Cityam 2012-03-26

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Boris: I will
veto third
runway
LONDON mayor Boris Johnson has
insisted he will not support a third
runway at Heathrow, despite renewed
interest in the plan from other senior
Tories.
The mayor said the runway would
cause intolerable traffic and fumes
in the west of the city and it will not
be built as long as I am mayor of
London.
The Tories ruled out the prospect of
a third runway in their 2010 mani-
festo, but last week chancellor George
Osborne used his Budget to acknowl-
edge the need for airport expansion
in the South East.
It is understood that a third run-
way is back on the agenda and will be
considered alongside plans for a new
airport in the Thames Estuary, which
has been backed by Johnson.
Meanwhile, Johnson, who is run-
ning for re-election in May, has
backed a pledge supporting a referen-
dum on Britains membership of the
European Union. Johnson added his
name to the Peoples Pledge on a cam-
paign visit to Romford in Essex over
the weekend.
The Mayor said at the end of last
year that a referendum would be justi-
fied if a new pan-European treaty was
in danger of being forced upon the UK.
I am delighted Boris has signed up,
said Tory MP Andrew Rosindell. I wish
the campaign all the best.
Peter Cruddas promised access to David Cameron in exchange for large donations Pictures: REX, GETTY
TALKS over the future of party funding
are being fast-tracked to the top of the
political agenda after the Tory treasur-
er was caught offering access to the
Prime Minister in exchange for large
donations.
Peter Cruddas was forced to step
down yesterday after appearing to
promise potential donors the chance
to influence government policy.
Donors who give the Conservative
Party more than 200,000 can have
their views put into the policy com-
mittee at Number 10, he told under-
cover reporters.
Last night, David Camerons aides
were forced to admit that the Prime
Minister had used his taxpayer-funded
flat at Number 10 Downing Street to
host a small number of dinners with
Conservative party donors.
Senior Liberal Democrat Danny
Alexander yesterday said that deputy
prime minister Nick Clegg will head
up a short sharp series of discussions
on funding between the leading
Westminster parties over the coming
weeks.
David Cameron has promised an
internal party enquiry, to make sure
this cant happen again.
What happened was completely
unacceptable, Cameron added. This
is not the way we raise money in the
Conservative Party.
CASH FOR ACCESS
ROW HITS TORIES
BY JULIAN HARRIS
POLITICS
www.cityam.com Issue 1,599 Monday 26 March 2012 FREE

BUSINESS WITH PERSONALITY
Labour leader Ed Miliband demand-
ed an independent investigation into
the allegations, which were unveiled
by the Sunday Times.
It is normal for large donors to meet
party leaders, with the Conservative
website advertising that people who
give 50,000 a year are invited to join
David Cameron and other senior fig-
ures from the Conservative Party at
dinners, post-PMQ lunches, drinks
receptions, election result events and
important campaign launches.
However, the meetings should only
concern party activities, and not the
business of government. Yesterday
Cruddas said that he had been wrong
to mention a Number 10 policy unit to
the undercover fake donors.
I have never knowingly even met
anyone from the Number 10 policy
unit, he said.
I deeply regret any impression of
impropriety arising from my bluster in
that conversation.
Cruddas founded spread betting
firm CMC Markets in 1989, and later
founded his eponymous charitable
trust, intended to help disadvantaged
children.
He is set to be replaced by Lord Fink,
formerly chief of the hedge fund Man
Group. Fink held the party treasurer
post until earlier this month, when
Cruddas took over.
ALLISTER HEATH: P2
Certified Distribution
30/01/2012 till 26/02/2012 is 98,573
BOARD QUOTAS ARE
NOT THE ANSWER
EXTRADITION:
STILL A SCANDAL
BY JULIAN HARRIS
MAYORAL
ELECTION
EXCLUSIVE COLUMN
BY NATWEST
THREE MAN P26
WE TALK TO MITIE BOSS
RUBY MCGREGOR-SMITH
P14-15
News
2 CITYA.M. 26 MARCH 2012
Birds Eye is on
block for 3bn
THE company that owns fish finger
maker Birds Eye is being put on the
block for a possible 2.9bn (2.42bn)
by Permira, its private equity firm
owner.
It is understood that Permira has
received a number of approaches for
Iglo and has appointed Credit Suisse
to handle the process.
Private equity firms such as
Blackstone and Cinven have been
touted as possible bidders for Iglo.
But it is expected to generate
Eastern interest too as Asian compa-
nies look for growth opportunities
in Europe.
Chinese company Bright Food
came close to buying British compa-
ny United Biscuits, the maker of Hula
Hoops and Jaffa Cakes, last year and
could be looking for another chance
to enter Europes food market.
COFCO, Chinas agricultural con-
glomerate, has also stepped up its
overseas food investment recently.
And Thai Union Frozen Products
said earlier this month it planned to
raise capital by offering 202.8m new
shares, sparking rumours it was
looking to make a big acquisition.
Another possible bidder is Ranjit
Singh Boparan, the West Midlands-
based ready-meals entrepreneur
who bought Northern Foods last
year.
BY LAUREN DAVIDSON
PRIVATE EQUITY
Crisis turning into real threat for PM

IT still seems likely that the coalition
will last for a while yet. But the pres-
sure is mounting again, with the res-
ignation of financier Peter Cruddas as
Tory party Treasurer and fresh allega-
tions about party funding dealing
another blow to David Cameron.
Many in the City have become too
complacent about the longevity of
this government, which seems deter-
mined to shoot itself in the foot at
every possible opportunity.
The Budget contained a variety of
grubby compromises which made it
inconsistent, as well as sleight of
hands that have turned out to be
politically damaging and badly
explained; the coalitions unpopular
minimum pricing of alcohol policy,
launched to deflect attention from
the row over pensioners tax thresh-
olds, will do nothing to cut alco-
holism or violence and will primarily
penalise poorer, well-behaved
drinkers; and now the cash for access
story will bring back whiffs of previ-
ous sleaze scandals and suggest to the
electorate that the Tory party is con-
trolled by wealthy donors.
The polls were grim for the Tories
even before the donations row: the
latest two YouGov polls showed leads
for Labour of seven-eight points, with
the Tories on just 34-35 per cent. This
is a disastrous result for Cameron, but
not a surprising one: he and his chief
strategist George Osborne failed to
win the 2010 general election, which
ought to have been unlosable, largely
because of incompetent communica-
tions and an inability to capitalise
on bread and butter issues the elec-
torate truly cared about. Cameron
and Osbornes performance has been
true to form since the start of the
year; the Conservative party needs to
bring in new blood to advise the
Cameroons, rather than relying so
much on a small coterie of socially
identikit associates and on civil ser-
vants.
Boris Johnson is ahead in London,
partly because Ken Livingstone has
upset so many Labour supporters
but also because the Mayor is a
unique figure, with the sort of mass
appeal (including the backing of
many poorer voters) that Tories often
used to have prior to the 1990s. But
otherwise this has been a bad few
months for the Tories: the rot started
well before the Budget. Its fortunes
peaked immediately after Cameron
blocked a new European treaty in the
early hours of 9 December. Even
though Camerons bravery had been
partly accidental, the Tories shot up
in the opinion polls.
The bounce was massive, conclu-
sive and lasted a couple of months.
Five days after Camerons veto, the
Tories were in the lead in the polls
again, at 40 per cent against Labours
38. Those days are now political
ancient history. All of the gains and
more have been reversed. Cameron
went back to being his normal self; he
even backtracked on Europe. Just
before Camerons veto, several Tory
MPs had told me a leadership chal-
lenge albeit a doomed one was no
longer out of question. These dissi-
dents (a small minority) subsequently
came back on side. But the situation
in the Tory party four months ago felt
eerily like it does today. There is noth-
ing its MPs hate more than being way
behind in the polls, with no strategy
to tackle the crisis. Add to that a crip-
pling donations row and the continu-
ing fallout from Andy Coulsons
defenestration and one has an explo-
sive situation. Cameron is in a far big-
ger pickle than most City folk realise.
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
THE COMPANY behind British Airways
is close to appointing an adviser in an
attempt to protect its north Atlantic
joint venture with American Airlines.
The debt-laden US carrier filed for
bankruptcy in November last year
and could soon become subject to
takeover approaches by US Airways
and Delta.
Willie Walsh, IAGs group chief exec-
utive, is understood to be evaluating
options including buying a stake in
American Airlines, in order to block a
rival approach.
IAGs revenue sharing agreement
with American Airlines involves co-
ordinating flight schedules to offer a
more frequent service, in particular
for business customers.
A successful bid by Delta or US
Airways would put that relationship
at risk, threatening the frequency of
BA flights to and from America.
A spokesperson for IAG declined to
comment yesterday.
BY KASMIRA JEFFORD
AVIATION
Walsh eyes US airline deal

Willie Walsh wants to protect his investment Picture: Laura Lean / CITY A.M.
NEWS | IN BRIEF
FSA hits back at Prudential claims
The City watchdog has hit back after
claims in a leaked Prudential email that
FSA policies are ludicrous and horren-
dous. The Financial Services Authority
said many of the complaints made in the
email should be directed at Brussels or
Westminster, as they were responsible for
many of the regulations. The FSA defend-
ed itself after Barry O'Dwyer, deputy chief
executive of Prudential's UK business, sent
an email to 2,000 of the firms staff,
describing the bodys policy plans as hor-
rendous for customers and accusing the
consumer panel of personal prejudices.
GM to expand in low-cost areas
General Motors may expand production
capacity in low-cost countries while clos-
ing its Bochum plant in Germany and
Ellesmere Port site in Britain, a German
magazine said, citing an internal strategy
document. If vehicle sales rise, GM would
build the additional cars in countries such
as Poland, Russia, China, India, Mexico and
Brazil, Der Spiegel said, quoting the docu-
ment, entitled Global Assembly
Footprint. "No decision has been made in
this regard for Opel's car production," a
spokesman for GM in Europe said.
EDITORS LETTER
ALLISTER HEATH
Editorial Statement
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Captain Birds Eye
could be jumping ship
as Permira considers
selling Iglo, which
owns the brand
ROYAL MAIL LOOKS TO DELIVER IPO
NEXT YEAR
The coalition government aims to
begin the privatisation of Royal Mail
by selling or floating at least part of it
in autumn 2013 if the state-owned
postal operators finances continue to
improve. The sell-off would be
Britains most ambitious privatisa-
tion since John Major broke up and
sold the railways in the 1990s.
Analysts think Royal Mail could be
worth up to 3bn-4bn.
WATCHDOGS NEED MORE BITE, SAYS
OUTGOING FSA ENFORCEMENT
OFFICER
UK financial watchdogs should step
up penalties and tackle a wider range
of fraud cases to make sure the City
continues to take the law seriously,
Margaret Cole, a top Financial
Services Authority official, has urged
as she prepares to leave for the private
sector.
BANKS SET TO CUT $1TN FROM BAL-
ANCE SHEETS
Investment banks are to shrink their
balance sheets by another $1tn or up
to seven per cent globally within the
next two years, says a report that
foresees a shake-up of market share
in the industry. Higher funding costs
and increased regulatory pressure to
bolster capital will force wholesale
banks also to cut 15 per cent, or up
to $0.9tn, of assets that are weighted
by risk, a joint report by Morgan
Stanley and consultants Oliver
Wyman predicts.
GOOGLE FLEXES ITS MUSCLES OVER
MOBILE WALLETS
An attempt by some of Britains
largest telecoms networks to turn the
mobile phone into a mobile wallet
faces a setback after it emerged that
Google will try to block its progress.
The mobile phone companies
Vodafone, O2 and Everything
Everywhere have submitted their
plan to the European Commission.
UK FOOD EXPORTS STILL SURGING
AHEAD
Selling salmon to the US, cheese to
the French and meat and poultry to
Hong Kong drove an 11.4 per cent rise
in UK food and non-alcoholic drink
exports last year to 12.15bn.
NICK CLEGG HAILS KOREAN TRADE
DEAL AS 2BN OPPORTUNITY FOR
BRITAIN
Deputy Prime Minister Nick Clegg
signed a trade agreement with South
Korea that he said could create 2bn
of export opportunities for British
businesses and add 500m to the UK
economy.
HOUSING SCHEME FAVOURS BIG
BUILDERS
The flagship housing scheme
launched by the Government is help-
ing big builders at the expense of
small and medium-sized firms,
according to industry complaints. The
House Builders Association (HBA) has
complained.
SINOPEC'S FULL-YEAR PROFIT EDGES
HIGHER
China Petroleum & Chemical said yes-
terday that its net profit for 2011 rose
two per cent as higher oil prices and
fuel sales outweighed lower refining
margins. The Beijing-based company,
also known as Sinopec, said it expects
Chinas demand for petrochemical
products to continue to grow, though
at a slower pace, this year.
ANTICLOT DRUG TESTS MERCK & CO.
An experimental Merck & Co. anti-
clotting drug, vorapaxar, proved
effective in a study at preventing
heart attacks for heart disease
patients, but increased the risk of sig-
nificant bleeding.
WHAT THE OTHER PAPERS SAY THIS MORNING
The new jobs website for London professionals
CAREERS.com
SANTANDER is understood to be clos-
ing 56 of its branches to reduce the
overlap that has been created follow-
ing the mergers of Abbey National,
Alliance & Leicester and Bradford &
Bingley.
The move comes as the Spanish
bank continues to negotiate the
takeover of 318 Royal Bank of Scotland
branches which is due to be complet-
ed by the end of 2012 a year behind
schedule.
The closures of former Alliance &
Leicester or Bradford & Bingley
branches are taking place on high
streets where the bank already has
three outlets.
The group has a 1,200-strong net-
work of branches and 107 locations
where there are currently three
branded units.
The bank is reportedly closing units
in 56 in these places to consolidate its
operations although it is likely to
find itself with new overlap once it
has absorbed the 318 RBS branches.
Santander, which entered the UK in
2004 through its purchase of former
building society Abbey National, has
been looking for an opportunity to
float in London for over a year but has
been set back by delays in acquiring
those branches, as well as the weak
state of Londons capital markets.
ARMY drivers are on standby to deliv-
er fuel to petrol stations if tanker driv-
ers vote today to strike over Easter.
The Unite union will this afternoon
announce the decision of 2,000 driv-
ers responsible for 90 per cent of
forecourt deliveries on whether to
take industrial action, starting 3
April.
But Cabinet Office minister Francis
Maude said the government had
learnt the lessons of the past,
including the chaos of fuel blockades
that hit Tony Blairs government 12
years ago.
The general public should not and
must not suffer from this dispute,
and strike action is manifestly not the
answer, said Maude.
Although we are pushing for an
agreement, we have learnt the les-
sons of the past and stand ready to act
to minimise disruption to motorists,
to industry and, in particular, to our
emergency services, in the event of a
strike.
The government plans to use police
to stop any threatened blockade by
striking drivers, and the training of
around 300 Army lorry drivers is like-
ly to begin this week.
Unites general secretary Len
McCluskey said unrelenting attacks
on drivers terms and conditions were
the reason for the action which he
believed was likely and said the gov-
ernment should be putting pressure
on oil companies, especially over the
issues of safety and training.
For over a year weve been desper-
ately trying to bring about some sta-
bility in the sector and urging
government ministers to persuade
contractors and oil companies to
engage in meaningful discussions
with us, said McCluskey.
Unfortunately its proving diffi-
cult to get them to respond. That
leads to frustration as workers feel
that no one is listening to them.
Well need to analyse the turnout
and feeling of members before decid-
ing whether to take any industrial
action, but we always hope that nego-
tiations can resolve the situation.
The Petrol Retailers Association,
which represents more than 5,500
petrol stations, said it knew nothing
of any government contingency plans
and was advising members to keep
stock levels high.
Army could
deliver fuel if
drivers strike
OFFICIAL government employment is
set to fall to a modern-era low as a pro-
portion of total UK employment, if the
coalitions plans are carried through
until 2017.
General government employment is
forecast to decline to 4.9m down
from its current level of 5.7m by the
start of 2017, according to the Office
for Budget Responsibility (OBR).
Although the measure does not
include some state-paid contractors, or
staff of taxpayer-backed organisations,
the Chartered Institute of Personnel
and Development (CIPD) says the drop
would be a tectonic shift in the
underlying structure of the labour
market.
In the nineties the lowest the pub-
lic sector hit was about 18 per cent of
the workforce, the CIPDs John
Philpott told City A.M. By 2017 it
would be closer to 16 per cent [on
these projections], he added.
In 1999, when the currently used
measure of public sector employment
began to be recorded, there were 5.4m
people directly employed by the UK
state. The figure grew to a peak of
6.35m in 2009, Labours final full year
in power.
While public sector jobs are expect-
ed to drop below 5m, the fall will be
more than offset by the private sector
adding around 1.7m jobs by 2017, the
OBR expects.
Government sector jobs set
to drop below 5m by 2017
Santander plans closure of 56
bank branches to reduce overlap
BY JENNY FORSYTH
UNIONS
BANKING
BY JULIAN HARRIS
EMPLOYMENT
News
The government hopes to avert a tanker driver strike, such as the four-day strike over pay
(pictured) in 2008, but is also training army drivers to stand in. Picture: GETTY
THE bank buyout vehicle run by Lord
Levene is about to make another
approach for the 632 Lloyds branches
put up for sale as it appears a deal with
the Co-operative Group could falter.
NBNK is planning an improved
1.5bn offer for the Project Verde
assets, the future of which appears
uncertain after Lloyds last week
pushed back the deadline for signing a
sale agreement with the Co-op.
New bank NBNK proposes Lloyds
demerge the 632 branches, float the
business and allow NBNK to fully
underwrite the demerger in cash. Its
hopes have been raised by the delay in
the deal with the Co-op, which has pre-
ferred bidder status.
The FSA is carrying out a detailed
interrogation of the Co-op, which
could lead to changes to the groups
structure to ensure its financial servic-
es arm is capitalised separately. The
regulator has also asked if the Co-op
Financial Services arm has sufficient
management experience.
Yesterday Lloyds said it is preparing
for an initial public offering alongside
the sale talks. A person familiar with
the views of NBNK said: They remain
keen to offer something to Lloyds
should the Co-op deal fall apart.
Co-op executives are understood to
have expected a long process, because
of the complexity of the transaction
and the need to get the right deal for
its members. NBNK and Lloyds
declined to comment.
NBNK set for
comeback on
Lloyds sell-off
ENGINEERING and financial services
giant General Electric is to open an
online retail bank in Britain.
The American groups GE Capital
UK arm won approval for its banking
licence from the Financial Services
Authority last week and is expected to
launch in mid-April.
The new bank will be called GE
Capital Direct and aims to bring in bil-
lions of pounds of savings as it boosts
its 10bn British corporate loan book.
GE Capital UK has sought to benefit
from the turmoil in the banking sec-
tor by lending more to businesses. In
the autumn chief executive John
Jenkins said: Disruption is good for
us. It makes businesses think different-
ly and businesses are looking for alter-
natives.
The new online venture could be
the largest British bank launch since
the financial crisis. Other new
entrants to the market include high
street lender Metro and Aldermore,
Britains first private equity-backed
bank, while Virgin Money has agreed
to buy the good arm of Northern
Rock.
GE, which declined to comment,
has around 18,000 staff around Britain
spread across healthcare, energy and
entertainment as well as financial
services.
GE plots quick
launch of online
bank in Britain
On your Marks: the Co-op boss could cash in on Sunwin
BY PETER EDWARDS
BANKING
BANKING
News
THE Co-operative group is considering
a sale of its cash handling business as
it tries to raise cash for its deal to buy
632 branches of Lloyds bank.
The mutual has reportedly hired
Buckingham Corporate Finance to
handle the sale of Sunwin Services,
which could raise 30m or 40m.
Sunwin provides secure transport
of cash for stores and dispensers, as
well as security, fire detection and IT
services.
Co-op chief executive Peter Marks
(pictured) has previously spoken of
the need for scale but that does not
mean he will sell the smaller business-
es within the group.
The sale of Lloyds Verde assets
would create Britains seventh-biggest
bank. Yesterday a Co-op spokesman
declined to comment on specula-
tion. More information could emerge
on Thursday, however, when the
group publishes its full-year results.
Co-op mulls Sunwin sale
to beef up branches bid
BY PETER EDWARDS
FINANCIAL SERVICES
ANALYSIS l Lloyds Banking Group PLC

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23 Mar
19Mar 23Mar 20Mar 21 Mar 22Mar
BANKERS are set to try to delay the
receipt of bonuses to take advantage of
the abolition of the 50p top rate of tax.
City workers could increase by tens
of thousands of pounds the net value
of their awards for this years perform-
ance by deferring payment by a few
months from the start of 2013 to April.
George Osbornes decision to reduce
the top rate of tax to 45p in last weeks
Budget was cheered by Tory back-
benchers but experts warned high-
earners could shift payments into the
new tax year, which begins on 6 April.
A square mile recruiter who works
with a series of banks told City A.M.:
What may happen is rather than the
first payment coming in February or
March 2013 it may come in April.
Others may choose to take the cash
immediately, however, because they
fear being made redundant.
The tax cut, for people earning over
150,000, was meant to be one of the
highlights of the Budget, with
Osborne describing the 50p rate as
the highest in the G20.... (and) widely
acknowledged by business organisa-
tions and international observers as
harming the British economy.
It was overshadowed, however, by
the furore over the granny tax, ques-
tions over the timing of the 45p tax
rate and impact on revenues.
Danny Cox, head of advice at
Hargreaves Lansdown, said: A deferral
provides high earners plenty of time to
delay their bonuses (and) dividends to
take advantage of lower tax rates. This
will potentially reduce the amount of
tax collected over the next 12 months.
Chris Sanger, head of tax policy at
Ernst & Young said the decision not to
introduce it until April 2013 was
somewhat surprising, especially as he
(Osborne) criticised his predecessor for
forestalling. Alistair Darling, then the
chancellor, announced the 50p tax in
the 2009 Budget and it was introduced
as a temporary measure in 2010.
The Treasury did not return calls.
RBS and Lloyds said a bonus deferral
was not being considered.
Bonuses set
for delay as
tax cut looms CHINA Construction Bank, the
worlds second biggest lender by
market value, reported a 25 per cent
rise in 2011 net profit, missing
expectations as lending curbs on the
real estate sector hit earnings.
Net profit in 2011 rose to 169.3bn
yuan (16.9bn) from 135bn yuan the
year before, according to a filing to
the Hong Kong bourse. This was
below expectations for 170.1bn
yuan, according to a survey of 25
analysts.
CCB, which has Singapore state
investor Temasek as a stakeholder,
said loan-loss provisions rose by a
fifth last year, higher than its 14.5
per cent annual loan growth.
The higher bad loan costs high-
light growing concern that non-per-
forming loans at Chinas banks are
likely to increase as growth in the
economy slows. Premier Wen Jiabao
this month forecast sub-eight per
cent GDP growth for the first time
in eight years.
In 2012, the global economic
environment is expected to become
more severe and Chinas economic
development faces numerous chal-
lenges, CCB said in a statement yes-
terday.
Chinas CCB
posts rise in
2011 profit
BY PETER EDWARDS
TAX
BY HARRY BANKS
FINANCIAL SERVICES
News
Chancellor George Osborne has delayed scrapping the 50p tax rate until 2013
BRITAINS largest companies face pay-
ing billions more into pension
schemes to cover the costs imposed by
planned new EU regulations, a study
revealed today.
The average FTSE100 firm could see
its pension liabilities rise by up to
2.5bn, Deloitte said, as three-quarters
of those surveyed said gross liabilities
will rise by between 20 per cent and 50
per cent under new capital rules.
The EUs pensions regulator is con-
sulting on plans to impose Solvency
II-style capital requirements on pen-
sion schemes, forcing the funds to
build up a capital buffer to protect
against shocks.
However, the UK pensions industry
has argued the nature of the pension
funds, with very long-term investors
and liabilities, means they are not vul-
nerable to short-term shocks in the
way the insurance industry is, and so
do not need the same kind of buffer.
Furthermore, the study of schemes
and their sponsors with liabilities of
over 100bn found a rise in costs is
happening at a particularly bad time.
Almost without exception, respon-
dents are critical of the proposals,
said Deloittes Feargus Mitchell.
The proposal will be one more fac-
tor accelerating the decline of defined
benefit pensions in the UK.
NEW regulations cannot absolutely
prevent the possibility of another
financial crisis or of banks failing, a
Bank of England policy maker
announced just days after the Bank
had pushed for stronger powers over
the industry.
The culture within banks, as well as
changes to the structure of incentives,
will be the most important changes,
financial policy committee (FPC) mem-
ber Michael Cohrs said, arguing the
pre-crisis regulatory structure was
myopic and dangerously focused on
individual firms, rather than the
financial system as a whole.
As the Bank is given more powers, it
should also be made robustly inde-
pendent if it needs to burst a credit
boom, the FPC must be able to stand
up to the howls of protest, he said.
On Friday the FPC announced it had
requested powers to adjust capital
requirements through the economic
cycle, charge banks for lending to sec-
tors vulnerable to bubbles, and impose
a maximum leverage ratio of total lia-
bilities to capital.
The Committee also discussed push-
ing financial institutions to hold
buffers of more liquid assets in case of
a crisis, but has to wait for more inter-
national agreement on the topic.
Governor Mervyn King conceded
we know absolutely nothing about
how these instruments are going to
work it is very important we play it
safe and be cautious.
The FPC has not asked for the power
to limit loan-to-value mortgage levels,
stepping back from Kings earlier sug-
gestions that loans should be capped
to avoid another sub-prime bubble,
fearing this may be an unpopular step.
However, it did not rule out using
such powers in the future, when they
may be less controversial.
Meanwhile the Banks Andy
Haldane yesterday called for banks to
cut bonuses and dividends to free up
cash to use building up capital buffers.
Financial market conditions have
improved somewhat and the
European situation has normalised to
a degree but the risk is still very con-
siderable, he said.
Our message to the banks is to
build their defences, do some more
insurance, guard against the chance of
things taking a turn for the worst per-
haps later in the year.
Bank seeks
new powers
over lending
Pensions deficits set to soar on
Solvency II-style EU regulations
BY TIM WALLACE
REGULATION
REGULATION
News
AT A GLANCE: FPCS NEW POWERS
What the FPC has asked for
The Bank of Englands Financial Policy
Committee (FPC) has asked the Treasury
for three main new powers that it hopes
will help maintain financial stability and
reduce risks to the system as a whole. It
wants to be able to alter the size of banks
capital buffers depending on the state of
the economy; set different buffers depend-
ing on the sectors each bank is most
exposed to; and set an overall capital level
that banks must maintain, regardless of the
riskiness of their balance sheets.
The counter-cyclical buffer
Banks are required to keep a certain stock
of capital aside as a buffer to protect
against losses on bad loans. The FPC wants
to be able to vary the size of this buffer
depending on the state of the economy in
good years, banks would have to hold more
capital against unexpected losses, and in
bad years they would be able to run down
the losses and lend more, preventing, or at
least slowing, a fall in lending. That could
stem over-exuberance in UK credit growth
in some circumstances and support credit
growth in others, the Committee hopes.
Buffers by sector
The FPC believes it can identify bubbles
building in a particular sector, and by forc-
ing banks to hold more capital against
loans in that sector both slow the bubbles
development, and ensure banks are well
protected against its bursting. In particular
it points to commercial and residential
property bubbles as examples of ruinous
booms in the recent past, as well as lending
to other parts of the financial sector.
Total leverage ratios
Although bank lending will be constrained
by capital requirements, which are based
on risk, banks should also face a maximum
ratio of total liabilities to capital, the FPC
believes. This would be changed over time,
but have the broad benefits of being trans-
parent, simple and free from an assess-
ment of the riskiness of assets.
Loan-to-value ratios
The FPC has not asked for the power to
limit loan-to-value ratios in mortgage lend-
ing, though it has not ruled out asking for
the power in future. Similarly, it may in
time ask for the power to impose more
stringent liquidity requirements on banks,
as well as the power to force disclosure of
the details of more activities, allowing it to
better combat potentially risky activities.
The FPC is also currently campaigning for
banks to cut bonuses and use the cash to
boost capital levels.
MPC member Michael Cohrs said regulations alone will not stop banks failing
ROYAL Dutch Shell is struggling to pay
off $1bn (630m) that it owes Iran for
crude oil because European Union and
US financial sanctions now make it
almost impossible to process pay-
ments.
The oil major owes a large sum to
the National Iranian Oil Company for
deliveries of crude, with one putting
the figure at close to $1bn, according
to industry sources. A debt of that size
would equate to about 8m barrels.
Shell declined to comment.
The European Union toughened
financial sanctions and placed a ban
on Iranian oil imports in January but
gave companies until July to wind
down their existing business.
With daily contract volumes of
100,000 barrels, Shell ranked as Irans
second biggest corporate client along
with Frances Total behind Turkeys
Tupras.
Shells chief executive Peter Voser
said last month the company would
take its final deliveries of Iranian
crude within a matter of weeks.
Rigorous US and European financial
measures aimed at punishing Iran for
its nuclear programme have already
come into force, making it increasing-
ly difficult to pay for and ship crude
from Iran.
Given the outstanding amount
owed in the face of sanctions, senior
oil executives say the only way forward
is for Shell to ask the British govern-
ment to help settle the account with
Iran.
Royal Dutch
Shell has $1bn
debt to Iran
BP has put several of its North Sea oil
assets worth close to 2bn up for sale
just a week after the chancellor
unveiled tax breaks for the industry
in a move to encourage more explo-
ration in the region.
BP, which won approval last week
to drill a deepwater well off the coast
of the Shetland Islands, launched an
auction this month to sell many of its
stakes in reservoirs where it holds a
minority position, according to
reports this weekend.
Jefferies, the US investment bank,
has been hired to advise on the sale.
BP is, however, continuing to invest
in the North Sea and in October the
oil giant and its partners were grant-
ed government approval to push
ahead with the second-phase 4.5bn
development of the giant Clair field,
west of the Shetland Islands.
BP and its partners also announced
plans last year for the 3bn redevelop-
ment of the Schiehallion and Loyal
fields, west of Shetland, and the
700m development of the Kinnoull
field in the central North Sea.
The company is also divesting
North Sea Assets such as the sale
Wytch Farm to Perenco last year for
$600m (378m) and working to sell its
Southern North Sea gas assets.
BP declined to comment.
BP looks to sell
2bn of North
Sea oil assets
BY HARRY BANKS
ENERGY
ENERGY
News
CITYA.M. 26 MARCH 2012 9
ANALYSIS l Royal Dutch Shell PLC
p
2,270
2,250
2,260
2,240
2,230
2,220
2,210
2,220.00
23 Mar
BP, led by chief executive Bob Dudley, is selling North Sea assets Picture: GETTY
News
Our reader panel says Osborne should have cut 50p
rate further but welcomes cut in corporation tax
GEORGE Osborne should have gone fur-
ther in cutting the top rate of tax by reduc-
ing it from 50p to 40p in his Budget last
week, rather than 45p,
according to our read-
ers panel.
Sixty-seven per cent
of panellists on the
Voice of the City
Panel, run in con-
junction with
PoliticsHome, said the
chancellor should have
cut the top rate of tax
back to 40p, compared to
30 per cent who disagreed.
However, the vast majori-
ty of panellists (76 per
cent) said they were
favourable towards
the decision to cut
the rate of income
tax on those earn-
ing over 150,000.
One panellist said: Reducing the top
rate to 45p has effectively made it perma-
nent, which will be counterproductive in
the longer term. The chancellor would
have been better off retaining 50p but
committing to reduce it to 40p over a spe-
cific period.
The most popular measure was the
reduction in the headline rate of corpora-
tion tax by two per cent to 24 per cent.
Eighty-seven per cent said they were
favourable to the policy.
A new seven per cent rate of stamp
duty on the sale of houses worth
more than 2m was also popular
with the majority of panellists,
with 53 per cent saying
they were favourable,
against 32 per cent who
said they were
unfavourable.
Osbornes so-called
granny tax, which will see the personal
allowance for pensioners frozen, drew a
more mixed response. Roughly 40 per cent
said they were unfavourable to the policy
while a similar amount said they were
favourable.
However, some members of the panel
said they thought Osborne had failed in
the way he presented the policy, which
drew sharp criticism in the media last
week. It is surprising that Osborne didnt
at least pre-brief the granny tax, so that it
could be presented as overall package of
fairness and rebalancing, said one panel-
list.
The Budget led to a modest bounce in
the chancellors approval ratings on our
panel. Forty-three per cent of panellists
said they were more favourable to
Osborne following the Budget compared
to 25 per cent who said they were less
favourable. Around one third said it had
made no difference.
Yes
No
%
Should George Osborne have reduced
the 50p rate of income tax to
40p rather than 45p?
Dont know
67
30
3
How did the Budget afect your favourability towards the following?
% 50
45
40
35
30
25
15
5
20
10
0
Coalition
Government
George
Osborne
Conservative
Party
Labour
Party
Liberal
Democrats
Much more favourable

Somewhat more favourable
No diference
Somewhat less favourable
Much less favourable
Dont know
How favourable were you to the measures proposed?
% 70
60
50
40
30
20
10
0
Cuttingincome tax
onearnings over
150,000from
50pto45p
Cutting
CorporationTax
by2%to
24%
Anew7%rate of Stamp
Dutyonpurchases of
homes worth2m
or more
Freezingpersonal
allowances
for pensioners
(termedthe GrannyTax)
Raisingthe personal
income taxallowance
(amount that is tax-free
to9,205
Very favourable

Somewhat favourable
Neither favourable nor unfavourable
Somewhat unfavourable
Very unfavourable
Dont know
In association with
PoliticsHome.com PoliticsHome.com
Apply to join today at www.cityam.com/panel
BATS Global Markets, the US
exchange operator that withdrew
its public offering Friday after a
computer glitch sent its newly-
issued stock into a tailspin, should
develop a credible IPO plan and
go through with it in the second
quarter, its founder and current
director has said.
BATS own stock was to be its first
listing. But the initial public offering
ended up a disaster after a software
bug briefly sent the price of the
shares down from $16 (10) to less
than a penny, before trading was halt-
ed. Later in the day, BATS took the
extremely rare step of withdrawing
the IPO altogether.
The companys founder, Dave
Cummings, also advocated suspend-
ing all bonus plans at BATS, writing
in an open letter emailed to industry
insiders yesterday: In this business,
mistakes cost money.
Cummings founded BATS, an
acronym for Better Alternative
Trading System, in 2005 with 13
employees. It now handles about 11
per cent of all US stock trading, runs
an options market, and recently com-
pleted the cross-Atlantic takeover of
alternative trading venue Chi-X
Europe.
This was a freak one-time event,
wrote Cummings. BATS manage-
ment should develop a plan to go
public in the second quarter, if possi-
ble, he said.
This might seem tough, but I
believe it is the only way to move past
the issue.
Cummings, who remains a BATS
investor after stepping down as its
chief executive in 2007, said the deal
would need to be re-priced. But he
defended BATS technological record
and argued that the botched IPO
does not have much long-term
impact on earnings because the
exchange has solid fundamentals.
Late on Friday, BATS outlined how
the bug set off a series of fast-paced
glitches through the trading day,
including a halt in the trading of
Apple shares and the cancellation of
erroneous trades in both Apple and
BATS stock.
The software code used for the IPO
was new and lab-tested, Cummings
said, but bugs do occur in the real
world. BATS just happened to discov-
er a bug at the most embarrassing
time possible.
Cummings, a trailblazer and fierce
defender of electronic trading, occa-
sionally sends such emails to finance
executives, traders, regulators and
journalists. The letter was entitled
What should BATS do now?
IPO underwriters included
Citigroup Inc, Morgan Stanley and
Credit Suisse Group, which along
with trading firm Getco and others
are major BATS stakeholders.
YELL group is already concerned about
meeting the terms of next years finan-
cial covenants and is looking to get a
head start on speaking to lenders.
The struggling Yellow Pages
provider, whose stock has lost 99 per
cent of its value in the last four years,
is set to appoint Goldman Sachs and
Greenhill to manage discussions.
Since relaxing covenant headroom
in December over a 2.6bn debt pile
at the cost of 22m the company
should be clear of financial issues with
creditors until March 2013.
But another restructuring possibly
a debt-for-equity swap could be on
the cards.
The Reading-based group, which
unveiled a drop in revenues of 15 per
cent last quarter, has struggled to keep
up with the digital era despite an
attempt to rebrand its services.
Yell remains almost 2bn in debt to
its lenders, including RBS and HSBC.
Troubles not over: Yell plans
its next debt restructuring
BY LAUREN DAVIDSON
TECHNOLOGY
News
LLOYDS OF LONDON TO POST LOSS
LLOYDS of London, the insurance market, is this week expected to post a significant
annual loss following a string of natural disasters including the Japanese tsunami, the
flooding in Thailand (pictured) and the earthquake in New Zealand. The loss is set to
come in below 1bn despite the total value of claims going over 10bn. Picture: GETTY
BATS founder
calls for fresh
flotation plan
BY HARRY BANKS
CAPITAL MARKETS
ANALYSIS l Yell Group PLC

p
4.10
4.00
4.05
3.95
4.00
23 Mar
The Mitie boss who
says board quotas
are not the answer
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Interview
Ruby McGregor-Smith, the only Asian female to run a FTSE 250
company, discusses how she juggles her family and high-ying job
H
OW many FTSE 250 bosses are
on Twitter? Before I met Ruby
McGregor-Smith, the chief exec-
utive of outsourcer Mitie, I
would have confidently said the num-
ber was zero. But then @RubyMS, as
she is known to those who follow her
tweets, is not your average chief execu-
tive. Asian, female and under 50 years
old, she doesnt even have her own
office. I always wanted to be some-
one that just fitted in. Obviously I
dont, necessarily, but that doesnt
actually matter.
Since joining Twitter, she has
become something of an evangelist
for the micro-blogging social network.
Doesnt every CEO have [an account]?
And if not, why not? How are you sup-
posed to understand your employees
if you are not prepared to communi-
cate with them on their level?
When I meet McGregor-Smith in
the firms conference rooms facing
HMS Belfast on the Thames, she is
frantically searching for a hairbrush.
Inexcusably, I have forgotten to tell
her that her photo is to be taken. The
only thing I still find quite embarrass-
ing is photographs, she explains. I
was quite painfully shy once. That
might be so, but these days it doesnt
really show.
If anything, she seems too glam-
orous to be running an outsourcer,
but McGregor-Smith insists her job is
a huge amount of fun. She says that
Mitie pronounced mighty isnt
your typical support services firm. Its
name, which stands for Management
Incentive Through Investment and
Equity, is a nod to its 1987 origins,
when it was created to buy a series of
start-ups.
Today we have a business that
doesnt have lot of start-ups, but we
still have quite a few because it keeps
the young culture of the business
alive. Theres nothing more fun than
sitting with some of the young start-
up teams who come in and are start-
ing businesses from scratch, she says.
Since she joined Mitie, which man-
ages everything from the Royal Opera
House to baggage screening at
Heathrow, the firm has grown its top
line very quickly. It is on course to pass
the 2bn revenue mark for the first
time this year. In the year to 31 March,
the company grew pre-tax profits by
8.9 per cent to 86.8m on revenues
that were 10 per cent higher at
1.89bn.
When I joined in 2002, we believed
we could go from 500m revenues to
where were likely to end up this year,
and I never for one single day did not
believe that, she says.
So how does she feel about being
the only Asian woman to run a FTSE
250 company? Frankly, shes rather
non-plussed. I didnt know until
someone told me, she says. I dont
tend to dwell too deeply on these
things. What matters is what you can
bring to an organisation, not where
youve come from, nor where you
grew up.
McGregor-Smith says she is passion-
ate about getting more diversity
around every board table, but she
has little time for forcing companies
to change. I dont agree with quotas,
not at all. I want to be recognised for
my talent, not because someone said I
had to be part of a quota system. It
wouldnt have given me the confi-
dence I need to do my job well at all.
Instead she thinks social progress
will take its course. Its a genera-
tional thing. I think youll see in the
next generation that things will be
very different. Today, boys and girls
are brought up very equally when
they are children. That will make a big
difference in 20 years or so.
McGregor-Smith hit the pause but-
ton on her own high-flying career in
2000, after struggling with the
demands of family life and the board-
room. My experience was it was very,
very tough to move from a big career
to having young children and to be
able to do both well. I found it very tir-
ing, very tiring indeed and I needed
more support. In the end I took quite
a lot of time out.
When she took the finance director
job at Mitie in 2002, she laid down
some ground-rules. I said, Look I can
do this but I still have small children. I
have to have some flexibility around
nativity plays, around the fact that
one of them is unwell.
That was the basis of my going
back to work. When anyone has a fam-
ily, male or female, then it does
change their life but that is OK.
Currently I have a senior HR director
who is on a sabbatical because other-
wise she would have left. She found it
really tough with her young children
and shes coming back at the end of
the year.
When she returned to work,
McGregor-Smiths husband Graham
gave up his own career in private equi-
ty so that one parent could be with
their children full-time. Graham has
taken time out to be around the kids
more and hes trained as an opera
singer, of all things. Hes on stage in La
Traviata at the moment, she says.
I ask whether McGregor-Smith, who
already sits on the board of Michael
Page, has been inundated with offers
of directorships since the Davies
report recommended that FTSE 250
boards should aim to have 25 per cent
female representation by 2015.
She is coy, but it is clear the offers
have been rolling in. Ive always had
lots of requests. Probably. I cant really
tell, she laughs. It seems the offers
WORDS BY DAVID CROW
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Interview
Age: 49
Background: Born in Lucknow, India.
Emigrated with parents to the UK in
1965, aged 2.
Education: Bentley Wood High
School; Lowlands Sixth Form College;
Kingston University (BA Economics)
Career:
1985-1991 Qualified as an account-
ant training at BDO Stoy Hayward
1991-2000 Worked at Serco Group in
a range of operational & financial
roles
2000-2001 Worked at SGI / Babcock
International
2002 Joined Mitie as the Group
Financial Director
2005 Promoted to chief operating
officer of Mitie
2007 Appointed as chief executive of
Mitie
Family: Married to Graham
McGregor-Smith since 1990
Two children, a daughter aged 15 and
son aged 13.
Hobbies: Running, usually 5ks or 8ks.
Is training to run a 10k. Gardening.
Other roles: Non-executive director
of Michael Page, the recruitment
firm.
CV | RUBY MCGREGOR SMITH
ANALYSIS l MITIE Group PLC
p
290.0
287.5
285.0
280.0
282.5
282.60
23 Mar
22Mar 23Mar 19Mar 20Mar 21 Mar
have been getting quite short shrift
though. I laugh quite often when I
get called, and I just say no. I dont
want to sit around a table because I
am there to tick a box.
McGregor-Smith has few gripes
against the government, although
that must be partly because the public
sector is such a crucial client. Like oth-
ers though, she says there is a real
shortage of talent in the UK for a
firm like hers. Its about finding fan-
tastically motivated people in the serv-
ice industry that really want to go the
extra mile. I think there is a shortage
of that in the UK.
After ten years of fast growth, I ask
whether Mitie is going to take its foot
off the pedal and enter a period of
consolidation. Oh no no no, were
going to grow more, she says.
Particularly in the energy markets
and also I think were beginning to
win much bigger contracts as we get
larger.
And what about McGregor-Smith?
Will she and her husband swap places
again, or will she look somewhere
else? You really do get the impression
that its very unlikely, that if you were
to cut her down the middle youd find
the word Mitie written there like a
stick of rock. I only think about
Mitie, she says. I wouldnt have a
clue what to do next.
It was very, very tough to move from a big
career to having young children and to be able
to do both well. I found it very tiring, very tiring
indeed and I needed more support. In the end
I took quite a lot of time out.
When Ruby Mc-
Gregor Smith
joined Mitie in
2002 it had rev-
enues of 500m a
year. In 2012, it is
on course to turn
over 2bn.
Picture:
LAURA LEAN /
CITY A.M.
News
Brought to you by
IN ASSOCIATION with Repskan.com,
City A.M. is measuring the relative
Olympic media buzz around the London
2012 Olympic and Paralympic Games
partners, week by week. The
leaderboard, right, reflects their ranking
over the past week, in this case from
Wednesday 14 March to Wednesday 21
March.
Adidas has seen
media attention
on the conditions
of its suppliers
workers subside
over the past
couple of weeks, and discussion has
generally returned to positive stories about
its Olympic sponsorship.
As a clothing brand, a major event was the
launch of Team GBs Olympic kit. Tweets
from @TeamGB, @adidasUK and
@UKA_athletics to their combined 78,000
followers caused hundreds of retweets.
Subsequent discussion about the Olympic
kit launch helped to push Adidas up the
rankings this week.
Olympic Media Buzz
LONDON 2012 PARTNERS
Brand Position change
Adidas 3
British Airways 12
Cisco 0
Visa 1
Samsung 1
McDonalds 3
Coca-Cola -5
Panasonic 0
Lloyds TSB 3
Acer -9
Adidas Olympic mentions by category
Regional News
Twitter
Blogs
Other
Topicals
National News
%
4
87
3
2
1
3
TOP TEN PARTNERS BY MENTIONS
Odeon sees losses widen
ODEON, Europes largest cinema
chain, has seen its losses widen to
70m last year, up from 44m in
2010, according to the latest accounts
published on Companies House.
The group, which runs 2,153
screens in 231 cinemas in Europe,
reported a 12 per cent rise in group
turnover to 725m last year.
The 70m loss was largely attrib-
uted to the cost of a 475m bond
issue last year that was used to fund a
series of acquisitions, mostly in Spain
and Italy.
Odeon & UCI, owned by Terra
Firma, the private equity firm found-
ed by Guy Hands, said it suffered a
weaker first half in 2011 compared to
2010 when the box office hit Avatar
was released, but this was offset by a
strong footfall over Christmas.
LEISURE
Political risk is a global threat to recovery

I
N a tentative recovery, everyone
always looks for the next nasty
shock that could spring up and
derail growth. The answer this
time is political risk all over the
world. We all know about the geo-
political tensions in the Middle East
that sent Brent over $126 earlier this
month. But in a year heavy with elec-
tions and unpopular austerity, gov-
ernments have much work to do.
In Europe, several governments
have fallen since the crisis started and
their replacements arent having an
easy ride of it either.
Portugals prime minister Pedro
Passos Coelho won power nine
months ago in the midst of the crisis,
after the previous leader called in the
bailout and subsequently stood down.
But a clash between Coelhos gov-
ernment and the largest union over
job reforms prompted the countrys
second general strike last week. That
as markets speculate Portugal will
need a second bailout and a debt
restructuring.
In Italy, where the government fell,
to be replaced by technocratic leader
Mario Monti, unions are also railing
against labour market reform. In
Spain, another new mid-crisis leader,
Mariano Rajoy, has endured a test of
his commitment to austerity in this
weekends regional elections in
Andalusia.
Here in the UK, were facing a dif-
ferent political balancing act.
Battling to save the UKs AAA cred-
it rating, last weeks budget was com-
plicated by the fact George Osborne
had to balance not only growth and
austerity, but Liberal Democrat and
Conservative sensibilities.
Although the general public
brought the whole budget down to
the issue of the granny tax, Im end-
lessly impressed that the coalition is
managing to reach compromises and
keep the government together while
battling with outside pressures.
But its not only governments that
have to worry about politics. On
Thursday last week shares of
Randgold Resources plunged 14 per-
cent in one day after a military coup
in Mali spooked investors.
Theres still plenty more to come.
The Russian election concluded as
expected, but now we need to watch
returning president Vladimir Putins
response to increasing pressure on
him to condemn the Syrian crack-
down. Plus there are upcoming elec-
tions in the US and France and a shift
in leadership in China.
There are countless economic
issues at play in the recovery story,
but political risk is only going to
become ever more important as this
year continues.
Beccy Meehan is an anchor at CNBC.
Follow her on Twitter @BeccyMeehan.
CNBC COMMENT
BECCY MEEHAN
DESPITE increased pressure on compa-
nies to be more open about their busi-
ness practice and performance, firms
across Europe are failing to rise to the
challenge, new research claimed yes-
terday.
More than 60 per cent of the top 200
companies in Europe provide no
detailed corporate guidance to their
core investment audience, despite the
vast majority of analysts and business
media saying more detail would be
welcome.
According to research by specialist
communications consultancy
Smithfield, 93 per cent of investment
analysts and financial journalists
agreed that specific financial guid-
ance was either helpful or very help-
ful.
The report suggests that many com-
panies are influenced by the fear that
forecasts might have a detrimental
effect on how the business is viewed,
with a significant majority (39 per
cent) saying guidance could affect
their opinion to the negative.
And over half (52 per cent) of ana-
lysts said that they would apply a dis-
count or a premium to a company
based on its guidance.
According to Smithfield, of the top
200 companies in Europe, only 77 have
issued specific guidance for 2012.
GAME GROUPS lenders, led by The
Royal Bank of Scotland, are working
on plans that could result in them
buying the crisis-hit video games
retailer out of administration.
The company, which runs 1,274
stores worldwide and employs 10,000
workers 6,000 of them in the UK is
expected to fall into administration
as early as today, with the state-
owned bank reported to be among
the potential bidders.
Accountancy giant PwC has been
lined up as administrator. RBS said
last night it is still working with the
retailers five other lenders including
HSBC and Barclays on finding a solu-
tion, but refused to comment further.
Games 600-store estate in the UK
operating under the Game and
Gamestation brands is likely to be
whittled down in the administration
process before being sold on.
US-rival GameStop which has a
minimal presence in the UK is seen
as the frontrunner to buy the compa-
ny, with analysts saying it is likely to
be interested in some of the UK stores
and assets, such as its prized database
of 18,000 loyalty scheme customers.
The US games giant is also under-
stood to be circling the firms Iberian
business.
Private equity firm OpCapita may
also table a bid, however sources
familiar with the company said it is
less likely to make a second offer after
an initial bid to buy out the lenders
debt and pay suppliers in full was
given the cold shoulder.
Games woes came to a head this
month as banks restricted their lend-
ing and major game makers refused
to supply Game under new terms.
Last week Game admitted there was
no value left in the firm.
Game Groups
lenders mull
a rescue deal
Lack of corporate guidance in
spite of demand from audience
CORPORATE GOVERNANCE
BRAND ALLEY, the online designer

goods retailer, said an increasing
number of consumers shopping via
Facebook and their mobile phones
helped drive a 60 per cent surge in
sales last year to 28.9m.
The French company, which
launched its UK arm in 2008, sells
heavily discounted designer cloth-
ing, accessories and homeware in
flash sales over one or two days.
Things are extremely tough out
there for consumers but they are
very savvy in their shopping habits
and always on the lookout for
deals, Feldman told City A.M.
Our ongoing growth has been
driven by the consumer need for
value, quality products at a great
price, he said, adding that Brand
Alley had saved its members over
67m last year.
Brand Alley generated 450,000
through its Facebook page alone in
the fourth quarter, which gives fol-
lowers the extra privilege of access-
ing flash sales of designer brands
like Jaeger and The Kooples a day
early.
Feldman said 20 per cent of cus-
tomer purchases were made via its
mobile platform.
Brand Alley, which is part-owned
by News International, became prof-
itable for the first time in the fourth
quarter of 2011 and is set to make a
profit this year, Feldman said.
Revenues across the group
including France increased by 20
per cent to 125 from 104m in
2010.
Brand Alleys new friends help boost
online retailers sales by 60 per cent
Brand Alley, which sells heavily discounted designer labels, turned over 29m last year.
News
BY KASMIRA JEFFORD
RETAIL
ANALYSIS l GAME Group PLC

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Tonight's guest is Adam Boulton, Sky
News' Political Editor. Adam has been at
Sky News since the beginning. A pioneer
of the innovative use of live analysis and
pictures, it's believed that he has spent
more hours on television covering break-
ing stories than any other British television
reporter.
Adam is a winner of the Royal Television
Society's supreme Judges' Award and
was elected 2007 Chairman of the
Parliamentary Lobby. He has also
published books, 'Tony's 10 years:
Memories of the Blair Administration'
recounting the key moments of Tony
Blair's premiership and 'Hung Together'
about the days after the 2010 General
Election.
Before Sky, Adam was Political Editor of
Tv-am. He is the only reporter ever to have
door-stepped the Queen live on camera.
'Jazz in the City' on JazzFM is kindly
sponsored by global fund manager
Aberdeen Asset Management.
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CITY EYE
DOCTORS AND POLITICIANS
CHARGE THEIR OWN GLASSES
AS the debate rumbles on
over setting a minimum
price for alcohol, the British
Medical Association has
shown itself to be a bas-
tion of moral fortitude.
Heartily
backing
t h e
move, which has found favour
with the Prime Minister, it
spoke out against the
scourge of alcohol abuse
and has lobbied against super-
markets selling cheap booze as
a marketing ploy.
Such thundering suggested the
bodys doctors and medical stu-
dents would never breach the 21
or 14 units a week mens and
womens alcohol guidelines.
So it was something of a
surprise to hear the BMA
runs its own exclusive wine
club the Charles Hastings
Wine Club with special
deals including fine wines
sold below retail price.
While The Capitalist
would never suggest even its vin
ordinaire would be near the sug-
gested 45p a unit minimum price
level, its knockdown prices and
organised wine and pub tours do
seem to smack of uninhibited
imbibing.
Not so, said the BMA, stressing
that it does not disapprove of alco-
hol per se as long as drinkers
practise sensible consumption.
Thats a feat that appears less
likely for those other decision mak-
ers the politicians.
Latest reports reveal a total of
1.33m was spent in the House of
Commons bars in the year ending
31 March 2011.
And with subsidised prices set at
around 2.55 for a malt whisky,
Cointreau liqueur or Grand
Marnier and 2.35 for a glass of
decent quality wine, well... it would
seem rude to say no.
ANIMAL health officer Ann Dallimore inspects a python on its arrival at the
Heathrow Animal Reception Centre. The centre is run by the City of London
Corporation and handles over 35m animals per year. Picture: Laura Lean /
CITY A.M.
ITS barely a month since French
presidential candidate Franois
Hollande made a rare trip to London
in an effort to sway City expats
ahead of the countrys elections.
But the capitals 300,000 French
inhabitants already have a new man
vying for their votes in the shape of
Yannick Naud a portfolio manager
at Glendevon King whos also in the
running. Naud a bona fide expat
whos worked everywhere from
London to Tokyo will stand as an
MP for the newly created Northern
Europe seat, which encompasses
not just the whole of the British Isles
but 11 countries in total, including
Scandinavia and the Baltic states.
Already spotted campaigning out-
side French bank Societe Generales
UK headquarters last week, Naud
will be hoping that Londons French
community is ready for its very own
entente cordiale.
FRENCH ASSET
MANAGER TO
STAND AS MP
Bottoms up: The BMA has
its own wine club, which
offers cut-price booze
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INVESTORS sitting on the edge of
their seat over the Cable & Wireless
Worldwide bidding war might have
longer to wait as Vodafone and Tata
Communications are set to ask for an
extension on the put up or shut up
deadline imposed by the Takeover
Panel.
Vodafones original cut-off date of
12 March was extended to match the
29 March deadline given to Tata, the
second entrant to the race.
But both firms are understood to
be frustrated by the lack of informa-
tion about the company provided by
CWWs senior management, and
therefore feel ill-equipped to make a
decision by this Thursday.
Tata is showing no sign of backing
down, however. The Mumbai-based
communications firm, which is said
to have raised loans of $2bn to fund
the acquisition, has added Morgan
Stanley to its roster of banks working
on the deal. Australia and New
Zealand Bank, and the State Bank of
India, are also said to be joining Tatas
usual choice of Standard Chartered.
Bidders ears pricked when CWWs
stock crashed by as much as 80 per
cent in the six months following the
companys demerger from Cable &
Wireless Group in March 2010. Since
then the company has issued three
profit warnings and churned
through three chief executives.
But despite its struggling finances,
CWW is a tempting choice for the
interested parties.
Vodafone is likely looking at
CWWs fixed-line phone network in
the UK an asset the telecoms giant
lacks while Tata will have its eye on
CWWs 425,000km undersea cable
system.
Both companies will be attracted to
CWWs hefty client list of 70 of the
FTSE 100 companies.
It is not only buyers who have been
drawn to CWW, however. US activist
hedge fund Eliott Management has
collected a 0.62 per cent stake so far
in the cable company and is under-
stood to be vying to influence the out-
come of the bidding war.
Early reports put a 700m price on
CWW, when the group had a market
cap of under 530m. But the commu-
nications networks stock has almost
doubled since Vodafone said it was
looking to bid, valuing the company
and any likely bids above 1bn.
Vodafone and
Tata call for a
delay for bid
BETFAIR could launch its new fixed-
odds betting service by this summer as
it bids to keep hold of clients who are
turning to rival bookmakers.
The move, which Betfair has men-
tioned in passing for several months,
could launch within the next few
months and will see the company
open its arms to a gambling system it
previously dismissed.
The new service will offer a fixed-
odds sports book allowing cus-
tomers to bet against the house rather
than against each other to cater for
those who wish to gamble during a
sports match, get early prices on a par-
ticular event or place novelty bets.
Betfair currently acts as a person-to-
person exchange that connects players
willing to place similar stakes on the
same event thus cutting out tradi-
tional middle man the bookie.
But the gambling facilitator, which
launched in 2000 by marching coffins
saying death of the bookmaker
through the streets, insists it will not
go against its roots.
Betfair boss Stephen Morana
assured last week: Our sports
exchange always has been and
always will be Betfairs core product.
In October Numis analyst Ivor Jones
said the move could increase Betfairs
profits by more than 50 per cent.
Betfair takes a
gamble with
fixed-odds bets
Vittorio Colao-led Vodafone has already
extended its deadline once GETTY
Tata Communications boss Ratan Tata
has his eye on CWW GETTY
Gavin Darby, formerly of Vodafone, is CWWs third chief exec in the last year GETTY
BY LAUREN DAVIDSON
TELECOMS
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News
ECONOMIC woes in the Eurozone
are hitting the financial services
industry, a new report claims this
morning, despite political measures
that have calmed the markets.
Loans approaching or at the point
of default are set to hit an all time
high, according to economists at
Ernst & Young.
Non-performing loans will rise
above six per cent of total loans
across the Eurozone the group
warned this morning. The figure
would be the highest level since the
creation of the euro in 1999.
The unrelenting rise of non-per-
forming loans is an under-acknowl-
edged threat to banks capital levels,
said Ernst & Youngs Marie Diron.
While the worlds attention is
focused on losses on sovereign
debt holdings, non-performing
loans are creeping up on banks,
as businesses in the euro area
which they have lent to struggle
against the weakening econo-
my.
GDP shrank by 0.3 per
cent in the single cur-
rency area during
the final three
months of last
year, official fig-
ures have indi-
cated. Recent
economic data
appears to show that the Eurozone
could be experiencing a technical
recession with GDP shrinking again
in the first quarter of 2012.
Ernst & Youngs latest financial
services forecast predicts that the
Eurozone economy will contract by
0.5 per cent in 2012, which is expect-
ed to drive down demand for new
loans even further.
A bailout deal for Greece has eased
some investors fears in recent
weeks, while the European Central
Bank (ECB), led by Mario Draghi (pic-
tured), has pumped liquidity into
the markets via its Longer-Term
Refinancing Operation (LTRO).
The LTRO has calmed the markets
and given banks time to build capi-
tal via deleveraging, increasing
retained profits and selective asset
sales when the right buyer is found,
Ernst & Young said in its
report, stating that banking
assets and loans should
recover to 2010 levels by
2015.
In the short term, howev-
er, financial services in the
Eurozone, and those busi-
nesses that they work with,
will continue to feel
the pinch of a
weakening econ-
omy trapped in a
low growth, low
i n v e s t me n t
cycle, it
warned.
Economic woe
in euro area
will hit banks
BANKS were pushed into risky lend-
ing by low interest rates, creating the
sub-prime bubble and causing the
global financial crash, new research
out claims and low rates could
again be failing to help the economy
in the long run.
Low rates in the US and other
western economies in the 2000s led
banks to search for a higher return
on their investments, accepting riski-
er mortgage applicants, according to
Mathos Delis, presenting his conclu-
sions at the Royal Economics
Societys annual conference this
week.
The paper compares the risk pro-
file of loans made at different points
over the last 25 years and concludes
interest rates did impact on lending
decisions made.
Lowering rates at time of econom-
ic weakness after the dotcom bub-
ble and the 9/11 terrorist attacks, for
example simply put off the crash to
a later date, and allowed an addition-
al decade of even riskier investments
to build up, the researcher argues.
Our results are all the more strik-
ing as the present stance of the
Federal Reserve is to maintain ultra-
low interest rates in an attempt to
resurrect the sagging US economy,
said the authors.
Central banks should consider
the possible adverse effect of their
loose monetary policies on bank risk-
taking.
The claims come just a week after
the Bank of Englands chief econo-
mist Spencer Dale warned low inter-
est rates are keeping weak firms
afloat and could in time prevent the
necessary rebalancing of the UKs
economy.
Research: Low
interest rates
caused crisis
Homes near highly-ranked schools come with a steep premium Picture: GETTY
BY JULIAN HARRIS
EUROZONE
WORLD ECONOMY
Homes near top schools

cost an extra 90,000
HOUSES located near top performing
primary schools cost an average of 42
per cent more than homes in other
areas, according to research pub-
lished this morning.
Parents concerned with securing
their children a place at a well-regard-
ed school can pay an average of
91,618 more for a property than they
would have to cough up to live else-
where.
Yet the trend, revealed by the web-
site Prime Location, is significantly
weaker in London. Homes near good
schools in the capital are only 7.4 per
cent more expensive on average the
lowest premium in the UK.
This could be because external
influences on house prices here are
much stronger and high population
density means theres more competi-
tion for homes in London, even with-
out the lure of living near a top
primary school, said Prime
Locations Nigel Lewis.
Elsewhere in the south east, prices
near top schools are 37 per cent high-
er than in other neighbourhoods.
Meanwhile separate data from BM
Solutions, also released this morning,
has shown that buy-to-let investors
are continuing to take advantage of
high rents. Rental yields the annual
income from renting as a proportion
of the propertys price came in at
6.1 per cent last year.
HOUSING
Number of British
insolvencies edged
up over last year
INSOLVENCIES have crept up over the
past 12 months, according to data
released by Experian this morning.
The rate of insolvencies among
British companies rose to 0.1 per cent
last month, compared to 0.08 per cent
in February 2012.
Among medium to large-sized
firms categorised as those with
between 101 and 500 employees the
rate shot up to 0.17 per cent, from 0.12
per cent 12 months earlier.
However, businesses with between
51 and 100 employees fared much bet-
ter. Firms of this size saw their rate of
insolvency drop from 0.2 per cent in
February 2011 to just 0.12 per cent last
month.
The countrys struggling construc-
tion industry believed to be affected
by cuts to government-funded build-
ing projects saw the biggest jump in
the proportion of firms becoming
unable to pay their debts, compared to
the UKs four other largest industries.
In construction the insolvency rate
climbed to 0.21 per cent last month,
compared to 0.17 per cent a year earli-
er. Among all industries, pharmaceuti-
cals recorded both the sharpest rise in
its rate, plus the highest overall rate of
insolvencies.
Although business insolvencies
increased slightly in February, our
data is showing that UK business bal-
ance sheets have been improving grad-
ually since August, said Experians
Max Firth. Any increase in insolven-
cies among medium and large busi-
nesses highlights a riskier
environment, particularly for the
smaller firms that supply to them.
BY JULIAN HARRIS
UK ECONOMY
News
NEWS | IN BRIEF
Slow progress on derivative rule
International regulators are likely to miss
their 2012 deadline to push most deriva-
tives trading onto central counterparties,
the Bank of England believes, and need to
engage more with industry participants.
The G20 group of nations and the
Financial Stability Board (FSB) want
financial derivatives, such as interest rate
swaps, to be cleared centrally rather than
traded over the counter (OTC) to boost
transparency and reduce systemic in the
market. However, progress has been slow
because many products are individually
tailored to each customer, and some
markets may be too illiquid for a central
process to help. The industry may need
more specific guidance from the authori-
ties as to which OTC derivatives should
be centrally cleared, said the Banks
financial stability paper. There is also an
urgent need to develop precise and time-
ly metrics to monitor central clearing
progress. The FSB has already admitted
it risks failing to implement central clear-
ing by the end of the year.
FEWER PAY FREEZES AT UK FACTORIES
PAY settlements in UK factories have risen slightly to an average rise of 2.5 per cent, the
industry group EEF said today. The data showed that only one in 10 manufacturing
employees are now agreeing to a pay freeze, compared to a ratio of one in six when the
EEF last released its data in January. Picture: GETTY
GLOBAL market worries have contin-
ued to knock merger and acquisition
activity at the start of the year, accord-
ing to a new study released this morn-
ing.
Internationally, the number of
M&A deals fell by 24 per cent in the
opening three months of the year
compared to the final quarter of 2011,
Ernst & Young has calculated.
Compared to a year earlier, M&A
volumes at the start of 2012 were
down 26 per cent.
Yet the total value of deals declined
at a more modest rate 13 per cent
as some large deals were pushed
through.
The market uncertainty of late last
year has clearly impacted transaction
activity in quarter one of 2012, com-
mented Jon Hughes of Ernst & Young.
That said, the small upswing in
average deal values could indicate an
increase in confidence amongst buy-
ers who whilst still cautious about
undertaking transactions, are more
willing to push through larger deals,
he added.
Globally, the average deal in the
first quarter of this year rose to
$296m (186.5m), up 14 per cent from
$260m in the final three months of
last year.
The trend was seen clearly in the
UK, where the volume of deals
dropped by 14 per cent quarter on
quarter, yet the total value actually
grew 20 per cent over the same peri-
od. The average value of a deal in the
UK shot up by 41 per cent, from
$189m to 264m.
The UK bucked the international
trend of a decreasing level of deals
funded entirely by cash. While just
over half (55 per cent) of global deals
were 100 per cent financed by cash,
the figure in the UK was a far-higher
91 per cent.
Activity across international bor-
ders has continued to hold up despite
economic woes, according to the data
which is compiled from six separate
leading market sources.
Cross-border M&A activity jumped
by 32 per cent in the first quarter of
2012, while cross-regional deals were
also up by 20 per cent.
M&A volumes
down in 2012
BY JULIAN HARRIS
M&A
Business
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LARGE budget deficits and growing
national debts push up interest rates
and leave countries more vulnerable
to global economic shocks, accord-
ing to new research out today.
While monetary and fiscal policies
globally make the most difference to
rates, a paper presented today at the
Royal Economics Society argues indi-
vidual governments also have an
impact, with high-debt policies push-
ing up interest rates.
A one per cent increase in a coun-
trys public debt is associated with a
long-term interest rate rise of about
one basis point, economists Sergio
Sola and Salvatore DellErba found.
Furthermore, a one per cent rise
in the budget deficit increases sover-
eign spreads by 2.6 basis points.
A global risk-aversion shock, gen-
erates an increase in sovereign
spreads, which is higher for coun-
tries with a high stock of public debt
or weaker political institutions
namely Italy.
Austerity keeps
interest rates
low, says study
WORLD ECONOMY
A HIGHER lending capacity for the

Eurozones rescue fund would help to
reassure markets, the head of the
bailout fund said yesterday.
The German government is
believed to be about to bow to inter-
national pressure to bolster the fund.
More money would reassure mar-
kets. Wrongly or rightly the fact is
that big numbers in the shop window
create calm, Klaus Regling, head of
the temporary European Finance and
Stability Facility (EFSF), told
Germanys Focus magazine.
Eurozone finance ministers meet
in Copenhagen on 30-31 March and
are due to decide whether to increase
the lending capacity of the bailout
fund above a current 500bn.
Italian Prime Minister Mario Monti
said in an interview yesterday: The
higher the firewalls, the less likely it
is that they have to be actually used.
Regling went on to challenge popu-
lar opposition in Germany to more
money for the rescue fund.
The bailouts havent cost German
taxpayers a penny. The belief that this
money is gone and will never come
back is wrong. These are loans.
Head of bailout
fund wants big
Eurozone pot
EUROZONE
It's less than one hundred paces (under cover of course) from our train station to
our new y-through terminal at London Southend Airport. At peak times there
are up to 8 trains an hour operating from Central London. And with a journey time
of just 52 minutes from London Liverpool Street and 44 minutes from Stratford;

London Southend Airport...
under 100 paces from train station
to our new fly-through terminal!
Flying with
News
BEST OF THE BROKERS
19 Mar 20 Mar 21 Mar 22 Mar 23 Mar
315
310
305
295
300
312.10
23 Mar
p
ANALYSIS l Kingfisher PLC
KINGFISHER
Nomura has upped its target price on the
B&Q owner from 315p to 350p and main-
tained its buy rating on the stock fol-
lowing full-year results from the company
last week. The broker has also increased
its 2013 earnings per share outlook by
four per cent to incorporate lower tax
rates and a stronger view on the develop-
ment of its Screwfix brand.
19Mar 20Mar 21 Mar 22Mar 23Mar
104
106
102
100
96
98
97.30
23 Mar
p
ANALYSIS l Logica PLC
LOGICA
Merchant Securities maintains its sell rat-
ing on the business and technology service
company but ups its target price from 70p to
85p on a positive readacross from
Accentures second quarter results, showing
relatively strong growth in Europe. However,
the broker remains concerned about Logicas
outlook in the UK and France after lower
margins in the second half of last year.
19Mar 20Mar 21 Mar 22Mar 23Mar
2,975
3,000
2,950
2,925
2,875
2,900
2,987.00
23 Mar
p
ANALYSIS l Next PLC
NEXT
Deutsche Bank reiterates its buy rating
on the high-street retailer and increases its
target price to 3,280p after the companys
full year results came in in line with con-
sensus forecasts. The broker also increases
its estimates by 0-5 per cent over the next
three years, driven by small operating prof-
it and tax rate changes, but sees risks from
the threat of rising cotton prices.
To appear in Best of the Brokers email your research to notes@cityam.com
TODAY
Investors in highly volatile oil and
exploration stocks could face surprises
this week, as some small-cap firms
report, but the UK market should start
off quietly. Volume may pick up in the
afternoon with pending home sales
from the US. Given mildly disappoint-
ing existing home sales figures last
week, pending home sales could also
disappoint. Signs that the housing
market is struggling could pressurise
the Fed to consider a third tranche of
quantitative easing.
Reporting: Salamander Energy,
Punch Taverns, Bowleven.
TUESDAY
Consumer confidence numbers due at
3pm will clarify how shoppers are
positioned for planned purchases in
the US. Analysts expect a slight
downtick on the previous number,
indicating that the US consumer is
still a reluctant spender.
Reporting: Afren, Kazakhmys,
Bellway and 888.
WEDNESDAY
Trading will likely be quiet for the
first hour as traders await UK GDP
numbers at 9.30am. A fourth quarter
figure of -0.2 per cent is expected,
indicating the economy is still strug-
gling to grow. MBA mortgage applica-
tion numbers at 12pm will clarify
the US housing market.
Reporting: JKX Oil, Evraz
Ex-dividends: Money Supermarket,
BSkyB, British Land, AngloAmerican,
Schroders, Prudential, and Royal Sun
Alliance.
THURSDAY
In the UK, net consumer credit and
mortgage approvals are expected to
improve on the previous reading,
indicating mild bullishness. Traders
will likely wait for US GDP and initial
jobless claims numbers before com-
mitting. Market watchers will look
for both readings to maintain recent
trends and show signs of improve-
ment. Anything less could see equi-
ties pull back and a flight to safety.
Reporting: Moss Bros, Nighthawk
Energy, Falkland Oil & Gas and
Jubilee Platinum.
FRIDAY
A quiet end to the week doesnt
mean traders shouldnt be
trading. Its the end of the month
and first quarter, so equities will like-
ly see above average pick up in vol-
ume as portfolio managers adjust
positions.
Companies Reporting: Red Rock
Resources, Enegi Oil, Xtract Energy,
and Earthport.
Manoj Ladwa, professional trader at ETX
Capital, is running an open long/short port-
folio using his systematic trading method. To
follow Manojs trading journey more closely
go to: www.etxcapital.co.uk/manoj
MANOJ ON THE
MARKETS
MANOJ LADWA
Economic news drives
quiet week for trading
Jones Day
The global law firm has appointed com-
petition lawyer Nick Taylor to its
Sydney office as partner. Taylor was a
partner with Gilbert & Tobin, and has
also served in government, for the
Australian Competition Commission.
RSA
The leading global insurer has
announced the appointment of Karen
Myers as HR director, UK and western
Europe. She will report to Adrian
Brown, chief executive UK and western
Europe. Myers joined RSA in 2009 as
commercial HR director, and has been
acting HR director since last August.
Hedge Fund Research
The Chicago-based global leader in the
alternative investment industry has
appointed Joel M Schwab as managing
director. He will lead new business
development for the firms hedge fund
database and research products.
+44 (0)20 7092 0053
morganmckinley.com
To appear in CITYMOVES please email
your career updates and pictures to
citymoves@cityam.com
SPECIALISTS IN GLOBAL
PROFESSIONAL RECRUITMENT
in association with
Coutts
Jennifer Mathias has been appointed chief finan-
cial officer of the wealth division of the Royal
Bank of Scotland, with immediate effect. Mathias
joins from Lloyds Banking Group, where she was
finance director of the corporate banking division.
She will report to Fiona Davis, finance director
for retail and wealth within the Royal Bank of
Scotland, and to Rory Tapner, chief executive of
Coutts. She has previously served as head of
credit risk and compliance for the commercial
banking division of Lloyds TSB.
CITY MOVES | WHOS SWITCHING JOBS
Edited by Tom Welsh
Y
OU dont have to read too far into the City
pages, these days, to come across a story
about individuals or institutions under
investigation by either regulatory or pros-
ecutory authorities.
Whether its to do with mortgage securities,
Libor setting, insider dealing, or another ill,
theres little doubt that working in financial
services has never been quite so perilous.
Its easy to think that you cant fall foul of the
authorities by mistake, but in an ever-shrinking
world thats simply no longer the case.
Automatic cross-border sharing of information
among regulatory bodies effectively leaves indi-
viduals at risk of enforcement action, or even
prosecution by a foreign authority, for an activi-
ty conducted at a desk in London.
Twelve years ago, I unwittingly trod on such a
landmine. I was living in London and working
in the City. In a transaction which has since
become infamous, I invested personally, along
with two colleagues, in a deal connected to the
US energy company Enron. The transaction was
organised by Enrons chief financial officer, and
as I was in the process of leaving my employer,
NatWest, I didnt report it to them. Big mistake.
Eighteen months later, when Enron was in
deep financial difficulties, the three of us were
spooked by one of Enrons filings into believing
that thered been some insider dealing in the
transaction in which wed been involved. So we
self-reported to the FSA, who interviewed us at
length, thanked us profusely for coming in, and
passed on all the materials wed given to them
to the Securities and Exchange Commission. We
sat around and waited for a call that never
came.
Then one morning, seven months later, we
woke up to find ourselves on the breakfast news,
accused by the US Department of Justice of
defrauding NatWest Bank in London. Eighteen
months later, a new law came into force which
allowed the US government to request the extra-
dition of UK citizens without having to provide
any evidence to support the requests. Within a
month our extradition was sought.
A lengthy and very public battle to defeat the
extradition and change the law followed. We
failed on both counts and were sent to Texas in
July 2006, facing up to thirty-five years in prison.
Eventually, in November 2007, we bowed to
the inevitable and agreed to plead guilty to one
count of wire fraud in return for an agreement
to expedite our return to the UK. We were sen-
tenced to thirty-seven months in prison, and
served seven months in the US, and a further
eleven months in the UK, before being allowed
home on electronic monitoring.
To a degree we were the architects of our own
misfortune. But our case became a cause celebre
because we highlighted the dangers in a piece of
legislation that had been shovelled through par-
liament on the back of the War against Terror,
and which has since caught many British busi-
nessmen in its tentacles.
The issue is this: a US prosecutor can obtain
an indictment with the minimum of effort and
in a process that has no judicial oversight, con-
ducted behind closed doors. Armed with that
charging document, and no more, he can
request the extradition of a UK citizen, and our
extradition laws give that individual substantial-
ly no defence against extradition. Once in
America, he or she will be thrown into prison
and will languish there until ready to confess to
the crimes, however spurious the allegations.
You may think I exaggerate and that your
company or the UK authorities would protect
you if this happened to you, but youd be foolish
to believe so. The UK authorities will turn the
other way. Your employer will most likely fire
you to avoid an indictment of the firm itself, the
threat of which is a routine tactic of US prosecu-
tors to make sure individuals are isolated.
Since returning to the UK, I have been directly
involved in several cases of British businessmen
caught up in this nightmare. Ian Norris, the for-
mer chief executive of Morgan Crucible. Jeremy
Crook of Peregrine Systems. David Carruthers,
former chief executive of Betonsports. And most
recently Christopher Tappin, who is currently in
a prison in the middle of the New Mexico desert.
Its easy to believe that you wont be next.
Every one of the above thought exactly that. But
all bar Tappin now have a criminal record to
show for their experiences, and Tappins plea
bargain will surely be a next-step formality if he
is unable to get bail.
The villain in the piece is the UKs Extradition
Act, which positively encourages overreach by
zealous US prosecutors. In opposition, both the
Tories and Lib Dems knew what was wrong with
the law and tried to change it. In government,
however, the Tories have come over all squeam-
ish on the subject. If you are reading this, the
chances are that you are very much at risk, and
will remain so until the politicians can be per-
suaded to change this Orwellian law.
David Berminghams book A Price to Pay is pub-
lished today by Gibson Square Books at 8.99, with an
e-book at 2.99. www.apricetopay.co.uk. All the
authors profits will be divided between Liberty and Fair
Trials International.
26
The Forum
CITYA.M. 26 MARCH 2012
We highlighted the dangers
in legislation enacted on the
back of the War on Terror
Britains faulty extradition
treaty has opened up a fast
route from City desk to jail
cityam.com/forum
DAVID BERMINGHAM
Agree? Disagree? Got a sharp comment?
The Forum wants you to join the debate.
COMMENT NOW ON
Twitter: @cityamforum;
on the web: cityam.com/forum;
or by email: theforum@cityam.com.
Top responses will be reprinted in The Forum.
27
The temperance
lobbys influence
wont stop with
this one measure
Nanny cant cure
the UKs alcohol
price headache
T
HE era of big, bossy, state interference,
top-down lever pulling is coming to an
end. So said David Cameron in 2008.
Of all the hostages to fortune politi-
cians take in their years in opposition, this
has the makings of a classic. Its hard to
believe that less than two years have passed
since the bright-eyed coalition promised to
tear through the statute book as it threw
intrusive and illiberal legislation on the bon-
fire.
Does anyone now remember the
YourFreedom website which asked the pub-
lic to nominate unnecessary laws and regu-
lations for the scrap-heap? That project bit
the dust when it transpired that the public
wanted to repeal the drug laws and relax the
smoking ban. The website now exists only in
the National Archives, so future historians
can marvel at the golden summer of 2010
when deregulation briefly seemed possible.
As we move towards summer 2012, nor-
mal service has very much been resumed.
Far from scrapping illiberal laws, the govern-
ment has launched two policies which will
give it unprecedented powers over private
enterprise. Plain packaging of cigarettes will
allow bureaucrats to dictate the entirety of
one products appearance, while minimum
pricing of alcohol will allow the state to
decide the right price of another.
It is a tribute to the astonishing influence
of ASH, Alcohol Concern, the British Medical
Association (BMA) et al. that neither of these
policies was on the radar of even the most
extreme public health groups five years ago.
Traditionally, pressure groups had to cam-
paign for decades before they persuaded leg-
islators. Today, fundamental freedoms can
be cast aside in what seems like the blink of
an eye. And make no mistake, the freedom
for manufacturers to sell their products at a
price that suits them and suits their cus-
tomers is fundamental.
Meanwhile, Cameron is talking about set-
ting the minimum price at 40p a unit, a rate
so low that only a trivial number of low-qual-
ity beverages will be affected. The idea that
50,000 crimes and 900 deaths a year will be
prevented as a result of a regulation that
affects virtually no one is patently absurd.
But does anyone seriously believe the min-
imum price will stay at 40p for long? A clas-
sic bait and switch is on its way. The BMA has
long called for a 50p unit. In Scotland, there
are already demands for 60p. The very fact
that a 40p unit will do nothing will be used
as justification for further action. At 45p,
the price starts to bite. At 50p and above,
those of us who earn less than a doctor or
politician will assuredly lose out.
The 40p unit proposal is a Trojan horse.
Once it becomes law, the temperance lobby
will have a powerful weapon with which to
incrementally raise prices. If 69p for a can of
lager is pocket money, is not 89p or 99p
also loose change? There is no correct price
for alcohol. For the temperance lobby, the
answer to the question of how much a drink
should cost will always be more.
Chris Snowdon is an author and freelance jour-
nalist. His latest book is The Art of Suppression:
Pleasure, Panic and Prohibition Since 1800.
Priority boarding
[Re: A third runway at Heathrow
is essential if London is to be a
globally competitive city, Friday]
Paul Willis is right that Boris
Island is imaginative but twenty
years away. The short-term
answer is for government to dic-
tate that only strategic business
routes are served by Heathrow.
New routes to China and Latin
America should be prioritised
while less critical destinations are
moved to regional airports.
David Williams
Unclipped wings
A Heathrow third runway is the
most viable option. Critically it
would be entirely private sector
funded, with no taxpayer money
required. But it is no silver bullet in
itself. A second runway at
Stansted would help relieve
Gatwick, and Gatwick should also
be able to build a second runway
to be a viable alternative for long-
haul routes. The alternatives are
ludicrous. HS2 will have next to no
impact, at best a 3 per cent reduc-
tion in flights and at massive tax-
payer expense. The Boris Island
hub is a great dream, but besides
taking at least ten years to build, it
would cost a fortune. Constraining
Heathrow hinders British Airways
against its competitors, which all
have unconstrained airport space.
Restrictions on expansion wont
save the environment, since air
traffic will just shift to other hubs.
Scott Wilson
Email: theforum@cityam.com
Twitter: @cityamforum
RAPID RESPONSES
CHRIS SNOWDON
BY STUART FRASER
The Forum
A
S THE financial
year draws to a
close, and with a
degree of stability
in financial markets, we
can now think about the
longer-term future of the
City and Londons finan-
cial services.
The findings of the City of Londons latest research
report, published in partnership with London First and
the City Property Association, highlight the impor-
tance of keeping an eye to the future.
Delivering Power: The Future of Electricity
Regulation in Londons Central Business District antici-
pates that, without investing in infrastructure to meet
future needs, Londons future economic growth risks
being compromised.
The Greater London Authority estimates that, by
2032, central London will benefit from around 20 per
cent growth in employment and will require up to 3m
square metres of new office floor space the equiva-
lent of twenty seven buildings the size of the Shard.
Electricity distribution companies have limited
incentives to invest in anticipating demand. Current
investment tends to be reactive rather than proactive.
This clearly raises genuine concerns over supply, but
also over the constant disruption to our lives through
what seem to be permanent roadworks.
Network operators need more incentives, and pro-
tection from the added risks inherent in forecasting
demand, if they are to get ahead of the demand curve.
If we are to keep up with our competitors, greater
flexibility must be built into the network, for example
through investment in capacity in selected substa-
tions, or by installing spare cable ducting in anticipa-
tion of where it is most likely to be needed.
These initial investments would speed up the deliv-
ery of power supplies to new developments. It would
also reduce the scale of roadworks required to con-
nect them, alongside accompanying disruption, mak-
ing life easier for everyone from buses to cyclists.
Development is a sign that the City is alive and
growing, and well-planned provision now will facilitate
growth and minimise disruption for years ahead. A
just in time approach to power provision wont do.
International competitiveness isnt all about tax
and regulation. While London has many competitive
advantages, we need to ensure we have efficient and
effective infrastructure to maintain our position.
Business needs to be confident about its access to
power networks and modern technology like high-
speed broadband and 4G networks.
The development of technologies like 4G and other
forms of effective, long-distance communication will
influence how working life is conducted, and may
influence future demand for office space; so estimat-
ing demand remains hazardous. Utilities need to take
more risk and we will have to pay for that, either
through higher charges or government insurance.
The reports publication and recommendations are
timely, coming ahead of talks between UK Power
Networks (the distribution network operator for
London) and Ofgem, which will decide the regulatory
framework and level of investment for 2015-2023.
There is obviously no magic bullet to resolve these
issues, but there is equally no doubt that key players
must continue to work closely together to ensure that
the future needs of business are met, that the City
continues to shine brightly as a global financial centre
and that our desktop technology comes on and
stays on when we want it to.
Stuart Fraser is the policy chairman at the City of
London corporation.
Future energy demand
requires planning now
Email: theforum@cityam.com
Twitter: @cityamforum
In association with
28
High and middle income earners can expect to gain and
lose, but pensioners, smokers, drinkers and drivers will all
be penalised by the chancellors announcements last week
How the Budget will
affect your finances
T
HE chancellor made an abun-
dance of announcements in
this weeks Budget, invoking a
variety of strong responses,
both in support and against.
The Budget contained both posi-
tives and negatives for high and mid-
dle income earners, but what seems
to have captured the popular imagi-
nation is the effect on pensioners.
The announcement that higher
age-related allowances for people
over sixty-five have been frozen, and
will eventually disappear, has stirred
up some strong feelings among peo-
ple of all ages and income levels.
The middle earner we asked also
felt that he has missed out personal-
ly especially in an economy where
prices are rising. Our high earner
sees the benefit of cutting the 50p
tax, but remember that inflation, as
well as higher taxes on cigarettes,
fuel and alcohol and the Budgets
new rules on VAT, stamp duty and
reliefs will all eat into extra dispos-
able income.
MIDDLE INCOME EARNERS
The chancellor announced that the
tax-free personal allowance for
under 65s will increase to 8,105 on
6 April this year, and then rise to
9,205 on 6 April 2013. This is set to
give as many as 24m low and middle
income earners an effective tax cut.
Its also set to rise again to 10,000 in
April 2014 one year earlier than
originally planned.
However, dont get too excited. At
the same time, the threshold for 40
per cent tax has been lowered, mean-
ing youll start to pay 40 per cent tax
on any earnings over 42,475 in
2012-2013 and 41,450 in 2013-2014.
Theres more bad news if youre a
single parent, middle income earner.
Youll lose the full amount of child
benefit, from January 2013, if you
earn 60,000. Thats 1,000 a year for
one child, 1,700 for two and 2,500
for three. You start to lose the bene-
fit if you start earning 50,000 a year.
Nick is an internet company owner,
earning about 50,000 per year, who
wont gain from the increase in the
personal allowance because of the
lowering of the higher rate tax band.
Married without children, he said
of the Budget: It doesn't make much
difference. At first I thought a lot of
people were going to benefit from
raising the income tax threshold,
but when you work it out, its noth-
ing compared to the rise in gas bills
and council tax. It seems that the
very rich and the poor have done
very well out of the Budget, but not
those in the middle or retired peo-
ple.
Whatever you earn, as usual there
are some changes which will affect
the majority of people in one way or
another.
Smokers and drinkers will now
have to dig deeper into their pockets.
There has been an immediate tax
increase on tobacco of 5 per cent.
This typically means forking out an
extra 37p for a packet of twenty ciga-
rettes. Drinkers are also affected as,
while no new alcohol taxes were
announced, the 2 per cent above
inflation rise in the cost of a pint of
beer will go ahead. This will increase
the price of a pint by around 5p.
Similarly, despite no new fuel duty
measures being announced, the
3.02p per litre rise in unleaded
petrol from 1 August will go ahead.
HIGH INCOME EARNERS
If you are a high earner on 150,000
or more, you will benefit from hav-
ing your income tax rate cut from 50
per cent to 45 per cent. This wont
happen immediately, but kicks in
from April 2013.
Kay, 43, is a high earner and owner
of a West End media agency.
I am happy with the cut in the
50p tax rate, she says. We need
businesses and entrepreneurs to
come here and, as a country, we
dont benefit in any way from the
50p rate.
But I do feel strongly that, of all
the people in this country, those
who suffer most are older people. I
realise that we have a burgeoning
elderly population, but to freeze
their benefits is wrong.
Trevor Lloyd-Jones is consumer finance
expert at MoneyVista.
Wealth Management | Personal Finance
Balancing the budget on the lungs of smokers
MONEYVISTA
TREVOR LLOYD-JONES
CASE STUDY: KAY, 43
CASE STUDY: NICK, 46
Wealth Management | Markets
EUSHARES
AIR LIQUIDE...............99.09 -0.21 101.00 80.90
ALLIANZ .....................91.18 -0.25 107.45 56.16
ANHEUS-BUSCH INBEV54.42-0.36 55.20 33.85
ARCELORMITTAL......14.93 0.15 26.40 10.47
AXA.............................12.73 0.08 15.97 7.88
BANCO SANTANDER ..6.04 -0.06 8.42 4.94
BASF SE .....................65.85 -0.07 70.22 42.19
BAYER.........................53.44 -0.16 59.44 35.36
BBVA.............................6.24 -0.07 8.81 4.94
BMW............................67.90 0.29 73.95 43.49
BNP PARIBAS ............37.46 0.41 55.44 22.72
CARREFOUR..............18.40 0.15 28.39 14.66
CRH PLC.....................15.73 -0.30 17.03 10.28
DAIMLER ....................45.49 0.70 53.95 29.02
DANONE .....................51.18 -0.24 53.46 41.92
DEUTSCHE BANK......38.34 0.33 44.56 20.79
DEUTSCHE BOERSE.50.62 0.02 57.68 35.65
DEUTSCHE TELEKOM.9.11 0.06 11.38 7.88
E.ON............................18.03 -0.05 23.54 12.50
ENEL .............................2.80 -0.01 4.86 2.78
ENI ...............................17.78 -0.14 18.72 11.83
FRANCE TELECOM ...11.49 -0.02 15.98 10.92
GDF SUEZ...................19.54 -0.09 28.98 17.65
GENERALI ASS. .........12.28 -0.08 16.44 10.34
IBERDROLA .................4.42 -0.07 5.95 4.16
INDITEX.......................71.50 -0.09 72.80 52.20
ING GROEP CVA..........6.62 -0.01 9.50 4.21
INTESA SANPAOLO.....1.48 0.02 2.19 0.85
KON.PHILIPS ELECTR15.25 -0.13 23.01 12.01
L'OREAL .....................88.49 -0.42 91.24 68.83
LVMH.........................128.35 -0.50 136.80 94.16
MUNICH RE...............114.75 -0.25 117.55 77.80
NOKIA...........................3.98 0.03 6.36 3.33
REPSOL YPF ..............19.24 -0.38 24.90 17.31
RWE.............................35.94 0.04 47.29 21.15
SAINT-GOBAIN...........34.98 0.44 47.64 26.07
SANOFI .......................57.76 -0.40 59.56 42.85
SAP .............................53.01 -0.49 54.85 32.88
SCHNEIDER ELECTRIC49.77 0.37 61.83 35.00
SIEMENS.....................77.36 -0.56 99.39 62.13
SOCIETE GENERALE23.94 0.49 49.47 14.32
TELECOM ITALIA.........0.91 -0.01 1.10 0.70
TELEFONICA..............12.67 -0.12 18.34 12.32
TOTAL .........................40.74 -0.32 43.73 29.40
UNIBAIL-RODAMCO SE151.00-2.30162.95 123.30
UNICREDIT ...................3.96 0.04 12.44 2.20
UNILEVER CVA ..........25.33 -0.05 27.16 20.96
VINCI ...........................39.12 0.00 45.48 28.46
VIVENDI ......................14.03 0.13 21.37 13.54
VOLKSWAGEN VORZ132.35 2.20 152.20 86.40
Price Chg High Low Price Chg High Low
WORLD INDICES
USSHARES
3M.................................88.46 -0.11 98.19 68.63
ABBOTT LABS............60.40 0.29 60.56 46.29
ALCOA.........................10.11 0.10 18.47 8.45
ALTRIA GROUP...........30.40 0.26 30.71 23.20
AMAZON.COM...........195.04 2.64 246.71 160.82
AMERICAN EXPRESS 57.25 -0.04 57.55 41.30
APPLE........................596.05 -3.29 609.65 310.50
AT&T.............................31.52 -0.19 31.97 27.29
BANK OF AMERICA......9.85 0.25 14.05 4.92
BERKSHIRE HATAWB81.38 0.45 85.51 65.35
BOEING CO.................73.97 0.05 80.65 56.01
CATERPILLAR...........107.83 1.40 116.95 67.54
CHEVRON..................106.36 1.01 112.28 86.68
CISCO SYSTEMS ........20.53 0.15 20.65 13.30
CITIGROUP..................37.14 0.24 46.90 21.40
COCA-COLA................71.49 0.07 71.77 63.25
COMCAST CLASS A...29.99 0.10 30.05 19.19
CONOCOPHILLIPS .....76.51 0.62 81.80 58.65
DU PONT(EI) DE NMR.52.63 0.41 57.50 37.10
EMC CORP ..................29.15 0.02 29.68 19.84
EXXON MOBIL.............85.55 0.22 88.13 63.47
GENERAL ELECTRIC .19.78 -0.07 20.85 14.02
GOLDMAN SACHS GRP126.181.44164.40 84.27
GOOGLE A.................642.59 -3.46 670.25 473.02
HEWLETT PACKARD..23.63 0.60 43.28 19.92
HOME DEPOT..............49.54 -0.14 49.93 28.13
IBM.............................205.48 -0.01 207.52 157.13
INTEL CORP................27.88 -0.02 27.99 19.16
J.P.MORGAN CHASE..45.16 0.51 47.80 27.85
JOHNSON & JOHNSON64.55 0.09 68.05 55.76
KRAFT FOODS A ........38.25 0.04 39.06 24.30
MC DONALD'S CORP.95.55 -0.25 102.22 73.53
MERCK AND CO. NEW38.01 0.41 39.43 29.47
MICROSOFT ................32.01 0.02 32.95 23.65
OCCID. PETROLEUM..97.62 1.87 117.89 66.36
ORACLE CORP ...........28.55 -0.08 36.50 24.72
PEPSICO......................65.30 -0.09 71.89 58.50
PFIZER.........................21.82 0.09 22.17 16.63
PHILIP MORRIS INTL..86.83 -0.01 87.15 60.45
PROCTER AND GAMBLE67.43-0.09 67.95 56.57
QUALCOMM INC.........66.69 0.40 67.00 45.98
SCHLUMBERGER.......73.18 1.20 95.53 54.79
TRAVELERS CIES.......58.20 0.23 64.17 45.97
UNITED TECHNOLOGIE81.80-0.27 91.83 66.87
US BANCORP DELAWRE31.700.33 32.18 20.10
VERIZON COMMS.......39.42 -0.24 40.48 32.28
VISA CL A...................118.78 1.50 119.72 71.20
WAL-MART STORES...60.75 0.10 62.63 48.31
WALT DISNEY CO.......43.65 0.36 44.13 28.19
WELLS FARGO & CO .33.53 0.18 34.59 22.58
FTSE 100 . . . . . . . . . . . . . . 5854.89 9.24 0.16
FTSE 250 INDEX. . . . . . . . 11566.67 14.97 0.13
FTSE UK ALL SHARE . . . . 3041.59 4.63 0.15
FTSE AIM ALL SH . . . . . . . . 793.62 2.41 0.30
DOWJONES INDUS 30 . . 13080.73 34.59 0.27
S&P 500. . . . . . . . . . . . . . . . 1397.11 4.33 0.31
NASDAQ COMPOSITE . . . 3067.92 4.60 0.15
FTSEUROFIRST 300 . . . . . 1079.42 -0.07 -0.01
NIKKEI 225 . . . . . . . . . . . . 10011.47 -115.61 -1.14
DAX 30 PERFORMANCE. . 6995.62 14.36 0.21
CAC 40 . . . . . . . . . . . . . . . . 3476.18 3.72 0.11
SHANGHAI SE INDEX . . . . 2349.54 -26.23 -1.10
HANG SENG. . . . . . . . . . . 20668.80 -232.76 -1.11
S&P/ASX 20 INDEX . . . . . . 2533.70 1.10 0.04
ASX ALL ORDINARIES . . . 4360.70 -4.20 -0.10
BOVESPA SAO PAOLO. . 65812.95 -15.24 -0.02
ISEQ OVERALL INDEX . . . 3264.51 1.75 0.05
STRAITS TIMES . . . . . . . . . 2904.76 -1.93 -0.07
IGBM. . . . . . . . . . . . . . . . . . . 834.28 -7.18 -0.85
SWISS MARKET INDEX. . . 6240.33 -9.23 -0.15
Price Chg %chg Price Chg %chg Price Chg %chg
LON GD ONCE FIX AM...........................................1651.00 15.00
SILVER LDN FIX AM..................................................32.09 0.74
MAPLE LEAF 1 OZ ....................................................34.71 2.50
LON PLATINUM AM ...............................................1625.00 8.00
LON PALLADIUM AM...............................................654.00 -24.00
ALUMINIUM CASH.................................................2139.00 -53.00
COPPER CASH......................................................8319.50 -150.50
LEAD CASH...........................................................1999.00 -25.00
NICKEL CASH......................................................18465.00 -410.00
TIN CASH ............................................................22300.00 1000.00
ZINC CASH............................................................2003.00 -22.50
BRENT SPOT INDEX ...............................................123.26 -5.50
SOYA.....................................................................1349.50 -6.00
COCOA..................................................................2285.00 -74.00
COFFEE ..................................................................176.95 -7.75
KRUG ....................................................................1729.30 24.40
WHEAT ....................................................................172.50 2.38
COMMODITIES CREDIT & RATES
BoE IR Overnight.....................................................................0.500 0.00
BoE IR 7 days..........................................................................0.500 0.00
BoE IR 1 month.......................................................................0.500 0.00
BoE IR 3 months.....................................................................0.500 0.00
BoE IR 6 months.....................................................................0.500 0.00
LIBOR Euro - overnight...........................................................0.263 0.00
LIBOR Euro - 12 months.........................................................1.417 -0.01
LIBOR USD - overnight ...........................................................0.153 0.00
LIBOR USD - 12 months..........................................................1.152 0.00
Halifax mortgage rate..............................................................3.990 -0.02
Euro Base Rate........................................................................1.500 0.00
Finance house base rate.........................................................1.500 0.00
US Fed funds ...........................................................................0.250 0.00
US long bond yield..................................................................3.310 -0.01
European repo rate..................................................................0.145 0.00
Euro Euribor.............................................................................0.320 0.00
The vix index............................................................................14.82 -0.75
The baltic dry index.................................................................908.0 12.0
Markit iBoxx ...........................................................................240.68 0.65
Markit iTraxx...........................................................................119.09 7.61
BAE Systems . . . . . .305.2 1.0 340.8 248.1
Chemring Group . . . .414.3 0.1 736.5 368.8
Cobham . . . . . . . . . . .221.9 2.3 236.5 165.9
Meggitt . . . . . . . . . . . .390.9 3.2 408.3 304.9
QinetiQ Group . . . . . .144.5 0.2 153.2 101.5
Rolls-Royce Holdi . . .825.5 5.0 842.5 557.5
Senior . . . . . . . . . . . . .195.7 2.9 201.0 135.6
Ultra Electronics . . .1731.0 12.0 1779.0 1305.0
GKN . . . . . . . . . . . . . .210.3 2.9 245.0 157.0
Barclays . . . . . . . . . . .244.5 4.9 308.9 138.9
HSBC Holdings . . . . .558.3 -5.1 667.2 463.5
Lloyds Banking Gr . . .36.0 0.7 62.4 21.8
Royal Bank of Sco . . .28.0 0.1 44.4 17.3
Standard Chartere .1599.0 2.0 1690.0 1169.5
AG Barr . . . . . . . . . .1220.0 2.0 1395.0 1031.0
Britvic . . . . . . . . . . . . .387.2 8.9 444.0 289.9
Diageo . . . . . . . . . . .1510.0 -13.5 1553.0 1112.0
SABMiller . . . . . . . . .2541.5 -18.0 2660.0 1979.0
AZ Electronic Mat . . .296.5 3.7 338.1 206.1
Croda Internation . .2097.0 -23.0 2238.0 1597.0
Elementis . . . . . . . . . .185.2 3.0 196.1 107.5
Johnson Matthey . .2285.0 -7.0 2403.0 1523.0
Victrex . . . . . . . . . . .1315.0 6.0 1590.0 1025.0
Yule Catto & Co . . . . .246.9 2.8 253.0 148.0
/$ 1.3271 0.0073
/ 0.8362 0.0019
/ 109.28 0.2261
/ 1.1958 0.0027
/$ 1.5870 0.0051
/ 130.68 0.0246
FTSE 100
5854.89
9.24
FTSE 250
11566.67
14.97
FTSE ALLSHARE
3041.59
4.63
DOW
13080.73
34.59
NASDAQ
3067.92
4.60
S&P 500
1397.11
4.33
Carpetright . . . . . . . . .663.5 -10.5 748.0 375.0
Debenhams . . . . . . . . .78.5 -1.5 80.5 51.2
Dignity . . . . . . . . . . . .820.0 -3.0 854.5 693.0
Dixons Retail . . . . . . .19.6 0.7 19.9 9.4
DunelmGroup . . . . . .510.0 4.0 524.5 383.9
Halfords Group . . . . .304.5 -1.5 405.9 268.6
Home Retail Group . .123.0 -0.1 228.5 72.5
Inchcape . . . . . . . . . .378.2 1.0 425.4 268.1
JD Sports Fashion . .775.5 6.0 1030.0 570.0
Kesa Electricals . . . . .72.1 -0.6 151.4 60.2
Kingfisher . . . . . . . . .312.1 4.7 314.8 217.0
Marks & Spencer G . .383.7 0.7 402.2 301.8
Next . . . . . . . . . . . . .2987.0 73.0 3006.9 1980.0
Sports Direct Int . . . .287.5 -0.2 296.1 181.5
WH Smith . . . . . . . . . .548.0 3.0 559.0 433.8
Smith & Nephew . . . .634.0 5.0 715.0 521.0
Synergy Health . . . . .854.0 -3.5 981.0 809.5
Barratt Developme . .146.1 -1.5 149.6 67.5
Bellway . . . . . . . . . . . .810.0 -4.5 851.0 540.5
Berkeley Group Ho .1335.0 -5.0 1414.0 1019.0
Bovis Homes Group .500.0 -6.5 518.5 326.5
Persimmon . . . . . . . .641.5 -19.5 706.5 374.0
Reckitt Benckiser . .3571.0 41.0 3597.0 3064.0
Balfour Beatty . . . . . .293.9 7.5 348.6 214.6
CRH . . . . . . . . . . . . .1319.0 -18.0 1687.0 1053.0
Galliford Try . . . . . . . .612.0 8.5 623.0 362.0
Kier Group . . . . . . . .1179.0 -18.0 1489.0 1097.0
Drax Group . . . . . . . .528.0 9.0 581.5 371.9
SSE . . . . . . . . . . . . . .1312.0 0.0 1423.0 1193.0
Domino Printing S . .552.0 -8.0 701.5 434.3
Halma . . . . . . . . . . . . .390.2 -0.4 429.6 306.3
Laird . . . . . . . . . . . . . .204.3 -2.1 213.6 127.9
Morgan Crucible C . .322.4 -1.6 360.0 224.0
Oxford Instrument .1186.0 -38.0 1262.0 662.5
Renishaw . . . . . . . . .1344.0 4.0 1886.0 800.0
Spectris . . . . . . . . . .1759.0 -17.0 1823.0 1039.0
Aberforth Smaller . . .638.5 -1.5 714.0 494.0
Alliance Trust . . . . . .370.5 0.0 392.7 310.2
Bankers Inv Trust . . .421.9 -0.9 433.8 346.5
BH Global Ltd. GB .1197.0 4.0 1212.0 1058.0
BH Global Ltd. US . . . .12.1 0.1 12.2 10.4
BH Macro Ltd. EUR . . .19.8 0.0 20.2 16.3
BH Macro Ltd. GBP 2069.0 19.0 2078.0 1671.0
BH Macro Ltd. USD . . .19.6 0.0 20.2 16.2
BlackRock World M .662.5 6.0 815.5 574.5
BlueCrest AllBlue . . .162.7 -1.3 176.2 160.6
British Assets Tr . . . .128.2 -0.3 139.4 109.0
British Empire Se . . .431.7 -2.4 533.0 404.0
Caledonia Investm .1524.0 -6.0 1800.0 1337.0
City of London In . . .298.1 0.4 306.9 257.0
Dexion Absolute L . .140.0 -0.3 150.0 130.0
Edinburgh Dragon . .243.3 -4.2 253.1 201.4
Edinburgh Inv Tru . . .499.9 2.9 504.0 422.5
Electra Private E . . .1713.0 0.0 1755.0 1287.0
F&C Inv Trust . . . . . .314.5 0.3 327.9 261.5
Fidelity China Sp . . . . .80.8 -0.7 114.3 70.0
Fidelity European . .1132.0 6.0 1287.0 912.0
Herald Inv Trust . . . . .519.0 -2.0 545.5 419.0
HICL Infrastructu . . . .119.4 -0.2 121.3 112.7
John Laing Infras . . .106.6 -0.2 110.6 103.8
JPMorgan American .949.5 -1.5 965.5 721.5
JPMorgan Asian In . .198.0 -0.8 244.0 170.1
JPMorgan Emerging .557.0 -1.0 610.5 480.1
JPMorgan Indian I . . .363.0 2.5 459.0 313.1
JPMorgan Russian .578.0 5.0 741.0 415.1
Law Debenture Cor . .383.9 -6.3 398.7 323.0
Mercantile Inv Tr . . .1048.0 -6.0 1119.0 823.0
Merchants Trust . . . .385.6 2.6 431.8 341.5
Monks Inv Trust . . . .332.9 -1.6 367.9 298.1
Murray Income Tru . .659.5 0.5 674.0 568.0
Murray Internatio . . .992.0 -3.5 1007.0 818.5
Perpetual Income . . .271.0 1.0 276.0 236.5
Personal Assets T .34300.0 100.0 35350.030600.0
Polar Cap Technol . .398.4 -1.6 404.0 299.5
RIT Capital Partn . . .1232.0 7.0 1360.0 1173.0
Scottish Inv Trus . . . .485.0 -1.0 524.0 417.0
Scottish Mortgage . .704.5 2.5 781.0 565.0
SVG Capital . . . . . . . .275.0 0.2 295.5 165.1
Temple Bar Inv Tr . . .927.5 -0.5 970.0 791.0
Templeton Emergin .598.0 -3.5 684.5 497.0
TR Property Inv T . . .155.0 -2.1 206.1 136.2
TR Property Inv T . . . .70.0 -1.5 94.0 59.8
Witan Inv Trust . . . . .493.7 -4.3 533.0 401.5
3i Group . . . . . . . . . . .207.8 -0.2 301.1 166.9
3i Infrastructure . . . .122.9 0.1 125.2 115.0
Aberdeen Asset Ma .249.9 -1.1 265.8 167.8
Ashmore Group . . . .377.1 11.6 420.0 306.4
Brewin Dolphin Ho . .164.2 0.9 176.5 113.7
Camellia . . . . . . . . . .9550.0-150.010950.08800.0
Charles Taylor Co . . .144.0 4.0 165.0 115.6
City of London Gr . . . .67.0 0.0 93.6 61.3
City of London In . . .351.8 -3.3 440.0 304.3
Close Brothers Gr . . .792.0 3.0 845.5 590.0
F&C Asset Managem .69.7 0.1 81.7 56.1
Hargreaves Lansdo .486.4 3.0 646.5 402.5
Helphire Group . . . . . . .2.0 0.1 16.0 1.4
Henderson Group . . .125.8 0.0 173.1 95.1
Highway Capital . . . . .13.0 0.0 21.0 7.0
ICAP . . . . . . . . . . . . . .417.8 2.5 541.5 311.6
IG Group Holdings . .448.4 -2.5 502.5 393.6
Intermediate Capi . . .278.2 1.7 345.0 197.9
International Per . . . .247.7 0.1 388.8 148.5
International Pub . . . .119.1 -0.4 121.5 112.7
Investec . . . . . . . . . . .382.4 -1.4 522.0 318.4
IP Group . . . . . . . . . . .119.5 -0.5 120.0 36.0
Jupiter Fund Mana . .235.8 -2.2 310.5 184.9
Liontrust Asset M . . .114.0 -1.0 115.0 57.9
LMS Capital . . . . . . . . .58.5 -1.0 64.8 54.0
London Finance & . . .19.5 0.0 23.5 18.5
London Stock Exch 1009.0 4.0 1076.0 756.5
Lonrho . . . . . . . . . . . . .12.0 0.3 19.8 8.9
Man Group . . . . . . . . .134.5 -1.0 259.6 104.5
Paragon Group Of . .190.9 1.2 206.1 134.6
Provident Financi . .1162.0 7.0 1171.0 915.0
Rathbone Brothers .1271.0 1.0 1316.0 977.0
Record . . . . . . . . . . . . .11.1 0.3 35.5 10.3
RSM Tenon Group . . . .8.6 -0.0 39.8 5.6
Schroders . . . . . . . .1603.0 20.0 1906.0 1183.0
Schroders (Non-Vo .1246.0 -7.0 1554.0 970.0
Tullett Prebon . . . . . .353.2 5.2 428.6 262.3
Walker Crips Grou . . .45.5 0.0 51.5 40.0
BT Group . . . . . . . . . .232.1 11.9 235.3 161.0
Cable & Wireless . . . .32.2 0.2 48.9 31.3
Cable & Wireless . . . .37.5 -0.5 55.0 14.2
COLT Group SA . . . .101.5 0.0 154.0 84.1
KCOM Group . . . . . . . .68.5 -0.3 84.0 58.5
TalkTalk Telecom . . .143.8 -1.2 150.0 118.9
TelecomPlus . . . . . . .687.0 19.0 802.0 452.3
Booker Group . . . . . . .81.8 0.3 83.0 57.7
Greggs . . . . . . . . . . . .519.0 -1.0 558.0 445.0
Morrison (Wm) Sup .305.7 4.1 328.0 268.5
Ocado Group . . . . . . .118.3 0.3 237.0 52.9
Sainsbury (J) . . . . . . .316.4 0.9 362.8 263.5
Tesco . . . . . . . . . . . . .337.7 6.1 420.1 310.5
Associated Britis . .1210.0 7.0 1228.0 977.0
Cranswick . . . . . . . . .802.5 3.0 842.5 588.5
Dairy Crest Group . . .343.5 0.6 409.7 311.0
Devro . . . . . . . . . . . . .320.0 -1.8 332.2 232.0
Tate & Lyle . . . . . . . . .702.0 -1.0 720.5 544.5
Unilever . . . . . . . . . .2051.0 -5.0 2189.0 1869.0
Mondi . . . . . . . . . . . . .589.0 5.5 664.0 413.5
Centrica . . . . . . . . . . .314.7 0.7 333.0 278.8
International Pow . . .372.8 3.3 374.6 279.4
National Grid . . . . . . .637.0 -1.0 659.0 569.0
Pennon Group . . . . . .711.0 -5.0 737.5 620.0
Severn Trent . . . . . .1564.0 -25.0 1610.0 1375.0
United Utilities . . . . .611.0 -7.0 637.0 560.0
Cookson Group . . . . .695.0 2.5 724.5 395.8
Rexam . . . . . . . . . . . .431.8 1.8 434.8 299.8
RPC Group . . . . . . . .379.6 1.0 393.2 278.0
Smith (DS) . . . . . . . . .178.4 3.8 183.7 113.3
Smiths Group . . . . .1020.0 4.0 1340.0 869.5
Brown (N.) Group . . .244.8 3.8 304.5 227.0
Price Chg High Low
Redrow . . . . . . . . . . . .129.0 -1.0 136.2 103.5
Taylor Wimpey . . . . . . .50.6 0.0 52.8 28.7
Bodycote . . . . . . . . . .391.1 -0.4 426.5 225.6
Fenner . . . . . . . . . . . .435.5 -4.5 483.7 280.0
IMI . . . . . . . . . . . . . . . .955.5 7.5 1119.0 636.5
Melrose . . . . . . . . . . .417.2 -0.3 423.7 268.0
Northgate . . . . . . . . . .220.0 6.0 346.7 190.9
Rotork . . . . . . . . . . .1974.0 14.0 2099.0 1501.0
Spirax-Sarco Engi . .2101.0 22.0 2184.0 1649.0
Weir Group . . . . . . .1814.0 11.0 2236.0 1375.0
Evraz . . . . . . . . . . . . .388.9 0.0 460.5 315.0
Ferrexpo . . . . . . . . . . .300.0 -2.6 499.0 238.7
Talvivaara Mining . . .249.1 -1.2 589.0 195.2
BBAAviation . . . . . . .213.6 0.3 223.4 156.0
Stobart Group Ltd . . .130.5 0.5 152.8 112.0
Admiral Group . . . . .1164.0 4.0 1754.0 787.0
Amlin . . . . . . . . . . . . .340.7 1.2 427.0 270.6
Beazley . . . . . . . . . . . .143.7 1.1 151.8 109.6
Catlin Group Ltd. . . .419.7 1.7 449.0 337.0
Hiscox Ltd. . . . . . . . . .406.5 2.3 424.7 340.5
Jardine Lloyd Tho . . .696.0 -10.5 764.5 576.0
Johnston Press . . . . . . .7.5 -0.3 9.0 4.1
MecomGroup . . . . . .176.8 9.3 310.0 134.5
Moneysupermarket. .127.5 1.0 130.3 85.8
Pearson . . . . . . . . . .1219.0 14.0 1255.0 1038.0
PerformGroup . . . . .305.0 1.7 317.2 150.0
Reed Elsevier . . . . . .549.0 5.0 578.0 461.3
Rightmove . . . . . . . .1430.0 33.0 1446.0 933.0
STV Group . . . . . . . . .115.6 0.1 168.0 76.3
Tarsus Group . . . . . .149.5 0.3 165.0 119.5
Trinity Mirror . . . . . . . .38.8 1.3 54.3 35.3
UBM . . . . . . . . . . . . . .618.0 5.5 626.0 416.0
UTV Media . . . . . . . . .147.5 4.3 150.0 92.5
Wilmington Group . .100.0 2.0 157.0 78.5
WPP . . . . . . . . . . . . . .861.5 0.0 877.0 578.0
Yell Group . . . . . . . . . . .4.0 0.0 11.0 3.4
African Barrick G . . .394.5 -4.8 616.5 388.4
Anglo American . . .2459.5 17.5 3344.0 2138.5
Anglo Pacific Gro . . .325.0 -0.6 340.0 237.9
Antofagasta . . . . . . .1172.0 31.0 1491.0 900.5
Aquarius Platinum . .152.2 3.2 370.0 130.9
Avocet Mining . . . . . .188.0 1.4 286.8 177.5
BHP Billiton . . . . . . .1917.5 16.5 2631.5 1667.0
Bumi . . . . . . . . . . . . . .698.0 0.22 703.0 686.0
Centamin (DI) . . . . . . . .74.8 0.2 154.2 72.9
Eurasian Natural . . .632.0 4.5 973.5 522.0
Lancashire Holdin . . .779.0 19.5 790.5 595.0
RSA Insurance Gro . .114.8 0.7 139.8 99.6
Aviva . . . . . . . . . . . . . .346.7 -1.7 452.7 275.3
Legal & General G . . .132.6 -1.0 135.0 89.8
Old Mutual . . . . . . . . .158.0 -0.1 164.6 98.1
Phoenix Group Hol . .560.0 10.0 688.0 451.1
Prudential . . . . . . . . .783.0 7.0 792.0 509.0
Resolution Ltd. . . . . .279.5 0.5 316.1 229.5
St James's Place . . . .364.7 2.7 376.0 294.0
Standard Life . . . . . . .234.0 0.3 250.7 172.0
4Imprint Group . . . . .290.0 2.0 295.0 200.0
Aegis Group . . . . . . .181.6 0.0 185.9 115.7
Bloomsbury Publis . .113.0 -0.8 138.0 91.3
British Sky Broad . . .692.5 -1.0 850.0 618.5
Centaur Media . . . . . . .37.3 -4.0 56.5 32.5
Chime Communicati .209.0 1.0 298.5 163.0
Creston . . . . . . . . . . . .60.9 0.3 121.0 47.0
Daily Mail and Ge . . .447.3 3.5 515.0 343.4
Euromoney Institu . .801.5 1.5 812.0 522.5
Future . . . . . . . . . . . . . .12.9 0.0 26.5 8.3
Haynes Publishing . .215.0 0.0 257.0 192.0
Huntsworth . . . . . . . . .45.0 -1.0 76.3 32.3
Informa . . . . . . . . . . . .442.6 3.6 446.0 313.9
ITE Group . . . . . . . . . .232.7 0.4 258.0 157.7
ITV . . . . . . . . . . . . . . . . .88.0 1.2 89.9 51.7
Fresnillo . . . . . . . . . .1660.0 39.0 2150.0 1302.0
GemDiamonds Ltd. .284.6 -19.0 310.6 179.8
Glencore Internat . . .405.0 1.5 531.1 348.0
Hochschild Mining . .470.3 5.3 657.0 365.9
Kazakhmys . . . . . . . .935.5 22.5 1493.0 730.0
Kenmare Resources . .47.2 2.6 61.5 31.0
Lonmin . . . . . . . . . . .1083.0 8.0 1760.0 941.0
New World Resourc .432.6 13.1 1060.0 409.4
Petra Diamonds Lt . .175.7 1.5 189.0 97.0
Petropavlovsk . . . . . .614.0 6.5 1073.0 543.5
Polymetal Interna . . .960.5 19.5 1175.0 877.0
Randgold Resource 5650.0-115.0 7565.0 4567.0
Rio Tinto . . . . . . . . .3382.5 48.5 4595.0 2712.5
Vedanta Resources 1315.0 28.0 2518.0 928.0
Xstrata . . . . . . . . . . .1105.5 -1.5 1550.0 764.0
Inmarsat . . . . . . . . . . .471.9 11.9 628.5 389.3
Vodafone Group . . . .173.6 -0.2 182.7 155.1
Genesis Emerging . .503.0 0.5 548.5 424.0
Afren . . . . . . . . . . . . . .124.0 -0.7 171.2 73.6
BG Group . . . . . . . . .1492.0 6.0 1564.5 1144.0
BP . . . . . . . . . . . . . . . .477.6 1.0 504.6 363.2
Cairn Energy . . . . . . .342.1 -1.8 531.8 291.9
EnQuest . . . . . . . . . . .129.6 1.4 141.5 85.7
Essar Energy . . . . . .153.8 12.8 489.8 101.6
Exillon Energy . . . . . .172.8 -9.6 469.7 170.1
Heritage Oil . . . . . . . .151.5 0.5 301.3 145.1
Ophir Energy . . . . . . .402.0 -15.0 440.8 184.5
Premier Oil . . . . . . . . .412.6 -13.6 520.5 310.0
Royal Dutch Shell . .2220.0 -1.0 2402.0 1883.5
Royal Dutch Shell . .2236.5 -7.5 2489.0 1890.5
Salamander Energy .224.0 1.4 317.6 182.3
Soco Internationa . . .304.4 -1.4 400.0 278.0
Tullow Oil . . . . . . . . .1473.0 5.0 1601.0 945.5
Amec . . . . . . . . . . . .1103.0 -6.0 1207.0 740.5
Hunting . . . . . . . . . . .922.5 12.0 968.0 530.0
Kentz Corporation . .444.3 -5.6 508.0 374.5
Lamprell . . . . . . . . . . .337.0 0.0 395.2 220.7
Petrofac Ltd. . . . . . .1674.0 14.0 1714.0 1108.0
Wood Group (John) .720.5 -0.5 763.5 469.9
Burberry Group . . . .1513.0 -31.0 1600.0 1092.0
PZ Cussons . . . . . . . .324.7 7.2 387.9 285.0
Supergroup . . . . . . . .623.5 -7.5 1600.0 435.2
AstraZeneca . . . . . .2840.0 -3.0 3194.0 2543.5
BTG . . . . . . . . . . . . . .340.3 -2.0 365.0 222.7
Genus . . . . . . . . . . . .1275.0 0.0 1368.0 853.5
GlaxoSmithKline . . .1418.5 -8.0 1497.0 1160.0
Hikma Pharmaceuti .679.5 -9.5 869.0 555.5
Shire Plc . . . . . . . . . .2135.0 -20.0 2300.0 1791.0
Capital & Countie . . .191.9 -2.0 203.7 154.5
Daejan Holdings . . .2990.0 -59.0 3049.0 2282.0
F&C Commercial Pr .100.7 0.2 108.0 92.6
Grainger . . . . . . . . . . .109.0 0.5 133.2 77.3
London & Stamford .110.5 -3.0 140.0 103.9
Savills . . . . . . . . . . . . .375.0 2.0 427.1 256.2
UK Commercial Pro . .70.5 -0.3 85.5 65.1
Big Yellow Group . . .292.3 -5.8 344.4 218.0
British Land Co . . . . .498.0 -1.5 629.5 444.0
Capital Shopping . . .337.8 -3.4 408.6 288.7
Derwent London . . .1732.0 -17.0 1880.0 1400.0
Great Portland Es . . .358.9 -2.2 445.0 312.9
Hammerson . . . . . . . .414.0 -4.4 490.9 345.2
Hansteen Holdings . . .73.5 -1.4 89.5 68.0
Land Securities G . . .719.5 -4.5 885.0 612.0
SEGRO . . . . . . . . . . . .235.9 -5.5 331.3 195.0
Shaftesbury . . . . . . . .499.4 -3.1 539.0 441.2
Aveva Group . . . . . .1659.0 -16.0 1799.0 1298.0
Computacenter . . . . .418.3 -14.3 490.0 324.7
Fidessa Group . . . . .1666.0 18.0 2109.0 1444.0
Invensys . . . . . . . . . . .196.5 0.9 354.9 180.9
Logica . . . . . . . . . . . . .97.3 -0.2 144.8 59.0
Micro Focus Inter . . .453.3 -4.5 471.2 242.9
Misys . . . . . . . . . . . . .357.0 -1.5 420.2 214.9
Sage Group . . . . . . . .291.7 -1.2 312.4 231.7
SDL . . . . . . . . . . . . . . .740.0 0.0 756.0 586.0
Telecity Group . . . . . .717.0 0.0 722.0 450.5
Aggreko . . . . . . . . . .2242.0 6.0 2316.0 1522.0
Ashtead Group . . . . .261.9 -0.9 270.8 99.4
Atkins (WS) . . . . . . . .776.5 0.0 820.0 490.2
Babcock Internati . . .767.5 -7.0 778.5 570.5
Berendsen . . . . . . . . .525.0 -2.5 568.0 402.7
Bunzl . . . . . . . . . . . . .996.5 -4.5 1003.0 676.5
Cape . . . . . . . . . . . . . .450.1 -4.2 591.5 295.0
Capita . . . . . . . . . . . . .728.0 -8.5 767.0 611.5
Carillion . . . . . . . . . . .301.8 2.2 403.2 281.0
De La Rue . . . . . . . . .924.0 -11.0 1001.0 730.0
Diploma . . . . . . . . . . .407.7 0.7 427.9 284.0
Electrocomponents .250.6 -2.2 294.9 182.2
Experian . . . . . . . . . . .990.0 5.0 995.5 665.0
Filtrona PLC . . . . . . . .463.7 1.7 467.2 296.3
G4S . . . . . . . . . . . . . . .273.0 0.8 292.1 219.9
Hays . . . . . . . . . . . . . . .85.7 -0.7 119.6 58.9
Homeserve . . . . . . . .238.4 -1.4 532.0 214.7
Howden Joinery Gr . .127.5 2.2 130.4 93.1
Interserve . . . . . . . . . .300.3 0.2 341.3 252.8
Intertek Group . . . . .2516.0 -10.0 2537.0 1744.0
Michael Page Inte . . .480.0 -1.5 567.0 323.0
Mitie Group . . . . . . . .282.6 0.6 288.3 196.1
PayPoint . . . . . . . . . . .604.5 -7.0 638.0 410.0
Premier Farnell . . . . .216.6 -0.1 301.0 144.5
Regus . . . . . . . . . . . . .116.0 1.5 119.7 64.0
Rentokil Initial . . . . . . .84.7 0.1 100.9 58.2
RPS Group . . . . . . . . .241.9 2.8 253.0 156.6
Serco Group . . . . . . .547.5 -0.5 597.5 458.0
Shanks Group . . . . . . .99.4 0.2 130.9 90.8
SIG . . . . . . . . . . . . . . .118.6 1.0 153.5 77.0
Travis Perkins . . . . .1076.0 7.0 1112.0 715.0
Wolseley . . . . . . . . .2464.0 -40.0 2558.0 1404.0
ARM Holdings . . . . . .593.5 1.5 645.0 464.0
CSR . . . . . . . . . . . . . .243.6 -0.4 391.4 154.1
Imagination Techn . .712.5 17.0 720.5 296.9
Spirent Communica .152.1 -1.2 160.3 105.8
British American . .3190.5 -19.5 3245.0 2401.0
Imperial Tobacco . .2535.0 -10.0 2576.0 1880.0
Betfair Group . . . . . . .869.0 -8.5 1030.0 567.0
Bwin.party Digita . . .152.1 -0.9 204.0 100.6
Carnival . . . . . . . . . .2013.0 2.0 2642.0 1742.0
Compass Group . . . .666.0 3.0 670.0 512.5
Domino's Pizza UK . .467.7 2.7 526.0 377.0
easyJet . . . . . . . . . . . .461.4 7.1 478.4 302.5
FirstGroup . . . . . . . . .291.3 3.3 370.2 282.5
Go-Ahead Group . . .1295.0 12.0 1598.0 1190.0
Greene King . . . . . . .517.0 -1.5 526.0 410.0
InterContinental . . .1442.0 3.0 1497.0 955.0
International Con . . .182.3 3.0 258.7 132.0
JD Wetherspoon . . . .420.0 -0.8 468.3 380.5
Ladbrokes . . . . . . . . .157.0 0.9 161.8 114.0
Marston's . . . . . . . . . .100.0 1.0 112.0 84.6
Millennium& Copt . .487.3 2.7 540.0 371.2
Mitchells & Butle . . . .276.4 3.1 336.8 215.6
National Express . . .248.2 2.1 270.2 201.6
Rank Group . . . . . . . .130.0 0.7 153.7 109.5
Restaurant Group . . .296.0 1.0 335.0 254.9
Spirit Pub Compan . . .58.5 -0.3 61.0 35.3
Stagecoach Group . .261.1 1.1 287.4 211.0
TUI Travel . . . . . . . . . .194.4 -0.3 250.0 136.7
Whitbread . . . . . . . .1761.0 13.0 1785.0 1409.0
WilliamHill . . . . . . . . .252.0 2.1 253.2 178.9
Abcam . . . . . . . . . . . .347.8 4.5 460.0 320.0
Advanced Medical . . .78.5 0.5 96.0 64.8
Albemarle & Bond . .359.0 2.0 400.1 281.0
Amerisur Resource . .24.3 0.0 29.0 9.5
Andes Energia . . . . . . .51.1 0.3 82.8 17.5
Andor Technology . .505.0 6.0 685.0 387.1
Archipelago Resou . . .64.5 -0.5 79.0 55.5
ASOS . . . . . . . . . . . .1816.0 51.0 2468.0 1142.0
Aurelian Oil & Ga . . . .18.5 -0.4 77.0 16.0
Avanti Communicat .253.0 10.5 499.8 241.3
Blinkx . . . . . . . . . . . . . .65.3 -0.8 158.0 50.5
Borders & Souther . . .68.5 6.0 80.5 43.5
BowLeven . . . . . . . . . .88.3 -3.8 382.3 62.0
Brooks Macdonald 1295.0 2.5 1372.5 940.0
Cluff Gold . . . . . . . . . . .83.5 -1.3 119.0 66.5
Cove Energy . . . . . . .205.0 0.0 242.0 61.0
Daisy Group . . . . . . .108.5 0.3 127.0 88.6
EMIS Group . . . . . . . .515.0 30.3 580.0 397.5
Faroe Petroleum . . . .152.0 -1.0 183.3 130.0
Gulfsands Petrole . . .135.0 9.0 315.5 126.0
GWPharmaceutical . .91.5 1.4 130.0 78.5
H&T Group . . . . . . . . .300.5 2.6 395.0 285.0
Hargreaves Servic .1211.0 6.0 1258.0 855.0
Healthcare Locums . . . .2.3 -0.2 2.7 2.3
ImpellamGroup . . . .340.0 3.5 387.5 225.0
Iomart Group . . . . . . .128.0 -2.0 151.0 85.5
James Halstead . . . . .495.1 12.1 513.0 410.3
London Mining . . . . .275.3 6.0 436.5 257.5
Lupus Capital . . . . . .126.6 -3.4 150.0 86.0
M. P. Evans Group . .470.0 0.0 475.0 371.0
Majestic Wine . . . . . .433.8 -1.3 510.0 315.0
May Gurney Integr . .285.3 0.3 302.0 236.0
Monitise . . . . . . . . . . . .35.0 -0.5 40.0 20.5
Mulberry Group . . . .1900.0 -23.0 1995.0 1290.0
Nanoco Group . . . . . . .69.0 3.3 93.3 38.0
Nautical Petroleu . . .330.0 17.8 419.0 223.5
Nichols . . . . . . . . . . . .646.0 -1.0 653.8 457.5
Numis Corporation . . .95.5 0.0 119.6 72.0
Pan African Resou . . .16.3 0.5 18.3 9.5
Patagonia Gold . . . . . .39.0 2.0 70.0 36.0
Prezzo . . . . . . . . . . . . .68.1 1.1 71.5 53.5
Rockhopper Explor .330.0 0.0 393.5 141.0
RWS Holdings . . . . . .546.0 1.0 569.4 377.0
Secure Trust Bank .1075.0 0.0 1110.0 755.0
Sirius Minerals . . . . . .20.0 -0.5 32.0 6.4
Songbird Estates . . .115.5 3.0 160.3 103.0
Valiant Petroleum . . .519.0 2.0 628.5 400.0
Young & Co's Brew . .667.5 -7.5 712.0 565.0
Essar Energy . . . . . .153.8 9.1
Kenmare Resources . .47.2 5.7
BT Group . . . . . . . . . .232.1 5.4
Ruspetro . . . . . . . . . .189.7 3.8
Dixons Retail . . . . . . .19.6 3.7
Ashmore Group . . . .377.1 3.2
New World Resource 432.6 3.1
Telecom Plus . . . . . . .687.0 2.8
Northgate . . . . . . . . . .220.0 2.8
Antofagasta . . . . . . .1172.0 2.7
Gem Diamonds Ltd. .284.6 -6.3
Exillon Energy . . . . . .172.8 -5.3
Ophir Energy . . . . . . .402.0 -3.6
Computacenter . . . . .418.3 -3.3
Premier Oil . . . . . . . . .412.6 -3.2
Oxford Instruments .1186.0 -3.1
Persimmon . . . . . . . .641.5 -3.0
London & Stamford .110.5 -2.6
SEGRO . . . . . . . . . . . .235.9 -2.3
TR Property Inv Tr . . . .70.0 -2.1
Risers Fallers
MAIN CHANGES UK 350
Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low
GILTS
AEROSPACE & DEFENCE
CONSTRUCTION & MATERIALS
ELECTRICITY
ELECTRONIC & ELECTRICAL EQ.
EQUITY INVESTMENT INSTRUM.
FINANCIAL SERVICES
FIXED LINE TELECOMS
FOOD & DRUG RETAILERS
FOOD PRODUCERS
FORESTRY & PAPER
GAS, WATER & MULTIUTILITIES
GENERAL RETAILERS
HEALTH CARE EQUIPMENT & S.
HHOLD GDS & HOME CONSTR.
INDUSTRIAL ENGINEERING
INDUSTRIAL TRANSPORTATION
MEDIA
LIFE INSURANCE
PERSONAL GOODS
PHARMACEUTICALS & BIOTECH
REAL ESTATE INVEST. & SERV.
SOFTWARE & COMPUTER SERV.
SUPPORT SERVICES
TECHNOLOGY HARDW. & EQUIP.
TOBACCO
TRAVEL & LEISURE
AIM 50
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AUTOMOBILES & PARTS
BANKS
CHEMICALS
BEVERAGES
GENERAL INDUSTRIALS
MOBILE TELECOMS
OIL & GAS PRODUCERS
OIL EQUIPMENT & SERVICES
MINING
NONEQUITY INVESTM. COMM.
Tsy 5.250 12 . . . .100.95 -0.04 105.1 100.9
Tsy 9.000 12 . . . .101.90 0.00 110.8 101.9
Tsy 2.500 13 . . . .283.58 0.01 287.7 282.6
Tsy 4.500 13 . . . .103.85 -0.03 106.4 103.8
Tsy 8.000 13 . . . . .111.34 -0.05 116.5 111.3
Tsy 5.000 14 . . . . .111.06 -0.03 112.9 109.3
Tsy 8.000 15 . . . .126.62 0.08 129.2 123.8
Tsy 4.750 15 . . . . .113.83 0.04 115.4 109.1
Tsy 4.000 16 . . . . .113.21 0.13 114.7 105.6
Tsy 2.500 16 . . . .343.64 0.10 344.2 318.0
Tsy 12.000 17 . . . .119.70 0.00 128.0 118.4
Tsy 1.250 17 . . . . .115.82 0.23 116.6 108.4
Tsy 8.750 17 . . . .139.46 0.20 141.9 133.3
Tsy 5.000 18 . . . .120.83 0.23 122.5 110.6
Tsy 3.750 19 . . . . .113.89 0.30 115.6 100.7
Tsy 4.500 19 . . . . .118.99 0.27 120.7 106.5
Tsy 4.750 20 . . . .121.29 0.30 123.5 107.7
Tsy 2.500 20 . . . . .363.11 0.25 367.1 322.1
Tsy 8.000 21 . . . .149.63 0.30 153.4 134.8
Tsy 1.875 22 . . . .126.07 0.42 129.1 113.3
Tsy 4.000 22 . . . . .115.26 0.36 118.2 100.0
Tsy 2.500 24 . . . . .325.11 0.41 334.7 282.2
Tsy 5.000 25 . . . .126.07 0.44 130.6 108.5
Tsy 1.250 27 . . . .122.17 0.46 127.0 106.6
Tsy 4.250 27 . . . . .117.10 0.50 122.7 99.1
Tsy 6.000 28 . . . .141.25 0.47 148.0 120.7
Tsy 4.125 30 . . . .309.33 0.31 322.8 268.3
Tsy 4.750 30 . . . .123.56 0.44 130.5 104.3
Tsy 4.250 32 . . . . .116.11 0.45 123.1 97.5
Tsy 4.250 36 . . . . .115.99 0.52 123.9 96.8
Tsy 4.750 38 . . . .125.40 0.52 134.2 105.0
Tsy 4.500 42 . . . .121.69 0.57 130.8 101.3
% %
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L
AST weeks Budget announcement
contained few shocks and surprises,
yet some of the changes are vital to
aiding Londons thriving hub of entre-
preneurs and startups. Significantly, the
governments Enterprise Investment
Scheme (EIS) looks set to benefit from a
much needed boost, with the announce-
ment of an extension to its parameters. EIS
already allows tax relief to private individu-
als investing in small companies. Under
existing guidelines, private investors can
reclaim 30 per cent of the cost of the shares
from their income tax liability for that
Philip Salter talks to
Piers Linney about
his career, company
and aspirations
F
ROM growing up in the Rossendale
valley the once beating heart of the
industrial revolution Piers Linney is
now a man with many strings to his
bow: law, accounting, banking, media,
finance and entrepreneurship. Now he
has his head in cloud computing a tech-
nological revolution with the scalability to
turn over billions.
His career path from a Lancashire mill
town to co-founder with Simon Newton
of Outsourcery has taken many twists
and turns. He has constantly reinvented
himself: first from solicitor at SJ Berwin,
to investment banker at Barclays de Zoete
Wedd, then Credit Suisse. He left banking
when the internet was taking off, building
a record label and internet radio station.
Following this he became the chief execu-
tive of a corporate finance boutique, and
then a partner in an alternative invest-
ment fund providing structured debt and
equity financing to small cap public com-
panies.
Despite his corporate career Linney had
entrepreneurial aspirations: When I was
a young trainee solicitor what interested
me were the entrepreneurs. When deal-
ing with small venture capital private
equity funds at SJ Berwin he found the
work of the management teams was more
interesting than the legal side: I was
much more interested in the deals than
writing them up thats when I looked
around and realised Im not going to be a
lawyer in twenty years.
In April 2007, as a partner in a small
venture capital fund, Linney and his co-
founder (and now co-CEO) took over a
Manchester-based business providing
mobile phone services to small compa-
nies, through a buy-in management buy-
out (Bimbo).
This would become Outsourcery, but
first they went in and took the business
to pieces atom by atom. Instead of flip-
ping the company, they invested in it,
acquiring a small professional services
firm, some infrastructure from Cable and
Wireless, and building a hosting compa-
ny. In March 2011 they sold the mobile
business and recapitalised as a cloud busi-
ness: Most companies build infrastruc-
ture, sit on it for three to five years and
then think about rebuilding it; we
scrapped it after 12 months.
This willingness to adapt is key. Linney
repeated three words regularly through-
out our meeting: Then I realised. It neat-
ly sums up his entrepreneurial attitude
always learning, always changing. Linney
admits he didnt really know what invest-
ment banking was until his second year
as a trainee lawyer; so he bought a book
called Investment Banking, read it, and
Business Features| Entrepreneurs
30
Ex-City professional one
step ahead of the cloud
same year. This is obviously an attractive
offer, but has previously been limited to
investment in companies of up to 50
employees well suited to funding SMEs,
but not conducive to the long-term support
of a growing company.
However, George Osbornes announce-
ment means EIS is now likely to be extend-
ed to include companies with up to 250
staff members, providing a much more
supportive structure to empower UK busi-
ness growth. As Eric Schmidt,
chairman of Google, said in
2011, the UK does a
great job of backing
small firms and
cottage indus-
tries, but
theres little
point in get-
ting a thousand
seeds to sprout if
theyre then left to
wither or get trans-
planted overseas. Notably, the
change also fits in well with
the venture capital
model, which is
specifically designed
to support companies long-term from early
stage startups with only a few employees, to
big global businesses ready for exit.
Similarly, the Seed Enterprise Investment
Scheme (SEIS) can be considered the little
cousin to EIS, and will come into effect on
6 April. This will allow smaller angel
investors to inject 100,000 into a start-up
in a single tax year, and then claim back a
full 50 per cent of this investment in tax
relief. The two schemes combined are
vital for the stimulation of the
British economy, and pro-
vide genuine government
support for David
Camerons widely
touted enterprise
led economic
recovery.
Most impor-
tantly, these
schemes allow private
angel investors and
VCs to work together
in a previously unprece-
dented manner. Business
angels have a valuable role
to play in supporting British
entrepreneurs at the early stage
of a new business, but VC firms can typical-
ly offer the larger scale investment that will
take a startup to the next level of growth. In
the past, this has often resulted in the pri-
vate investors which supported a business
at seed level missing out on the larger
rewards available when a business reaches
maturity, something the new schemes pave
the way to eradicating.
Ultimately, forward thinking VCs will
utilise the schemes within their own invest-
ments, and this can only be positive for
Londons entrepreneurial hub. We have
just launched the first Angel Co-Investment
Fund in the UK, a pot of money specifically
for joint projects between private individu-
als and venture firm DFJ Esprit. For entre-
preneurs, this means an increased
availability of growth capital, ripe for the
taking of the fastest growing and most
promising European startups.
This is one step towards tackling
Schmidts observation, and ensuring that
small startups are nurtured into major con-
cerns that will help stimulate Britains eco-
nomic recovery.
Richard Marsh is a partner at venture capital
firm DFJ Esprit and manager of their Angel Co-
Investment Fund.
George Osborne delivers a
decent deal for aspirant
and established businesses
T
HE men and women busy building
Britains future economic wealth broadly
welcomed last weeks Budget. Although
lacking a radical strategy for growth, the
coalition has gone some way in oiling the
wheels of entrepreneurship.
Richard Marsh explains how reforms to the
Enterprise Investment Scheme has allowed the
creation of the first angel co-investment fund in
the UK (article, below).
In response to the Budget, PwC cites a num-
ber of other positives:
l The reduction in corporation tax rate to 24
per cent from April 2012 (originally expected 25
per cent) and further reduction to 23 per cent
then 22 per cent in subsequent two years.
l The reduction in higher income tax rate
from 50 per cent to 45 per cent from April 2013
the most concrete signal yet that the 50 per
cent rate is indeed a temporary necessity.
l For those who have spent their working lives
building business and are now looking to save
for retirement, no further tinkering with pen-
sions reliefs.
l A particular win for those companies who
can use the Enterprise Management Incentive
(EMI) an increase in the limit per individual to
250,000 (subject to EU state aid approval) and a
proposed extension of Entrepreneurs Relief to
shares acquired through EMI.
Debbie Griffiths, partner in Deloittes entre-
preneurial business practice, notes the
increase in the value of EMI (tax advantaged)
options which a company can grant to 250,000
is positive for SMEs seeking to recruit and retain
high calibre employees without increasing their
employment costs. However, not all will bene-
fit, as qualifying companies for EMI cannot
have gross assets of more than 30m, so some
larger SMEs still cannot qualify.
Money matters. Piers Linney (article, right)
knows this better than many before founding
Outsourcery he was innovative in applying a US
derived mixed debt and equity funding model
to Europe. He still thinks there is a massive
structural hole in the UK because funds and
investors each specialise in only equity or debt.
If blended, he thinks we could see the kind of
growth capital associated with the west coast of
the US.
philip.salter@cityam.com
Twitter: @Philip_Salter
PHILIP SALTER
DEPUTY BUSINESS FEATURES
EDITOR
CITY A.M.
became an investment banker.
Linney is animated about cloud tech-
nology: I grew up making mainland calls
now my Dad is speaking with me off the
coast of Hawaii. However, because cloud
is infinitely scalable Outsourcery will
need to raise finance. Eventually he
thinks it makes sense in cloud to go pub-
lic because it offers people the assured-
ness that you are going to be around.
Just when I thought the interview was
coming to its conclusion, Linney whipped
a laptop out of his bag and started com-
municating with his colleagues across the
UK. Newton was soon interrupted, as were
various members of staff each clearly
used to Linney showing off the impressive
capabilities of unified communications.
Job title: Co-CEO
Turnover: 10m+
Number of staff: 135
Age: 41
Lives: Camden, London
Studied: Accounting and Law, University of
Manchester
Drinking: Caipirinha
Reading: Various news sources
Talents: Downhill mountain biking
Favourite business book: The Big Switch:
Rewiring the World from Edison to Google,
by Nicholas Carr
Motto: Just get on with it.
First ambition: To go into space (is booked
on a Virgin Galactic space flight)
CV | PIERS LINNEY, OUTSOURCERY
BUDGET OPENS
UP INCREASED
INVESTMENT
RICHARD MARSH
The skys the limit
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ONE NIGHT
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New series. Drama telling the story
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Destroyed in Seconds
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7pmSupernanny US 8pm18 Kids
and Counting 9pm42 Stone Mum
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Hour 4.45amCrash Test
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BBC2 ITV1 CHANNEL4 CHANNEL5
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TVPICK
6pmBBC News
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News 10.25pmRegional News
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11.35pmLate Kick Off 12.05am
Who Do You Think You Are? US
12.50amWeatherview12.55am
Sign Zone: Letting Go 1.40amSign
Zone: Great British Food Revival
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4.25am-6amBBC News
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Kitchen: Cooking with Rachel
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9pmThe Tube
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1 2 3 4 5
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8
12
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 digits 1-9
and you must not use the
same digit twice in a block.
The same digit may occur
more than once in a row or
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COFFEE BREAK
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
KAKURO
QUICK CROSSWORD
LAST ISSUES
SOLUTIONS
KAKURO
WORDWHEEL
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.
SUDOKU
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.
SUDOKU
QUICK CROSSWORD
ACROSS
1 Club that is used
as a weapon (6)
6 Calculating
machine (6)
7 Fat used in
cooking (4)
8 Moving to music (7)
12 Quench (5)
13 And not (3)
14 Allow (3)
15 Application (3)
17 Class of people
enjoying superior
status (5)
18 Hang freely (7)
21 International
alliance begun in
1949 (inits) (4)
22 Pickled ower buds
used in various
sauces (6)
23 The act of
coming out (6)
DOWN
1 Person of exceptional
importance and
reputation (8)
2 Period of history between
classical antiquity and the
Italian Renaissance (4,4)
3 Tibetan or Mongolian
priest (4)
4 Bath powder (4)
5 Product of seabirds,
used as a fertiliser (5)
8 Dig deeply into (5)
9 Made a written
record of (5)
10 Close, familiar (8)
11 Causing fear by
threatening great
harm (8)
16 Product derived from
cane or beet (5)
19 Having patches coloured
diferently (4)
20 Olfactory organ (4)
N
S
A
U
K C
O
R
E

4

4
4

D A T E D S H E A F
E X H N A
B A S I N O U G H T
T C L A S P R A
S E R E N E B A I L
U L V
D U M A M A L I G N
R M S A T I N A
A W A K E E G G O N
K G N H C
E L E C T I T C H Y
4 8 1 3 5 9 4
2 5 9 3 4 8 7 6 1
1 3 8 6 9 8 7
4 8 1 9 8 7
7 1 4 2 1 6 5 3
9 8 5 7 2 4 3 1
8 6 4 9 7 5 4 2
3 2 1 9 3 5
3 2 4 8 1 3 6
7 4 3 9 5 1 2 6 8
2 5 1 4 2 2 9
4
4
4
4
4
4
4
4
4
WORDWHEEL
The nine-letter word was
VOUCHSAFE
Lifestyle | TV&Games
32
H
AVING recently visited nearby
Malaysia, I thought I had a fair
idea of what to expect from the
Philippines. A bustling Asian
melting pot where a hotchpotch of
cultures, religions and cuisines col-
lide in the middle of the Indian
ocean, right?
But stepping off the plane at our
first stop Mactan Island in Cebu
felt more like landing in the
Caribbean. As we made our way
through the arrivals lounge after
a 14-hour trawl via Hong Kong,
our hosts rushed forward with
jasmine flower necklaces and
loud exclamations of
Mabuhay Tagalog for wel-
come, and the one Filipino word I
hear more than any other during
my week in the country.
Cebu the first place
Portuguese explorer
Ferdinand Magellan land-
ed in the Philippines is
the perfect place to start a
holiday, steeped as it is in
so much of the islands
tumultuous history.
Though Magellan was
swiftly killed after convert-
ing the islands ruler to
Christianity, his voyage set in
motion the Spanish colonisation of
the Philippines that lasted more
than 300 years and left an indelible
stamp on Filipino culture
undoubtedly what makes it feel so
different from the rest of Asia.
From the traditional guitar-mak-
ing shops on every street corner
in Cebu to the habit of serenad-
ing passers by in as many public
places as possible, the entire
country is imbued with the spir-
it of its conquerors.
Our hotel the Shangri-La
Mactan is one of the groups
five resorts in the country, and
sits on a narrowing peninsula
towards the north east of the
island. My sea view room, fitted out
in shades of dark bamboo and wick-
er, looked over the hotels gardens
towards a breezy, calm sea and across
to Olango Island, a popular site for
scuba diving.
Though days could easily be whiled
away doing nothing more than soak-
ing up the sun or indulging in the
local Hilot massage (dispensed at the
hotel spa) the area has so much to
offer youd be foolish not to venture
further afield.
So while dragging yourself out
of bed in the early hours of the
morning on holiday may seem
unappealing, take my word that
a day trip to nearby Bohol Island
more than makes up for the
5am wake-up call. Just a two-
hour ferry ride from Cebu,
Bohol is the island that really
does seem to have it all, from
world-class diving sites and whale
watching to rural towns steeped
in tradition and the stunning geo-
graphical phenomenon of the
Chocolate Hills 1,776 naturally
occurring limestone domes that
stretch across Bohols highlands like
thousands of giant molehills.
But its the tarsiers that most visi-
tors to Bohol really come to see. These
tiny, bush baby-like primates are
native to this part of South East Asia,
and Bohol has a sanctuary dedicated
to their preservation. Come anytime
and youll have a good chance of see-
ing them, as after the guides expert
eyes have spotted them in the morn-
ing the sleepy mammals arent
inclined to move much.
Back on Cebu we had three days of
acclimatising to the time difference
and making the most of the tours
offered in the local area from Cebu
city to spectacular snorkelling and
island
hoppi ng
trips before
it was back to the
airport for a short hop to
our next destination, Boracay Island.
Arriving at Caticlan airport should
give you fair idea of what a stay on
Boracay just an hours flight from
either Manila or Cebu is going to be
like. Even the airport toilets look like a
spa hotel. Within 10 minutes of arriv-
ing on the tarmac we were greeted by
a Shangri-La rep and whisked to the
h o t e l s
Mabuhay
Centre, a pri-
vate lounge on the
jetty port where youll be
greeted with fresh calamansi
juice, made from the tiny tangerine-
coloured native fruit that locals will
tell you cures everything from insect
bites to the common cold.
From there, its a 15 minute hop by
speedboat over to Boracay, a lush eco-
reserve covering just 10 square kilome-
tres, and the runner-up in
TripAdvisors best beaches of 2011
award.
Two days of pure relaxation fol-
lowed. Shangri-Las resort on the
island has two private beaches per-
fect for following the sun as it made
its way across largely unclouded skies,
interrupted by the occasional tropical
downpour to break the 30 degree-plus
heat. For true indulgence book your-
self one of the resorts 11 treetop villas
and gawp at the views from your two-
storey pad, kitted out with everything
you could ever need, including a pri-
vate hot tub deck overlooking the bay
and a mobile phone with which to
contact your on-call butler, just in case
the local beer in your minibar needs
topping up.
Again, if you can manage more
than luxuriating in the sun, a short
shuttle bus ride away (or tuk-tuk side-
car for the brave) is White Beach a
four-kilometre stretch of just that,
lined with beach bars, restaurants and
shops. Here, its all hustle and bustle:
hawkers peddling knock-off Ray-Bans
and even a beachfront Starbucks, but
the beach itself is surprisingly calm
and uncrowded, not to mention stun-
ning. Its also home to some pretty
lively nightlife come sundown.
Boracay is so spectacular that I was
tempted to shed a tear as I waited on
the resorts jetty for my transfer back
to the airport, but as a city dweller all
of my life I was also itching to get to
Manila, and kick the adrenalin levels
up a notch (see next page).
As with every stunning new desti-
nation, a week was far too short to
fully delve into everything the
Philippines has to offer. Given longer,
Id have loved to seek out one of the
countrys never-ending supply of fies-
tas regional saints days where vast
quantities of food are cooked and
From
top: dusk
and daytime
on Boracay; the
Shangri-La in
Cebu.
Lifestyle| Travel
Elizabeth Fournier visits two idyllic
wildlife and vibrant local colour in
paradise
Cebu &
From top: The
Makati Shangri-La
Hotel in Manila,
the San Agustin
church in Manila,
Cebu city on
Mactan Island, a
Tarsier monkey.
33
open-house rules
apply and spent
longer delving into the
fascinating years spent
under US control and then
the iron grip of the Marcos
administration.
But as an introduction to the
islands, one of the least visited stops
on the well-trodden South East Asia
trail, it was just enough to convince
me that the countrys president
Benigno Aquino an ex-advertising
man whos declared himself the
Philippines chief promoter will
have an easy job on his hands.
TWENTY-FOUR HOURS IN MANILA
Manila, the Philippines official capi-
tal since the Spanish arrived in the
16th century, gets a bad rep. Officially
the most densely populated city in the
world, a straw poll of Western opinion
will cite heavy traffic, smog and a fair-
ly stark division of wealth among rea-
sons not to visit. But as ever, behind
the developing world clichs are
enough hidden gems to merit more
than a stopover.
From the pseudo-Caribbean feel
of the outlying islands, arriving in
Manila is like being flung back into
Asia at full speed jeepneys (jeep-
bus hybrids run like communal
taxis) and smoke-spewing motor-
bikes weave terrifyingly through
rush hour traffic that starts backing
up around breakfast and doesnt
move much for the rest of the day.
To see as much of the city as possi-
ble, take a full or half-day tour
around some key landmarks. Its
the only way to navigate the
impenetrable road system and
a local dri-
vers short
cuts will
mean youre
never short
of something
to gawp at
through the
window.
Intramuros
is Manilas well-
p r e s e r v e d
Spanish quarter,
with shady court-
yards and Hispanic
architecture that feel
like a little part of old-
town Central America
uprooted and plonked right in
the middle of the surrounding hub-
bub. Despite covering less than one
square kilometre its home to seven
Catholic churches, including the stun-
ning San Augustin, a vast baroque
building that serves as a popular wed-
ding venue for the well-heeled. We
managed to (discreetly) crash one cere-
mony from the churchs top floor
gallery, and its endless rows of pews
were still only half full despite one of
the biggest bridal parties Ive ever
seen.
Nearby attractions worth visiting
include Casa Manila, a (surprisingly
authentic feeling) reconstruction of a
Spanish colonial house commissioned
in the 1980s, and Fort Santiago, the
citys original defensive fort and site of
national hero and revolutionary Jos
Rizals execution.
Elsewhere, Quiapo is the citys old
downtown and home to wet and dry
ma r k e t s
selling cut-
price every-
thing from
local wicker
handicrafts to reli-
gious amulets and
pirated DVDs. Also
worth a visit is the Chinese
cemetery in La Loma, where
some of the citys Chinese-Filipino
community are entombed in multi-
storey crypts that look more like
upmarket holiday homes ask the
driver to take you there past some of
the traditional Lechon (pork) roasting
houses.
The Makati Shangri-La was the
groups first hotel in the country, and
remains a 28-storey lesson in opulence
step into the huge atrium lobby at
the right time of day and youll
encounter a full string orchestra play-
ing to guests whove stopped by to
sample afternoon tea, Philippine-style.
Rooms are spacious with a businessy
feel, and the higher you go the better
the views over Makati, Manilas mod-
ern business and shopping district.
Manila is also the best place to sam-
ple some of the best food the
Philippines has to offer, though the
islands selection of fresh seafood was
pretty hard to beat. For an authenti-
cally Filipino feast head to Abe, a local
favourite with several locations across
Manila. Order Lechon (Philippine-style
melt-in-the-mouth pork belly), chick-
en adobo, marinated in soy sauce and
rice vinegar, and the butterflied deep-
fried tilapia fish, served whole and
standing up on its wings, eyes intact.
Kuoni (www.kuoni.co.uk) offers seven
nights in the Philippines, with three nights
at Shangri-La's Mactan in Cebu
(www.shangri-la.com), two nights at
Shangri-La's Boracay and two nights at the
Makati Shangri-La Manila. Prices include
breakfast, plus flights with Cathay Pacific
(www.cathaypacific.co.uk) from Heathrow,
domestic flights and private transfers.
Prices for 2012 are from 2,259 per per-
son based on two sharing.
Filipino islands and finds heritage,
abundance along with perfect beaches
with flair
Boracay
Sport
34
Strauss is eager to make amends for the
Pakistan whitewash Picture: GETTY
MANCHESTER United manager Sir
Alex Ferguson admits he is relishing
the run-in after reeling in arch-rivals
Manchester City in the race for the
Premier League title.
Early pace-setters City, held by
Stoke on Saturday, have squandered
their lead, and United could go three
points clear at the top with victory
over Fulham tonight.
We are in the right place, at the
right time and, most importantly,
with the right players, said Ferguson.
Our guys have been flogging away
and perhaps wondering if they would
ever catch up before we hit the finish-
ing line. Well, we did and they are
capable of going in front again as we
battle it out with City.
Fulham, meanwhile, are looking to
avoid a third consecutive defeat and
avenge Decembers 5-0 home drub-
bing by United.
FOOTBALL
Fulham between United

and three-point title lead
ENGLAND captain Andrew Strauss
insists his teams precarious status as
the worlds No1 Test side is not on his
mind as he prepares to lead them in
the first match against Sri Lanka
today.
A series whitewash defeat to
Pakistan earlier this year has weak-
ened Englands grip on top spot, with
South Africa, the outfit best placed to
dethrone them, set to tour these
shores in the summer.
Another loss in Sri Lanka, where
England have won just three Tests in
30 years, would threaten their posi-
tion further, but Strauss is more con-
cerned with responding to a mixed
start to 2012.
I think weve obviously got a point
to prove. We have to bounce back
after those results against Pakistan,
he said, ahead of the first match of a
two-Test series, which begins early
this morning in Galle.
We are not focusing on the world
rankings at the moment; it is not of
great consequence to us. I think if you
focus too much on that, you take out
whats important, which is trying to
win.
We know the extent of the chal-
lenge. Weve got to be very good to
overcome those challenges. There is
plenty for us to focus on and the rank-
ings will take care of themselves.
Strauss was yesterday agonising
over whether to include all-rounder
Ravi Bopara as a specialist batsman,
with the Essex star unable to bowl
due to a side strain, or an extra
bowler either spinner Samit Patel or
seamer Tim Bresnan.
He has also been given cause for
concern by Ian Bell, who was the only
batsman to fail to shine during two
warm-up victories and also toiled
without success against Pakistan in
the Middle East.
Paceman Stuart Broad has been
passed fit to play, however, despite
suffering an ankle sprain last week
and sitting out training on Saturday.
England have toiled previously in
the demanding conditions in Sri
Lanka failing to win a Test on each
of their last two visits where temper-
atures last week reached 46C and
humidity 80 per cent.
Strauss: We
have a point
to prove in
Sri Lanka
BY FRANK DALLERES
CRICKET
NEWCASTLE boss Alan Pardew hailed

a champagne display after a 3-1 win
at West Brom hoisted them level on
points with fifth-placed Chelsea.
Striker Papiss Demba Cisse scored
twice and the outstanding Hatem Ben
Arfa grabbed the other, with Shane
Long replying for the Baggies, who lie
14th in the Premier League.
Today it was champagne stuff,
said Pardew. Weve been phenome-
nal all year, the players have worked
so hard and deserve all the plaudits
they get. With players like we have [in
attack] youre going to score goals.
Cisse brace lifts
Newcastle level
with Chelsea
FOOTBALL
SCOTTISH two-time world champion

Jocky Wilson has died, aged 62. He
had recently been suffering from a
lung disorder and police said his
death had been due to a medical
matter.
Kirkcaldy-born Wilson, who won
BDO world titles in 1982 and 1989,
became a household name in his
eighties heyday, when he enjoyed
rivalries with Eric Bristow and John
Lowe. The four-time British champion
reached at least the quarter-finals of
every World Championship between
1979 and 1991 and retired in 1996.
World champ
Jocky Wilson
dies, aged 62
DARTS
Conspiracy theories raised after Ferrari star pips

youngster Perez in rain-affected Sepang race
SAUBER chiefs were forced to deny
claims they conspired to let
Ferraris Fernando Alonso win the
Malaysian Grand Prix, after the
Spaniard claimed top spot in the
world championship at torrential
Sepang yesterday.
Alonso was just half a second
ahead of Sauber youngster Sergio
Perez in the closing stages before
the Mexican ran wide at a corner,
consigning him to second place,
ahead of Britains Lewis Hamilton.
The incident came after
Sauber engineers had told
Perez we need the posi-
tion a message some
interpreted as team
orders to back off the
Ferrari, who trained
Perez and supply
Saubers engines.
But team boss Peter
Sauber said: Its a misun-
derstanding. It was because
behind us all our main competi-
tors scored points. So it was impor-
tant we kept the result and not the
position.
He denied Perez had been asked
to stay behind Alonso, or that
there had been any discussions
with Ferrari, adding: No 100 per
cent no; 100 per cent nothing. We
had no discussion about Checo
[Perez] nor the position.
Sauber chief executive Monisha
Kaltenborn said: What we meant
was: get the car home. It was
important to us to get the result
there was nothing else to it. There
was no instruction.
The row detracted from a won-
derful drive by the 22-year-old,
who scored more points yesterday
than in all of last season and is
being touted as a replacement for
Ferraris own Felipe Massa.
Alonsos 28th Grand Prix win
put him five points clear in the
drivers standings and owed much
to the rain, which made his car
more competitive and caused a
safety car stoppage after six laps.
Hamilton (inset) said he was
satisfied after finishing third
again despite starting on
pole, but McLaren team-
mate Jenson Button,
winner last week in
Australia, was 14th
after a collision dam-
aged his front wing.
World champion
Sebastian Vettel finished
a race pointless for the first
time in 27 Grands Prix after
being nudged by HRTs Narain
Karthikeyan.
BY FRANK DALLERES
FORMULA ONE
Victory was Alonsos

28th in Formula One
Picture: GETTY
Man City 30 22 4 4 72 22 70
Man Utd 29 22 4 4 73 27 70
Arsenal 30 18 4 8 61 39 58
Tottenham 30 16 7 7 53 35 55
Chelsea 30 14 8 8 49 34 50
TOP FIVE
TEAM PLD W D L F A PTS
1. Fernando Alonso (Ferrari) 35 points
2. Lewis Hamilton (McLaren) 30
3. Jenson Button (McLaren) 25
4. Mark Webber (Red Bull) 24
5. Sergio Perez (Sauber) 22
6. Sebastian Vettel (Red Bull) 18
STANDINGS | WORLD CHAMPIONSHIP
Sauber deny
fixing Alonso
Malaysia win
Sauber deny
fixing Alonso
Malaysia win
35
Grange City Hotel
8- 14 Cooper s Row
L ondon E C3 N 2 B Q
T e l : 0 2 0 7 8 6 3 3 7 0 0
Email: cityfb@grangehotels.com
Enjoy authentic
sushi at Koto II
Grange City
Hotel
Perfect for business
lunches and dinners,
the ever popul ar
Kot o I I s er ves a
delicious selection
of sushi, noodles and
Japanese delicacies.
Takeaway opti ons
available; pre-booking
not required.
Find us between
Tower Hill underground and
Fenchurch Street rail stations.
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email sport@cityam.com
SPORT | IN BRIEF
Rangers spoil Celtic title party
FOOTBALL: Rangers won an incident-
packed five-goal thriller at Ibrox to pre-
vent Celtic claiming the Scottish
Premier League title on their arch-rivals
turf. Goals from Sone Aluko, Andy Little
and Lee Wallace downed the Bhoys,
who had Cha Du-Ri, Victor Wanyama
and manager Neil Lennon sent off.
Walkover puts Murray through
TENNIS: British No1 Andy Murray pro-
gressed to the last 16 of the Miami
Masters last night without hitting a ball
after opponent Milos Raonic withdrew
from their third-round match injured. Crofts late breakaway try sealed a Leicester victory Picture: GETTY
LONDON IRISH head coach Toby
Booth refused to show remorse for
not shutting up shop as the Exiles
squandered an Aviva Premiership vic-
tory and a losing bonus point against
Leicester yesterday.
Tom Crofts last-gasp breakaway
try put the gloss on a 41-32 Tigers
win at the Madejski Stadium, after
Irish had led 32-31 with just five min-
utes left, following three long-range
penalties from Tom Homer.
A Toby Flood penalty had then
forced the hosts to chase the game
and defeat, along with failure to
secure a bonus point, means that,
with just four matches remaining,
their hopes of a Heineken Cup spot
look over.
Booth said: We wanted to go and
win the game even when we were
ahead, not just hang on. We gave
Leicester a very good test of their
mettle and got ourselves on the front
foot which is very encouraging.
If you buy a ticket for this year's Aviva
Premiership Final on 26 May you will
receive a free rugby shirt. Go to www.pre-
miershiprugby.com/freeshirt to buy yours
Leicester leave it
late to ruin Irish
Heineken hopes
FORMER world No1 Tiger Woods
gave his Masters hopes a timely boost
by winning his first PGA Tour title
for more than two years last night at
the Arnold Palmer Invitational.
Woods comfortably held off
Nor t her n I r el and s Gr aeme
McDowell at Bay Hill, carding a two-
under-par final round of 70 to finish
five strokes clear on 13 under.
McDowell had begun the final day
in Florida just one behind Woods but
shot a 74, the same as Englands Ian
Poulter, who finished two further
adrift in third.
The Americans 72nd PGA Tour
title, and first since September 2009,
took him to within one of Jack
Nicklaus and lifted his spirits for the
years first Major at Augusta in 10
days.
Im excited, theres no doubt,
Woods said. Im looking forward to
[using] the momentum Ive built
here. The things Ive done to my
game are coming together at the
right time.
GOLF
Masters boost as Woods

ends PGA Tour title wait
BY GERARD MEAGHER
RUGBY UNION
PREMIERSHIP
TEAM PLD W D L F A B PTS
Harlequins 18 14 1 3 412 300 4 62
Saracens 18 13 1 4 393 282 5 59
Leicester 18 11 1 6 498 405 9 55
Nhampton 18 11 0 7 432 304 8 52
Exeter 18 10 0 8 350 326 9 49
Gloucester 18 8 1 9 375 376 8 42
Sale 18 8 0 10 384 464 8 40
Bath 18 8 0 10 330 330 7 39
London Irish 18 6 1 11 407 436 10 36
Worcester 18 7 1 10 253 307 5 35
Wasps 18 5 0 13 298 414 7 27
Newcastle 18 3 2 13 283 471 3 19
Results
EUR/GBP Headline Typical Margin
CMC Markets 0.9pts 0.972pts 0.25%
IG Markets 1.0pt 1.99pts 0.50%
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Spreads may widen dependent on liquidity and market volatility
CMC Markets spreads are as of week ending 16th March 2012
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from the IG Markets website on 16th March 2012. For full details of
our comparisons please visit www.cmcmarkets.co.uk/fx
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THE NEW JOBSITE

FOR LONDONS PROFESSIONALS

www.cityam.com Issue 1,599 Monday 26 March 2012 FREE

Crisis turning into real threat for PM

Walsh eyes US airline deal

ANALYSIS l Lloyds Banking Group PLC

ANALYSIS l Yell Group PLC

Political risk is a global threat to recovery

BRAND ALLEY, the online designer

ANALYSIS l GAME Group PLC

Homes near top schools

A HIGHER lending capacity for the

Fulham between United

NEWCASTLE boss Alan Pardew hailed

SCOTTISH two-time world champion

Conspiracy theories raised after Ferrari star pips

Victory was Alonsos

Masters boost as Woods

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