financial
circumstances; and basic advisers
offer only a basic assessment.
Its particularly important to
understand the new concept of
independent. It currently
describes brokers who are not tied
to a specific firm, but the new defi-
nition implies an ability to offer
market-wide advice. The old label
takes on a completely different
meaning, says Jason Hollands of
Bestinvest, and it is no longer para-
mount to seek an independent
adviser. A restricted adviser may
be more appropriate, since they
can offer you more specific niche
advice.
Increased transparency of fees
and more rigorous categorisation
of what advisers can do should be
good for investors. But the changes
RDR aims to deliver are likely to
reduce the size of the market and
the cost of advice is likely to
become prohibitive for many
smaller investors. One thing is
sure: given that they will need to
take more control over their
money, its vital that investors rise
to the challenge.
cent will close their doors entirely
to them.
TAKING RESPONSIBILITY
But given the complexity of some
financial products on offer,
Georgina Partridge of Plutus
Wealth argues that there is long-
term value in seeking advice. It
can help to set clear, realistic finan-
cial goals.
Unbiased.co.uk also found that
financial advice does encourage
better investment decisions. Those
who use a qualified adviser retire
on average with 74,554 nearly
double the paltry 37,277 of those
who do not though this may
simply be because people who seek
advice have more assets.
There are, however, services on
offer for savvy investors who are
happy to do their own research,
and who just want a cheap, effi-
cient way to pick their invest-
ments. Execution-only platforms,
offered by brokerages like
Bestinvest and Hargreaves
Lansdown could be a flexible and
inexpensive way of purchasing
products. They could also be used
in conjunction with a short-term
relationship with a financial advis-
er. If you treat your adviser like a
lawyer and pay an hourly fee for
advice you may then go away and
invest in appropriate products,
albeit at a steep price.
THE NEW INDEPENDENT
RDR requires advisers to gain an
INTRODUCING THE FSAS
NEW INVESTMENT RULES
ROBERT LEMPKA
EXECUTIVE CHAIRMAN, GEKKO
J
UST over six years ago, the
Financial Services Authority
(FSA) announced a review of
retail investment, with the aim
of identifying and addressing
the root cause of problems that
continued to emerge in the market.
Called the Retail Distribution Review
(RDR), its a key part of the FSAs
consumer protection strategy.
But what problems have emerged
and why? In 1986, the UK financial
services market was deregulated,
meaning that financial services
companies could begin selling each
others products and services almost
without restriction. There was a
degree of regulation, but it was
untried, untested and rather amateur
compared to the level of regulation
we have today.
Since that time, the level of
competition in financial services has,
to some extent, encouraged firms to
become more orientated towards
selling products. Almost immediately,
out went the days when a bank
manager would personally manage
his or her customers through the
financial trials and tribulations of
bringing up a family. And in came
stories of people being hauled in to
see a younger, possibly less
experienced bank manager. They
would talk about their bank account,
only to be sold another credit card or
loan that the customer did not want.
In short, the core idea of RDR was to
establish a resilient, effective and
attractive retail investment market.
The FSA wants consumers to have
trust and confidence in retail
investment, at a time when they need
more help and advice than ever with
their retirement and investment
planning.
THE RULES
Over the the last six years, a wide-
ranging consultatation has taken
place, followed by a huge amount of
hard work by the financial advisory
industry in the UK. All this effort
culminated in a series of new rules
that will come into effect on 31
December 2012. These rules will apply
to all advisers in the retail investment
market, regardless of the type of firm
they work for. Banks, product
providers, independent financial
advisers, wealth managers and
stockbrokers will all be affected.
The new rules require advisory firms
to explicitly disclose and separately
charge clients for their services. The
firms will also have to clearly describe
their services as either independent or
restricted, and individual advisers
must adhere to consistent
professional standards, including a
code of ethics.
THE OBJECTIVES
The FSA has set a number of clear
objectives for RDR:
An industry that engages with
consumers in a way that delivers
more clarity for them on products and
services;
A market which allows more
consumers to have their needs
and wants addressed;
Remuneration arrangements
that allow competitive forces to
work in favour of consumers;
Standards of professionalism
that inspire consumer
confidence and build trust;
An industry where firms are
sufficiently viable to deliver on
their longer-term commitments and
where they treat their customers
fairly; and
A regulatory framework that can
support delivery of all of these
aspirations and which does not inhibit
future innovation where this benefits
consumers.
But for this to be a truly successful
strategy, the FSA and its successor
organisation cannot just rely on the
introduction of new rules and
regulations. If firms only concentrate
on improving their processes and
procedures, they will well and truly
lose the war. To win back the trust of
customers, and to maintain their
loyalty over the long term, firms will
need to once more prove that the
customer is king.
Paying lip-service to this ideal, and
then being seen not to put it into
practice is not good enough;
customers do not deserve to be
treated like that.
Financial services companies will
have to prove they agree with the
spirit of RDR; they will have to prove
they care, when coming from the
massively advantageous position
that they currently occupy. It will
take a huge effort and wholesale
change of attitude.
RDR is an opportunity for the
whole financial services industry to
regain and retain the trust and
loyalty of retail investors across
Britain.
Part one of a four-part series
MONDAY 5 NOVEMBER 2012
22
MANAGEMENT WEALTH FUTURE OF INVESTING
cityam.com
But its a good time to take control, says Yogesh Chandarana
Advice worthy of trust
No. 3 / Nov. 12
Distributed within City A.M.
AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
John Bevan dispells some of the many myths
surrounding asset based nance
UNDERSTAND THE
ALTERNATIVE
FUNDING OPTION
Bright future
The recent
research that
highlights the
potential of the
industry
Business growth
More small
businesses
are reaping the
rewards
Understanding
the benets
Know how to
make the most
of your assets
Managing risk
Is asset nance
a more secure
way to raise
capital?
P
H
O
T
O
:
P
R
I
V
A
T
E
ASSET FINANCE
Global Investment Banking Analyst/Associate Programme
Full-Time (5 weeks) or Part-Time (5 weekends) work experience
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in Partnership with
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Greensea Capital
2 NOVEMBER 2012 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
The Asset Based Finance
Association is pleased to
support this publication.
Our members have been
providing invoice finance
and asset based lending
asset based finance to
businesses in the UK and
Ireland for over 50 years.
The popularity of asset based -
nance has steadily grown in recent
years. The latest quarterly statis-
tics for April to June 2012 show that
the number of businesses using the
products increased by 4 per cent,
reaching nearly 43,000. Total ad-
vances to businesses reached 16 bil-
lion in Q2 2012 an increase of 2 per
cent.And with an additional 7.3 bil-
lion of funding available there is po-
tential for the industry to do more.
Managing risks
Asset based nance products
are available throughout the
economic cycle. The nature of the
products enables clients to be oered
greater levels of nance whilst still
allowing the funder to appropriately
manage their risks.
Asset based nance is normally
provided on the basis of outstanding
trade debts and funding decisions are
based on the underlying strength of
the business rather than the users
balance sheet.With funding directly
linked to real growth in the business,
clients do not have to rearrange fund-
ing lines and can instead concentrate
on managing their business.
Exceeding expectations
Asset based nance is an in-
creasingly important part of the
commercial nance landscape and it
is the industrys ability and willing-
ness to fund which is its strength.The
expectations of clients and potential
clients are evolving and the industry
is moving to ensure it can meet and
exceed those expectations.There will
be some exciting developments in
2013, not least a refreshed industry
Code and other initiatives to make
the products even more accessible.
This industry has a proud history and
an even brighter future.
Finance & Leasing
Association (FLA) members
lease wind turbines, train
rolling stock and many
other multi-million pound
items, but they play an
even more important role
across the small business
sector. Around a third of
small UK businesses that
borrow funds are using
asset finance.
In these straitened times, with
banks seemingly reluctant to
lend, businesses are looking at
other potential sources of fund-
ing and asset finance is proving a
popular option.
Julian Rose, Head of Asset Fi-
nance at the FLA said: Increas-
ingly, small businesses want to
conserve their cash,so when they
look to invest, whether thats
to remain competitive or grow,
they are looking at leasing to help
them to get the equipment quick-
ly and affordably.
Security and flexibility
There are many other advan-
tages for businesses.The lease
is secured wholly or largely on the
asset being nanced, reducing the
requirement for additional collat-
eral; its secure for the user, as the
nance cannot be recalled during
the life of the agreement; and the
business can choose to transfer the
residual value risk of the equip-
ment to the leasing company, giv-
ing them more exibility to re-
place or update equipment at the
end of the lease period.
Availability and compliance
Rose added, Asset finance is
widely available through a
network of around 5,000 equip-
ment dealers and hundreds of
brokers, as well as direct from fi-
nance companies.
Most companies providing direct
Asset Finance in the UK are mem-
bers of the FLA which means they
have to comply with the stringent
business standards set out in the
FLAs Business Code of Conduct.
CHALLENGES
Asset based nance, a
vital part of the business
funding landscape
It makes sense
to consider hire
purchase if the asset
to be nanced has a
low rate of technical
obsolescence
George
Ashworth,
Managing director
asset nance,
Aldermore
WE RECOMMEND
PAGE 4
ASSET FINANCE, 3RD EDITION,
NOVEMBER 2012
Managing Director: Chris Emberson
Editorial and Production Manager:
Faye Godfrey
Business Development Manager
Dominic Webber
Responsible for this issue:
Project Manager:
Lee Harrison
Phone: 020 7665 4441
E-mail: lee.harrison@mediaplanet.com
Distributed with: City A.M.
Mediaplanet contact information:
Phone: 020 7665 4400
Fax: 020 7665 4419
E-mail: info.uk@mediaplanet.com
Find Mediaplanet UK on:
We make our readers succeed!
Mediaplanets business is to create
new customers for our advertisers by pro-
viding readers with high-quality editorial
content that motivates them to act. Julian Rose,
Head of Asset Finance, FLA
To access BETTER BUSINESS FUNDING
call 0800 91 95 92
and quote ref CA01
www.betterbusinessfundinguk.com
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Your Invoice Finance Experts
Kate Sharp, Chief Executive, Asset
Based Finance Association (ABFA)
NOVEMBER 2012 3 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
The shortage of available funding
and lengthy application process-
es have left SMEs and individu-
als with a growing problem of not
just gaining access to money but
also having it delivered in a time
frame that suits their needs.
Personal asset loan specialist
borro focuses on providing liquid-
ity from luxury personal assets
such as ne art, antiques, jewel-
lery,luxury watches,high end cars
and more. Launched in the UK in
2008 and in the US in January 2012,
borro has therefore dened a new
category of lending.
Alternative funding
With banks still reluctant to lend,
borro provides a much needed al-
ternative for funding, offering
loans from 1,000 1 million
which can be advanced within 24
hours with no credit checks.
People are undoubtedly look-
ing at alternative ways to access -
nance, says Paul Aitken, CEO, bor-
ro. Our recent research showed
that the wealthy are turning to
their assets more and more to ac-
cess liquidity. Indeed,according to
recent company research, the ma-
jority of borro customers use the
loan to facilitate a business trans-
action or opportunity. Over 60 per
cent of borros customers are small
business owners who have seized
the opportunity to gain nance
through loans oered against their
personal assets. For them, this has
proven to be a quick and eective
way of helping their business,
Aitken adds. borro has also rm-
ly established itself in the nan-
cial intermediary sector winning
numerous industry awards in-
cluding the prestigious Alterna-
tive Lender of the Year by Credit
Today for two consecutive years in
2011 and 2012.Intermediaries have
come to realise borro as a viable al-
ternative to address their clients
short term borrowing needs.
The business is growing fast
and borro recently launched two
further products in the market.
The first is consignment loans
which are specifically tailored
for clients looking to sell person-
al assets at auction or through
private treaty. The second is a
valuation service, carried out in
the clients home by specialists
who have worked for Sothebys,
Bonhams and Christies.
Market confidence
The business which has seen sig-
nicant growth over the last three
years looks set to fuel its growth
in the UK and US by securing 16
million in funding, led by Canaan
Partners and a further 20 million
from Octopus Investments.
Aitken, said: These new fund-
ing lines represents the condence
the market has in our business. It
is another exciting step for borro,
and will allow us meet the demand
from clients for our unique lend-
ing proposition, therefore maxi-
mizing our opportunity to become
the leading global online liquidity
marketplace for luxury personal
assets. We have invested heavily in
our UK and US businesses with the
recent equity injection.
Finding a better way to borro
COMMERCIAL FEATURE
Are asset loans only
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to take out? No individuals
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At Baker Tilly we believe in teamwork to
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Steve Merchant
Head of Asset Based Lending Services
Mobile: 07827 814920
Email: steve.merchant@bakertilly.co.uk
An independent member of Baker Tilly International
www.bakertilly.co.uk
Proud sponsors of the
6th Annual Conference
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People are
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Paul Aitken, CEO, borro
For more information call:
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Visit: borro.com/cityam
Chancery House, 53-64
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4 NOVEMBER 2012 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
If a company wants to make use
of asset finance, there are es-
sentially three types of prod-
ucts: leasing, hire purchase and,
to a lesser extent, loans. There
are two types of leasing: finance
leasing and operating leasing,
says George Ashworth, Managing
Director of asset finance at Alder-
more. A finance lease is a lease
designed to amortise in full the
capital cost of the equipment and
provide the lessor with a profit.
An operating lease does not gen-
erally amortise in full the capi-
tal cost of the equipment, but the
lessor retains a residual value,
and the lessor looks to the sale of
the asset at some future date to
be made financially whole.
Wealth creation
A company might choose to fi-
nance by way of an operating
lease when the asset to be leased
doesnt have strategic financial
importance within the business
for example, a fork life truck.
The operation may grind to a halt
without it in logistical terms but
it is not a wealth creating asset.
On the other hand, a customer
might want to fully amortise the
cost of an asset. He can do so via a
finance lease or hire purchase ar-
rangement and in so doing cap-
ture either all or the vast major-
ity of any sale proceeds when the
asset is eventually sold.
Valuable goods
A hire purchase agreement is
suitable when a customer wants
to take tax ownership of the as-
set from day one and ultimately
legally own the asset. It makes
sense to consider hire purchase if
the asset to be financed has a low
rate of technical obsolescence.As
a result, the asset is very likely to
generate positive sale proceeds,
says Ashworth.
Loans also feature,
although they are
less common.
They can be se-
cured or un-
secured: Small
businesses are bet-
ter served by unse-
cured loans when-
ever possible as they
are not having to
stand behind the loan
as surety. Security is
generally in the form
of a debenture or a chat-
tel mortgage. As an in-
vestment vehicle asset
finance is generally se-
cured on the assets that
are financed.
George
Ashworth,
Managing director
asset nance,
Aldermore
CHOOSING THE
RIGHT FORM
OF FUNDING
Question: Are there many
asset nance products on
the market?
Answer: Yes, and companies
should choose which one they
will make use of by what their
business needs.
NEWS
VIRGINIA BLACKBURN
info.uk@mediaplanet.com
NOVEMBER 2012 5 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
Although the asset based nance
market is now a mature one,it is still
rife with misunderstanding. A lot
of misconceptions relate to the his-
toric use of the product, says John
Bevan, Head of trade and working
capital in the UK and Ireland at Bar-
clays and a past chairman of the As-
set Based Finance Association (AB-
FA). Total funding through asset
based lending is now just under 16
billion with over 41,000 companies
using the facilities.
John Bevan is keen to dispel
myths, starting with the fear that
the asset based lender will have ac-
cess to their invoice book and will
allow them to assert too much con-
trol. Clients can outsource their
sales ledger management and many
clients nd this a signicant bene-
t, he says.However,the business
can also choose to maintain full
control over their sales ledger by us-
ing invoice discounting - and mere-
ly releasing the working capital tied
up in their debtor book.
Another misconception is that
this type of lending is expensive: in
fact interest rates charged are com-
petitive with more traditional types
of funding.
Then there is the claim that on-
ly failing companies use it, patent-
ly untrue given that ABFA is gain-
ing membership and the volume
of client sales, which are managed
by members of ABFA, grew by 9 per
cent in the last 12 months. Increas-
ingly, larger businesses regular-
ly turn to this type of nance and
growth of this type of funding far
outperforms other forms of debt.
One of the essential points about
it is the transparency, says John
Bevan.And he points out that it can
be extremely benecial for a com-
pany to have a lender who has a
close insight into the day to day run-
ning of the business.The lender can
often spot potential issues with a
clients working capital and provide
assistance before these arise.
Removing the
myths about
asset nance
VIRGINIA BLACKBURN
info.uk@mediaplanet.com
MISCONCEPTIONS
MAKE THE RIGHT CHOICE
It is important to
understand which form of
funding will work best for
your business
PHOTO: SHUTTERSTOCK
John Bevan
Head of trade and
working capital, UK
and Ireland,
Barclays
Business
is nally
booming
again
Its official: Britains out
of recession, with the
economy growing by 1 per
cent in the three months
from July to September.
And as the economy
recovers, the asset finance
industry is equally able to
help companies benefit as
their lending facilities grow
with the companies.
Businesses tend to fail on the
way out of a recession, not the
way in, says Matthew Haw,
partner at Baker Tilly. They
need working capital, which
traditional lenders may be re-
luctant to supply, and invoice
discounting provides that.
Of course, asset based lend-
ers can also lend against as-
sets such as stock gures and
plant and machinery, and as
a business grows, it will have
more stock to lend against. If
you go from selling 750,000
a month to selling 1 million a
month, your purchasing needs
will grow, but you will still not
have got paid, explains Haw.
But this way your working cap-
ital can grow as quickly as your
sales. And as companies grow,
of course, so the economy con-
tinues to prosper, thus creating
a virtuous circle, whereby the
economy continues to improve.
VIRGINIA BLACKBURN
info.uk@mediaplanet.com
Question: Why are there so
many misconceptions about the
asset nance market?
Answer: Because some
common misunderstandings
mean businesses do not realise
how cost effective and efcient
it can be.
Get in touch to nd out
about our upcoming reports
www.mediaplanet.com | Tel: 020 7665 4400
Mediaplanet is the leading International
publisher of high-quality and in-depth
analysis on topical industry and market
issues, in print, online and broadcast
6 NOVEMBER 2012 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
INSPIRATION
Making the most
of your assets
FUNDING SOLUTION
Asset based finance is
a viable alternative to
conventional funding
for businesses
PHOTO: SHUTTERSTOCK
Asset based nance is surprisingly
still a much-misunderstood prod-
uct, but it is also one of the best
ways for a company to nance it-
self during a period of change,
such as expansion, a change of
ownership, an MBO or a turna-
round period in a companys for-
tunes. Corporate Britain is wak-
ing up to this: according to gures
from the Asset Based Finance As-
sociation (ABFA), no fewer than
43,000 businesses now use asset
based lending involving invoice
nance, and total lending in the
UK is now 16 billion, with a third
of this to companies with a turno-
ver of more than 50 million. As-
set-based nance is very much a
viable option for all businesses,no
matter what their size.
In recent years asset based -
nance has become the rst port
of call for many corporate nance
advisors particularly with trans-
actions and when working with
private equity, as they now see
risk in the traditional providers
of debt nance, says Steve Mer-
chant, Head of asset based lend-
ing services at Baker Tilly. Ma-
ny believe there is a greater risk
that banks will pull out of provid-
ing the debt, whereas asset based
lending has a strong track record
of delivering.
Know your options
At its simplest,asset based lending
involves invoice nance, or factor-
ing, whereby a company borrows
against, typically, 70 per cent to 85
per cent of the value of its invoices.
The level of service the lender pro-
vides can vary enormously, from
straightforward cash advances to
managing the sales ledger, provid-
ing collection services and insur-
ance, which may be more expen-
sive, but also absolves the borrow-
er from more of the risk.
As it has developed, asset based
lenders (ABLs) will now advance
loans against much more, in-
cluding inventory, plant and ma-
chinery and property, as well as,
when appropriate, more esoter-
ic assets such as branding. Some
ABLs also have the capability to
offer a cash flow advance along-
side asset based facilities. The
business involved can expect to
pay base rate plus two to three
basis points, together with a
service charge, with the cost
depending on the strength of
the borrower and any if more
services are added on.
The quality of the organ-
isations and their people
involved continues to im-
press and improve, and
there are now many ma-
jor players and many new
entrants into the market,
says Merchant. Whereas
once it was an alterna-
tive source if you couldnt
achieve funding in the con-
ventional way, through, for ex-
ample, loans, it is now regarded
as the first port of call.
There are many advantag-
es that cannot be found in other
forms of nancing. A bank might
suddenly withdraw an overdraft,
but it is very unlikely to withdraw
an asset based facility if the un-
derlying asset is still in place. An
asset based lender closely moni-
tors the security position of the
company, which makes it easier
to help through dif cult times,
says Merchant. And while an
overdraft or loan tends to
be a xed amount, the as-
set based facility can grow
as the business expands.
VIRGINIA BLACKBURN
info.uk@mediaplanet.com
SHOWCASE
Question: How can
asset based nance help
many growing companies
as an alternative to loans or
overdrafts?
Answer: By providing
a funding solution that can
actually increase at the same
rate as the cash ow needs of
the business.
Steve Merchant, Head of asset based
lending services, Baker Tilly
NEWS IN BRIEF
Edward Winterton, Commercial
Director, Bibby Financial Services
Invoice finance
helping SMEs
to grow their
business
Of all the challenges facing
small and medium-sized busi-
nesses generating cash and
keeping it owing can be two
of the toughest. And of course
many SMEs have found condi-
tions in recent years even more
challenging.
With the emphasis now
rmly on restoring economic
growth following long years of
recession, many business own-
ers are looking at alternative
forms of funding, such as asset
based nance or invoice nance.
Invoice finance helps to
bridge the cash ow gap be-
tween raising an invoice and
getting paid, giving business-
es an immediate cash-injection
and then an on-going supply of
working capital against the val-
ue of outstanding customer in-
voices as they are raised.
By ensuring the business
has a stable cash ow in place,
the owner can focus on the job
of running and growing their
business and does not have the
burden of extra business debt
such as a loan.
Managing the
business cycle
Many rms like the exibil-
ity ofered by invoice nance as
it can help them to manage the
peaks and troughs most busi-
nesses experience, without hav-
ing to renegotiate long-term -
nancial arrangements.
As a form of funding for busi-
nesses, the invoice nance sec-
tor has seen a signicant increase
in the number of SMEs looking to
use this type of funding in order
to help them grow their business.
The latest gures from the
trade body Asset Based Finance
Association, show that on aver-
age businesses with invoice -
nance in place have seen turn-
over increase in the rst two
quarters of the year, providing
real support for rms looking to
grow their business.
bank leumi (uk) plc is authorised and regulated by the financial services authority
Working together to deliver
a comprehensive approach
to Asset Based Lending.
Contact us to see how the combined
strength of Bank Leumi (UK) and
Leumi ABL can benet your business.
Nicola South, Head of Commercial Finance, Bank Leumi (UK)
Tel: 020 7907 8195 | Email: nsouth@bankleumi.co.uk
Phil Woodward, Managing Director, Leumi ABL
Tel: 01273 716202 | Email: pwoodward@leumiabl.co.uk
Our services include:
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LIFE&STYLE
MONDAY 5 NOVEMBER 2012
32
cityam.com
TRAVEL
I
AMteetering on the edge of a cliff
at the top station of Les Deux
Alpes. I normally feel confident on
my carving skis but this feels like
no ordinary black run.
Around me are some of the most
spectacular views of the French Alps
known to man, but all I can do is focus
wide-eyed on the sheer drop below.
Adding to my apprehension is the
fact that I am harnessed to another
skier and what seems to be the worlds
longest parachute is draped behind us
on the snow.
Are you ready? says Luc, my para-
penting pilot, as he makes a final
check of the equipment. Allons-y! We
pick up speed and drop into the abyss.
Seconds later we are soaring high
above snow-capped peaks. I now
understand why, in a second life, most
people would like to return as a bird.
The white corduroy slopes stretch out
below my hanging skis and the air is
fresh and crisp. The sun, set high in a
blue sky, glimmers off the mountains.
We grab the thermals and go ever
higher, climbing to what seems an alti-
tude way above the mountains that
immediately surround us. Is that Mont
Blanc with a crown of cloud in the dis-
tance, Europes highest summit? As we
begin our descent, Luc tells me that in
summer he is regularly followed by
eagles, but as they are migratory birds
I was not so lucky during the first
weeks of March.
Its the best possible view of Les Deux
Alpes, an area I have come to with the
Ski Club of Great Britain. Im here to
experience the full range of skiing on
offer from groomed slopes to the sav-
age and unpisted runs of La Grave. For
while Les 2 Alpes offers a vast ski area
of 225 kilometres of signed pistes
between 1,300m (Mont de Lans village)
and 3,600m (glacier) perfect for fami-
ly skiing it is also home to Europes
most challenging off piste runs at La
Grave.
Les Deux-Alpes is a long, narrow vil-
lage sitting on a high, remote col. The
six-day pass covers La Grave and gives
two days in Alpe-dHuez and access to
Serre-Chevalier (an hour away over the
Col du Lautaret) and other resorts.
There are buses twice a week to Alpe-
dHuez. The village is a long, sprawling
collection of apartments, hotels, bars
and shops, most lining the two streets
that form the one-way traffic system.
There is a wide range of building
styles, from old chalets through 1960s
blocks to more sympathetic recent
buildings. The place has quite a buzz,
in the early evening at least.
The resort sits high among the south-
ern Alps, with great views from the
upper slopes of the Ecrins peaks.
But despite Les Deux Alpes easygo-
ing charms, La Grave beckons.
As we leave the comfort of Les Deux
Alpes beautifully groomed ski area, a
group of about thirty skiers wait
patiently in line, even though there is
no ski lift. Soon, the reason becomes
clear as a piste-basher chugs towards
us trailing lines of knotted ropes this
is our lift over to La Grave. We each
grab a handle and are soon being
tugged merrily towards La Grave. The
imposing 3,983m high glaciated peak
of La Meije looms into view above the
12th century village of rambling stone
cottages.
Forget Courchevel-style fashion here,
nearly everyone is sporting ropes, har-
nesses, shovels, avalanche transpon-
ders and helmets. Our guide, Maxant
Danilo, noticing the anxiety on our
faces, assures us that the harnesses are
just a precaution. If one of us fell into a
crevasse, it means he could attach a
rope to us to haul us out.
Dont be tempted to deviate from
my path as sometimes the most
benign-looking snow can cover a deep
crevasse underneath, he warns us.
And never follow tracks in the snow
unless you know where they lead.
Hiring the services of a High
Mountain guide like Danilo is a must
in La Grave as there are no ski patrols
outside the marked glacier routes
and, because of the high altitude,
weather conditions can change very
suddenly. Conditions at La Grave
couldnt be further from those found
at popular ski resorts in that it is a uni-
verse entirely devoted to freeride,
with all that notion implies in terms of
responsibility and risk. Tackling La
Graves rebellious slopes is no easy
matter: just imagine a 2,150m, non-
stop, vertical descent, with no marked
runs. Apart from the valleys, you can
choose either Le Pan du Rideau or Les
Trifides. These steep corridors require
real skiing prowess and knowledge of
the area. The Chancel route is more
accessible, but like the others, is a
steep mountain route, with all the
challenges you might expect.
We find the skiing enjoyable but
tough and although we are all confi-
dent off piste skiers, by lunchtime our
thighs are aching, not least from hav-
ing dropped into several of the infa-
mous 45-degree chutes that in places
are barely wider than a ski is long.
When these funnels of hard snow
drop below you towards giant shards
Thrill seekers put one foot
Keith Perry tries
out some ultimate
extreme skiing
LES 2 ALPES NEED TO KNOW
How to get there:
By plane:
Grenoble (120km)
Lyon (160km)
There are regular transfers from both
airports. For more information, visit
www.les2alpes.com
The ski area:
Les 2 Alpes offers a vast ski area of 225
kilometres of signed pistes between
1,300m (Mont de Lans village) and
3,600m (glacier).
417 ha of skiing; 1400 ha of off piste
Lift pass 2012/13
Adult
1-day: 42.50
6-day: 211
Six-day (and more) passes include: free
access to the swimming pool and ice-rink,
discounts on many non-skiing activities,
free access to the ski area of Grande
Galaxie, two days at L'Alpe dHuez Oz /
Vaujany (VFD shuttle) and one day at
Serre Chevalier, Montgenvre (Voie
Lacte) and Puy St Vincent and Sestrires.
ESF
Instructor for one day off piste: 81 per
person. Six-day: 469 (four people
maximum).
Paragliding: take off with skis from the
top of the Diable cable car at 2,400m in
a tandem flight to land in the resort
www.esf2alpes.com
Accommodation
Hotel de la Valentin is a family-friendly
two-star hotel with 27 bedrooms. The
hotel also includes a restaurant and
wellness area with a sauna, Jacuzzi and
fitness room.
From 49 per person per day half board.
From 70 per night for two in a double
room, with breakfast.
For more information contact:
www.les2alpesleisure.com - +33 (0)4 76 79 22 43
Restaurants
In the resort
Les Sagnes (creperie)
On the slopes
Chalet La Tourra
Above: Paragliding is as close to flying as you can get and ther
views are breathtaking.
Below: La Grave Village in all its snow-crested beauty
Stay warm
and stylish
on the slopes
GANT
Caldwell boots,
100
www.gant.com
KJUS
Formula four-
way-stretch
jacket,
730
www.mrporter.com
Ray-Ban
Aviator
sunglasses,
155
www.mrporter.com
KJUS
GSM bluetooth
skiing gloves,
180
www.mrporter.com
MONDAY 5 NOVEMBER 2012
33
Skis go Free!
*
City to Slopes.
Fast!
Bern s Chambery s Geneva s Milan s Zurich
To enter visit ski.londoncityairport.com/comp
*Certain routes only, please visit ski.londoncityairport.com for details.
W
I
N
!
Scan to ENTER
A luxury family holiday worth
with
10,000
of rock, it has a way of focusing the
mind. Most of us experience a tumble
or two but sometimes falling is not an
option as we go one by one through
narrow corridors of ice and rock. It is
controlled skiing at its best, learning
to use edges to maximum effect to
reduce speed. A popular saying here is
that in ski resorts they adapt the
mountain for skiing but here you
must adapt your skiing to the moun-
tain, says Danilo.
By the time we complete our third
run down the mountain, our bodies
are well and truly spent. We reflect on
an incredible days skiing at LAuberge
Edelweiss, a favourite with bon-vivant
skiers and cyclists, run by a former City
financier Robin Gray and his Dutch
wife Marlon Treffers. It is a privately-
owned centuries-old coaching inn in
the heart of the La Grave village and is
less than five minutes walk from the
Tlphrique.
Enjoying warm slices of wild mush-
room tarte, local cheeses and delicious
red wine, we embrace the rustic hotels
atmosphere as the sun goes down over
the hulk of La Meije. Weve had both
feet in La Grave and survived.
in La Grave
SKI CLUB Freshtracks run a number of
ski holiday options to Les 2 Alpes and
La Grave including seven-night
development holidays to Les 2 Alpes
from 850 (price includes flights,
resort transfers, chalet-hotel
accommodation, instruction and Ski
Club Leader service) and seven-night
off-piste holiday options to La Grave
from 995 per person (price includes
accommodation in the Edelweiss
hotel, a mountain guide each day, Ski
Club Leader service and return
transfers from Geneva). Four-night
weekend holiday options are also
available to La Grave.
Ski Club Freshtracks holidays are
perfect for independent skiers. The
holidays are split into six categories:
Action, Performance, Weekend, Off
Piste, Heli and Touring. All holidays are
graded by ski standard, ensuring the
best possible skiing experience.
EasyJet flies to Grenoble from
Bristol, Edinburgh, Liverpool, London
Gatwick, London Luton and London
Stansted. Prices one way start from
26.99 and include all taxes (prices are
subject to change). Visit
www.easyJet.com to book.
The Ski Club of Great Britain is a not-
for-profit snowsports club which offers
benefits to its 31,000 members.
Membership costs 50 for an
individual, 93 for families and 22 for
members aged under 24.
Go to Skiclub.co.uk/freshtracks or
call 020 8410 2022 for more
information.
The Lowdown
Adidas by Stella
McCartney
Ski jacket,
350
www.adidas.co.uk
Adidas by Stella
McCartney
Kattegat Boots,
175
www.adidas.co.uk
34
TV & GAMES
cityam.com
T
E
R
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S
T
R
I
A
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BBC1
SKY SPORTS 1
7pmLive Monday Night Football
11pmNetbusters 11.30pmSPL
Round-Up 12amSoccer AM: The
Best Bits 1amMonday Night
Football 3.30amWatersports
World 4.30amMax Power
5.30am-6amFIFA Futbol
Mundial
SKY SPORTS 2
6pmLive ATP World Tour Finals
Tennis. The opening day from the
O2 in London. 10pmNASCAR
11pmThinking Tackle 12am
Triathlon 12.30amGreat Run
Series 1amNASCAR 2amWorld
Golf Championship 3amPGA Tour
Classic 4am-5amTrilby Tour Golf
SKY SPORTS 3
7pmShow Jumping 8pmNFL
10pmWWE: Late Night Bottom
Line 11pmWWE: Late Night
Afterburn 12amWWE: NXT
1am-4.15amLive WWE: Late
Night Raw
BRITISH EUROSPORT
6.30pmEurogoals 7.15pm
MotoGP 12.15am-1amEurogoals
ESPN
7pmESPN Game of the Week
7.30pmPardon the Interruption
UK 8pmPremiership Rugby Union
9pmESPN Game of the Week
9.30pmFrench Ligue 1 Review
10.30pmESPN Kicks: Scottish
Football 10.45pmESPN Kicks:
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Pass 11.30pmESPN Game of the
Week 12amUFC: The Ultimate
Fighter 1amMajor League
Soccer 2.45amSerie A Review
3.15amESPN Kicks: Scottish
Football 3.30amESPN Game of
the Week 4am-6amESPN Films:
The Fab Five
SKY LIVING
7pmCriminal Minds 8pm
Nothing to Declare UK 8.30pm
Show Me Your Wardrobe 9pm
Americas Next Top Model
10pmCriminal Minds 11pmBones
12amSun, Sea and A&E 1am
Smash 1.50amSupernatural
2.40amMedium3.30amBones
4.20amNothing to Declare
5.10am-6amPassport Patrol
BBC THREE
7pmDont Tell the Bride 8pm
Junior Doctors: Your Life in
Their Hands 9pmBorder Wars:
Stacey Dooley in the USA 10pm
Russell Howards Good News
10.30pmEastEnders 11pmFamily
Guy 11.45pmAmerican Dad!
12.30amBorder Wars: Stacey
Dooley in the USA 1.30amSun,
Sex and Suspicious Parents
2.30amRussell Howards Good
News 3am-3.55amUnsafe Sex in
the City
E4
7pmHollyoaks 7.30pmHow I Met
Your Mother 8pmNew Girl.
Schmidt tries to win Ceces
affections. 8.30pmSuburgatory
9pmDerren Brown: Apocalypse
10pmMade in Chelsea 11.05pm
The Work Experience 11.40pm
Fresh Meat 12.30amThe Big
Bang Theory 1.30amHow I Met
Your Mother 1.55amScrubs
2.20amFresh Meat 3.05amMy
Name Is Earl 3.50am90210
4.30amOne Tree Hill
5.10am-6amSwitched
HISTORY
7pmStorage Wars 7.30pmPawn
Stars 9.30pmCajun Pawn Stars
10pmAmerican Pickers 11pm
Storage Wars 11.30pmPawn
Stars 12.30amCajun Pawn Stars
1amAmerican Pickers 3amAx
Men 4amSwamp People 5am
Pawn Stars 5.30am-6am
American Restoration
DISCOVERY
7pmBattle Castle with Dan
Snow. 8pmFifth Gear 9pmHow
We Invented The World. New
series. 10pmAmerican Guns
11pmDeadliest Catch 12amHow
We Invented The World 1am
American Guns 3amHow We
Invented The World 3.50amFifth
Gear 4.40amDiscovery Atlas
5.30am-6amMeerkat Manor
DISCOVERY HOME &
HEALTH
7pmDr Oz 8pmSecretly
Pregnant 9pmTrauma: Life in the
ER 10pmHospital Sydney 11pm
Born on a Bad Day 12amTrauma:
Life in the ER 1amWanted Down
Under 2amHospital Sydney 3am
Born on a Bad Day 4amA Baby
Story 5am-6amBirth Days
SKY1
8pmArrow9pmBrit Cops:
Frontline Crime UK 10pmGame
of Thrones 11.20pmFringe
12.20amRoad Wars 1.15amBrit
Cops: Frontline Crime UK 2.05am
Road Wars 4.10amBrainiac:
Science Abuse 5.05am-6amDont
Forget the Lyrics
BBC2 ITV1 CHANNEL4 CHANNEL5
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&
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6pmBBC News
6.30pmBBC London News
7pmThe One Show
7.30pmInside Out: BBC News
8pmEastEnders
8.30pmGambling Nation
Panorama
9pmCHOICE Richard
Hammonds Miracles of Nature
10pmBBC News
10.25pmRegional News 10.35pm
Have I Got a Bit More News for You
11.20pmMOBO Highlights 2012
12.50am Weatherview12.55am
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Nicks Quest
Fill the grid so that each
block adds up to the total
in the box above or to the
left of it.
You can only use the
digits1-9 and you must not
use the same digit twice in
a block. The same digit may
occur more than once in a
row or column, but it must
be in a separate block.
COFFEE BREAK
Using only the letters in the Wordwheel, you have
ten minutes to nd as many words as possible,
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters
or more, all must contain the central letter and
letters can only be used once in every word. There
is at least one nine-letter word in the wheel.
Place the numbers from 1 to 9 in each empty cell so that
each row, each column and each 3x3 block contains all the
numbers from 1 to 9 to solve this tricky Sudoku puzzle.
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
KAKURO
QUICK CROSSWORD
LAST ISSUES
SOLUTIONS
KAKURO
WORDWHEEL
SUDOKU
SUDOKU
QUICK CROSSWORD
WORDWHEEL
1 2 3 4 5
6 7 8 9 10
11
12 13
14 15 16 17 18
19
20 21
22
34 7
17 11
12 30
16 17
14 15 14
45
4 10 6
15 8
12 13
23 35
11 15
13
26
16
28
15
24
5
14
10
29
8
16
7
18
11
28
7
22
12
29
10
27
9
ACROSS
2 Adding avour to (9)
6 Fashion reminiscent
of the past (5)
8 Plait hair (5)
11 Stress (7)
12 Run of to marry (5)
13 Time of life
between the ages
of 13 and 19 (5)
14 Tall stories (5)
17 Right-hand page
of a book (5)
19 Artists workroom (7)
20 Stupeed by drugs (5)
21 Hanging cloth used
as a blind (5)
22 First James Bond
lm in which Pierce
Brosnan starred (9)
DOWN
1 Reaped (9)
2 Fight (3-2)
3 Make up for (5)
4 Celestial path (5)
5 Asinine, silly (5)
7 Full to
satisfaction (7)
9 Graceful
woodland
animal (3,4)
10 Corruptible (9)
15 Facing of a
jacket (5)
16 Grasslike marsh
plant (5)
17 Long, narrow
hill (5)
18 Lifting
machine (5)
E
D
R
E
U O
N
N
D
4
4
4
S P I R A L U C
A A E A R N E R
C O N I F E R A U
K S S T A R M
S E P I A E M O B
E N D O R S E
B E L V Y O D E L
O I R I S N I
G C S U R N A M E
E L A T E D E G
Y N S A T I R E
7 3 5 1 8 4
9 2 1 8 7 4 5 3 6
2 7 3 7 1 8
8 7 6 9 1 3
9 8 3 7 6 9 8 5
7 2 4 1 2 6 9
2 1 4 5 3 7 9 8
6 7 1 3 5 2
7 3 8 9 2 1
3 1 7 8 5 4 2 9 6
2 9 9 7 8 1
4
4
4
4
4
4
4
4
4
The nine-letter word was
NEIGHBOUR
T
E
R
R
E
S
T
R
I
A
L
S
A
T
E
L
L
I
T
E
&
C
A
B
L
E
BBC1 BBC2 ITV1 CHANNEL4 CHANNEL5
MONDAY 5 NOVEMBER 2012
RICHARD HAMMONDS MIRACLES
OF NATURE BBC1, 9PM
The Hamster enters the natural
world to uncover animals abilities
and reveal how those skills have
inspired a series of inventions.
MASTERCHEF: THE
PROFESSIONALS BBC2, 8.30PM
Gregg Wallace, Michel Roux Jr and
Monica Galetti return with the
culinary challenge as the first batch of
10 chefs enters the kitchen
MONROE
ITV1, 9PM
In the last episode of the series, a
traffic accident brings a slew of new
patients to St Matthews, stretching the
hospitals facilities to breaking point.
TVPICK
IN BRIEF
SARACENS boss Mark McCall knows
full well the impact Charlie Hodgson
has had on Saracens this season but
he insisted he delivered more than
he expected in yesterdays 29-24
Aviva Premiership win over Wasps.
The 31-year-old kicked seven penal-
ties in another assured performance
with the boot at Vicarage Road, tak-
ing his total points tally in the
Premiership this season to 90.
Alistair Hargreaves scored
Saracens sole try but Wasps, who led
5-3 early on thanks to Tom Varndell,
did earn a losing bonus point thanks
to Charlie Davies late score.
But there was no doubting the star
performer for McCall, though he
believes Hodgsons performance was
a little bit more special than usual.
Charlie has had a phenomenal
season. Weve played some good
rugby in the last few weeks and
Trusty Hodgson
kicks Sarries to
win over Wasps
Charlies been instrumental in that,
but this was a little bit different, said
McCall. In the second half we were
much better and I thought Charlie
controlled the game really well. He
used the breaks there were and we
spent a lot of time in their half.
London Welsh left it until the
death to win their third game of the
Aviva Premiership as Gordon Rosss
penalty and Nick Scotts try helped
the Exiles down Bath 16-9.
Harlequins staved off a late come-
back to beat Gloucester 28-25 and
remain top but level on points with
Saracens on Saturday. London Irish
became the first team to suffer defeat
to Sale, after tries from Nick Macleod
and Johnny Leota earned a 21-9 win.
Aviva is proud to be title sponsor of
Aviva Premiership Rugby one of the
worlds leading rugby union competitions.
Each season will feature 135 games, which
will be watched by 1.7m people live at the
grounds. Visit www.premiershiprugby.com
England call up Gloucester duo
n RUGBY UNION: Gloucester pair
Freddie Burns and Billy Twelvetrees
were drafted into the England squad last
night ahead of Saturdays first autumn
international against Fiji. Fly-half Burns
and centre Twelvetrees have been
summoned as cover for injured duo
Jordan Turner-Hall, of Harlequins, and
Jonathan Joseph of London Irish.
Hooker Dylan Hartley and lock Courtney
Lawes have already been ruled out.
Poulter ends trophy drought
n GOLF: Ryder Cup star Ian Poulter
came from four shots behind to overhaul
fellow Englishman Lee Westwood and
claim his first win of the year at the WGC
Champions at Mission Hills in Shenzhen.
Poulter carded a second consecutive 65
to finish 21 under par, two shots clear of
a group including Open winner Ernie Els.
Czech Republic retain Fed Cup
n TENNIS: The Czech Republic beat
Serbia 3-1 in Prague yesterday to
successfully defend the Fed Cup. Lucie
Safarova comfortably defeated former
world No1 Jelena Jankovic 6-1, 6-1 after
Ana Ivanovic had beaten Petra Kvitova
to raise Serbian revival hopes.
ENGLANDS fitness worries ahead of this months Test series in India deepened
yesterday when fast bowler Stuart Broad suffered a heel injury. Broad, captaining the
team with Alastair Cook rested, picked up the knock in Englands tour match against
Mumbai A, who made 232-4 in response to 345-9 declared. Paceman Steven Finn is
already expected to miss the first match in Ahmedabad on 15 November.
ENGLAND SWEATING OVER BROAD HEEL INJURY
BY JAMES MARTIN
SPORT
35
MONDAY 5 NOVEMBER 2012
cityam.com
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Qualifying in Formula One? I say draw lots
A
VERY well argued email in
response to last week's
column in which I advocated
summer rugby union accused
me of being a serial offender in
the art of peddling idiotic
and preposterous ideas a
phrase worthy of Danny Baker,
and as such I thought it deserved a
wider audience.
So a decadent Sunday afternoon
watching television yesterday
prompted further flights of sporting
fancy which will doubtless lead to
similar correspondence.
Sebastian Vettel started the Abu
Dhabi Grand Prix in the pit lane after
being penalised in qualifying for one
of those bizarre F1 rules that make
little or no sense to anyone who does-
nt know their Red Bull from their
Red Rum. The consequence of that
decision was to engineer one of the
most exciting races in years as the
German, like a jinking outside half,
weaved and danced his way through
the field, ultimately finishing in
third place to maintain his position
as favourite for the world title.
So, why not just get rid of all that
qualifying nonsense that is about as
interesting as watching the knock-up
before a tennis match, and draw lots
each race for who starts where. Real
drama as Hamiltons name comes
out of the hat to start on the eighth
row of the grid, and then even
greater drama as he spends the next
two hours trying to get past every-
body. Be honest: youd watch it.
RECRIMINATIONS
And then it was Liverpool against
Newcastle, a game notable for one of
the goals of the season from the bril-
liant Luis Suarez, and also for anoth-
er very harsh Sunday sending-off. Last
week Fernando Torres; this week
Fabricio Coloccini for Newcastle
another occasion when the option of
a 10-minute sin-bin would have been
the perfect way of ensuring the pun-
ishment fitted the crime, and we
didnt have the inevitable tedious
recriminations afterwards.
And then when the Liverpool
crowd booed the fact that only four
minutes of added time was being
played at the end, they should have
been directing their ire not at the
officials on the day, but on the
games Victorian authorities who
still, in this digital age, refuse to stop
the clock when players get injured or
time-wasting tactics are employed,
leaving all of us guessing how many
arbitrary extra minutes are to be
be sanctioned.
So altogether a productive Sunday
on the preposterous ideas front. No
qualifying in F1 races, and the intro-
duction of countdown clocks and the
sin-bin in football. Zero chance of any
of it happening of course, but you
have to keep on peddling...
SPORT
COMMENT
JOHN INVERDALE
In association with
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Results
Rodgers raves
about growing
Reds future
QUEENS Park Rangers boss Mark
Hughes insists he is still the man to
turn around the Hoops fortunes,
despite leading the club to their equal
worst ever start to a top flight season.
Kaspars Gorkss put Reading 1-0 up
after a quarter of an hour of yester-
days clash, and although Djibril Cisse
equalised with 25 minutes to go, the
home side failed to find another goal
and remain winless from their open-
ing 10 Premier League games.
Weve got the potential for a good
team here, weve just got to get that
first win, Hughes said.
Asked if he is still the right man for
the job, Hughes responded with a
determined yes. The Welshman is
under increasing pressure as his team
continues to disappoint despite sign-
ing an array of players in the summer.
Were working exceptionally hard
on a daily basis to try and turn this one
around, and well get there we know
that, the QPR manager added, brush-
ing off jeers from the crowd
that greeted the full-time
whistle.
I think that was iso-
lated, the vast majority
understood the team
was trying really hard
not to sit on a 1-1 draw
but to actually go for the
three points.
The visi-
tors, also
LIVERPOOL manager Brendan
Rodgers praised the improved per-
formance of his players in the belief
that they were continuing to assimi-
late his ideas but regardless felt that
they had squandered the opportunity
of three Premier League points in yes-
terdays draw with Newcastle.
Luis Suarezs audaciously skillfull
second-half equalising goal gave the
home side over 20 minutes with
which to secure a winner, but even
after Fabricio Coloccinis late dis-
missal they were simply incapable of
making their dominance truly count.
We went to sleep just before half-
time but for every other moment of
the game I thought we were brilliant,
and we deserved three points but
we could just not put away any of
the chances we had, said Rodgers,
whose team had trailed from Yohan
Cabayes almost-equally technically
impressive goal.
I believe we are moving forward
and as youve seen from the perform-
ance it was absolutely outstanding
and once we improve the group over
the coming months hopefully we can
turn these draws into wins. That we
control games and dominate the ball
with the young players we have, we
clearly have a great future.
Controlling the typically elusive
Hatem Ben Arfas far-post cross,
Cabaye unleashed a powerful dipping
shot over the helpless Brad Jones in
the 43rd minute. Suarezs incredibly
composed equaliser came when he
deftly took Jose Enriques long ball
with his shoulder before side-step-
ping Newcastle goalkeeper Tim Krul
to stroke in the equaliser, and was
then fouled by Coloccini for the lat-
ters 84th minute red card.
Hughes shrugs off sack
talk as QPR stay winless
Berdych targets revenge mission
with Murray playing at home
WORLD No6 Tomas Berdych has
revealed a desire to avenge his
defeat at the US Open to eventual
champion Andy Murray when the
two meet in London in the opening
singles match of the ATP World
Tour finals today.
In exceptionally windy, difficult
conditions at Flushing Meadows in
September, Murray secured a 5-7,
6-2, 6-1, 7-6 (9-7) victory to deny the
Czech a place in the second Grand
Slam final of his career, a result he
hopes to reverse at the O2 Arena,
though he accepts that as starts to
any tennis tournaments go he could
scarcely have planned for anything
more difficult.
Playing Andy is clearly one of the
hardest of starts, but thats how it
is, said Berdych. And its kind of a
small revenge for the US Open. But
its another match, and I hope that
we are going to play each other in
many more matches in the future.
The crowds going to be on his
side, but theyre one of the best Ive
ever played [in front of].
The Spaniard David Ferrer is
another of the single tournaments
eight players, but he was yesterday
competing in the final of the Paris
Masters, in which he defeated
Polands Jerzy Janowicz who had
eliminated Murray in the third
round 6-4. 6-2.
Djibril Cisse netted his first Premier League goal of the campaign, yet could not grab a winner for the struggling Queens Park Rangers
BY DECLAN WARRINGTON
BY JULIAN HARRIS
AT LOFTUS ROAD
BY DECLAN WARRINGTON
MONDAY 5 NOVEMBER 2012
36
SPORT
cityam.com/sport
Why not just get rid of that
Formula One qualifying
nonsense and draw lots for
each race for who starts where?
John Inverdales column: Page 35
@cityam_sport
QPR.............................................1
READING.....................................1
PREMIER LEAGUE
Sunderland 9 1 6 2 6 9 9
Aston Villa 10 2 3 5 8 14 9
Reading 9 0 5 4 12 18 5
QPR 10 0 4 6 8 19 4
Southampton 9 1 1 7 14 26 4
BOTTOM FIVE
TEAM PLD W D L F A PTS
without a league win this season,
came out of the blocks quicker than
QPR and opened the scoring after
16 minutes.
Nicky Shorey sent in an outswinging
corner from the left which Sean
Morrison contested at the far post. The
ball bounced vertically upwards off
Morrisons head and with Anton
Ferdinand strangely backing off
Morrison had another go, looping his
second header against the crossbar.
As the ball bounced off the wood-
work, Gorkss pounced acrobatically to
half-volley it through Julio Cesars
hands and into the net.
But QPR raised the tempo after the
break, and an equaliser came on 68
minutes. Djibril Cisse controlled and
turned on a cross from the right by
Jose Bosingwa before stabbing the
loose ball past Alex McCarthy with his
studs from five yards.
Hughes urged his side forward and
with five minutes to go they could
have snatched all three points. Adel
Taarabt turned his defender but
FERRARIS Fernando Alonso warned
championship leader Sebastian
Vettel that he has the perfect team to
hunt down the Germans lead, after
beating him by one place in
yesterdays Abu Dhabi Grand Prix.
Lotuss Kimi Raikkonen won the
race in one hour, 45 minutes and 58
seconds, with Alonso in second and
Red Bulls Vettel ending third despite
starting at the back of the grid.
Vettels heroics mean that he still
leads Alonso by 10 championship
points, yet the Spaniard was bullish
after the race.
I repeat they have the quicker
car, we have the better team, he
said. Everyone fights with the
weapons they have at their disposal:
we will not manage to turn our car
into the quickest of the pack with a
wave of a magic wand, but we will
counter their performance with the
perfection of our team.
Alonso has two races in the US,
and Brazil to overtake Vettel and
claim his first title since 2006.
McLarens Lewis Hamilton led
from pole yesterday and was on
track for a resounding win before his
car broke down on lap 20 of 55.
Raikkonen moved into the lead
while Alonso overtook Williams
Pastor Maldonado into second.
Despite starting last on the grid
due to a penalty, and damaging his
car mid-race, Vettel weaved his way
to an unlikely podium finish.
BY JULIAN HARRIS
LIVERPOOL .................................1
NEWCASTLE................................1
PREMIER LEAGUE
TODAYS SCHEDULE
Singles
Andy Murray v Tomas Berdych, 1.45pm
Novak Djokovic v Jo-Wilfried Tsonga,
7.45pm
Doubles
M Mirnyi/D Nestor v R Lindstedt/H
Tecau, 12pm; B Bryan/M Bryan v
M Granollers/M Lopez, 6pm
Mark Hughes QPR side are
seeking a first league win
watched in disbelief as McCarthy stuck
out a right boot to save his side-footed
effort from the resulting one-on-one.
QPR move up to 19th, above
Southampton who play tonight.
Confident Alonso says perfect
Ferrari team can win him title