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EUROZONE leaders once again put off
finding a decisive remedy to the
regions debt turmoil last night, pro-
ducing little but rhetoric on the most
pressing problems in a crisis that
threatens to throw the world into a
new recession.
After more than a week of delays,
the summit of 17 euro nations pro-
duced merely the third leg of what
was supposed to be a comprehensive
three-part rescue plan.
While they were said to have agreed
that the regions bailout fund would
be leveraged up to a firepower of 1
trillion half markets hopes of 2 tril-
lion they did not give an official
number or method for achieving it.
They did agree that banks must be
required to amass a level of capital
equal to nine per cent of their assets
after a write-down of their sovereign
bond holdings. The total capital to be
raised by European banks will be
around 106bn, with Britains lenders
deemed to have enough reserves to
avoid raising anything more.
But euro leaders failed to deliver a
plan for tackling the fundamental
problem of burgeoning debt among
uncompetitive Eurozone economies.
After producing a vague outline for
reform, Italian parliamentarians
ended up in a brawl that saw MPs
exchanging blows and grabbing at one
ments. For those states that cannot
afford it, the money will come from
the euro bailout fund.
However, the capital requirements
are subject to an assessment of the
impact of the proposed magnitude
and nature of any proposed deleverag-
ing.
That means that if national regula-
tors fear that the aggressive stress tests
and tight time-frame could choke off
credit to the real economy too quickly,
the rules could be adjusted.
Spains largest five banks, including
Santander, are expected to have to
raise 26bn between them, not much
more than Greeces six biggest lenders,
which will have to beef up their bal-
ance sheets to the tune of 30bn.
Frances biggest four banks are
expected to have to raise 8.8bn
lower than previous estimates of
10bn while five Italian lenders will
need to produce 14.7bn extra.
Thirteen German banks will between
them have to raise only 5.2bn.
French President Nicolas Sarkozy
and German Chancellor Angela
Merkel have already started meeting
with banks in order to thrash out the
details of haircuts on their Greek debt
holdings.
Sarkozy is also said to be seeking bil-
lions in Chinese and Brazilian cash to
buy any debt issued by the Eurozone
bailout fund in order to leverage it to
the required levels.
ALLISTER HEATH AND MORE: P2-3
UROFUDG
BY JULIET SAMUEL
EUROZONE
www.cityam.com Issue 1,498 Thursday 27 October 2011 FREE

TWENTY-FIVE YEARS AGO TODAY
THE CITY CHANGED FOREVER
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anothers throats. Romes parliament
was hastily suspended.
In Brussels, European leaders grap-
pled for hours with two crucial ele-
ments of the rescue plan: an orderly
default for cash-strapped Greece and a
way to leverage up the regions 440bn
bailout fund.
In the event, they failed to
announce details on either score.
The IMF was said to favour a haircut
on Greek debt of 70-75 per cent above
expectations of 60 per cent but there
was no official announcement. Banks
will so far only be required to write
down their holdings of government
debt and non-core assets for sale to
market prices as of September.
They will have until June next year
to reach the nine per cent pass rate for
stress tests conducted by the European
Banking Authority, and will have to
tap private markets for cash first
before going cap in hand to govern-
Certified Distribution
29/08/11 till 02/10/11 is 98,447
Italian politicians came to blows yesterday as leaders around Europe remained mired in talks over the bailout Picture: Reuters
Source: Reuters graphic/Scott Barber, David Cutler 10/26/2011
ANALYSIS l xxxxxxxxx
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News
2 CITYA.M. 27 OCTOBER 2011
FORGET about all the nonsense, the
acronyms, the double-speak and the
details of last nights communiqus
from Europes leaders. The reality is
this. A country that has too much
debt and cannot repay it by raising
taxes or selling assets faces three
choices: it can default; try and
inflate or depreciate the debt away
by debasing its currency; or get
another country to pick up the bill.
Cutting out the verbiage and obfus-
cation, all three of these options
were discussed in some form at yes-
terdays near-useless summit.
Option one is often best in the
medium-term for countries but
triggers massive pain in the short-
term for national economies
(Argentinas society and middle class
almost collapsed after its 2002
default, before bouncing back) as
well as those who lent them the
money (banks, insurers and pension
funds) or who insured the debt. A
large enough uncontrolled default
could affect the entire world.
The good news is that a managed
write-off of Greek debt is on the
agenda; the bad news is that it may
not be big enough to prevent anoth-
er Greek bankruptcy in a couple of
years time. Yesterdays meeting was
vague about this. EU officials said
that negotiations on bank haircuts
on Greek debt may not be concluded
by the weekend. There is a general
but faulty consensus that the
process must be passed off as volun-
tary not to become a credit event
which would then trigger credit
default swaps (CDS) having to paid
out (but what, then, is the point of
CDSs? It is a disgrace that people are
being robbed of the insurance they
have purchased). They also want to
ringfence Greece by claiming that
EDITORS LETTER
ALLISTER HEATH
7
th
Floor, Centurion House,
24 Monument Street, London, EC3R 8AJ
Tel: 020 7015 1200 Fax: 020 7283 5334
Email: news@cityam.com www.cityam.com
Editorial
Editor Allister Heath
Deputy Editor David Hellier
News Editor David Crow
Acting Night Editor Marion Dakers
Business Features Editor Marc Sidwell
Lifestyle Editor Zoe Strimpel
Sports Editor Frank Dalleres
Art Director Jo Simpson
Pictures Alice Hepple
Commercial
Sales Director Jeremy Slattery
Commercial Director Harry Owen
Head of Distribution Nick Owen
Distribution helpline
If you have any comments about the distribution
of City A.M. Please ring 0207 015 1230, or email
distribution@cityam.com
it is the only country that will see
write-offs. What is really needed is
maximum Greek haircuts and maxi-
mum private sector contributions;
a managed default in all but name.
Some Eurozone financial institu-
tions had no choice but to load up
on Greek debt for regulatory reasons
and one should feel sorry for them;
but others chose to do so. Such is
life; there must be no more
socialised losses and privatised
gains. Many institutions will have to
raise more capital to compensate for
the write-offs (106bn in total, the
European Banking Authority says)
but the idea that everybody should
have 9 per cent Core Tier I capital by
June 2012 is dangerous as it could
lead to a credit crunch and reduced
lending, rather than safer banks.
Option two is not possible for indi-
vidual Eurozone countries as their
debt is, in effect, denominated in a
foreign currency they do not con-
trol. But trying to use the ECB to
monetise national debt is equivalent
to doing this. Pushed to the extreme,
it can trigger hyperinflation or,
more likely in the current environ-
ment, excess liquidity which ends
up blowing new bubbles in asset
markets. The ECB has an exposure of
590bn to the PIIGS nations, up
from 444bn only 4 months ago.
Option three is what the bailout
fund which will now be leveraged
to just 1 trillion, possibly with the
help of Chinese money would
achieve. Again, it is not quite clear
what is being planned here, the
potential role of the IMF, the struc-
ture of the mooted special purpose
investment vehicle or how the lever-
aged fund would be turned into an
insurance scheme for Italian debt. It
is amusing that the EU is now
embarking on the sort of financial
engineering and off-balance sheet
structures it loudly blamed from the
crisis of 2008.
Yet even if emerging nations are
willing to put their money into such
a dodgy venture, Germany and
other EU member states would still
pick up some of the tab. Its not
quite another Versailles Treaty,
where Germany was saddled with
reparations for years, but it could
still eventually become that way. The
stark truth is that the debt will not
go away: it would just be spread
around the global economy. This is a
recipe for disaster moving sub-
prime mortgages around the system
did not reduce or abolish their risk.
Risky assets are correlated.
Even if the bailout fund can be
leveraged to 1 trillion, there will
not be enough resources to fully
backstop Italy and Spain. Open
Europe has the numbers: Italy will
have to borrow between 825bn and
907bn over the next three years,
depending on budget policies. Spain
will have to borrow between 500bn
and 602bn. A 1 percentage point
increase in yields would boost Italys
interest payments 43bn over the
next five years. Some money from
the leveraged-up bailout fund will
also be needed for other countries
and then there will also be other
expenditures, such as on recapitalis-
ing some banks. The sums are mas-
sive. Yesterdays agreement is
barely a draft blueprint and is large-
ly devoid of numbers and detail. But
even taken at face value, this is not a
plan that will save the Eurozone.
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
These vague plans
wont save Europe
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NEGOTIATIONS over the extent of the
private sectors involvement in a sec-
ond financial aid package for Greece
have stalled, with no agreement over
any elements, the managing director
of the Institute for International
Finance (IIF) said late last night.
There has been no agreement on
any Greek deal or a specific haircut,
Charles Dallara, who is leading nego-
tiations on behalf of the IIF, which
represents private sector creditors,
said in a statement.
We remain open to a dialogue in
search of a voluntary agreement.
There is no agreement on any ele-
ment of a deal.
Eurozone states are pushing the
private sector to accept a 50 per cent
writedown on their holdings of Greek
bonds in an effort to reduce Greeces
debt burden by around 100bn.
Failure to agree on a voluntary
writedown or haircut could lead to
a full scale default in Greeces debt,
with a heavy knock-on impact on
markets.
Earlier in the day, a European offi-
cial revealed that the International
Monetary Fund (IMF) was pushing for
a haircut of 65 per cent or more,
Dow Jones reported.
The IMF could push for a haircut of
up to 70 or 75 per cent, reports said,
although the international bailout
fund did not confirm its position.
No agreement reached on level of private sector
haircuts on Greeces debt, warns banking body
ITALIAN Prime Minister Silvio
Berlusconi presented European lead-
ers with a hastily constructed package
of economic reforms last night, in
response to an ultimatum demanding
action to boost growth and cut Italys
huge public debt.
Employment laws could be
reformed and state assets palmed off
to raise cash, according to a letter sent
by Berlusconi to European leaders.
The offer came after a chaotic day of
politics in Italy, involving a fist-fight
between opposition and government
MPs in the countrys parliament.
It was not clear whether Europes
leaders, who have been highly scepti-
cal about Berlusconis ability to deliv-
er, would be satisfied by a series of
promises of future measures to get
Italy out of the firing line.
Berlusconi, in political trouble at
home, had been caught between the
EU ultimatum and the refusal of his
Northern League partners in a centre-
right coalition to make more than
slight concessions on pensions -- a key
plank of the reform programme.
After tense coalition talks late into
the night, Berlusconi carried a letter
of intent to the summit, which prom-
ised a much delayed economic devel-
opment plan by 15 November.
Berlusconi in
pensions fight
Jan 18 -
Finance ministers
inch towards
beefing up the EFSF
rescue package.
Feb 14 -
Finance ministers agree on
permanent rescue mechanism
(ESM) that would total 500bn.
March 15 -
Officials say they are likely to agree soon on a reformed
EFSF to be operational by mid-summer.
March 24/25 -
EU leaders confirm
that the EFSF would
have a higher
effective lending
capacity by June.
April 8/9
Informal meeting in
Hungary following
Portugals request
for EU and IMF aid.
May 16
Finance ministers
approve a 78bn
bailout for Portugal,
then led by Jos
Scrates (left).
June 23/24
Leaders endorse treaty setting
up the ESM, a permanent
mechanism for resolving
sovereign debt crises,
from mid-2013.
July 3
Finance ministers
agree to disburse
a further 12bn
to Greece.
July 21
Leaders promise a sec-
ond bailout of Greece.
The EFSF rescue
fund will also be allowed
to buy bonds in the
secondary market and
lend governments money
to recapitalise banks.
500bn
78bn
MSCI Eurozone banks
index - rebased to 100
MISSED DEADLINES | EUROZONE MEETINGS IN 2011
12bn
BY HARRY BANKS
EUROZONE
THE BAILOUT fund should be used

immediately and the European
Central Bank (ECB) will keep buying
bonds, incoming boss Mario Draghi
told a Rome conference yesterday.
He also hinted a cut in interest rates
might come soon as growth is slow. He
takes the helm at the ECB on 1
November, with the first interest rate
decision taken two days later.
Immediate implementation of
financial support is required to man-
age the crisis, he said.
Draghi explained that a definitive
and lasting answer is needed to sooth
markets and resolve the debt crises.
The Bank bought Italian bonds in
August to drive down soaring yields.
Draghi vows to
take action as
new ECB boss
BY HARRY BANKS
EUROZONE
BY TIM WALLACE
EUROZONE
result!
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Final Day
ANGELA Merkel invoked Europes war-
torn history as German MPs backed her
plea for an increase in the size of the
single currencys rescue fund.
The German Chancellor told a
packed Bundestag they must fulfil
their historic duty by approving her
negotiating role at the Brussels emer-
gency summit, which is considering
ways to boost the firepower of the
440bn (383bn) European Financial
Stability Facility (EFSF).
No one should take it for granted
that there will be peace and affluence
in Europe in the next half century,
she said.
The world is watching Germany
and Europe to see if we are ready and
able to take responsibility. If the euro
fails, Europe fails.
Supporters hailed Merkels victory
by 503 votes to 89 as a boost to her
authority at home and in Brussels but
she remains weakened by the domes-
tic perception of dithering during the
crisis. Fifteen members of her centre-
right coalition either voted against
the motion or abstained yesterday.
The vote was passed with changes
because German politicians do not
want to see ECB loans used to prop up
the EFSF. With a leveraged EFSF, the
central bank will no longer need to
buy bonds on the secondary market.
The options being discussed in
Berlin are for the fund to offer guaran-
tees to purchasers of new Eurozone
debt or to use part of its capacity to set
up an investment vehicle to attract
money from sovereign wealth funds.
The two proposals could also be com-
bined.
Merkel said it was right to take the
chance of higher risks which would
come from leveraging the EFSF. She
wants to see Greeces debt to gross
domestic product ratio cut to 120 per
cent by 2020.
That would mean a 50 per cent
writedown for private sector bond-
holders under plans put forward by
the ECB, European Commission and
the International Monetary Fund.
Merkel wins
support after
invoking war
News
EMERGING giants India, Russia and
Brazil ruled out contributing to the
Eurozone bailouts though Chinese
leaders were yesterday said to be con-
sidering offering help.
China has bought Spanish bonds in
the past, and was last month courted
by Italy as a potential investor.
Last night the countrys leaders
were said to be mulling over two
potential lines of investment.
One option is to put money into a
special purpose investment vehicle
(SPIV), which is intended to gather
funds to invest alongside the
European Financial Stability Facilitys
(EFSF) 440bn contribution.
The second option is to increase
Chinese participation through the
International Monetary Fund (IMF),
which may then bail out more strick-
en governments. However, other
countries could oppose any blanket
increase in contributions to the fund.
But French bank Socit Gnrale
insisted yesterday that it could turn to
its own shareholders if it ever needed
to raise additional capital and has no
need for any government funds. If we
ever needed it, which I doubt, we could
call for funds from our shareholders,
and in any case we wont seek public
funds, boss Frederic Ouda said.
BRICs consider
options for aid
and investment
Sept 16/17
Meeting in Poland EU
finance ministers broke
no new ground. Timothy
Geithner (right) made
an appearance to urge
Germany to do more to
solve the crisis.
Oct 3
Meeting of finance ministers,
hours before Dexia became the
first European bank to have to be
bailed out due to the debt crisis..
Oct 23
Near agreement
on bank
recapitalisation
and on how to
leverage EFSF
rescue fund
Oct 26
Latest talks between European leaders
end with more pledges to solve the crisis
but precious few details
THE EURO CRISIS
TALKS AT A GLANCE
BAILOUT FUND
Leaders have thrashed out a rough
agreement to leverage the fund to
increase its size from 440bn to around
1 trillion. This deal will satisfy German
leader Angela Merkel, who lobbied for
leveraging, but is smaller than hoped for
by many in the markets.
GREEK DEBT HAIRCUTS
While no firm agreement has been
reached on the scale of haircuts to be
forced upon Greek bondholders, the
numbers being thrown around suggest
the figures will be vast. The IMF was
said to favour haircuts of as much as 75
per cent, though a 50 per cent figure
has also been widely mentioned. Talks
between leaders and private lenders
were still underway in the early hours of
this morning.
BANK CAPITALISATION
One of the few details in the leaders
three-page communique last night was
this: There is broad agreement on
requiring a significantly higher capital
ratio of nine per cent of the highest
quality capital and after accounting for
market valuation of sovereign debt
exposures, both as of 30 September
2011. The EBA estimates that
European banks need to raise 106bn.
TIMING
Vague at best. Leaders hope to pin
down the remaining details next month.
Banks have until June 2012 to meet the
new capital requirements.
Aug 4
ECB, led by
Jean-Claude
Trichet,
resumes bond
buying
BY PETER EDWARDS
EUROZONE
BY TIMWALLACE
EUROZONE
CITY employers will shed more than

26,000 jobs this year, slashing employ-
ment back to 1998 levels, as they pre-
pare for a renewed downturn rather
than recovery, a leading think-tank
warns today.
Headcount at banks and finance
firms is expected to drop 8.5 per cent
this year to 288,225 in the biggest fall
since the 2008 financial crisis, the
Centre for Economics and Business
Research found.
CEBR economist Rob Harbron said
the job cuts come after three years of
very low productivity in the financial
sector, as employers have held on to
under-utilised staff in anticipation of
an uptick in their business.
But with concerns mounting over
future economic growth in the UK
and Eurozone, institutions are now
cutting out the slack in their head-
count, he told City A.M.
The job losses are likely to slash
Londons 2011 GDP growth to less
than a quarter of historic levels this
year, while the loss of tax revenue is
certain to hurt the Treasury.
A large part of City bonuses has
gone to the taxman, so with job losses
there will be a drop in incomes and it
is really the taxman that loses out,
Harbron said.
Meanwhile Bank of England policy-
maker Robert Jenkins yesterday said
he had great concerns over the
salaries and benefits paid to bankers.
City jobs will
hit 1998 low
BY ALISON LOCK
RECRUITMENT
THE PARENT company of Yorkshire

and Clydesdale banks has increased
second-half cash profit by 17 per cent
as bad-debt charges fell and mortgages
grew at more than three times the
rate of the industry.
National Australia Bank said this
morning that profit was a record
A$2.79bn (1.82bn), despite doubts
over the immediate health of the glob-
al economy. Chief executive Cameron
Clyne said: Business credit and con-
sumer credit are functions of confi-
dence and obviously it has been low. It
has led to lower credit growth.
NAB has grown loans 7.6 per cent in
the year, mainly due to its aggressive
mortgage focus. It also said net inter-
est margin, a key measure of prof-
itability, rose five basis points in the
second half to 2.28 per cent.
Bad-debt charges fell by A$199m
and Tier I capitalclimbed 79 basis
points to 9.70 per cent.
NAB has long considered an exit
from the UK and rejected a bid for its
British assets by Hugh Osmonds Sun
Capital before entering into its current
talks with NBNK. NAB said underlying
profits in UK banking rose four per
cent to 533m and pre-tax cash earn-
ings rose 45 per cent to 237m in a
very difficult environment.
All trading on the Australian
Stock Exchange was halted this morn-
ing as it probed a technical glitch.
Cut in bad debt spurs profit
at National Australia Bank
BY PETER EDWARDS
BANKING
News
This week we are asking members
of the City A.M. Voice of the City
panel, run with PoliticsHome, how
hopeful they are about the
Eurozones efforts to right itself.
Have leaders done enough to hold
the single currency together? And
can Berlusconi and other under-
pressure heads of state keep their
jobs amid the debt crisis?
To answer, please apply to join at
cityam.com/panel
In partnership with
PoliticsHome.com PoliticsHome.com
How are EU leaders doing?
Apply to join today at www.cityam.com/panel
ST PAULS HOPES TO RE-OPEN TOMORROW
THE DEAN of St Pauls, the Right Rev Graeme Knowles, said he is optimistic the cathe-
dral will re-open tomorrow in time for the 12.30pm Eucharist following a re-shuffle of
protesters tents. The cathedral refused to comment on reports that Rev Canon Dr Giles
Fraser, the Chancellor, had threatened to resign if the church attempts an eviction. The
City of London Corporation will meet tomorrow to decide whether to launch legal action.
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anniversary of John Keats' birth.
Guests welcome more details
from www.cityofIondon.gov.uk/
keatshousehampstead
Award-winning actress Dame
Eileen Atkins, who studied at
Guildhall School of Music &
Drama, receives the Freedom
of the City of London at the
Guildhall today. Her extensive
credits include Vanity Fair,
Cold Mountain, Gosford Park
and Cranford.
Birds, churches and everyday objects feature in a new exhibition
of Zoe McMillan's water-based work, which runs from 1 26
November at the City of London's Barbican Library.
FREE www.cityofIondon.gov.uk/barbicanIibrary
City Freedom for
Dame Eileen Atkins
John Keats celebrated
at Westminster Abbey
Zoe McMillan exhibition at Barbican Library
F
BUSINESS Secretary Vince Cable has
shot down new plans to make it easi-
er for companies to sack under-per-
forming staff.
Liberal Democrats said the proposal
to scrap unfair dismissal rules, con-
tained in a leaked report for the coali-
tion by venture capitalist Adrian
Beecroft, would not get off the
ground. Aides to Cable said there was
no evidence to back the idea and it
was unlikely to improve flexibility in
the labour market.
Downing Street advisers also believe
the Beecroft plans are unlikely to be
make it onto the statute book.
Their cool reaction came after the
leak of Beecrofts report, which said
unfair dismissal laws deter small busi-
nesses from hiring staff and hit com-
petitiveness.
If the government wants to encour-
age economic growth, Beecroft said, it
must move to make labour markets
more efficient, creating more jobs.
John Longworth, director general of
the British Chambers of Commerce,
said the fear of costly tribunals
deterred firms from taking on staff.
Nine per cent of claims were struck
out before a hearing took place,
according to Ministry of Justice figures
for April to June.
Cable anger at plans to
make firing staff easier
Adrian Beecroft says firms fear laws on firings, so do not create jobs in the first place
BY PETER EDWARDS AND TIM WALLACE
REGULATION
News
SANTANDER SEEKS TO OFFLOAD 3BN
OF PROPERTY
Spains Santander, the biggest bank
in the Eurozone by market capitalisa-
tion, is quietly trying to sell a 3bn
package of thousands of repossessed
homes and plots of land to foreign
investors to clean up its balance
sheet, according to sources.
WHAT THE OTHER PAPERS SAY THIS MORNING
RIO TINTO HAS TO FACE WAR CRIMES
TRIAL, US COURT RULES
Rio Tinto is to face charges in
America of genocide and war crimes
over its alleged activities in Papua
New Guinea during the 1980s. An
appeal court in San Francisco has
ruled that a lawsuit brought by resi-
dents of Bougainville.
MANUFACTURING has been hit by the
Eurozone crisis, and output may
decline this quarter according to the
Confederation of British Industrys
(CBI) quarterly trends survey.
Business optimism has fallen for the
second consecutive quarter. The net
balance of firms feeling more opti-
mistic than they were three months
ago fell to minus 30 per cent from
minus 16 in July.
Total new orders increased by six
per cent in the third quarter, but com-
panies expect a decline of 10 per cent
in the current month period.
Manufacturing output rose by an
estimated 0.2 per cent over the third
quarter, and is expected to fall 0.6 per
cent in the fourth. In terms of jobs,
around 8,000 were created in the last
three months, but 4,000 will go by the
end of the year, the survey suggests.
The lack of global political leader-
ship and in particular the Eurozone
crisis have knocked confidence, said
Ian McCafferty from the CBI.
McCafferty stressed that the next
two weeks of EU negotiations are vital
for business confidence, investment
and jobs, but that even with a very
good result from the summit and
negotiations, it would still take a bit of
time for confidence to recover.
However, lower investment expecta-
tions were registered in earlier surveys.
The fall before the third quarter is
largely down to consumer spending
being squeezed by inflation, said
McCafferty. Central government cuts
have yet to start overall spending has
risen over 2011 and so cannot be seen
as a main cause of the decline in
expectations so far.
McCafferty stressed the need for
supply side reforms to free up the UKs
economy and boost growth. Issues like
planning reform and a need to cut the
administrative burden involved in run-
ning a business are key, he said.
Manufacturers group EEF said pay
settlements have held steady, mean-
while, averaging 2.5 per cent in the
three months to September.
Output of UK
factories hit
by euro woes
BY TIM WALLACE
UK ECONOMY
News
ANALYSIS l Manufacturers optimism has
declined sharply
%
balance
Business optimism
Export optimism
2002 2004 2006 2008 2010 2000
30
0
-10
-20
-30
-40
-50
-60
-70
20
10
Manufacturers
are suffering as
demand falls,
according to the
CBI, led by John
Cridland.
Picture: REUTERS
CITY VIEWS: ARE YOU WORRIED ABOUT THE STATE OF THE UK ECONOMY?
Interviews by Phoebe Torrance
I am not overly concerned at the
moment; it is definitely getting
worse but I have every confidence
that it will turn around over the next
couple of years.
PETE GOAD | LLOYDS OF LONDON
Not really, not more than it was
worrying me 20 years ago. What
increasingly affects us is the state
of other countries economies as we
rely on them more and more.
PAUL CLAYTON | JRP UNDERWRITING
Yes, it worries me. In these times of trouble I think that it is middle England that suffers the most.
The British economy is really struggling at the moment. And to make it worse, the government
seems unconcerned about hard-working people.
DARREN PETCHEY | RANDALL & QUILTER INVESTMENTS
* These views are those of the individuals above and not necessarily those of their company.
Record drop in retail jobs
as consumers spend less
LOW consumer spending has led to
the fastest drop in retail employment
since the British Retail Consortium
(BRC) started monitoring data in 2008,
a study released yesterday showed.
Employment fell by 23,000 in the
twelve months to September. Part-time
staff were worst hit, while full time
employment in the third quarter fell
5,780 on the same period last year.
Fifty-four per cent of retailers plan
to increase staff levels for Christmas,
down from 61 per cent who planned
to in the same month last year.
Uncertainty about Christmas trad-
ing may also be leading retailers to
delay taking on seasonal staff with
that reluctance compounded by the
new Agency Workers rules, said BRC
director general Stephen Robertson.
However, store numbers did
increase over the year there are now
2.3 per cent more shops than in
September 2010. However, this is hav-
ing a limited impact on employment.
Food retailers are almost entirely
responsible for rising store numbers
and curiously the trend for them is
towards more full-time job opportuni-
ties with part-timers hours remaining
almost flat, said Christina Tolvas-
Vincent from law firm Bond Pearce.
This trend could make things more
difficult for those looking for flexible
employment.
RETAIL
SPAINS second biggest lender, BBVA,

saw profits drop and impairments in
its core Spanish business rise in yes-
terdays third-quarter results.
The bank also gained market share
in mortgages, increasing its exposure
to the countrys troubled property
market.
Group pre-tax profits dropped by
21.2 per cent to 4.15bn (3.61bn),
while in Spain pre-tax earnings lost a
whopping 38.4 per cent to hit
1.63bn.
The cost of impairments on BBVAs
financial assets in Spain jumped 36
per cent to 1.25bn.
The results are a troubling sign for
European retail banks: thus far, the
retail side of large integrated lenders
had been holding up better than
their wholesale sides, but BBVA is
predominantly a consumer-led bank.
S&P Equity Researchs Jawahar
Hingorani downgraded the bank
from hold to sell after the results,
saying: Spanish exposure (60 per
cent of total lending) remains a con-
cern, after an 11.4 per cent decline in
net interest income year on year
through the third quarter led to net
attributable profit declining 38 per
cent. [We are] expecting weaker
Mexico and US growth as well.
Net interest income declined five
per cent to 9.68bn at the group level.
The banks funding position
improved on a year ago, however,
with its funding gap dropping by
20bn since September 2010.
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BBVA sees impairments
rise in Spanish business
BY JULIET SAMUEL
BANKING
News
FREDDIE Macs chief executive,
Charles E Ed Haldeman Jr, will step
down by the end of the year after just
over two years in the post, the regula-
tor of the company said yesterday.
The US Federal Housing Finance
Agency, which also oversees sister
state-backed mortgage investor
Fannie Mae, said it will work with the
board at Freddie Mac to replace him.
Head of Freddie
Mac set to quit
BANKING
BBVA chief Angel Cano Pic: REUTERS
ANALYSIS l Banco Bilbao Vizcaya Argentaria S.A

20Oct 21 Oct 24Oct 25Oct 26Oct
6.30
6.20
6.10
6.40
6.50
6.23
26 Oct
STRUGGLING derivatives broker MF
Global is understood to have hired
bankers to help it consider its options,
which could include a takeover or the
sale of parts of the business.
The New York-based firm, which
has seen its share price fall by almost
50 per cent this week following dire
results, was downgraded to a notch
below junk by Moodys on Monday.
MF Global to
weigh options
BANKING
BARCLAYS launched a new bid to

entice prospective house-buyers back
to the market yesterday by offering
no-fee mortgages needing only a ten
per cent deposit.
The bank has refused to offer 90
per cent loan-to-value mortgages
since 2008 when it pulled them dur-
ing the financial crisis, but is now fol-
lowing rivals such as NatWest and
Santander back into the market.
The loans will be issued through its
Woolwich mortgage division and will
waive the standard 499 application
fee charged for most mortgages.
Barclays billed the new offer as a
way to revive the UKs stalled housing
market by getting first-time buyers
on the property ladder and helping
homeowners to remortgage their
properties.
We recognise the importance of
supporting the first time buyer mar-
ket, which is why weve committed
today to extend our lending to 90 per
cent, said Barclays head of mort-
gages Andy Gray.
The deal will give customers a
three-year 4.99 per cent interest rate
before reverting to 3.39 per cent
above the base rate after the fixed
rate period ends. Anyone holding a
Barclays current account can also
request a five-year fixed 5.49 per cent
rate, again with no fees, the bank
said.
Personal finance comparison site
www.moneysupermarket.com said
there were 312 mortgages offering 90
per cent loan to value in July, the
highest level of choice seen since
November 2008.
Barclays to
offer 90pc
mortgages
SWEDENS Handelsbanken bucked a
slowing economy as it unveiled rising
income and lower loan losses in the
third quarter at a time when many of
Europes banks are being shaken by
debt woes across the region.
Swedens second-biggest bank by
market capitalisation and traditional-
ly the most conservative,
Handelsbankens operating profit
was 4.4bn crowns (420m) against
4bn forecast in a poll, and 4.1bn in
the previous quarter.
A FORMER Goldman Sachs director,
who was once the global head of elite
consultancy McKinsey & Co, yesterday
surrendered to the FBI to face crimi-
nal charges related to insider trading.
Rajat Gupta, one of the most
prominent business executives to be
caught up in the governments wide-
ranging insider-trading probe, had
been named by prosecutors as an
unindicted co-conspirator in the
criminal case against hedge fund
tycoon Raj Rajaratnam earlier this
year.
An FBI spokesman said Gupta, 62,
was currently in custody and being
processed.
Guptas attorney said: Any allega-
tion that Rajat Gupta engaged in any
unlawful conduct is totally baseless.
The facts demonstrate that Mr Gupta
is an innocent man and that he has
always acted with honesty.
Handelsbanken
shows Swedish
bank strength
Former head of McKinsey
surrenders himself to FBI
An attorney for Rajat Gupta said the allegations were baseless Picture: GETTY
BY ALISON LOCK
MORTGAGES
BANKING
NBNK Investments, the buy-out vehi-

cle led by Lord Levene, sent in a first-
round bid for nationalised lender
Northern Rock yesterday.
City A.M. revealed that NBNK was
exploring a bid in August when it
became clear that the auction would
not get off the ground before the
banks prohibition on bidding
expired. It had agreed a hiatus on bid-
ding after employing the Rocks for-
mer chief Gary Hoffman.
NBNK puts in a
bid for the Rock
BANKING
Will offer its first 90 per cent mortgages

since 2008 through its Woolwich lending arm
Barclays will waive 499 fee on new 90 per
cent mortgages and charge a 4.99 per cent
three-year rate, or 5.49 per cent for five years.
FAST FACTS | BARCLAYS
News
CITYA.M. 27 OCTOBER 2011
BY HARRY BANKS
FINANCIAL CRIME
9
THE UNCERTAIN nature of the recov-
ery in the global car market was
underlined yesterday as Ford posted a
dip in third-quarter profit.
Americas number two car-maker
also cut its profit margin forecast for
this year after racking up losses in
Europe and Asia.
It said it had been hit by slowing
growth in China and price pressure in
Europe and did not say when it expect-
ed to pay its first dividend since it slid
into crisis in 2006. Lewis Booth, chief
financial officer, said only that it
would be sooner rather than later.
Revenue rose 14 per cent to $33.1bn
(20.73bn) but profit fell two per cent
to $1.65bn. The group also cut its 2011
outlook for its margin on automotive
profit, saying it now expects 5.7 per
cent, down from 6.5 per cent through
the first three quarters. It had previ-
ously said it would at least match its
2010 level of 6.1 per cent.
The group posted a pre-tax profit of
$1.55bn in America as auto sales stead-
ied over the summer but swung to a
pre-tax operating loss of $43m in Asia
and Africa, compared with a $30m
profit last year. European losses shot
up 56 per cent to $306m as price com-
petition hit margins.
The quarter included a non-cash
charge of about $350m to write down
the value of hedges Ford had taken to
offset the risk of raw material costs
increasing, when they actually fell.
JP Morgan called the results so-so
and Citi said they were a bit messier
than expected.
Asia presses
the brakes on
Ford recovery
AMAZON says it will create an eighth
high-tech warehouse on the outskirts
on London as it prepares to increase its
product range and meet an expected
rise in demand for online shopping.
The plans will see the retailer create
up to 4,000 new jobs in the UK by
Christmas next year, with its core mar-
ket for books and DVDs growing by 19
per cent year-on-year.
The online retailer plunged 12 per
cent yesterday, wiping $11bn (6.92bn)
from its value, after it said it could lose
as much as $200m in its fourth quar-
ter. The firm has pumped millions into
developing the Kindle Fire, which it
hopes can unseat Apple as the undis-
puted champion of the nascent mar-
ket. Amazon has not revealed whether
the $199 tablet is being sold at a loss
but some analysts have calculated it
could cost the firm $50 per unit.
Amazon also got UK competition
clearance for its purchase of the Book
Depository yesterday.
Amazon to open massive
new London warehouse
Amazon boss Jeff Bezos wants to expand his UK product range
BY PETER EDWARDS
AUTOMOTIVE
News
BY STEVE DINNEEN
TECHNOLOGY
NEWS | IN BRIEF
Cameron warning over QE con
David Cameron has warned that bankers
could face criminal charges if they are
found manipulating the market to cash
in on quantitative easing. He said it is
important to send a message about
the severity of financial services crime.
The Bank of England has reportedly rep-
rimanded one commercial bank already.
Gucci owner shows off growth
French luxury and retail group PPR yester-
day said it saw no sign of a slowdown as it
posted third-quarter sales that comfort-
ably beat expectations, pulled by strong
growth at brands Gucci, Bottega Veneta
and in markets such as China. The group's
luxury sales soared 24.6 per cent at con-
stant exchange rates in the three months
to 30 September to 1.28bn (1.11bn).
US durable goods orders rebound
The US economy should start the fourth
quarter with solid momentum, official
data yesterday suggested. Orders for
durable goods, excluding transportation
items, rose a stronger-than-expected 1.7
per cent last month after falling 0.4 per
cent in August. The gain was the largest
since March. A second report showed that
new home sales increased 5.7 per cent.
But the median price for a new home fell
3.1 per cent to $204,400 last month,
down 10.4 per cent from a year earlier.
Peugeot to cut 6,000 jobs
Frances PSA Peugeot Citroen plans to cut
6,000 jobs in a bid to slash costs after
warning that pricing pressure meant its
core car making business would barely
make a profit this year. PSA pledged to
reduce costs by 800m (697m) next
year, including the job cuts. It also expects
2011 free cash flow to be negative.
$
ANALYSIS l Ford Motor Co
12.40
12.00
12.20
11.80
11.60
12.60
12.80
11.87
26 Oct
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BRITISH American Tobacco (BAT) lift-
ed its sales by seven per cent in the
first nine months of the year as the
firm saw price rises and recovering
volumes in the third quarter.
The London-based maker of Kent,
Dunhill, Lucky Strike and Pall Mall
cigarettes said a good performance
from these top four brands would
help drive another year of good
earnings growth.
Its key four brands delivered eight
per cent growth, with Kent up nine
per cent.
Sales grew in its top 10 markets,
especially Russia, Romania and
Ukraine.
However, overall group volumes
fell 0.6 per cent to 523bn cigarettes
over the period.
While the challenging economic
conditions continue to impact con-
sumers in some markets, other mar-
kets are showing signs of recovery,
said chief executive Nicandro
Durante yesterday.
The group added that some of its
major markets were recovering,
while others like Turkey, Canada and
South Korea were still tough.
The worlds biggest cigarette
group, Marlboro-maker Philip Morris
International, last week reported
underlying third quarter volumes
rose 4.4 per cent with sales up 15.7
per cent. Imperial Tobacco said it
expected volumes for the year to
drop by two per cent.
Shares in BAT rose 1.52 per cent to
2,896p yesterday.
BAT in sales
rise as price
hikes kick-in
NASDAQS core profit jumped 20 per
cent in the third quarter, the firm
said yesterday, as volatile markets
boosted trading volumes across the
exchange operator's spectrum of
assets.
Nasdaq had a six per cent rise in
stock trading revenue and a 40 per
cent jump in revenue from deriva-
tives trading and clearing, including
the top market share in US equity
options.
Excluding one-time items, the
Nasdaq Stock Market parent earned
$121m (75.8m) in the quarter, up
from $101m a year ago.
Revenue rose 18 per cent to
$438m, slightly ahead of expecta-
tions.
They are relying on organic
growth, and pointing to derivatives
and market technology and data to
get there, said Patrick
O'Shaughnessy, analyst at Raymond
James. For the most part its been
working another quarter of record
earnings.
Including $14m in costs related in
part to merger efforts, net profit was
$110m.
Under chief executive Robert
Greifeld, Nasdaq has been on the
sidelines of a global merger push
among exchanges after dropping its
hostile bid for NYSE Euronext in May.
Nasdaq tops
forecasts with
its earnings
BY JOHN DUNNE
CONSUMER
CONSUMER
News
ANALYST VIEWS: IS BAT ABLE TO BUILD ON
IMPROVING SALES? Interviews by John Dunne
MARTIN DEBOO | INVESTEC

These figures are quite strong and show the defensive qualities of the
stock. There is pricing strength in the tobacco industry and volumes and margins
are improving. BAT is in line with Philip Morris but pulling ahead of Imperial
Tobacco.
TINA COOK | CHARLES STANLEY

BAT has released a reassuring quarter three trading update with pleas-
ing growth in revenue and profit. Organic revenue is up seven per cent, reflecting
continued positive pricing despite challenging economic conditions. BAT remains
on course to meet its target of 35 per cent for the full year.
KEITH BOWMAN | HARGREAVES LANSDOWN

Despite an early year wobble, BAT is again underlining its defensive
growth attributes. Although geographical performance remains mixed, volumes
have made some recovery, with its four key brands leading the way, whilst strong
finances underwrite an ongoing and supportive share buy-back scheme.
Chief executive Nicandro Durante is upbeat on growth Picture: NEWSCAST

p
ANALYSIS l British American Tobacco
2,820
2,800
2,780
2,840
2,860
2,880
2,900
2,920
2,896.00
26 Oct
News
VISA said yesterday quarterly net
income rose by 14 per cent, as the
company processed more card pay-
ments and payment volumes
increased.
The San Francisco-based card
processor reported fiscal fourth-
quarter net income of $880m
(550.8m), up from $774m a year
ago.
Total revenues rose 12.6 per cent
to $2.38bn, while total processed
transactions totaled 13bn during
the quarter, a nine per cent increase
over a year ago.
Payment volumes increased 13
per cent to $970bn.
Visa shares declined two per cent
to $90.10 in after-market trading
after the results were announced,
having risen during the day.
DRUGMAKER GlaxoSmithKline said
sales returned to growth in the third
quarter as the pharmaceutical giant
looked to put patent expiries and a col-
lapse in revenue from troubled dia-
betes pill Avandia behind it.
The firm said sales in the quarter
increased four per cent from the same
period a year ago at 7.1bn slightly
ahead of market expectations.
GSK is recovering from a slump in
revenues after a ban on its Avandia
diabetes drug last year on fears that it
increased the risk of heart attack and
strokes, as well as the loss of patent
cover on herpes drug Valtrex.
The environment for pharmaceuti-
cal and consumer products remains
challenging. The impact of healthcare
reform in the US and price cuts in
Europe this year is in line with our
expectations and we continue to
expect a full year impact of around
325m, said chief executive Andrew
Witty.
The group also hiked its
shareholder dividend by six per cent to
17p, and also increased its expecta-
tions for share buybacks this year to
up to 2.3bn, from 2bn previously.
Glaxo enjoys a return to growth
BY KASMIRA JEFFORD
PHARMA
INTERNATIONAL Power said trading

in the nine months to September was
in line with its expectations, as strong
growth across its Latin American oper-
ations helped offset poor results across
Europe.
The FTSE 100 firm, which merged
with the power generation arm of GDF
Suez in February, said revenues until
the end of September were 12.3bn
(10.7bn), up from 12.1bn in the same
period of last year.
Performance for Latin America was
up strongly compared to the same
period in 2010, benefiting from higher
average achieved prices in Brazil, driv-
en by inflation escalation and
favourable renewal of contracts,
International Power said yesterday.
Revenues across Europe however,
fell by 10 per cent, weighed down by
the roll-off of higher priced contracts
and weaker market conditions in the
UK.
In August the utility announced
that it had temporarily reduced the
declared capacity of Teesside, one of
the countrys biggest power plants, to
just 45 megawatts and would not
return to full operation until the mar-
ket recovers.
International Power is in the process
of building 6,600 megawatts of new
power plants, mostly in developing
countries, such as Brazil and Thailand
as well as North America.
Chief executive Phil Cox said the
group continues to expect second-half
performance to be similar to the first
half.
We are confident of delivering sus-
tained growth in shareholder value
from our significant pipeline of devel-
opment projects in emerging markets,
coupled with our strong competitive
position and future recovery in mer-
chant markets, he said in a state-
ment.
Int Power
boosted by
Brazil prices
IF EVERY axed employee dreams of
taking their boss down with them,
then Michael Woodford was living the
dream yesterday.
All-powerful Olympus chairman
Tsuyoshi Kikukawa (pictured) finally
fell on his sword after the scandal
engulfing his company showed no
sign of abating.
Olympus, the 92-year-old camera-
maker, has now lost more than half its
value since former chief executive
Woodford went public about what
appear to be excessively large advisory
fees paid in relation to a UK acquisi-
tion. Around $687m was paid to an off-
shore firm following the $2.2bn
takeover a percentage cut that has
entered the record books.
The incident is now being investi-
gated by regulators in Japan, the
Financial Services Authority (FSA) in
the UK and the FBI in the US.
Woodford said Kikukawas resigna-
tion was a start but added his
replacement Shuichi Takayama, a
41-year company veteran had also
failed to demand expla-
nations about hefty
fees linked to acquisi-
tions.
Olympus denies any
wrongdoing and is
understood to be
c o ns i de r i ng
legal action over
the leak of con-
fidential infor-
mation.
The firm
c l a i m s
Woodford was
fired, after just
two weeks into
the job, for fail-
ing to adapt to
the Japanese man-
agement style.
Chairman
of Olympus
finally quits
RUSSIAS top oil producer Rosneft yes-
terday beat forecasts with a $2.82bn
(1.78bn) third quarter net profit, as
the state-owned giant ploughs on with
its international expansion efforts.
Rosneft has hired a former BP proj-
ect director to help it forge ties in the
international market, just months
after the firms $10bn share swap with
BP collapsed.
Laurence Bates, who also previously
worked for TNK-BP and Baker Hughes,
left BP in September but will likely end
up working on Rosnefts similar explo-
ration deal agreed with ExxonMobil.
Rosneft said its crude oil output has
risen 2.9 per cent to 2.4m barrels a day
during the three months to the end of
September, while petroleum output
rose 21 per cent on last year to 15m
tonnes. The firm said tax and
transport costs had dampened gains.
Rosneft snaps up BP exec
ENERGY
Glaxo CEO Andrew Witty Pic: REUTERS

BY STEVE DINNEEN
TECHNOLOGY
BY HARRY BANKS
CONSUMER
BY KASMIRA JEFFORD
ENERGY
p
ANALYSIS l GlaxoSmithKline
1,390
1,380
1,370
1,400
1,410
1,393.00
26 Oct
Visas income edges higher
US OIL giant ConocoPhillips reported a
much higher-than-expected quarterly
profit on strength in its refining arm,
sending its shares up one per cent.
Conoco reported a third-quarter
profit of $2.6bn compared with $3.1bn
a year earlier. Refining and marketing
earnings nearly tripled to $789m,
helped by higher margins.
ConocoPhillips
tops forecasts
ENERGY
25 years since the Big Bang

THE BIG Bang set the City on a course
of profound expansion, not just of
wealth, but of people and culture and
even location. Twenty-five years after
deregulation, Londons financial and
legal districts are full of the sort of peo-
ple that would have made the bowler-
hatted old boys of the post-war period
shudder. Women, foreigners, and
openly gay people not only work here,
but reach the very top of the pile. And
they do so not just in the Square Mile
and Mayfair, but in Canary Wharf,
Southwark and other places too.
The Big Bang, then, made the City a
lot bigger in every way possible. In the
old days, finance was segregated by
class: stockbrokers were upper class
and jobbers were working class.
Fathers took care of sons, and old boys
looked out for each other, keeping the
City like a members club. Now, in
many workplaces, foreigners are a
majority and advancement is general-
ly decided meritocratically. Overall,
the scale of Londons financial services
grew exponentially, turning
the capital into the worlds
greatest financial hub, even
overtaking Wall Street.
But it was the sud-
den money
unl e a s he d
after 27
October 1986
that brought
change first and
fast, transforming
City tastes, fashions and
working practices. First to
go were the bowler and
top hats, which were still
worn in certain places in the
City, even if they had been in
decline for years. Mens fash-
ion changed quickly and
tellingly: the three-piece suits and
umbrellas were replaced with a look
evoking the brashness of Wall Street.
Braces and screaming stripes moved
in and soon set the City boy in a
league of his own, at least where sus-
pect fashion was concerned. William
Skinner, inheritor of the Savile Row
tailor Dege & Skinner, founded in
1865, says: Certainly red braces char-
acterised the City look of the late 80s:
they were worn straight under jackets,
not hidden by waistcoats. And big bold
chalk stripes were very popular. Now
people are a bit more subtle from a
Savile Row perspective. Pre-deregula-
tion, says Skinner, the bowler, three-
piece suit and umbrella outfit was
worn as a kind of uniform that nod-
ded to Britains hefty military tradi-
tion the hat in particular.
Were a long way from a Colonels
formality now. The US import of casu-
al Fridays in the nineties created a
vogue for the relaxed look, and led to
such horrors as not wearing a tie with
your suit -- or in many cases not wear-
ing a suit at all,.
Another big change in the City since
1986 is the ratio between work and
play. The nail in the coffin of the
Chablis lunch was the
Americanisation of finance. Long
hours and eating lunch al desko
became the expectation and the neces-
sity as business became global and you
had to be on hand for calls and emails
from different time zones.
Ashley Crossley, head of the wealth
management at Baker &
MacKenzies London offices,
says: Lawyers at our firm are
on email and expected to be
responsive literally 24/7 as we are
a global firm and we
have clients emailing
from all over
the world.
Global busi-
ness means
you cant just
sign off and head out for
a long lunch. Even after
you leave the office at
night, you need to be
contactable.
Post-Big Bang, the
ancient, richly
appointed offices in Mayfair and the
Square Mile, surrounded by the finest
dens of food, wine and culture, were
being given the boot for shiny new
towers, some popping up in Canary
Wharf. After years of resistance, the
City gave in to the development of sky-
scrapers. Tim Badham, the founder of
Inner Place, a luxury concierge and an
employee of Merrill Lynch in the early
nineties, says: Canary Wharf was not
a place you wanted to go to, and you
tried to avoid having to, even for meet-
ings. We far preferred the City or the
West End.
But how things have changed. For
lunch its got one of Londons highest
densities of attractive eateries, from
the swanky and high-end like Roka
and Plateau, to the quick and easy, like
Itsu and Byron Burgers.
Are law, finance and earning bonus-
es just less fun now in London? Not
necessarily. You can spend, you just
have to do it quietly. Its become the
norm at Nobu, for instance, to order
sake worth hundreds, but served in an
plain carafe to hide the label. And pri-
vate dining rooms have become a
must for any restaurant serving City
folk everywhere from the Mercer on
Threadneedle Street to Marcus
Wareing at the Berkeley has one.
Badham recalls the time in the early
nineties when a competitor bank went
and bought up an entire showroom of
Porsche Boxters on the day a new
model came out, hired a car trans-
porter and dropped the cars off out-
side the bank.
Certainly the Citys personal rela-
tionship with cash is more discreet
now. At least where red braces are con-
cerned, thats is a good thing.
When black bowler hats
gave way to red braces
T
WENTY-FIVE years ago
today the doors of the
London Stock
Exchange were blown
wide open.
In one sweeping moment
of market deregulation,
Londons horizons suddenly
broadened, and money
flowed into the Square Mile.
Outside investment broke up
the LSEs boys club and fixed
commission charges for bro-
kers, which effectively killed
competition, were scrapped.
The brainchild of LSE chairman Sir
Nicholas Goodwin and trade and
industry secretary Cecil Parkinson, the
Big Bang of 1986 set London on the
path to becoming the international
financial centre it is today, as technolo-
gy trumped tradition and a flurry of
M&A expanded the Citys borders.
The trading floors of the Stock
Exchange Tower on Old Broad Street
fell quiet as high-tech computerised
screens were introduced, ending the
tradition of open outcry buying and
selling that had defined equities trad-
ing in Britain for almost 300 years.
London lets
the world in
ZOE STRIMPEL
We celebrate the day that saw the City reclaim its
place on the global map. By Elizabeth Fournier
25 years since the Big Bang
Outside ownership of firms that
were members of the LSE was allowed
for the first time, paving the way for
US and European firms to snap up City
stalwarts, and the idea of working-
class jobbers (market makers) and
upper-class brokers evaporated as
firms began to integrate.
American money in particular was
quick to arrive, as hungry investment
banks fought for a piece of the City,
picking off the capitals historic hous-
es one by one. Frustrated by Glass
Steagalls separation of retail and
investment banking on home shores,
ambitious US bank chiefs crossed the
Atlantic in search of new money.
A notable entrant to the scene was
Lehman Brothers, then a rapidly grow-
ing investment bank with a young
upstart named Dick Fuld put in
charge of its European expansion,
which bought broker L Messel soon
after deregulation.
And when the Americans came, the
Brits were ready. Powerless in the face
of the huge balance sheets wielded by
retail banks as well as the Morgan
Stanleys and Goldman Sachs of the
world, in the lead up to deregulation a
series of stock exchange couplings had
taken place.
Pre-Big Bang the maximum owner-
ship held outside of the Stock
Exchange was 29.9 per cent, so the
mid-80s saw SG Warburg snap up a
stake in jobbers Akroyd & Smithers,
while Rothschild took a share of
Akroyd rivals Smith Brothers. The
most astute American firms had even
got in on the game early, with Citicorp
buying 29.9 per cent of broker Vickers
da Costa as early as November 1983.
And as soon as the day of reckoning
came, consolidation started.
Quick off the mark to take advan-
tage of the new stockbroking model
was SG Warburg the pioneering UK
bank that issued the first Eurobond in
1963. Warburg snapped up the stakes
it didnt already own in stockbrokers
Rowe & Pitman, jobbers Akroyd &
Smithers, and gilt market-makers
Mullens & Co. By 1987 it had brought
them all under the Warburg umbrella
creating one of Londons first inte-
grated merchant banking and stock-
broking firms.
With the influx of American firms
on the look out for talent and increas-
ing rivalry among UK companies for
home-grown hotshots, it wasnt just
jobbers fortunes that were on the up.
In 1979 a director at Morgan
Grenfell took home 40,000. By 1986
average executive remuneration at the
merchant banker had hit 225,000 a
five-fold increase in just seven years.
Partners also cashed in as they sold
out and the old partnership model
faded away.
But as pay packets swelled, so did
the number of hours that City workers
had to put in to earn them. As one
Messels broker lamented: I have to
get in at 8am now before the
Americans arrived the working day
started at 9.15am I arrive before the
tea lady now. While bankers waist-
lines may have shrunk as long lunches
have given way to snatched sandwich-
es, theres no doubt that elsewhere a
huge amount of growth has taken
place in the past 25 years.
In 1986 the daily turnover generated
by foreign exchange was $50bn
(31.3bn at todays rates) in the year
to April 2011 that figure hit $2,191bn.
Private equity, which contributed just
$360m to the UK financial sector in
1986, raised over $10bn last year.
So as the last of those that the
remember the City pre-Big Bang start
to retire, a very different London raises
a glass to the next 25 years of growth.
THE FORUM: P26 THE CAPITALIST: P16
IN 1986, we saw our way of life on
the floor of the stock exchange com-
ing to an end. How would we
respond, off the floor, sitting behind
screens?
Wed had a while to realise how
things would change as we already
had SEAQ in play on screens so we
were experiencing a mixture. We
and Smith Brothers remained alone
on the stock exchange floor, the
thought being that, as many stock-
brokers operated from dealing boxes
around the market, we would cap-
ture the lions share of the trades. It
only took a couple of weeks to realise
that we were wrong, the machines
had taken over. With our tail
between our legs we retreated to our
offices and joined the battle and
how business took off. From an aver-
age of 20,000 bargains a day to hun-
dreds of thousands today.
AFTER THE RULE BOOK
The rule book had been ruled out of
order and the separation of capaci-
ties was a thing of the past. Huge
mergers came about. The flagship
for the UK, or so we thought, would
be the mighty Warburgs who incor-
porated the blueblood stockbrokers
Rowe & Pitman and the pre-eminent
gilt jobbers Akroyd and Smithers.
Regrettably this flagship got over-
taken by the Americans. However,
everybody scrambled to find a part-
ner. Lots of broking firms were incor-
porated into bigger firms and
became integrated houses both
broker and market maker but with
Chinese walls in place. One wonders,
and I still do, whether these walls
were solid enough.
We chose to stick to our last and
although we did get taken over by
County NatWest we remained a job-
ber. The other arm to County was
Fielding Newson Smith, a broker. We
continue to remain, in the main, a
jobber under the umbrella of our
present parent Close Brothers.
Life went on, people and firms
made a lot of money, dealers
overnight became rocket scientists
commanding huge salaries. The
whole thing got out of hand and, in
fact, for many ended in tears and
huge losses.
ANOTHER EVOLUTION
Now the economic scene has deterio-
rated so the City is going through
another evolving moment. We will
come out the other end fitter and
stronger, I believe, but a lot slimmer.
Do we like where weve got to? Well
its not as much fun as it was, its cer-
tainly not as personable. What really
matters is that the City of London
remains the Wimbledon of financial
services.
The public might resent what peo-
ple get paid in the City and the
financial services industry but if
they do a good job, create jobs for
people and also input a huge part of
our GDP, which they do, then why
not pay them handsomely? Nobody
seems to care what promoters of
reality shows earn or, come to that,
footballers, whose clubs rip off the
public with their ever-changing
strips.
So what is missing from our City?
A stock exchange museum. This will
not only show the public the value of
capitalism but also its unacceptable
face. Watch this space Im working
on it.
Brian Winterf lood began his City
career in 1953. He is life president of
Winterflood Securities.
BRIAN WINTERFLOOD
Recalling how
machines took
over the old City
WITHIN eighteen months of the Big Bang
reforms being announced, major consoli-
dation of the UKs fragmented financial
systems had begun, with all the main job-
bers and eighteen out of twenty brokers
entering into partnerships.
lFrom the US, Citicorp bought Vickers
da Costa and Scrimgeour Kemp-Gee, plus
Seccombe Marshall Campion, while
Merrill Lynch bought gilts jobber Giles &
Cresswell and Lehman Brothers bought L
Messel. Chase Manhattan snapped up bro-
kers Laurie Milbank and Simon & Coates.
lNatWest bought jobber Bisgood
Bishop, plus brokers Fielding Newson-
Smith and Wood Mackenzie.
lSG Warburg bought Rowe & Pitman,
Akroyd & Smithers and Mullens & Co. It
was later bought by the Swiss Bank Corp,
which merged with UBS in 1998.
lBarclays Bank bought Wedd Durlacher
and de Zoete & Bevan and formed the
fully integrated BZW.
lMidland Bank bought broker W
Greenwell. Midland was subsequently
bought by HSBC in 1992.
lHill Samuel was bought by TSB in 1987
after UBS withdrew from a takeover bid.
THEN AND NOW: HOW THE CITY CHANGED
LONG FORGOTTEN stockbroking
firms were revived at Drapers Hall
last night at the reunion for all those
who worked on the London Stock
Exchange floor before the Big Bang.
Seligman Harris, Phillips & Drew,
Capel Cure Myers and Quilter & Co
all consigned to City history, but for-
mer staff such as Phil Cole still
remember the days of paying one
and thruppence for a weeks supply
of paper collars at AJ Neils.
One early female pioneer after the
LSE changed its rules to admit
women in 1973 was Barbara Gill, who
met John, her husband of 28 years,
when she worked at Vanderfelt and
he worked at Scrimgeour Kemp Gee,
where his nickname was pit prop.
The youngest person at the party
was Daniel Broby, 47, who has risen to
become chief investment officer of
Silk Invest after starting at
Buckmaster & Moore aged 22. The
elder statesman, meanwhile, was
Eden Financials Roy Cutts, 70, the
current father of the house as the
oldest former Stock Exchange employ-
ee still working in the City.
The Stock Exchange floor was the
university of life, he told The
Capitalist. You learned how to behave
and to treat people fairly I have
never regretted it for one minute.
The City was calmer, there was
more time to think, and one was able
to build very good relationships with
ones clients, who became friends,
added European American Capitals
Martin Jaske on life before the 27
October 1986 watershed.
A sentiment shared by Simon
Cowan of Redmayne Bentley, who
concluded: However much money
people made after the Big Bang, it
was never going to compensate for
the camaraderie and fun the Stock
Exchange instilled in people.
STOCKBROKERS RELIVE
LIFE BEFORE THE BANG
Left: Barbara Gill, former-
ly of Laurence Prust, and
John Gill of WH Ireland
Right: Daniel Broby of Silk
Invest
Below: Bill Puckle, former-
ly of Guy Puckle
Above: Martin Jaske
of European
American Capital
Left: Chris Paddick of
Christopher Street
Capital and Simon
Cowan of Redmayne
Bentley
Pictures: Alice
Hepple/CITY A.M.
Over the next 15 years, it is forecast that exports from Brazil
to China will increase by approximately 125%.* And this kind
of direct trade between emerging economies is growing much
faster than the global average.
HSBC Trade and Supply Chain teams are on the ground in the
major and emerging trading economies speaking the languages,
knowing the people and getting business done.
We can help you see both the impact and the opportunities
brought about by shifting trade patterns.
For more information visit www.hsbc.co.uk/trade
*Varies by sector. Source: Delta Economics 2011.
In the future, new trade corridors
will be the norm not the novelty.
Issued by HSBC Bank plc. AC22830
The Capitalist
EDITED BY
HARRIET DENNYS
Got A Story? Email
thecapitalist@cityam.com
Follow The Capitalist
on Twitter: @dennysharriet
Above: Willie Mundy, formerly of Akroyd, Stephanie Marsh,
formerly of Grenfell & Colegrave, and Chris Marsh, formerly
of Phillips & Drew
Above: Roy Cutts of Eden Financial, Brian Winterflood of Winterflood
Securities and Les Ames of WH Ireland
BAA posted a 17 per cent rise in under-
lying earnings in the first nine
months of the year, lifted by traffic
growth, especially at Londons
Heathrow airport.
BAA, owned by a consortium led by
Spanish infrastructure group
Ferrovial, said adjusted earnings
before interest, tax, depreciation and
amortisation rose to 842.2m, on rev-
enues 10.2 per cent higher at 1.7bn.
The debt-laden group narrowed its
pre-tax losses to 147.3m from
192.6m in 2010, although its perform-
ance last year was hit by the effects of
the volcanic ash cloud and British
Airways cabin crew strike.
BAA, which owns Londons
Heathrow as well as Southampton,
Stansted, Glasgow, Edinburgh and
Aberdeen airports, said passenger traf-
fic rose 4.3 per cent during the period.
Heathrow traffic rose by 6.1 per
cent, more than offsetting a 2.1 per
cent fall in passengers at Stansted,
caused by a declining domestic mar-
ket.
A steady rise in long-haul business
traffic, especially to emerging markets
such as China, India and Brazil and
new US routes has helped drive
growth, the group said.
BAA put Edinburgh airport up for
sale after the Competition
Commission told the firm earlier this
month that it must sell either
Edinburgh or Glasgow airport before
it disposes of Stansted.
BAA confirmed that a judicial
review of the watchdogs ruling
requiring it to sell Stansted would
take place in December.
Meanwhile BAAs director of
Terminal Five, Liz Neighbour,
resigned yesterday after less than 12
months in the role. The company
said people come and go all the time
in a large organisation.
BAA earnings
rise as traffic
edges higher
BY KASMIRA JEFFORD
TRANSPORT
STOBART Groups profit growth

was held back after the British
freight company was hit by fluctu-
ating demand in a tough economy,
particularly at its biggest division,
sending shares down more than
seven per cent.
The companys road transport
operations suffered as panicky
retailers launched early promo-
tions amid the UK high street
gloom.
However, the company said
improved information technology
systems, and resulting cost reduc-
tions helped it achieve profitability
in line with earlier expectations.
First half to 31 August underly-
ing pre-tax profit was 16.4m, com-
pared with 15.4m a year ago.
Revenue rose 15 per cent to
281.1m.
Stobart growth hit
as demand falters
TRANSPORT
News
ANALYSIS l Ferrovial SA
9.60
9.50
9.40
9.30
9.70
9.80
9.50
26 Oct
TRAFFIC GROWTH IN 2011: BY MARKET:
UK
HEATHROW:
STANSTED:
4.3%
-5.7%
EU
4.3%
LOW HAUL
6.1%
6.1%
-2.1%
YEAR TO SEPTEMBER 30 2011
REVENUE:
+10%
BOEINGS DREAMLINER MAKES MAIDEN VOYAGE
BOEINGS Dreamliner
has finally taken its
maiden commercial
voyage, after three years
of delays. All Nippon
Airlines (ANA) flight
carried its first passen-
gers on the carbon-com-
posite aeroplane from
Tokyo to Hong Kong.
Meanwhile, Boeing said
third quarter net profit
rose 31 per cent to
$1.1bn (689m), from
the same July-September
period last year and
raised its earnings out-
look for the year.
Picture: Getty
NOKIA yesterday unveiled the hero
handset it hopes will allow it to com-
pete with the likes of Apple and
Samsung.
The Lumia 800 is the first device
from the Finnish company to use
Microsofts Window Phone 7 software,
following the sweetheart deal penned
by the two struggling telecoms players
earlier this year.
Chief executive Stephen Elop brand-
ed the handset the first real Windows
Phone, saying it will help dispel
Nokias stuffy image. He said Nokia
had developed a reputation as reli-
able, durable, trustworthy... it always
combs its hair every day but lacked
the sexier edge of its rivals. But he said
the firm, which reported better than
expected results this month, is show-
ing very encouraging signs of adapt-
ing to the new mobile landscape.
He also stressed the importance of
emerging markets, saying Nokia will
increasingly focus on the next bil-
lion smartphone users.
It will release a series of new Asha
handsets the Hindi word for hope
aimed squarely at emerging markets.
The average age of its target cus-
tomer in countries including China,
Mexico and India is just 25, with Elop
saying many had never been connect-
ed to the internet before. Nokia
already has a strong emerging mar-
kets presence and is keen to exploit
the expected boom in data traffic over
the next five years.
Nokia: Lumia
will dispel our
stuffy image
EVERYTHING Everywhere yesterday
announced its first results under new
chief executive Olaf Swantee, with
the firm appearing to stabilise after a
string of underwhelming quarterly
figures.
The company, formed by the merg-
er of France Telecoms Orange and
Deutsche Telekoms T-Mobile, said it
gained 185,000 contract customers,
while it shed 227,000 pre-paid users.
Swantee told City A.M. he is not wor-
ried about the net fall, saying that 80
per cent of the firms revenue comes
from contracts. He said the thing that
keeps him awake at night is losing
these, with Everything Everywhere
now boasting an industry-leading
churn rate. The company does not
report profit figures until its full-year
results next year.
Its service revenue fell 1.9 per cent
to 1.56bn compared with last year.
However, excluding regulatory
changes to mobile termination rates,
which have hit all the networks, its
service revenue rose 3.8 per cent. This
is still expected to lag behind rivals
O2 and Vodafone, both of which
report next month.
Swantee also said he was taken out
of context when he called the
Everything Everywhere brand silly,
insisting he liked the name and call-
ing it provocative, inspiring, chal-
lenging and unusual. It has been
dogged by rumours it is set to drop
the branding, despite plans to open
new Everything Everywhere stores.
The firm, which has slashed its top-
heavy management structure since
Swantees arrival, said it was making
good progress in cutting costs and
said it is on track to make at least
3.5bn worth of synergy savings by
2014.
Orange JV sees improvement
BY STEVE DINNEEN
TELECOMS
News
BY STEVE DINNEEN
TELECOMS
NOKIAS turnaround, says its chief

executive Stephen Elop, is already
underway: a sentiment given cre-
dence by its better than expected
results last month, in which it
avoided making an expected loss.
Elop has admitted the firm has
an image problem and its new
handsets go some way to address-
ing that. But short of a miracle
Nokia will never be as big a player
in Europe or the US as Googles
Android, nor release a handset as
profitable as Apples iPhone.
However, this is not the market
upon which Nokia will now focus
its attentions. Yesterdays keynote
made it clear emerging markets
are at the core of Nokias long-
term plans. The next billion
users will hail from China, India,
Latin America, Indonesia and
Africa, and Nokia is in a strong
position win them over. At the
end of last year, Nokia had an 86.8
per cent share of the global mar-
ket for handsets retailing for less
than $200. Its new Asha handsets
upgrade its low-end offering,
while the high-end Lumia makes
it an aspirational brand.
If Nokia plays its cards right, in
five years Europe could be a giant
R&D department to its key global
operations.
BOTTOMLINE
Analysis by Steve Dinneen
ANALYSIS l Nokia Oyj

4.90
4.80
4.70
4.60
4.50
5.00
5.10
4.80
26 Oct
Boss Olaf Swantee has wielded the axe since starting last month Picture: Reuters
Future lies far
from Finland
THE LUMIA 800 was a launch Nokia couldnt afford
to get wrong: described by boss Stephen Elop
as its new hero device, it is also the first
running Windows Phone 7, the software
upon which it has staked its future.
The event certainly had a sense of
theatre: a giant shutter slowly opened to
reveal a hanger lit only by the glowing
screens of its new handsets; all that was
missing was a cloud of dry ice and it
could have been the set from Alien. It
followed a presentation in which Nokias
senior executives gave the impression
they had in a doubtlessly heartwarm-
ing tale met and bonded in an asylum.
Marketing boss Bianca Juti danced on
stage and insisted on referring to the
new phones as her babies. Head of
devices Kevin Shields shouted arbitrarily
like a confused war veteran mid-way
through a vivid flashback. Elop, looking
every inch like an engorged lizard, once
appeared to lick his own eyeball. They
didnt seem like the creators of a great
phone; more the kind of people who
might have added a spittoon to the
handset, or scales, or just replaced every
1,000th device with a live grenade.
But they didnt. The Lumia is sleek,
metallic and weighty enough to feel
expensive. Its elegant, curved screen
makes the best of the eye-catching
Windows Phone 7 display and the cam-
era is, as expected, first class. It isnt
going to make people bin their iPhones
its not quite up to 4S standards but, along with the
likes of the Samsung Galaxy S2 and the Motorola
Razr, it adds another impressive horse to the race.
FIRST LOOK
By Steve Dinneen at Nokia World
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Capital thinking #20
The ability to cut losses quickly
is the sign of a good trader.
We know what youre thinking yes
we all know that but when your trade is
tumbling more into the red, what do you
do? You do the opposite you run your
losses and take your prots too early.
NIGHTCLUB operator Luminar said
yesterday it is entering administration
proceedings, just a month after telling
the market that trading at its Oceana
and Liquid venues had stabilised.
Luminar said that Lloyds, RBS and
Barclays had decided not to extend the
waiver on certain covenants related to
a three-year banking facility, meaning
that the terms of the lending will be
breached this morning.
The directors of Luminar have no
option but to take steps to place the
company and certain of its subsidiaries
into administration, the company
said.
STRONG demand for events and train-
ing enabled business media group
Informa to post organic nine-month
revenue growth of 4.2 per cent and to
confirm its full-year expectations yes-
terday.
The company, which publishes ship-
ping guide Lloyds List and organises
exhibitions and events, said yesterday
it had continued to grow after it cut
back on smaller and discretionary
events during the downturn in 2008,
leaving it with stronger key exhibi-
tions in certain sectors.
Finance director Adam Walker said
it would continue to look for acquisi-
tions next year but if it fails to identify
much of a pipeline it will instead look
at ways to increase returns to share-
holders.
Were not complacent but were
very pleased with the results, he said.
Much of Informas growth was driv-
en by its events and training business,
which posted organic revenue growth
for the period of 5.2 per cent, which it
said was slightly ahead of the expected
full-year growth rate.
The exhibition division performed
well with a strong performance from
its new Brazilian printing show, an
Australian furniture show and the
Monaco Yacht show.
Although the economic environ-
ment is uncertain, we have not seen
any impact on current trading, chief
executive Peter Rigby said. The group
is generating organic growth across all
three divisions, recent acquisitions are
performing well and we remain on
track to meet our expectations for the
full year.
Analysts welcomed the results and
the resilience shown against the tough
macro conditions. Informa shares rose
more than three per cent on the news.
Informa gets
boost from
training arm
MARKETING company Aegis has
bought Dutch firm Kobalt Media,
whose clients include continental
brands C&A and Perfetti Van Melle.
The deal, believed to be worth
around 18.9m (16.4m) will see the
firm merged into Aegis Dutch opera-
tion, Aegis Media Netherlands, in a
bid to extend market share across the
country.
The agreement enhances our
prospects, providing additional ener-
gy and focus in continuing to pro-
duce outstanding client work, said
Julius Minnaar, chief executive of
Aegis Media Netherlands.
Aegis snaps up
Kobalt Media
Luminar leaves
the dancefloor
BY HARRY BANKS
MEDIA
CONSUMER
MEDIA
News
Caution hits orders at CSR
CHIPMAKER CSR is seeing caution
among its customers in the car,
home audio and mobile sectors, and
now expects fourth-quarter revenue
to fall short of market expectations.
The Cambridge-based company,
which makes GPS, bluetooth and
wifi chips, said consumer demand
was being hit by economic uncer-
tainty in Europe and unemploy-
ment in the US, echoing comments
made by its peers.
Theres caution in the market,
theres caution in the order pat-
terns, chief executive Joep van
Beurden said yesterday.
On the inventory side things are
OK, but people are just not willing
to take risks with pre-orders.
CSRs lack of a bluetooth-wifi
combination chip has left it side-
lined as rivals captured most of the
smartphone market. But van
Beurden said yesterday its new com-
bination chip was ready for internal
validation.
CSR said it expected fourth-quar-
ter revenue to be between $230m
(200m) and $250m, just short of
consensus forecasts of $255m.
CSR met market expectations for
the third quarter by posting revenue
of $243m, including a one-off contri-
bution from its acquisition of Zoran
Corp in August.
On a standalone basis, revenue
was $209.2m, down from $222.1m,
while adjusted earnings per share
fell to $0.13 from $0.19, although it
beat forecasts of $0.11.
Shares in the group, which have
nearly halved since 1 January,
touched a two-and-a-half-year low
before recovering to close 2.44 per
cent down at 179.7p.
BY HARRY BANKS
TECHNOLOGY
Chief executive Peter Rigby said economic uncertainty had not hit trading
p
ANALYSIS l Informa Plc
360
350
340
370
380
367.80
26 Oct

Martin Wolf Merryn Somerset Webb Jeffrey Currie Russ Mould Steve Ward Dominic Frisby Julian Mayo Eoin Treacy
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News
BG GROUP will export liquefied natu-
ral gas from the US under a landmark
$8bn (5bn) deal with Cheniere Energy
that will allow US producers to ship
their shale gas supplies to the world for
the first time.
The FTSE 100-listed group said it had
agreed to buy 3.5m tonnes of liquefied
natural gas (LNG) a year for 20 years
from Sabine Pass, a subsidiary of
Cheniere.
It is the first agreement of its kind
in this region and it secures us early
access to the rapidly emerging com-
mercial opportunities driven by the
recent material increases in US gas
reserves, said BG chief executive Sir
Frank Chapman.
Yesterdays deal paves the way for
Cheniere to secure financing for the
the Sabine Pass project in Louisiana,
which could be the first LNG export
plant built in the US in nearly 50 years.
If we start construction by next year
then we could be exporting by 2015,
Cheniere chief Charif Souki said.
BG shares closed up 1.2 per cent.
BG pens $8bn
shale gas deal
BY HARRY BANKS
ENERGY
TURKEY DISASTER LOSSES TO REACH $170M

THE 7.2 magnitude earthquake that devastated Turkeys eastern city of Van on
Sunday is likely to have caused up to $170m (106m) of insured damage, risk model-
ling firm AIR Worldwide said yesterday. It said insured losses would be at least
$55m, and warned the region had suffered more than 400 aftershocks of 3.0 magni-
tude or higher.
News
Adrian Lee & Partners
The currency specialist has appointed
Keith Zaccaria as senior portfolio man-
ager, Rakesh Odedra as international
economist and portfolio manager, and
Maria Isaeva as portfolio manager. The
three new hires join from State Street
Global Advisors, Oxford Economics and
APG Asset Management respectively.
Williams de Bro
The wealth manager has appointed
Alisdair Hogg and Jacqueline Morton
as business development executives in
its Edinburgh office. Hogg joins from
the Bank of Ireland Group in Dublin
and Jacqueline Morton was previously
employed by Skandia in Glasgow as an
IFA business consultant.
Aon Hewitt
The HR consultancy has hired Meena
Raza to lead its global benefits team in
Dubai. She joins after eight years at
the Dubai operations of Mercer
Consulting and Marsh.
Kleinwort Benson
The private bank has appointed Danny
Vogt as chief operating officer and John
Boyce as chief technology officer. Vogt
joins from RBS/ABN Amro, where he
was head of change and portfolio devel-
opment group operations, and Boyce
previously worked at Barclays Global
Investors, where he was a managing
director and European head of IT.
BDO
The accountancy group has appointed
Merryck Lowe as partner in the London-
based forensic services team. Prior to
joining BDO, Lowe was the founding
managing director of Alvarez & Marsals
European forensic services business.
Capgemini Consulting
Bill Cook has been appointed to lead
Capgemini Consulting in the UK, over-
seeing a team of strategy and man-
agement consultants. Cook previously
worked at Ernst & Young, where he
was a partner.
Barclays Wealth
The wealth manager has appointed
Kevin Shone as a managing director in
the ultra high net worth and family
offices team, based in Manchester.
Shone joins from Goldman Sachs pri-
vate wealth management, where he
was a managing director.
CITY MOVES | WHOS SWITCHING JOBS Edited by Harriet Dennys
+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
Cheer from across
pond supports rally
U
S stocks rose yesterday as the
slow progress from European
leaders in resolving their debt
crisis was enough to satisfy
investors, even if early reports from an
EU summit were short on detail.
The Eurozone aims to leverage its
440bn bailout fund several fold, but
details are not expected until
November, according to a draft state-
ment obtained by Reuters.
European leaders agreed yesterday
to force banks to raise more capital by
June next year, to protect against losses
from any Greek debt restructuring
and to try to contain the regions
financial crisis.
Stocks increased gains in the after-
noon as the news emerged, continu-
ing the markets recent rally. The S&P
has risen 9.5 per cent for the month on
growing optimism for a deal to
address sovereign debt and bank bal-
ance sheets in Europe.
The market has begun to discount
any meaningful announcement com-
ing from todays meeting -- that should
be helpful for the markets as the bar is
set pretty low, said Joseph Tanious,
market strategist at JP Morgan Funds
in New York.
The Dow Jones industrial average
gained 162.42 points, or 1.39 per cent,
to 11,869.04. The Standard & Poors 500
Index rose 12.94 points, or 1.05 per
cent, to 1,241.99. The Nasdaq
Composite Index added 12.25 points,
or 0.46 per cent, to 2,650.67.
Financials were among the best per-
formers with JPMorgan Chase & Co up
2.1 per cent to $34.18 and US Bancorp
up 2.6 per cent to $25.48. The KBW
Bank index advanced 2.1 per cent.
Tanious said details still need to be
worked out, including what to do
about Greeces overhang of debt.
Gains were curbed on the Nasdaq as
Amazon.com Inc slumped 12.7 per
cent to $198.401 a day after forecasting
a disappointing outlook for the cur-
rent quarter on costs related to Kindle
and other investments.
On the Dow, Boeing Co rose 4.5 per
cent to $66.56 as the top boost to the
index after raising its outlook.
Visa Inc shed 2.1 per cent to $90.10
in extended trade after the San
Francisco-based card processor posted
fourth-quarter earnings.
With Europe dominating headlines,
earnings have taken a back seat.
According to Thomson Reuters data, of
the 206 companies in the S&P 500 that
have reported earnings for the quarter,
72 per cent have topped Wall Street
estimates.
Economic data showed demand for
a range of long-lasting US-made goods
rising at the fastest pace in six months
in September.
B
RITAINS leading share index
last night reached its highest
closing level for two-and-half
months.
Defensive stocks performed well as
investors awaited the outcome of a
European Union summit, which
opened last night, to resolve the two-
year-old sovereign debt crisis.
Investors also rewarded companies
reporting strong figures in a patchy
quarterly results season, with BG
Group up 1.2 per cent, extending its
3.8 per cent rise in the previous ses-
sion, and BP up 0.8 per cent.
The FTSE 100 closed up 27.70
points, or 0.5 per cent, at 5,553.24 in a
volatile session, swinging from a low
of 5,498.51 to a high of 5,576.63.
Volumes were thin, at just 75 per
cent of the average over the last 90
days, indicating investors caution
ahead of the summit.
The financial markets have been
buoyed by hopes that a decisive plan,
including a programme to recapi-
talise Eurozone banks, would be
unveiled after the summit, with the
UK index gaining about 12 per cent in
the last two weeks.
However, the regions policymakers
have not yet agreed on the scale of
Greek debt writedowns and how
much the rescue fund needs to be
leveraged to prevent other struggling
countries, such as Italy and Spain,
from being sucked into the crisis.
We are struggling even to get to
what percent of haircut we are going
to see in Greece. The (rescue fund) has
hardly been boosted. Bank recapitali-
sation is implausibly a small
amount, said Philip Lawlor, strategist
at investment management company
Smith & Williamson.
This is just over-promising and
under-delivering.
Banks, which have been hurt by
the ongoing Eurozone debt crisis,
slipped 0.3 per cent, though defensive
stocks were in demand.
Among them was British American
Tobacco, which gained 1.5 per cent
after the worlds second-largest ciga-
rette maker reported sales up seven
per cent in the first nine months of
the year. Peer Imperial Tobacco,
which will report its earnings next
Tuesday, rose 3.2 per cent.
Lawlor suggested investors stick
with high-quality, cashflow generat-
ing stocks.
Among FTSE 100 companies, Man
Group offers the highest dividend
yield at 8.8 per cent, followed by RSA
Insurance at 8.1 per cent and Aviva at
7.6 per cent, data from Thomson
Reuters StarMine shows.
However, companies that offer the
highest 12-month forward dividend
cover a measure of their ability to
pay its expected dividend out of esti-
mated earnings and cash flow were
Vedanta Resources, Tullow Oil and
Barclays, according to data from
StarMine.
Other defensive stocks to gain yes-
terday were drugmakers and mobile
phone operator Vodafone, which put
on 1.5 per cent.
Drugmaker Shire advanced 2.7 per
cent, as Societe Generale upgraded
the stock to buy from hold on the
basis of upcoming product launches
and its defensive growth abilities.
Rival GlaxoSmithKline put on 0.8
per cent as it raised its interim divi-
dend and said it was increasing its
plans for share buybacks.
We are now five months into the
earnings downgrade cycle. We sus-
pect earnings still have further to fall,
and believe 2012 (consensus) earnings
are now most at risk, UBS said in a
note, adding that they expected UK
company earnings to grow by an aver-
age of three per cent next year.
FTSE 100 climbs on hopes
EU summit will tackle crisis
THELONDON
REPORT
THENEW
YORKREPORT
BEST OF THE BROKERS
To appear in Best of the Brokers email your research to notes@cityam.com
ANALYSIS l Reckitt Benckiser
3,600
3,500
3,400
3,300
3,200
3,100
3,000
Aug Sep Oct
p
3,260.00
26 Oct
RECKITT BENCKISER
Citi rates the household goods maker buy with a target price of 40. The
broker has cut its forecasts for the firm to reflect higher than expected
Medicaid rebates, offsetting expected rises in organic growth. However, Citi
continues to see the valuations for the firm as compelling, with the stock cur-
rently trading on 13.8 times 2012 earnings and a free cash flow yield of 7.9
per cent. It also expects raw material costs to start easing from mid-2012.
ANALYSIS l Rank Group PLC
160
150
140
130
120
110
Aug Sep Oct
p
140.00
26 Oct
RANK GROUP
Goldman Sachs rates the casino owner neutral with a target price of 150p,
implying an 18 per cent upside. The broker has trimmed its forecasts slightly
following flat quarterly sales, and thinks the case for holding the shares is
evenly balanced given uncertainty over Ranks VAT reclaims. Goldman has dis-
counted its sum-of-the-parts valuation for Rank by 59m to account for a
possible negative ruling over its VAT claims.
ANALYSIS l Marks and Spencer Group PLC
350
340
330
320
310
300
Aug Sep Oct
p
329.00
26 Oct
MARKS & SPENCER
Nomura rates the retailer buy with a target price at 460p. Disappointing
first-half results have led the broker to cut its full year profit estimates by 12
per cent, in view of a squeeze in consumer spending. But Nomura paints an
optimistic view of M&S in the medium term, with improving online and inter-
national sales helping supplement sustainable UK profit growth. A close eye
should be kept on costs when the firm reports on 8 November, it adds.
p
1 Aug 19Aug 9Sep 29Sep 19Oct
6,000
5,200
5,000
5,400
5,600
5,800
ANALYSIS l FTSE
5553.24
26 Oct
Chaucer Syndicates
Mark Wood (pictured) has been appointed as
chairman of Chaucer Syndicates, the specialist
insurance group that underwrites risk at Lloyds
of London. Wood, who replaces Bob Deutsch,
was previously deputy chairman and chief exec-
utive of Paternoster UK, chief executive of
Prudentials UK and European insurance busi-
nesses, and UK chief executive of AXA. In addi-
tion, Christopher Stooke, the chairman of Miles
Smith, has been appointed as chairman of the
audit committee of Chaucer Syndicates.
I
MADE a mistake. I changed
my mind, says the first
line of former White
House adviser and hedge
fund manager Todd G.
Buchholzs new book, Rush:
Why You Need and Love the
Rat Race. Several years ago I
began to write a book about
happiness and the economy.
It was to be called Tail
Hunters: How Americans
Are Chasing Success and
Losing Their Souls, it con-
tinues. Everyone was
expending so much energy trying
to become the fittest, cleverest or
richest person and I thought it
was driving us crazy, he tells me.
The so-called happiness science
seemed to suggest that it was.
Then I looked at the research and
it was exactly wrong. Its the
effort and the endeavour that
makes us feel alive.
True to his word, Buchholz had
rushed out of a panel debate on
Kazakhstani investment to meet
me. His trip to London is clearly
not just a book tour.
I realised I was wrong about
this after I got this wonderful job
at the White House. I had a fancy
office and all sorts of lobbyists
and congressmen wanted to meet
me, but within a week I was mis-
erable. I had found out that there
had been a meeting over the
weekend that I was not invited to.
I had lost my feeling of self-
respect. I wanted to work over the
weekend. I wanted to feel want-
ed.
This realisation took Buchholz
back to the books. I just
realised that the
happiness science
is selfish and indi-
vidualised and
all the research
shows that we
need the competi-
tion of the rat race
to get the
dopamine and sero-
tonin chemicals in
our brains flowing
those are the hor-
mones that make us
feel happy.
Buchholzs biggest gripe with
happiness science it is its
attachment to a bygone age. It
seems to draw on this idea that
man needs to be in as natural a
state as possible. As if the whole
of the 20th century has been a big
mistake and if we just repealed
the whole thing and sat around a
camp fire holding hands wed be
happy. Wed be sweaty, yes.
Sooty, perhaps. But not happy.
Buchholz then reels off
reams of evidence on why
this is not the case. Just
look at any study on
primitive groups
throughout the ages.
Societies that led more natural
lives, that traded less and pro-
duced less were all more violent,
he concludes.
He takes a similar approach to
the lethargy of retirement. It
makes you stupid, he says blunt-
ly. Again, drawing on studies:
Researchers have interviewed 60-
year-olds across the globe, pre-
senting them with lists of items
and asking the interviewees to
repeat them. Then half an hour
later the researchers ask them to
repeat the list again. In countries
such as France where the retire-
ment age is lower, the intervie-
wees find it harder.
He doesnt mince his words on
on early retirement: These peo-
ple think they are going to sit in
sidewalk cafes discussing Le
Monde and doing crosswords
when they retire, but they wont
even be able to find the cafes any-
more because their brains will be
so idle.
American actress Lily Tomlin
once said: The trouble with
being in the rat race is that even if
you win, youre still a rat.
Perhaps thats not such a bad
thing after all.
Unhappy? You should
get into the rat race
Former White House economics adviser and hedge
fund manager Todd G. Buchholz tells Donata Huggins
why we need to rush, compete and even chase our
own tails often fruitlessly to live truly happy lives
Business Features| Careers
25
Buchholz says competition makes us feel alive Picture: Getty
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I dont have anything against people who do
yoga. What I object to is the idea that we need
to make our regular daily life more like a
holiday, that we need to step off the treadmill
and meditate. Thats wrong. We should not fool
ourselves into thinking the capitalist system
has corrupted us and made us coarse, evil and
unforgiving. The research shows that it
actually makes us happy. We need to
compete and take risks to feel alive.
Todd G. Buchholz
RUSH: WHY YOU NEED AND
LOVE THE RAT RACE
BY TODD G. BUCHHOLZ
PENGUIN
hhhhi
S
OMETHING had to happen. London had
once been the worlds major financial cen-
tre, but by the 1980s it had been overtaken
by New York and that lead was growing.
The City remained an old-fashioned world: to
outsiders like me, more like a private gentle-
mens club than a place of business. Its leading
players were sleepy, upper-crust partnerships
who could not have taken up the challenge of
globalised trading even if they had wanted to.
There were bizarre rituals and job discrimina-
tion. An open outcry system, which computers
and other forms of new communications tech-
nology were already making redundant. An
inexplicable division between jobbers and bro-
kers, maintained like the fixed commissions of
the time by an insider cartel.
The Thatcher government saw no reason why
all this should be maintained by UK regulation.
It believed in competition and markets as the
mainspring of economic progress and the best
way to drive down the costs and drive up the
quality of goods and services for the public.
Financial services were no different.
While she saw it as just one part of deregulat-
ing the sclerotic UK economy, the Big Bang
became crucial to Thatchers economic strategy.
The whole privatisation programme could not
have been managed by the old order.
That was obvious during the privatisation of
British Telecom in 1984. Only a few thousand
people in the UK owned shares. Downing Street
aides figured that, to sell an 8bn company like
BT, people would need educating. They visited
the stock exchange to discuss circulating a
leaflet. The stock exchange folk suggested print-
ing perhaps 5,000. It was shockingly compla-
cent: the government side had in mind a first
run of 1,000,000 with more to follow.
It is because of Big Bang, and the privatisation
that it was able to bear, that we now have not
thousands, but millions of shareholders with a
real stake in the UK. That led to a huge change in
attitudes towards business, and turned us, for
the first time, into a capital-owning democracy.
Meanwhile, London bounced back as the
worlds top financial centre. True, many City
firms were snapped up by foreign firms, includ-
ing many Americans who enjoyed looser regula-
tion here than in the US. But the key for any
industry, not just finance, is not who owns it but
where the jobs and value are being created. Big
Bang ensured the answer was London.
Some say the deregulation allowed things like
the Barings collapse a whole bank ruined by
one rogue trader. But even after the Big Bang,
Barings, with its huge momentum, remained
one of the old-boy, family run banks. Bad gover-
nance, not deregulation, brought it down.
People say Big Bang created a loadsamoney
culture that persists today. No. It simply allowed
more people to exploit new opportunities and
profit from them. Computerisation, which came
in simultaneously, massively multiplied the pro-
ductivity of all that new business, and salaries
and profits reflected that efficiency surge.
Others argue the money culture encouraged
us all to borrow and got us into our present diffi-
culties. Its a bit much to blame that on a dereg-
ulation 25 years ago. The critics should look
instead to high-spending, over-borrowing, note-
printing, easy money government policies and
implicit government guarantees to find the
explanation for that.
Dr Eamonn Butler is director of the Adam Smith
Institute.
26
The Forum
25 years after the Big Bang
we ask: Was it a good idea?
cityam.com/forum
Eamonn Butler
YES
O
N THIS day in 1986 the way in which
shares were traded in the UK was changed.
In particular, there were no longer any
fixed commissions for share trading and
brokers and market makers were allowed to com-
bine in so-called dual capacity firms.
Prior to Big Bang commissions on dealing were
fixed: all brokers charged the same rate of com-
mission and did not compete. Investors could
therefore not shop around and get the best deal.
But at least investors were protected in the sense
that the brokers relationship with the jobbers
was an adversarial one the broker would try to
get the best price obtainable from the jobber
when dealing.
This structure had made London increasingly
uncompetitive as a venue for share trading, par-
ticularly when compared with New York which
had its own version of Big Bang, known as May
Day as it happened on 1 May 1975 when it
scrapped fixed commissions. Trading in large
international company shares had begun to
migrate to New York because investors could deal
more cheaply there.
In my view Big Bang was a colossal mistake.
The basic motivation for it was correct. Fixed
commissions were a barrier to competition and
London was losing out as a centre for share trad-
ing as a result. But its architects made an incor-
rect assumption. They correctly foresaw that an
end to fixed commissions would lead to a radical
cut in commission rates. But they went on to rea-
son that this fall in commission rates would ren-
der stockbroking unprofitable. As a result they
accepted a quid pro quo that brokers should be
allowed to combine with jobbers (to use the jar-
gon, they should switch from being single capac-
ity firms which either did broking or jobbing to
dual capacity firms which did both).
These Big Bang changes introduced insupera-
ble conflicts of interest. No longer were investors
protected by a broker acting as their agent and
trying to get them the best price. Instead they
were dealing with integrated firms which max-
imised profits by giving investors the worst deal
they could as they were principals on the other
side of every transaction. And these were not the
only conflicts of interest which arose from Big
Bang. Integrated securities businesses also pro-
vided merger and acquisition advice to compa-
nies formerly the domain of merchant banks
as well as providing research on those compa-
nies shares for investors in those shares, trading
in those shares as principals and raising equity or
lending money to fund the deals. The potential
for profit at the expense of investors as a result
were manifold.
These conflicts are supposedly policed by so-
called Chinese Walls which keep these functions
separate within banks but the long line of scan-
dals on both sides of the Atlantic in the securities
markets over the past two decades show that this
has unsurprisingly proven to be ineffective. A reg-
ulatory concept like Chinese Walls is no match
for greed.
It may seem inconceivable that any of the Big
Bang reforms will ever be repealed but until they
are I think we will be condemned to suffer the
sort of mistakes, malpractice and calamities
which helped to cause the current financial cri-
sis.
I have changed my mind about Big Bang as a
result of the events of the credit crisis. As John
Maynard Keynes famously remarked: When the
facts change, I change my mind.
Terry Smith is the chief executive of Tullett Prebon.
Terry Smith
NO
Twitter: @cityamforum
on the web:
cityam.com/forum
or by email:
theforum@cityam.com. Top responses will be reprinted in The Forum.
Agree? Disagree? Got a sharp comment?
The Forum wants you to join the debate.
COMMENT NOW ON
27
Research reveals
the neoliberal
welfare states of
northern Europe
Scandinavia is a
showcase of free
market reforms
G
EORGE Monbiot once claimed Sweden
proves the neoliberals wrong about how
to slash poverty. Our new research
reveals a different story: Scandinavian
success is a triumph of prudent fiscal policy,
government downsizing and smart market
regulation. It is a showcase for neoliberalism,
and not its nemesis.
The whole regions success is striking: in the
past 15 years, Scandinavian economies robust-
ly outperformed the euro area and the OECD.
The growth in private consumption is even
more remarkable comparing 1986-1996 with
1997-2007, the rate of private consumption
growth tripled in Sweden, and more than dou-
bled in Denmark, Norway and Finland.
As Graeme Leach argues in a new report for
the Legatum Institute, it does not make sense
to argue that a large public sector explains
Scandinavias prosperity. Public spending in
Nordic countries has plummeted over the past
20 years. Between 1993 and 2007, public spend-
ing as a fraction of GDP fell by more than 20
per cent in Sweden. The smallest decrease took
place in Denmark, where public spending
nonetheless fell by 10 percent of GDP.
Scandinavian countries slashed government
budgets after the financial crisis of the early
1990s. Like the US in 2008, a housing price bub-
ble deflated in Sweden between 1991 and 1993.
The government initially provided explicit
guarantees to the banking sector, leading to a
fiscal crisis. In the aftermath of this crisis,
Sweden succeeded in consolidating its public
finances, through a combination of cuts and
expansionary monetary policy. Other
Scandinavian countries followed suit, and a
virtuous process of competition has led to the
reduction in the size of government and a
much lower tax burden.
Besides downsizing the state, Scandinavian
governments have privatised railways, air-
ports, air-traffic control, motorways, postal
services, fire departments, water systems and
schools. In Sweden, Carl Bildts cabinet made it
possible to privatise health care at the county
level. Sweden also put in place a system advo-
cated by Milton Friedman school vouchers.
Meanwhile, Denmark enjoys one of the
most flexible labour markets in the world.
Hiring and firing can occur at a very low cost
and within one day, making it easy to create
jobs. This is combined with a very generous
system of welfare benefits hence the popular
name for the system, flexicurity.
Denmarks welfare system has not been
strained as elsewhere in Europe. This is largely
because flexible labour markets leave little
room for unemployment. The country also has
high levels of social capital and abusing the
welfare system is still frowned upon.
Nordic countries demonstrate that in order
to make the welfare state work, we need a large
dose of free-market economics. The left is
right: the UK should indeed aspire to be more
like Scandinavia in liberalising its markets
and bringing public spending under control.
Dalibor Rohac is the acting director of economic
studies at the Legatum Institute. Economic Lessons
from Scandinavia by Graeme Leach is published by
the Legatum Institute this month. It is available at:
http://www.li.com/Publications.aspx.
University blues
While Jamie Whyte celebrates a
12 per cent decline in university
applications [Hooray for a
decline in university applications,
yesterday], the CBI says that 56
per cent more jobs in the UK will
require degree-level skills by
2017.
Whyte may belong to the group
of people who think we have too
many graduates, despite what
the CBI says. However, UK uni-
versities generate 59bn for the
UK economy, putting the higher
education sector ahead of the
agricultural, advertising, pharma-
ceutical and postal industries.
We are second only to America
in the global rankings and, with
just 1 per cent of the global pop-
ulation, the UK produces 7.9 per
cent of the world's research pub-
lications and 12 per cent of all
citations.
A key point Whyte has either not
understood, or chooses to ignore,
is who is likely to be put off by
bigger fees and larger debts. The
people most likely to miss out are
the ones unable to afford, or jus-
tify, paying 9,000 a year.
We need our best and brightest
brains studying the courses that
will ensure they contribute the
most to our society and econo-
my. The depressing slump in uni-
versity applications risks taking
us back to a time when it was
cost, not ability, that determined
an individuals future and should
not be celebrated.
Sally Hunt, general secretary,
University and College Union
RAPID RESPONSES
DALIBOR ROHAC
BY ANTHONY BROWNE
The Forum
T
HE world may
seem in deep eco-
nomic turmoil,
but it is only our
part of it. Across the
planet, the lumbering
Asian superpowers of
China and India are
ticking along nicely. For
many UK companies, exports to these growing
economies will be critical to pulling through the
next few years. In the longer term, boosting trade
with these economies and others such as Brazil,
Mexico and Turkey will be critical to the UK
remaining in the economic premier league.
So what then can the government do about it?
The last government used to have a trade policy,
which was completing the Doha trade round. In
fact, it was so wedded to this policy that it stuck
to it even after Doha had collapsed. The question
is, what policy should be put in its place? There is
no big multilateral trade round that we could sign
up to, even if we wanted to. In any case, the new
government is far more wedded to bilateral trade
deals, such as the free trade agreement between
the EU and South Korea that came into force earli-
er this year. It has a point: multilateral deals
involving every country in the world are so
unwieldy that they tend to yield very little.
But this begs the question of what the UK gov-
ernment can do. Trade, you see, is an EU compe-
tence. That means that Brussels officials are
meant to do all the trade negotiations on our
behalf. But we have a particular national interest
in trade that is not exactly the same as other EU
countries. In particular, our strength isnt exports
of capital goods or consumer goods or agricultural
produce, but services. And of that, financial and
professional services are by far the biggest compo-
nent.
Financial and professional services produced a
40bn trade surplus last year, larger than the
combined surpluses of all other net exporting
industries in the UK (the much-trumpeted pharma-
ceuticals came in second at a mere 7bn). It is
clear what our national trade strategy should be:
opening up the global trade in financial and profes-
sional services. Indeed, the government does per-
sistently lobby the EU to make trade in financial
and professional services its priority.
But there is a lot more the government is able
to do. Many barriers to trade in financial and pro-
fessional services are not the competence of the
EU, and the UK government could get more heavily
engaged.
For example, one of the critical issues for UK
companies is recognition of professional qualifica-
tions getting India to give greater recognition to
UK-trained lawyers would be a major boost to our
legal services exports, and isnt something we have
to rely on Brussels to do for us.
China recently made London the sole offshore
renminbi trading hub, after Hong Kong a great
boost to London and its long-term prospects.
HSBC has been successful in winning licences from
the Chinese government that have made US banks
green with envy.
The government has rightly fallen out of love
with big, all-encompassing multilateral trade deals.
Instead, it is the little victories that the UK must
focus on, chipping away at the many barriers to
trade in services with whatever tools it has at its
disposal.
Anthony Browne is the former director of the
leading think tank Policy Exchange.
anthony@anthonybrowne.org
A twenty-first century
trade policy for Britain
Email: theforum@cityam.com
Twitter: @cityamforum
In association with
Wealth Management| Funds
What to look for in a Junior Isa provider
E
VERY fund provider claims to be
different, but unlike most,
Vanguard really is. Founded in
1975 by legendary investor Jack
Bogle, Vanguards investment philoso-
phy is ingrained in its unique struc-
ture. As Tom Rampulla, the UKs
managing director says: We are the
only mutual mutual fund company
in the world. Vanguards investors
effectively own the company. Its size
permits Vanguard to be an incredibly
low cost provider for example, its
FTSE UK Equity index funds total
expense ratio (TER) is just 0.15 per
cent, its US Equity index fund is 0.20
per cent and its Emerging Markets
Stock index fund 0.55 per cent.
VIVA LA REVOLUTION
Most independent financial advisers
(IFAs) are enthusiastic about
Vanguards presence in the UK. Adrian
Pickersgill of Chatfield Private Client
says prior to its June 2009 UK launch,
he had been waiting many years for
Vanguard to reach the shores of the
UK investment world, so that it could
shake up the generally poor perform-
ing, but always over charging, active
fund managers. Vanguard now forms
the core of almost all Chatfields port-
folios. Jason Butler of Bloomsbury
Financial Planning believes Vanguard
is a real force for good in financial
services in general and investing in
particular. He says for far too long
investors have been paying the price of
a Picasso for what is painting by num-
bers. Robert Forbes of Plutus Wealth
Management appreciates Vanguards
transparency. He says with many
investment funds, the stamp duty cost
is hidden within the overall fund
charge, but he notes Vanguards
UK equity tracker reveals the 0.5
per cent stamp duty charge at
the outset.
SMELL THE COFFEE
The amount you shell out on
management fees has a very strong
connection to the returns you are like-
ly to see on your fund. Morningstars
director of research for Europe and
Asia Chris Traulsen describes fees as
negative alpha that compounds. He
says it tends to overwhelm other fac-
tors. As Rampulla says: Its difficult to
pick an active manager who can out-
perform over the long-term. That is
not to say that there are not active
managers that dont there are. Its
just hard to find them.
Research undertaken last year on
US mutual funds by Morningstar
shows how important costs are. The
results were unequivocal (see table,
right): If theres anything in the
whole world of mutual funds that you
can take to the bank, its that expense
ratios help you make a better decision.
In every single time period and data
point tested, low-cost funds beat high-
cost funds, notes Russell Kinnel,
Morningstars director of mutual fund
research. Expense ratios are strong
predictors of performance, he adds,
in every asset class over every time
period, the cheapest quintile pro-
duced higher total returns than the
most expensive quintile. Factoring in
the success ratio which accounts for
survivorship bias compounds the
point, because high-cost funds are
much more likely to have poor per-
formance and therefore be liquidated
or merged away. Kinnel thinks:
Investors should make expense ratios
a primary test in fund selection. They
are still the most dependable predic-
tor of performance, he says. Start by
focusing on funds in the cheapest or
two cheapest quintiles, and youll be
on the path to success.
TIMES ARE CHANGING
The retail distribution
review (RDR), which will
come into force on 31
December 2012, should
benefit Vanguard. The
new regulations include the banning
of trailing fees (commissions paid to
IFAs for selling their product) in an
attempt to make investing more trans-
parent. Andrew Swallow of Swallow
Financial Planning thinks RDR will
have a major impact on charges with-
in the investment market and compa-
nies. He says companies like iShares,
Vanguard and Dimensional are
already leading the field in this
regard. Jaskarn Pawar of Investor
Profile thinks Vanguard have come
to the UK at a good time, as clients are
questioning value for money from
advisers, and advisers are questioning
value for money from providers.
The only fly in the ointment is
Vanguards relatively small range of
funds and the scope of the fund, says
Forbes. There is no UK FTSE 100 fund
but there is a FTSE All Share fund. At
a Vanguard seminar for IFAs I attend-
ed earlier this year, I noted the same
question being asked over and over
again: What will Vanguard provide
next in the UK? IFAs have a voracious
appetite for Vanguards offerings.
Rampulla hints that ETFs and low cost
actively managed funds could hit UK
shores in the future.
Underperforming funds are a dime
a dozen and typically cost an awful lot
more. But a few providers are cutting
against the grain, offering transparent
and low cost investment options.
Vanguard is at the leading edge of this
revolution.
Vanguards in
the lead with
its lower fees
Compounding makes investment fees
the most vital statistic, says Philip Salter
J
UNIOR Isas are a replacement
for Child Trust Funds. Parents
and guardians will be able to
open a Junior Isa from 1
November 2011, while anyone else is
allowed to contribute to it.
Eligible children are those born
before 1 September 2002 and after 2
January 2011. Tuesdays launch will
offer a tax-free way to save for your
children. The Junior Isa will work in a
similar way to the adult Isa: a child can
have either a stocks and shares Isa, a
cash Isa or a combination of the two.
The limit will be set at 3,600 with the
amount rising with inflation from
April 2013, so investors can invest in
one Junior Isa now for 3,600 and put
the same amount in on 6 April 2012.
At 16 years old the child can take
over maintaining the Isa and make
investment decisions. When the child
turns 18, the Junior Isa will automati-
cally convert to an adult Isa and they
will be able to withdraw the money or
continue to invest.
It is important to make sure you
pick the right provider when choosing
where to invest in a Junior Isa, as you
can only have one provider for all the
allowances (but you will be able to
switch providers). Before deciding, ask
the provider if it offers access to a large
number of funds, investment trusts,
ETFs and shares? And if it rebates trail
commission? Also, if it offers anything
extra but not gimmicks such as
cashback? A typical loyalty bonus of
0.25 per cent per annum could boost a
familys savings by over 3,100 over 18
years compared with parents opening
a Junior Isa that doesnt.
Choice is of paramount importance,
when you consider a Junior Isa may be
invested for 18 years or longer. Having
wide choice will be essential for
investors to adjust and change their
portfolios to react to different market
conditions.
Some providers may offer a toy,
but over the longer term that will not
help your child.
INVESTMENT COMMENT
ADRIAN LOWCOCK
Tom Rampulla is
leading the UKs
revolution
Domestic Equity Cheapest 3.35 47.83 3.24 3.23
Priciest 2.02 23.39 2.66 2.66
Difference 1.33 24.44 0.58 0.57
International Equity Cheapest 6.46 48.03 3.27 3.27
Priciest 5.25 29.63 2.62 2.70
Difference 1.21 18.40 0.65 0.57

Domestic Equity Cheapest -0.27 49.40 3.13

Priciest -1.66 25.86 2.77
Difference 1.39 23.54 0.36
International Equity Cheapest 1.47 47.44 3.24
Priciest -0.11 26.68 2.68
Difference 1.58 20.76 0.56
Domestic Equity Cheapest -3.15 52.45 3.14
Priciest -4.65 29.79 2.75
Difference 1.50 22.66 0.39
International Equity Cheapest -3.98 49.86 3.25
Priciest -5.52 34.62 2.71
Difference 1.54 15.24 0.54
How Expenses Predict Success
Broad Group Expense Ratio
Quintile
Total Total Return 3yr Rating as of 5yr Rating as of
Return % Success Ratio% 31-March End Year 03/10/2010
2
0
0
5

|

5
y
r
2
0
0
6

|

4
y
r
2
0
0
7

|

3
y
r
2
0
0
8

|

2
y
r
Domestic Equity Cheapest -1.85 49.93
Priciest -3.13 30.34
Difference 1.28 19.59
International Equity Cheapest -6.72 52.65
Priciest -8.01 35.34
Difference 1.29 17.31
Souce: Morningstar
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FX FX OPTIONS COMMODITIES
INDICES FUTURES CFDs STOCKS ETFs
CITYA.M. 27 OCTOBER 2011 29
Wealth Management| Institutional FX
The Big Bang
silenced the
FX traders
T
ODAY marks the 25th anniversary of
the Big Bang the deregulatory
measures put in place on 27 October
1986 by Margaret Thatchers govern-
ment measures that changed the land-
scape of the UKs financial sector forever.
According to Tony Moulange, senior busi-
ness development manager for Colt, the
Big Bang flipped the status quo on its head.
When the regulations preventing stockbro-
kers from acting as market makers were
abolished, it moved the City away from
being a quote driven market towards being
an order driven market. Moulange says
that the Big Bang changed the dynamics of
the square mile. Whereas for centuries,
ones word was ones bond, the deregula-
tion swept out a lot of the old-boy net-
The deregulation did not just
affect equities, writes Craig Drake
The bowler-hatted
gentleman was finally
killed off in favour of
dress-down Fridays.
Picture: GETTY
works. Unencumbered by the Glass-
Steagall act on British soil, the City saw an
influx of US firms and US ways of doing
business.
EFFECTS ON FX TRADING
But how did the big bang affect the forex
industry? Currency trading only really
came into being around 1978 when previ-
ously pegged currencies were allowed to
float this change triggered seven years
after Nixon came off the gold standard. As
a result, the FX market was not structural-
ly changed by the deregulation. But it was
affected nonetheless. Neal Kimberly, an FX
analyst for Thompson-Reuters, was a forex
trader in 1986: In essence the Big Bang hit
the equity market more than it did us. The
big merchants like Baring Brothers, NM
Rothschild, Kleinwort Benson and
Schroder Wagg all sailed on though their
presence was arguably enhanced by a ride
in their ancillary forex flows caused by the
greater freedoms the Big Bang gave them.
FOR CRYING OUT LOUD
One of the biggest changes that the Big
Bang brought with it was a switch from
the open outcry trading pits to electronic
trading, drastically changing the way that
traders operated orders were accompa-
nied by a click of a mouse instead of
screaming and gesticulating in the trading
pit: Trading pre-electronic systems was
certainly more fun, says Nick Beecroft,
senior markets consultant for Saxo Bank.
At busy times, big forex dealing rooms
would become cacophonous, with traders
begging their colleagues to call out for
covering prices at they made quotes in
large amounts to customers. Beecroft
adds that this was of course a recipe for
excitement, but also for hilarious mis-
takes, practical jokes and general may-
hem.
So, as the Square Mile faces a barrage of
regulations from both Whitehall and
Brussels was the Big Bang the zenith of
market freedom for the City? Freedom
has massively diminished for some mar-
kets, and some deserved this, says
Beecroft. But the largely honest, $4 tril-
lion a day forex market is in many senses
largely unchanged just quieter!
BAE Systems . . . . . .279.0 -2.2 361.1 248.1
Chemring Group . . . .515.5 -7.0 736.5 485.0
Cobham . . . . . . . . . . .179.7 -0.3 239.4 168.5
Meggitt . . . . . . . . . . . .380.5 7.9 397.6 304.9
QinetiQ Group . . . . . .117.0 0.1 136.3 96.7
RoIIs-Royce Group . .708.5 -14.5 723.0 557.5
Senior . . . . . . . . . . . . .160.0 -0.5 190.6 131.1
UItra EIectronics . . .1581.0 -19.0 1895.0 1305.0
GKN . . . . . . . . . . . . . .193.5 -1.2 245.0 157.0
BarcIays . . . . . . . . . . .178.6 -1.4 333.6 138.9
HSBC HoIdings . . . . .526.2 1.2 730.9 473.6
LIoyds Banking Gr . . .34.3 -0.7 70.3 27.6
RoyaI Bank of Sco . . .24.8 -0.3 49.0 19.7
Standard Chartere .1402.0 -10.5 1950.0 1169.5
AG Barr . . . . . . . . . .1218.0 -17.0 1395.0 1031.0
Britvic . . . . . . . . . . . . .327.9 -7.1 503.5 289.9
Diageo . . . . . . . . . . .1314.0 7.0 1344.0 1112.0
SABMiIIer . . . . . . . . .2282.0 20.0 2340.0 1979.0
AZ EIectronic Mat . . .241.4 4.9 338.1 206.1
Croda Internation . .1881.0 -14.0 2081.0 1367.0
EIementis . . . . . . . . . .136.2 -0.1 187.4 104.8
Johnson Matthey . .1825.0 -8.0 2119.0 1523.0
Victrex . . . . . . . . . . .1197.0 -21.0 1590.0 1025.0
YuIe Catto & Co . . . . .171.5 -1.3 253.0 148.0
LON GD ONCE FIX AM...........1713.00 56.75
SILVER LDN FIX AM ..................33.34 1.11
MAPLE LEAF 1 OZ ....................35.98 0.27
LON PLATINUM AM................1566.00 12.00
LON PALLADIUM AM...............648.00 5.00
ALUMINIUM CASH .................2194.00 36.00
COPPER CASH ......................7590.00 210.00
LEAD CASH...........................1961.00 21.00
NICKEL CASH......................19820.00 790.00
TIN CASH.............................22285.00 485.00
ZINC CASH ............................1835.00 -5.00
BRENT SPOT INDEX ................111.45 0.61
SOYA .....................................1225.50 -1.25
COCOA..................................2636.00 9.00
COFFEE...................................236.55 -14.25
KRUG.....................................1777.90 33.50
WHEAT ....................................151.62 -0.62
AIR LIQUIDE........................................91.64 -0.48 100.65 80.90
ALLIANZ..............................................78.64 -1.18 108.85 56.16
ANHEUS-BUSCH INBEV ....................39.39 -0.27 46.33 33.85
ARCELORMITTAL...............................13.85 -0.29 28.55 10.47
AXA......................................................10.88 -0.02 16.16 7.88
BANCO SANTANDER...........................5.99 -0.08 9.37 5.05
BASF SE..............................................50.60 -1.25 70.22 42.19
BAYER.................................................44.81 0.20 59.44 35.36
BBVA......................................................6.23 -0.08 9.51 4.94
BMW ....................................................57.81 0.01 73.85 43.49
BNP PARIBAS.....................................30.05 -0.76 59.93 22.72
CARREFOUR ......................................18.44 0.23 34.29 14.66
CRH PLC .............................................13.73 0.08 17.40 10.28
DAIMLER.............................................37.90 0.15 59.09 30.52
DANONE..............................................48.20 0.26 53.16 41.92
DEU.BOERSE OFFRE ........................38.88 -1.30 55.75 35.46
DEUTSCHE BANK..............................28.43 -0.12 48.70 20.79
DEUTSCHE TELEKOM.........................9.05 -0.06 11.38 7.88
E.ON.....................................................17.25 -0.08 25.54 12.50
ENEL......................................................3.36 -0.01 4.86 2.81
ENI .......................................................16.05 0.12 18.66 11.83
FRANCE TELECOM............................13.11 0.09 17.45 11.12
GDF SUEZ ...........................................20.91 -0.17 30.05 18.32
GENERALI ASS...................................12.75 0.00 17.05 10.34
IBERDROLA..........................................5.19 -0.02 6.50 4.29
INDITEX ...............................................67.90 -0.14 69.34 50.92
ING GROEP CVA...................................6.22 -0.27 9.50 4.21
INTESA SANPAOLO.............................1.28 0.01 2.51 0.85
KON.PHILIPS ELECTR.......................14.91 -0.07 25.45 12.01
L'OREAL..............................................78.55 -0.35 91.24 68.83
LVMH..................................................118.40 1.00 132.65 94.16
MUNICH RE.........................................95.93 -2.05 126.00 77.80
NOKIA....................................................4.80 -0.03 8.49 3.33
REPSOL YPF.......................................21.76 -0.13 24.90 17.31
RWE.....................................................30.75 0.14 55.88 21.22
SAINT-GOBAIN...................................33.24 0.32 47.64 26.07
SANOFI ................................................50.53 0.30 56.82 42.85
SAP......................................................43.48 0.64 46.15 32.88
SCHNEIDER ELECTRIC.....................42.64 -0.16 61.83 35.94
SIEMENS .............................................75.15 -0.36 99.39 62.13
SOCIETE GENERALE.........................18.77 -0.24 52.70 14.32
TELECOM ITALIA..................................0.91 0.01 1.16 0.70
TELEFONICA ......................................15.09 -0.05 19.69 12.50
TOTAL..................................................37.80 0.06 44.55 29.40
UNIBAIL-RODAMCO SE...................139.50 -1.20 162.95 124.05
UNICREDIT............................................0.87 0.01 2.03 0.64
UNILEVER CVA...................................24.39 0.03 24.90 20.90
VINCI ....................................................35.24 0.16 45.48 29.49
VIVENDI ...............................................16.01 -0.01 22.07 14.10
VOLKSWAGEN VORZ.......................118.20 -2.45 152.20 86.40
Price Chg High Low
EUSHARES
WORLD INDICES
FTSE 100 . . . . . . . . . . . . . . 5553.24 27.70 0.50
FTSE 250 INDEX . . . . . . . 10422.38 -5.99 -0.06
FTSE UK ALL SHARE . . . . 2862.11 12.15 0.43
FTSE AIMALL SH . . . . . . . . 709.96 -4.93 -0.69
DOWJONES INDUS 30 . . 11869.04 162.42 1.39
S&P 500 . . . . . . . . . . . . . . . 1242.00 12.95 1.05
NASDAQ COMPOSITE . . . 2650.67 12.25 0.46
FTSEUROFIRST 300 . . . . . . 983.76 1.19 0.12
NIKKEI 225 AVERAGE. . . . 8748.47 -13.84 -0.16
DAX 30 PERFORMANCE. . 6016.07 -30.68 -0.51
CAC 40 . . . . . . . . . . . . . . . . 3169.62 -4.67 -0.15
SHANGHAI SE INDEX . . . . 2427.48 17.81 0.74
HANG SENG. . . . . . . . . . . 19066.54 98.34 0.52
S&P/ASX 20 INDEX . . . . . . 2565.00 13.40 0.53
ASX ALL ORDINARIES . . . 4300.80 13.10 0.31
BOVESPA SAO PAOLO. . 57143.79 857.80 1.52
ISEQ OVERALL INDEX . . . 2666.04 11.26 0.42
STI . . . . . . . . . . . . . . . . . . . . 2778.97 34.80 1.27
IGBM. . . . . . . . . . . . . . . . . . . 887.27 -5.21 -0.58
SWISS MARKET INDEX. . . 5700.50 -8.29 -0.15
Price Chg %chg
3M........................................................77.02 -0.02 98.19 68.63
ABBOTT LABS ...................................53.66 0.67 55.61 45.07
ALCOA ................................................10.36 0.22 18.47 8.45
ALTRIA GROUP..................................27.29 0.29 28.14 23.20
AMAZON.COM..................................198.40 -28.75 246.71 156.77
AMERICAN EXPRESS........................50.45 1.03 53.80 38.88
AMGEN INC.........................................56.95 0.48 61.53 47.66
APPLE...............................................400.60 2.83 426.70 297.76
AT&T....................................................28.75 0.34 31.94 27.20
BANK OF AMERICA.............................6.59 0.13 15.31 5.13
BERKSHIRE HATAW B.......................78.02 2.28 87.65 65.35
BOEING CO.........................................66.56 2.84 80.65 56.01
BRISTOL MYERS SQUI ......................32.51 0.40 33.20 20.05
CATERPILLAR....................................91.57 1.68 116.55 67.54
CHEVRON.........................................106.77 2.27 109.94 80.41
CISCO SYSTEMS................................17.61 -0.01 24.60 13.30
CITIGROUP.........................................31.16 0.26 51.50 21.40
COCA-COLA.......................................67.47 0.52 71.77 60.30
COLGATE PALMOLIVE......................90.54 0.56 94.89 74.39
COMCAST CLASS A..........................24.80 0.59 27.16 19.19
CONOCOPHILLIPS.............................71.89 1.21 81.80 58.37
DU PONT(EI) DE NMR........................46.10 1.16 57.00 37.10
EXXON MOBIL....................................81.07 1.63 88.23 63.47
GENERAL ELECTRIC.........................16.35 0.13 21.65 14.02
GOOGLE A........................................586.31 3.15 642.96 473.02
HEWLETT PACKARD.........................25.74 0.69 49.39 19.92
HOME DEPOT.....................................36.55 0.51 39.38 28.13
IBM.....................................................181.97 1.61 190.53 138.53
INTEL CORP .......................................24.70 0.07 26.78 19.16
J.P.MORGAN CHASE.........................34.18 0.69 48.36 27.85
JOHNSON & JOHNSON.....................64.49 0.80 68.05 57.50
KRAFT FOODS A................................35.02 0.09 36.30 24.30
MC DONALD'S CORP ........................91.78 0.01 92.86 72.14
MERCK AND CO. NEW......................33.54 0.63 37.68 29.47
MICROSOFT........................................26.59 -0.22 29.46 23.65
OCCID. PETROLEUM.........................87.20 2.06 117.89 66.36
ORACLE CORP...................................32.40 0.03 36.50 24.72
PEPSICO.............................................62.01 0.19 71.89 58.50
PFIZER ................................................19.29 0.42 21.45 16.25
PHILIP MORRIS INTL .........................70.80 1.96 72.74 55.85
PROCTER AND GAMBLE ..................64.95 0.44 67.72 56.57
QUALCOMM INC ................................51.60 -0.72 59.84 43.21
SCHLUMBERGER ..............................69.84 1.81 95.64 54.79
TRAVELERS CIES..............................57.50 1.16 64.17 45.97
UNITED TECHNOLOGIE ....................76.06 0.78 91.83 66.87
UNITEDHEALTH GROUP...................48.76 0.00 53.50 34.50
VERIZON COMMS ..............................36.81 0.62 38.95 31.60
WAL-MART STORES..........................57.37 0.66 57.90 48.31
WALT DISNEY CO ..............................35.05 0.54 44.34 28.19
WELLS FARGO & CO.........................25.76 0.21 34.25 22.58
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 ..................0.855 0.00
LIBOR Euro - 12 months ................2.073 0.00
LIBOR USD - overnight...................0.142 0.00
LIBOR USD - 12 months.................0.927 0.00
HaIifax mortgage rate .....................3.990 0.00
Euro Base Rate ...............................1.500 0.00
Finance house base rate................1.000 0.00
US Fed funds...................................0.250 0.00
US Iong bond yieId .........................3.180 -0.57
European repo rate.........................0.734 0.00
Euro Euribor ....................................1.147 0.00
The vix index ...................................31.04 -1.18
The baItic dry index ........................2.161 0.00
Markit iBoxx...................................234.81 0.42
Markit iTraxx..................................174.68 2.55
Price Chg High Low
Price Chg %chg Price Chg %chg Price Chg %chg
USSHARES
C/$ 1.3904 0.0010
C/ 0.8714 0.0022
C/ 105.53 0.3000
/C 1.1479 0.0027
/$ 1.5942 0.0062
/ 121.15 0.6032
FTSE 100
5553.24
27.70
FTSE 250
10422.38
5.99
FTSE ALLSHARE
2862.11
12.15
DOW
11869.04
162.42
NASDAQ
2650.67
12.25
S&P 500
1242.00
12.95
RPC Group . . . . . . . .354.3 4.3 384.8 215.4
Smiths Group . . . . . .928.5 -42.5 1429.0 907.5
Brown (N.) Group . . .259.3 -2.6 311.2 252.5
Carpetright . . . . . . . . .491.7 1.7 835.5 472.5
Debenhams . . . . . . . . .67.8 -0.5 77.4 51.2
Dignity . . . . . . . . . . . .816.0 7.0 854.5 640.0
Dixons RetaiI . . . . . . .12.1 0.1 28.5 10.6
DuneImGroup . . . . . .495.4 -3.6 550.0 383.9
HaIfords Group . . . . .325.0 -3.9 459.7 268.6
Home RetaiI Group . .100.3 -2.0 235.0 99.5
Inchcape . . . . . . . . . .321.2 -5.0 425.4 268.1
JD Sports Fashion . .828.0 19.0 1030.0 753.5
Kesa EIectricaIs . . . .105.0 2.4 174.0 80.0
Kingfisher . . . . . . . . .263.6 1.6 287.1 217.0
Marks & Spencer G . .329.0 -3.2 427.5 301.8
Mothercare . . . . . . . .175.8 -6.2 627.5 174.0
Next . . . . . . . . . . . . .2557.0 -54.0 2668.0 1868.0
Sports Direct Int . . . .228.3 -8.6 266.2 125.5
WH Smith . . . . . . . . . .550.5 6.0 558.0 433.8
Smith & Nephew . . . .569.0 -0.5 742.0 521.0
Synergy HeaIth . . . . .845.5 1.0 981.0 747.5
Barratt DeveIopme . . .89.3 -1.5 119.0 67.5
BeIIway . . . . . . . . . . . .723.5 0.0 753.5 511.0
BaIfour Beatty . . . . . .254.7 -2.9 357.3 228.6
GaIIiford Try . . . . . . . .471.5 18.3 530.0 276.5
Kier Group . . . . . . . .1430.0 20.0 1430.0 1097.0
Drax Group . . . . . . . .518.5 1.5 536.5 353.6
SSE . . . . . . . . . . . . . .1350.0 5.0 1423.0 1108.0
Domino Printing S . .555.0 2.0 705.0 434.3
HaIma . . . . . . . . . . . . .331.7 -6.4 429.6 306.3
Laird . . . . . . . . . . . . . .139.0 0.1 207.0 127.9
Morgan CrucibIe C . .275.0 -1.8 357.1 222.3
Oxford Instrument . .765.0 -1.5 1010.0 495.0
Renishaw . . . . . . . . . .925.5 4.5 1886.0 862.0
Spectris . . . . . . . . . .1219.0 3.0 1679.0 1039.0
Aberforth SmaIIer . . .539.0 -5.5 714.0 508.5
AIIiance Trust . . . . . .337.0 0.1 392.7 310.2
Bankers Inv Trust . . .380.9 -15.1 428.0 346.5
BH GIobaI Ltd. GB .1190.0 0.0 1210.0 1058.0
BH GIobaI Ltd. US . . . .11.9 0.1 12.2 10.4
BH Macro Ltd. EUR . . .19.3 0.2 20.1 15.8
BH Macro Ltd. GBP 1970.0 0.0 2070.0 1630.0
BH Macro Ltd. USD . . .18.8 -0.1 20.1 15.8
BIackRock WorId M .632.5 9.5 815.5 574.5
BIueCrest AIIBIue . . .168.0 -1.0 176.2 162.4
British Assets Tr . . . .118.7 -1.3 140.5 109.0
British Empire Se . . .453.6 0.2 533.0 409.9
CaIedonia Investm .1535.0 -5.0 1928.0 1470.0
City of London In . . .283.0 -4.4 306.9 257.0
Dexion AbsoIute L . .134.0 -0.4 151.0 130.0
Edinburgh Dragon . .221.3 0.6 262.1 201.4
Edinburgh Inv Tru . . .470.9 -2.7 492.2 414.9
EIectra Private E . . .1455.0 -5.0 1755.0 1287.0
F&C Inv Trust . . . . . .287.5 0.4 327.9 261.5
FideIity China Sp . . . . .79.0 0.5 128.7 70.0
FideIity European . .1012.0 -4.0 1287.0 912.0
HeraId Inv Trust . . . . .465.0 -4.0 545.5 419.0
HICL Infrastructu . . . .117.8 0.1 121.3 112.7
Impax Environment . .89.5 -1.5 130.5 88.5
JPMorgan American .832.0 5.5 916.0 721.5
JPMorgan Asian In . .188.0 0.1 250.8 170.1
JPMorgan Emerging .526.0 3.0 639.0 480.1
JPMorgan European .749.5 -8.5 983.5 692.5
JPMorgan Indian I . . .369.0 4.0 502.0 350.0
JPMorgan Russian .521.0 11.0 755.0 415.1
Law Debenture Cor . .350.0 -1.0 385.0 309.8
MercantiIe Inv Tr . . . .923.0 2.5 1137.0 856.5
Merchants Trust . . . .380.0 3.9 431.8 347.0
Monks Inv Trust . . . .316.6 -1.9 367.9 298.1
Murray Income Tru . .622.5 -3.5 673.0 568.0
Murray Internatio . . .902.0 9.0 991.5 818.5
PerpetuaI Income . . .253.6 1.1 276.0 234.8
PersonaI Assets T .33310.0 -60.0 33725.030210.0
PoIar Cap TechnoI . .341.0 -2.0 391.2 299.5
RIT CapitaI Partn . . .1304.0 -18.0 1334.0 1130.0
Scottish Inv Trus . . . .450.3 -0.7 524.0 417.0
Scottish Mortgage . .658.5 -5.5 781.0 586.5
SVG CapitaI . . . . . . . .209.0 0.9 279.8 187.9
TempIe Bar Inv Tr . . .868.5 -11.5 952.0 791.0
TempIeton Emergin .546.5 6.5 689.5 497.0
TR Property Inv T . . .169.0 1.2 206.1 150.0
TR Property Inv T . . . .75.1 0.2 94.0 69.5
Witan Inv Trust . . . . .447.0 -2.9 533.0 401.5
3i Group . . . . . . . . . . .206.8 -1.4 340.0 184.1
3i Infrastructure . . . .120.7 0.7 125.2 113.1
Aberdeen Asset Ma .188.9 2.8 240.0 167.8
Ashmore Group . . . .325.4 -3.4 420.0 301.5
Brewin DoIphin Ho . .118.6 -0.5 185.4 113.7
CameIIia . . . . . . . . . .8910.0 65.010950.0 8800.0
CharIes TayIor Co . . .138.5 -2.8 193.0 122.0
City of London Gr . . . .70.0 0.0 93.6 68.0
City of London In . . .340.5 0.5 461.5 321.3
CIose Brothers Gr . . .701.0 -12.0 888.5 656.5
CoIIins Stewart H . . . .60.5 0.3 90.8 59.0
EvoIution Group . . . . .82.3 0.5 94.0 62.3
F&C Asset Managem .69.1 5.1 92.9 56.1
Hargreaves Lansdo .493.3 -7.7 646.5 402.5
HeIphire Group . . . . . . .2.9 0.0 30.0 2.2
Henderson Group . . .119.2 -2.9 173.1 95.1
Highway CapitaI . . . . .14.5 0.0 21.0 6.5
ICAP . . . . . . . . . . . . . .404.7 -6.1 570.5 383.7
IG Group HoIdings . .467.0 -5.6 539.0 393.6
Intermediate Capi . . .234.2 0.0 360.3 197.9
InternationaI Per . . . .262.6 -8.2 388.8 196.5
InternationaI Pub . . . .115.7 -0.1 118.3 108.6
Investec . . . . . . . . . . .373.2 -2.5 538.0 331.8
IP Group . . . . . . . . . . . .69.8 3.3 70.0 27.9
Jupiter Fund Mana . .223.0 -1.3 337.3 184.9
Liontrust Asset M . . . .59.5 -0.5 94.3 57.3
LMS CapitaI . . . . . . . . .61.4 1.1 64.8 44.8
London Finance & . . .22.5 0.0 23.5 16.5
London Stock Exch .916.5 10.0 1076.0 717.0
Lonrho . . . . . . . . . . . . .13.3 -0.5 19.8 12.5
Man Group . . . . . . . . .155.3 -0.7 311.0 150.0
Paragon Group Of . .160.1 -1.2 206.1 134.6
Provident Financi . .1089.0 0.0 1124.0 728.5
Rathbone Brothers .1080.0 12.0 1257.0 871.0
Record . . . . . . . . . . . . .23.8 0.0 45.5 20.3
RSM Tenon Group . . .24.0 0.3 66.3 20.3
Schroders . . . . . . . .1370.0 7.0 1922.0 1183.0
Schroders (Non-Vo .1171.0 7.0 1554.0 970.0
TuIIett Prebon . . . . . .355.0 -12.0 428.6 327.8
WaIker Crips Grou . . .46.0 0.0 51.5 45.0
BT Group . . . . . . . . . .184.6 0.7 204.1 152.1
CabIe & WireIess . . . .35.6 0.4 54.1 31.3
CabIe & WireIess . . . .27.5 0.1 76.9 26.3
COLT Group SA . . . .100.9 0.3 156.2 91.6
KCOM Group . . . . . . . .70.3 -0.8 84.0 47.5
TaIkTaIk TeIecom . . .133.9 0.9 168.3 119.8
TeIecomPIus . . . . . . .736.5 -3.5 742.5 379.8
Booker Group . . . . . . .75.6 -0.8 80.0 53.4
Greggs . . . . . . . . . . . .505.0 4.0 550.5 429.1
Morrison (Wm) Sup .303.8 3.1 308.3 262.7
Ocado Group . . . . . . . .90.1 -0.3 285.0 84.8
Sainsbury (J) . . . . . . .303.5 0.5 391.5 263.5
Tesco . . . . . . . . . . . . .405.6 2.6 439.0 356.3
Associated Britis . .1095.0 10.0 1182.0 940.0
Cranswick . . . . . . . . .678.0 -5.0 895.0 588.5
Dairy Crest Group . . .348.5 2.0 424.9 325.0
Devro . . . . . . . . . . . . .235.0 1.0 296.9 218.0
Premier Foods . . . . . . . .4.0 -0.1 35.1 3.8
Tate & LyIe . . . . . . . . .656.0 4.0 660.5 490.2
UniIever . . . . . . . . . .2091.0 12.0 2109.0 1777.0
Mondi . . . . . . . . . . . . .474.6 0.1 664.0 448.4
Centrica . . . . . . . . . . .300.8 -0.7 345.8 282.6
InternationaI Pow . . .333.7 1.3 448.6 279.4
NationaI Grid . . . . . . .640.0 6.0 649.5 530.0
Pennon Group . . . . . .695.5 1.5 737.5 584.5
Severn Trent . . . . . .1512.0 -4.0 1571.0 1359.0
United UtiIities . . . . .617.5 4.5 631.5 543.5
Cookson Group . . . . .467.5 -28.2 724.5 395.8
DS Smith . . . . . . . . . .205.0 0.0 266.2 164.4
Rexam . . . . . . . . . . . .339.5 0.8 400.0 299.8
Price Chg High Low
BerkeIey Group Ho .1250.0 31.0 1299.0 789.5
Bovis Homes Group .465.2 -1.9 475.0 326.5
Persimmon . . . . . . . .508.5 1.5 510.0 336.5
Reckitt Benckiser . .3260.0 -70.0 3648.0 3015.0
Redrow . . . . . . . . . . . .118.5 -2.9 139.0 98.4
TayIor Wimpey . . . . . . .37.7 0.6 43.3 22.3
Bodycote . . . . . . . . . .276.7 -1.1 397.7 225.6
Charter Internati . . . .858.5 -1.5 876.5 538.5
Fenner . . . . . . . . . . . .344.0 0.7 422.5 259.3
IMI . . . . . . . . . . . . . . . .803.0 6.5 1119.0 636.5
MeIrose . . . . . . . . . . .325.7 -1.4 365.4 265.7
Northgate . . . . . . . . . .251.8 -0.6 346.7 202.0
Rotork . . . . . . . . . . .1669.0 4.0 1858.0 1501.0
Spirax-Sarco Engi . .1899.0 41.0 2063.0 1649.0
Weir Group . . . . . . .1880.0 10.0 2218.0 1375.0
Ferrexpo . . . . . . . . . . .308.7 0.9 499.0 238.7
TaIvivaara Mining . . .225.5 0.3 622.0 205.0
BBAAviation . . . . . . .180.9 -1.5 240.8 156.0
Stobart Group Ltd . . .118.8 -7.1 163.6 116.1
AdmiraI Group . . . . .1227.0 7.0 1754.0 1206.0
AmIin . . . . . . . . . . . . .299.9 -4.1 427.0 270.6
Huntsworth . . . . . . . . .58.3 1.3 85.0 55.3
Informa . . . . . . . . . . . .367.8 11.7 461.1 313.9
ITE Group . . . . . . . . . .179.1 2.6 258.2 157.7
ITV . . . . . . . . . . . . . . . . .62.0 -0.1 93.5 51.7
Johnston Press . . . . . . .4.4 0.1 13.3 4.1
MecomGroup . . . . . .157.5 8.5 310.0 134.5
Moneysupermarket. .103.8 -0.4 120.4 75.7
Pearson . . . . . . . . . .1154.0 -20.0 1207.0 926.0
PerformGroup . . . . .199.8 -0.2 234.5 150.0
Reed EIsevier . . . . . .544.5 4.5 590.5 461.3
Rightmove . . . . . . . .1341.0 -3.0 1360.0 736.5
STV Group . . . . . . . . .111.0 -0.3 168.0 90.3
Tarsus Group . . . . . .133.1 -3.1 165.0 114.0
Trinity Mirror . . . . . . . .46.8 0.8 106.5 37.5
UBM . . . . . . . . . . . . . .510.0 0.5 725.0 416.0
UTV Media . . . . . . . . .115.8 -1.5 150.0 101.0
WiImington Group . . .88.5 1.5 183.0 82.5
WPP . . . . . . . . . . . . . .652.5 2.0 846.5 578.0
YeII Group . . . . . . . . . . .3.7 -0.1 16.1 3.4
African Barrick G . . .551.0 25.5 618.5 393.5
AIIied GoId Minin . . .156.3 3.4 281.3 34.4
AngIo American . . .2308.0 8.5 3437.0 2138.5
AngIo Pacific Gro . . .275.0 1.1 369.3 237.9
Antofagasta . . . . . . .1176.0 24.0 1634.0 900.5
Aquarius PIatinum . .178.7 0.3 419.0 163.1
BeazIey . . . . . . . . . . . .126.8 -0.2 139.2 109.6
CatIin Group Ltd. . . .397.7 5.4 421.4 331.5
Hiscox Ltd. . . . . . . . . .390.0 0.4 424.7 340.5
Jardine LIoyd Tho . . .741.5 29.5 742.5 571.5
Lancashire HoIdin . . .727.5 -1.5 747.5 529.0
RSA Insurance Gro . .112.3 0.4 143.5 106.0
Aviva . . . . . . . . . . . . . .345.0 4.3 477.9 275.3
LegaI & GeneraI G . . .107.6 2.4 123.8 89.8
OId MutuaI . . . . . . . . .109.7 0.2 144.8 98.1
Phoenix Group HoI . .515.5 -9.5 688.0 451.1
PrudentiaI . . . . . . . . .639.5 -9.5 777.0 509.0
ResoIution Ltd. . . . . .283.4 1.7 316.1 211.3
St James's PIace . . . .358.4 -5.8 376.0 236.2
Standard Life . . . . . . .216.5 2.7 244.7 172.0
4Imprint Group . . . . .230.0 5.0 295.0 200.0
Aegis Group . . . . . . .138.4 1.6 158.5 115.7
BIoomsbury PubIis . . .98.8 0.3 138.0 95.1
British Sky Broad . . .733.0 11.5 850.0 618.5
Centaur Media . . . . . . .39.0 0.3 73.0 36.0
Chime Communicati .195.0 -4.0 298.5 173.0
Creston . . . . . . . . . . . .87.0 1.0 121.0 72.0
DaiIy MaiI and Ge . . .416.1 6.6 594.5 343.4
Euromoney Institu . .631.5 18.5 736.0 522.5
Future . . . . . . . . . . . . . .10.4 -0.6 30.0 9.5
Haynes PubIishing . .220.0 0.0 257.0 203.5
BHP BiIIiton . . . . . . .1968.5 8.0 2631.5 1667.0
Centamin Egypt Lt . .105.5 -1.4 197.1 89.7
Eurasian NaturaI . . .668.0 -8.5 1125.0 522.0
FresniIIo . . . . . . . . . .1654.0 70.0 2150.0 1247.0
GemDiamonds Ltd. .218.9 2.9 306.0 179.8
GIencore Internat . . .403.8 -4.3 531.1 348.0
HochschiId Mining . .458.0 16.5 680.0 397.0
Kazakhmys . . . . . . . .929.0 10.5 1671.0 730.0
Kenmare Resources . .39.8 -1.5 59.9 18.9
Lonmin . . . . . . . . . . .1081.0 1.0 1983.0 974.5
New WorId Resourc .508.0 -3.5 1060.0 410.5
PetropavIovsk . . . . . .755.5 -5.5 1165.0 543.5
RandgoId Resource 6880.0 170.0 7215.0 4425.0
Rio Tinto . . . . . . . . .3300.0 -2.5 4712.0 2712.5
Vedanta Resources 1257.0 -6.0 2559.0 948.0
Xstrata . . . . . . . . . . .1003.0 -11.5 1550.0 764.0
Inmarsat . . . . . . . . . . .473.5 -4.9 719.5 389.7
Vodafone Group . . . .176.7 2.6 182.8 155.1
Genesis Emerging . .460.0 6.8 568.0 430.0
Afren . . . . . . . . . . . . . . .91.0 0.5 171.2 73.6
BG Group . . . . . . . . .1395.0 17.0 1564.5 1144.0
BP . . . . . . . . . . . . . . . .461.0 3.8 509.0 363.2
Cairn Energy . . . . . . .299.9 2.9 469.7 261.4
EnQuest . . . . . . . . . . .105.9 1.4 158.5 86.6
Essar Energy . . . . . .289.6 -3.7 589.5 235.1
ExiIIon Energy . . . . . .275.1 7.5 469.7 184.2
Heritage OiI . . . . . . . .227.6 -3.7 486.0 190.0
Ophir Energy . . . . . . .252.0 4.1 299.0 184.5
Premier OiI . . . . . . . . .370.5 -6.6 535.0 310.0
RoyaI Dutch SheII . .2253.0 22.0 2326.5 1883.5
RoyaI Dutch SheII . .2319.0 25.5 2336.0 1890.5
SaIamander Energy .189.9 -5.1 317.6 182.3
Soco Internationa . . .336.1 -6.2 400.0 279.8
TuIIow OiI . . . . . . . . .1427.0 4.0 1493.0 945.5
Amec . . . . . . . . . . . . .901.5 -10.0 1251.0 740.5
Hunting . . . . . . . . . . .675.0 -6.0 817.0 530.0
Kentz Corporation . .493.2 -1.8 500.0 275.5
LampreII . . . . . . . . . . .236.0 8.1 395.2 220.7
Petrofac Ltd. . . . . . .1409.0 2.0 1685.0 1108.0
Wood Group (John) .611.5 6.0 715.8 432.5
Burberry Group . . . .1303.0 27.0 1600.0 996.0
PZ Cussons . . . . . . . .362.0 1.2 409.0 320.5
Supergroup . . . . . . . .627.0 -20.0 1820.0 617.2
AstraZeneca . . . . . .3041.5 24.5 3263.0 2543.5
BTG . . . . . . . . . . . . . .272.2 2.0 309.7 210.1
Genus . . . . . . . . . . . .1006.0 10.0 1111.0 800.0
GIaxoSmithKIine . . .1393.0 11.0 1404.5 1127.5
Hikma Pharmaceuti .665.0 35.0 900.0 555.5
Shire PIc . . . . . . . . . .2005.0 53.0 2136.0 1454.0
CapitaI & Countie . . .174.5 1.3 203.7 142.5
Daejan HoIdings . . .2799.0 59.0 2954.0 2282.0
F&C CommerciaI Pr .101.0 0.8 108.0 88.0
Grainger . . . . . . . . . . . .87.6 -2.0 133.2 77.3
London & Stamford .113.8 -2.2 140.0 112.9
SaviIIs . . . . . . . . . . . . .291.4 3.2 427.1 256.2
UK CommerciaI Pro . .78.0 0.5 85.5 70.4
Unite Group . . . . . . . .177.3 -0.7 224.1 152.9
Big YeIIow Group . . .249.3 -5.7 352.2 234.2
British Land Co . . . . .489.9 -8.8 629.5 452.0
CapitaI Shopping . . .324.0 -4.3 424.8 296.4
Derwent London . . .1602.0 -24.0 1880.0 1400.0
Great PortIand Es . . .356.8 1.4 445.0 317.4
Hammerson . . . . . . . .387.0 -5.0 490.9 353.0
Hansteen HoIdings . . .77.1 -0.8 89.5 70.0
Land Securities G . . .650.0 -18.0 885.0 616.0
SEGRO . . . . . . . . . . . .232.7 -4.6 331.3 210.1
Shaftesbury . . . . . . . .491.4 2.1 539.0 431.7
Aveva Group . . . . . .1541.0 21.0 1799.0 1298.0
Computacenter . . . . .375.5 0.3 490.0 354.8
Fidessa Group . . . . .1655.0 0.0 2109.0 1409.0
Invensys . . . . . . . . . . .215.5 2.7 364.3 199.6
Logica . . . . . . . . . . . . .92.7 0.2 147.2 73.9
Micro Focus Inter . . .337.8 0.8 426.2 239.4
Misys . . . . . . . . . . . . .277.8 6.6 420.2 214.9
Sage Group . . . . . . . .282.9 5.3 302.0 231.7
SDL . . . . . . . . . . . . . . .645.0 -3.0 711.5 555.0
TeIecity Group . . . . . .600.0 4.5 605.0 430.0
Aggreko . . . . . . . . . .1702.0 -8.0 2034.0 1394.5
Ashtead Group . . . . .164.1 -0.7 207.9 99.4
Atkins (WS) . . . . . . . .550.0 -9.0 820.0 490.2
Babcock Internati . . .692.0 -3.0 733.0 513.5
Berendsen . . . . . . . . .448.7 2.8 568.0 391.3
BunzI . . . . . . . . . . . . .804.5 -9.0 815.0 676.5
Cape . . . . . . . . . . . . . .476.7 -9.7 591.5 358.3
Capita Group . . . . . . .731.5 1.0 786.5 635.5
CariIIion . . . . . . . . . . .345.0 0.0 403.2 298.8
De La Rue . . . . . . . . .842.5 2.5 854.5 549.5
DipIoma . . . . . . . . . . .317.9 5.9 414.3 258.0
EIectrocomponents .218.4 0.4 294.9 182.2
Experian . . . . . . . . . . .781.0 0.5 833.5 665.0
FiItrona PLC . . . . . . . .368.2 10.2 385.5 227.5
G4S . . . . . . . . . . . . . . .236.3 -3.7 291.0 219.9
Hays . . . . . . . . . . . . . . .78.0 -0.5 133.6 66.6
Homeserve . . . . . . . .472.0 1.3 532.0 408.0
Howden Joinery Gr . .116.9 -0.2 127.5 76.1
Interserve . . . . . . . . . .328.3 8.6 341.3 183.5
Intertek Group . . . . .1990.0 19.0 2148.0 1715.0
MichaeI Page Inte . . .385.0 -3.6 567.0 338.7
Mitie Group . . . . . . . .249.0 2.7 250.0 194.1
Premier FarneII . . . . .174.9 0.3 308.8 144.5
Regus . . . . . . . . . . . . . .78.2 -0.6 119.0 64.0
RentokiI InitiaI . . . . . . .69.7 -2.7 104.9 64.8
RPS Group . . . . . . . . .173.7 0.7 253.0 156.6
Serco Group . . . . . . .521.0 2.5 621.5 490.9
Shanks Group . . . . . .109.7 0.0 130.9 103.0
SIG . . . . . . . . . . . . . . . .96.3 -1.2 153.5 83.8
SThree . . . . . . . . . . . .272.1 2.5 447.6 213.2
Travis Perkins . . . . . .872.5 8.0 1127.0 715.0
WoIseIey . . . . . . . . .1851.0 35.0 2261.0 1404.0
ARM HoIdings . . . . . .585.5 -4.5 651.0 338.9
CSR . . . . . . . . . . . . . .179.7 -4.5 447.0 175.0
Imagination Techn . .457.6 1.0 502.0 296.9
Pace . . . . . . . . . . . . . . .77.5 0.3 231.8 75.6
Spirent Communica .129.0 -0.2 160.3 109.5
British American . .2896.0 43.5 2904.5 2282.5
ImperiaI Tobacco . .2280.0 71.0 2280.0 1784.0
Betfair Group . . . . . . .792.0 -13.5 1545.0 567.0
Bwin.party Digita . . . .112.8 -2.2 280.9 100.6
CarnivaI . . . . . . . . . .2292.0 15.0 3153.0 1742.0
Compass Group . . . .570.0 7.5 612.0 511.5
Domino's Pizza UK . .474.0 14.6 586.0 377.0
easyJet . . . . . . . . . . . .357.1 -1.2 479.0 301.0
FirstGroup . . . . . . . . .328.5 -3.4 412.6 301.8
Go-Ahead Group . . .1379.0 -14.0 1598.0 1203.0
Greene King . . . . . . .452.4 0.3 518.0 410.0
InterContinentaI . . .1122.0 -1.0 1435.0 955.0
InternationaI Con . . .166.3 1.0 305.0 141.6
JD Wetherspoon . . . .432.3 -3.9 468.3 380.5
Ladbrokes . . . . . . . . .140.9 1.9 155.3 114.0
Marston's . . . . . . . . . . .97.5 0.5 117.1 84.6
MiIIennium& Copt . .428.2 -5.8 600.5 375.6
MitcheIIs & ButIe . . . .241.0 0.9 361.0 216.4
NationaI Express . . .228.4 -0.6 270.2 219.6
Rank Group . . . . . . . .140.0 11.0 153.7 109.5
Restaurant Group . . .298.0 3.3 335.0 254.9
Stagecoach Group . .245.8 0.2 272.4 200.0
Thomas Cook Group .54.8 -1.9 204.8 33.7
TUI TraveI . . . . . . . . . .171.8 3.9 271.9 137.2
Whitbread . . . . . . . .1674.0 -22.0 1887.0 1409.0
WiIIiamHiII . . . . . . . . .225.1 -3.0 244.1 155.5
Abcam . . . . . . . . . . . .347.0 2.5 460.0 307.0
AIbemarIe & Bond . .307.5 -4.5 400.1 272.0
Amerisur Resource . .12.8 0.0 29.0 9.5
Andor TechnoIogy . .500.0 0.0 685.0 370.0
ArchipeIago Resou . . .64.5 -0.6 79.0 40.3
ASOS . . . . . . . . . . . .1491.0 7.0 2468.0 1234.0
AureIian OiI & Ga . . . .18.0 0.8 92.0 16.0
Avanti Communicat .301.5 -5.5 735.0 248.5
Avocet Mining . . . . . .247.0 5.8 286.8 173.8
BIinkx . . . . . . . . . . . . .146.0 -0.5 158.0 70.5
Borders & Souther . . .46.8 -1.0 72.3 43.5
BowLeven . . . . . . . . .100.3 -4.0 398.0 74.5
Brooks MacdonaId 1345.0 25.0 1372.5 940.0
Cove Energy . . . . . . . .87.3 0.5 112.8 61.0
Daisy Group . . . . . . .105.0 -1.0 127.0 88.0
EMIS Group . . . . . . . .535.0 0.0 580.0 406.0
Encore OiI . . . . . . . . . .78.0 -0.5 151.5 40.8
Faroe PetroIeum . . . .163.5 1.5 218.3 130.0
GuIfsands PetroIe . . .190.8 -0.3 401.5 142.5
GWPharmaceuticaI . .92.3 -0.8 130.0 83.0
H&T Group . . . . . . . . .312.0 -12.0 395.0 277.0
Hamworthy . . . . . . . .547.0 36.5 705.0 373.8
Hargreaves Servic . .1119.0 -61.0 1180.0 683.0
HeaIthcare Locums . . . .5.9 -0.1 6.5 5.8
Immunodiagnostic . .875.0 -33.5 1218.0 768.5
ImpeIIamGroup . . . .297.5 -7.5 387.5 177.5
James HaIstead . . . . .472.5 5.0 495.0 345.5
KaIahari MineraIs . . .233.0 -4.0 301.0 168.0
London Mining . . . . .316.0 -5.8 436.5 283.0
Lupus CapitaI . . . . . .101.8 0.0 150.0 86.0
M. P. Evans Group . .405.0 0.0 500.5 371.0
Majestic Wine . . . . . .426.0 2.0 510.0 352.0
May Gurney Integr . .285.0 -0.3 300.0 211.0
Monitise . . . . . . . . . . . .34.5 -1.0 39.0 18.5
MuIberry Group . . . .1440.0 20.0 1920.0 530.0
Nanoco Group . . . . . . .42.0 -0.8 114.3 40.0
NauticaI PetroIeu . . .305.8 -5.5 547.0 223.5
NichoIs . . . . . . . . . . . .519.5 4.5 579.0 410.0
Numis Corporation . . .93.0 1.5 137.8 89.0
Pan African Resou . . .12.9 0.4 14.5 9.4
Patagonia GoId . . . . . .54.8 -2.3 70.0 20.3
Prezzo . . . . . . . . . . . . .55.0 0.3 71.5 53.3
Pursuit Dynamics . . .198.5 -5.5 700.0 160.5
Rockhopper ExpIor .206.3 -0.5 386.0 141.0
RWS HoIdings . . . . . .427.5 0.5 479.8 266.5
Songbird Estates . . .115.3 -6.0 160.3 110.3
VaIiant PetroIeum . . .471.0 -22.0 672.0 435.0
Young & Co's Brew . .632.5 7.5 712.0 535.0
Rank Group . . . . . . . .140.0 8.5
F&C Asset Manageme 69.1 8.0
Hikma Pharmaceutic 665.0 5.6
African Barrick Go . .551.0 4.9
FresniIIo . . . . . . . . . .1654.0 4.4
Jardine LIoyd Thom .741.5 4.1
GaIIiford Try . . . . . . . .471.5 4.0
HochschiId Mining . .458.0 3.7
LampreII . . . . . . . . . . .236.0 3.6
Informa . . . . . . . . . . . .367.8 3.3
Cookson Group . . . . .467.5 -5.7
Stobart Group Ltd. . .118.8 -5.6
Smiths Group . . . . . .928.5 -4.4
Bankers Inv Trust . . .380.9 -3.8
RentokiI InitiaI . . . . . . .69.7 -3.7
Sports Direct Inte . . .228.3 -3.6
Kenmare Resources . .39.8 -3.5
Mothercare . . . . . . . .175.8 -3.4
TuIIett Prebon . . . . . .355.0 -3.3
Thomas Cook Group .54.8 -3.3
Risers FaIIers
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
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
NON LIFE INSURANCE
REAL ESTATE INVEST. TRUSTS
http://corporate.webfg.com
mailto:
globaltechsales@webfg.com
AUTOMOBILES & PARTS
BANKS
CHEMICALS
BEVERAGES
GENERAL INDUSTRIALS
MOBILE TELECOMS
OIL & GAS PRODUCERS
OIL EQUIPMENT & SERVICES
MINING
NONEQUITY INVESTM. COMM.
Tsy 3.250 11 . . . . .100.18 -0.14 102.9 100.2
Tsy 9.000 12 . . . .106.50 0.00 114.3 105.8
Tsy 5.000 12 . . . .101.61 -0.04 105.8 101.5
Tsy 5.250 12 . . . .102.88 -0.02 107.2 102.8
Tsy 4.500 13 . . . .105.31 -0.04 108.5 105.3
Tsy 2.500 13 . . . .284.50 -0.06 287.7 277.6
Tsy 8.000 13 . . . . .114.05 -0.05 120.2 114.0
Tsy 5.000 14 . . . . .111.86 0.02 113.6 109.2
Tsy 4.750 15 . . . . .113.88 0.01 114.8 108.6
Tsy 8.000 15 . . . .127.56 -0.01 130.5 123.7
Tsy 7.750 15 . . . .101.15 -0.62 108.5 101.0
Tsy 4.000 16 . . . . .112.38 0.04 113.4 104.9
Tsy 2.500 16 . . . .339.64 0.05 342.2 310.2
Tsy 8.750 17 . . . .139.29 -0.19 141.9 132.9
Tsy 12.000 17 . . .123.81 0.00 133.3 122.5
Tsy 1.250 17 . . . . .114.02 0.13 115.3 106.7
Tsy 5.000 18 . . . . .119.71 0.17 121.0 109.7
Tsy 4.500 19 . . . . .117.31 0.28 118.8 105.4
Tsy 3.750 19 . . . . .111.92 0.29 113.5 99.4
Tsy 2.500 20 . . . .351.47 0.18 355.6 312.4
Tsy 4.750 20 . . . . .119.47 0.28 121.4 106.6
Tsy 8.000 21 . . . .147.90 0.19 151.8 133.8
Tsy 1.875 22 . . . .121.90 0.11 125.4 111.3
Tsy 4.000 22 . . . . .113.74 0.29 115.6 99.0
Tsy 2.500 24 . . . .310.61 0.01 320.1 273.5
Tsy 5.000 25 . . . . .125.11 0.35 126.9 107.4
Tsy 4.250 27 . . . . .116.15 0.30 118.1 97.9
Tsy 1.250 27 . . . . .114.96 -0.09 121.0 104.6
Tsy 6.000 28 . . . .140.48 0.28 142.9 119.5
Tsy 4.750 30 . . . .123.65 0.29 125.6 103.0
Tsy 4.125 30 . . . .292.98 -0.09 305.4 261.2
Tsy 4.250 32 . . . . .115.78 0.31 117.9 96.0
Tsy 4.250 36 . . . . .116.04 0.36 117.6 95.0
Tsy 4.750 38 . . . .125.54 0.39 126.9 102.8
Tsy 4.500 42 . . . .122.28 0.52 123.0 98.9
% %
ALTERNATIVE ENERGY
Wealth Management
We treat our clients customers
as our own...
trusted global business outsourcing partner
www.arvato.co.uk/cityam
Location, location, location
The importance of
choosing the right base
Saving time and money
How it can make your
business more efcient
AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
Building relationships: Outsourcing parts of your business
externally can ofer many benets and rewards
UNDERSTANDING THE
POTENTIAL
3
STEPS TO
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E
T
K
A
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A
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S
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OUTSOURCING
No. 2/ Oct. 11
2 OCTOBER 2011 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
L
ike the new kid in
school, outsourcing
struggled to be ac-
cepted before gradu-
ally making friends.
Today,things are look-
ing extremely posi-
tive for what is a growing sector
of the global economy.
For any business,reducing costs
is a main motivator in an econom-
ic downturn so it makes sense to
send non-core work to a specialist
third party.This strategy not only
saves money but frees up internal
resources to concentrate on what
really makes the business tick.
It means organisations become
nimbler in their core markets
and revenues grow - even in dif-
ficult times, making outsourcing
an effective strategy for growth.
Recognising the benefits
1
Expert third parties are well-
placed to optimise an organi-
sations back ofce and one way
they do this is through innovation.
Even in these budgetary-re-
strained, risk-averse times, inno-
vation is alive and well, albeit in a
more incremental fashion. Were
seeing projects achieve spectacular
results by tweaking processes 5-10
per cent at a time,rather than risk
dramatic, sweeping changes.
Having said that, 2011 sees a re-
cord number of entries for the In-
novation category of the National
Outsourcing Association Awards
the only awards for the UK out-
sourcing sector taking place in
November in London, as part of
the NOA Summit.
Trust and respect
2
Outsourcing is an established
industry but the concept of
outsourcing the profession is rela-
tively new. As yet, no-one grows
up wanting to be an outsourcer.
Outsourcings ascension to the
status of accountancy, law, medi-
cine a proper, professional pro-
fession is long overdue, but
amazing progress is being made.
The industry needs to build the
concept of mutual appreciation
that is seen in other professions.
In law, two barristers debat-
ing the fine details of a case each
know that the other has attained
a certain level of expertise, as
both are qualified members of
The Bar. This supports high-level,
in-depth conversation, both safe
CHALLENGES
The futures bright
Outsourcing is not the taboo word it once was. There is a
better understanding of what it is and the benets it brings
The management
and reduction of
cost is the top driver
for outsourcing but
contracting out the
entire process means
companies also have
peace of mind
Les Duncan
Director
Hays Resource
Management
WE RECOMMEND
PAGE 8
OUTSOURCING, 2ND EDITION
OCTOBER 2011
Managing Director:
Christopher Emberson
Editorial Manager: Faye Godfrey
Business Development Manager:
Hannah Butler
Responsible for this issue
Project Manager:
David Hodgson
Phone: 020 7665 4418
E-mail:
david.hodgson@mediaplanet.com
Distributed with: City AM, October 2011
Print: City AM
Mediaplanet contact information:
Phone: 020 7665 4400
Fax: 020 7665 4419
E-mail: info.uk@mediaplanet.com
We make our readers succeed!
Mediaplanets business is to create
new customers for our advertisers by
providing readers with high-quality editorial
content that motivates them to act.
in the knowledge there is mutual
understanding and esteem.
With outsourcing, an imbal-
ance of skills and experience can
cause mistrust, which leads to
protracted negotiations and in-
creased costs over the life of the
contract. By adhering to best
practice standards, which are a
benchmark of knowledge and
ability, all parties can be reas-
sured of their partners compe-
tency and wisdom.
Building relationships
3
We have learned over the
years that optimal collabora-
tion is something which needs to
be taught and to level the playing
eld we have created the post-
grad NOA Pathway Programme.
Honing relationships for true
partnership is never easy but ac-
creditation engenders trust and re-
spect. This fosters the spirit of col-
laboration and shared values cru-
cial for true outsourcing excellence.
Relationships must never be
one-sided. By their very nature,
successful contracts are a joint ef-
fort, designed for mutual satisfac-
tion so that working together cre-
ates value for everyone.
Martyn Hart
Chairman
National Outsourcing Association
Today, things
are looking
extremely
positive for what
is a growing
sector of the
global economy
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The right response for every customer.
The right solution for every business.
In the current economic gloom,
anything which claims to cut the
cost of running internal business
functions by up to 20 per cent will
grab a companys attention.
The financial pressure to save
money without sacrificing ser-
vice levels is prompting more
firms to consider Business Pro-
cess Outsourcing (BPO).
Back and front of ce functions
such as nance and accounting,
IT,human resources,payroll,legal
services, customer data analytics
and contact centres are being con-
tracted out to third party experts.
These providers have invest-
ed in the latest technology and
training to become a specialist,
leaving their clients to concen-
trate on their core business.
Make it work for you
Companies can fear losing con-
trol if they outsource. They wor-
ry about cultural differences,
potential security risks, dam-
age to the brand and difficulties
transferring knowledge. Yet with
a robust outsourcing strategy
these risks are minimised.
Duncan Aitchison, partner at
information services group TPI
EMEA and former head of glob-
al outsourcing at consultants
Capgemini, says companies can
achieve net savings of between
15-20 per cent by outsourcing.
Reap the benefits
Cost cutting must not be the on-
ly driver.This is as much about in-
creasing exibility within your
organisation and having access
to specialist talent, he says. The
reasons for outsourcing must be
well thought through. What is
your motivation and objectives
for using an external partner?
Dr Bharat Vagadia, CEO of out-
sourcing consultancy firm Op2i
and a board director of the Na-
tional Outsourcing Associa-
tion, says an economic down-
turn always makes outsourcing
an attractive option. A business
will benefit from a providers
economies of scale.
Go global or stay local?
Off-shoring remains popular but
there is more interest in local and
European options as companies
new to this way of working learn
the ropes of dealing with an out-
source provider, says Vagadia.
Companies do need the skills in-
ternally to manage off-shore pro-
viders effectively.
According to the London School
of Economics, about 120 coun-
tries want to become outsource
hubs. Of these, Egypt, the Philip-
pines and Mexico are seen as hav-
ing the labour and infrastructure
skills to compete with countries
such as India. China is struggling
to address concerns around lan-
guage,cultural barriers and intel-
lectual property security.
In a bid to appease companies
worried about cultural and lan-
guage difficulties, particularly
within call centres, when they
off-shore, providers are opening
local centres. This summer Ae-
gis, the global outsource provider
based in Mumbai, India, entered
the European market for the first
time when it created 600 jobs at a
contact centre in Manchester.
Bharat Vagadia
CEO of Op2i and
Board Director of
the NOA
OUTSOURCING
PROVES POPULAR
ROUTE IN DOWNTURN
Question: O How does an
organisation reduce the time
and money it spends running
its business processes without
lowering standards?
Answer: O By asking a
third party specialist to take
over responsibility.
NEWS
CUT COSTS BUT
KEEP QUALITY
1
STEP
STEVE HEMSLEY
info.uk@mediaplanet.com
...thats why the worlds most
trust arvato
trusted global business outsourcing partner
We enable our clients to achieve their overall objectives, whether thats a more competitive,
innovative organisation, increased revenues, happier customers or more fulfilled employees.
OCTOBER 2011 5 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
National Rail Enquiries (NRE) han-
dles 1.3m train journey queries eve-
ry day through its call centres,inter-
net and mobile services.
To cope with demand NRE,which
is part of the Association of Train Op-
erating Companies and a member of
the National Outsourcing Associa-
tion, has outsourced responsibility
for timetable and fare information
to more than 20 third party suppliers
employing about 1,000 people.
The decision to move from a sin-
gle source to a multi-source oper-
ation was taken by NREs Head of
Commercial Derek Parlour. He says
the huge number of customer con-
tacts handled online through www.
nationalrail.co.uk and via the call
centre,plus the speech recognition,
mobile and text services it provides,
meant it was crucial the company
worked with specialists. NRE has
negotiated separate contracts for
journey planning,the journey plan-
ning interface, real-time data,web-
site design and data management.
Money has been saved with more
ef cient contract pricing and com-
petition between suppliers, he says.
We are careful about which provid-
ers we work with because they must
be able to work with us and togeth-
er, which includes integration with
each others systems.
Parlour is convinced the multi-
sourcing market will continue to grow
and more competition between pro-
viders eager to grab market share will
bring costs down further for end-users.
This approach to outsourcing has
helped NRE reduce its costs by two
thirds since 2005. Passengers are
changing the way they source infor-
mation, switching from contacting
the call centre to using online and
mobile services.
Outsourcing does not mean some-
thing is no longer your responsibility
so you must ensure you can manage
a network of providers efectively,
says Parlour. We have changed our
skill set internally and rather than
employing rail experts we are re-
cruiting people with commercial and
project management skills who can
manage people who are delivering
important services on our behalf.
Multi-sourcing
just the ticket for
train enquiries
STEVE HEMSLEY
Travellers and train
companies demand a
reliable timetable service,
which is why National Rail
Enquiries outsources nearly
everything it does.
CHANGE
NEWS IN BRIEF
On the up BPO
market grows
The global BPO market will O
grow 6.3 per cent this year and
jump 5 per cent in 2012 accord-
ing to researcher Gartner. An
increase in the outsourcing of
payroll, recruiting and custom-
er data analytics is predicted
next year.
Government plans
outsourcing boost
The UK government will O
announce in November wheth-
er this summers Open Public
Services White Paper consulta-
tion will see more public serv-
ices from IT to probation work
contracted out to private
companies. Outsourcing could
cut the cost of delivering some
services by 30 per cent, says the
separate Julius Review.
Cloud the way
forward?
Cloud computing is an op- O
tion for companies keen to out-
source their IT. IBM is among
the companies offering this,
but a study by K2 Advisory says
in-house IT departments still
need the skills to act as busi-
ness service brokers for cloud-
delivered services so the sav-
ings promised are delivered.
respected organisations
for their business outsourcing needs.
If youre looking for a collaborative partner that delivers
results today and is committed to tomorrow, get in touch.
www.arvato.co.uk/cityam
Derek Parlour
Head of
Commercial,
National Rail
Enquiries
KEEPING STANDARDS HIGH
Outsourcing certain parts of
your business to a third party can
be daunting. It is important to
explore the options, and trust that
they will do the job well
PHOTOS: TOPRIGHT- WAVEBREAKMEDIALTD/
SHUTTERSTOCK
INSPIRATION
Great Scots woo
call centre giant
French contact centre giant Tel-
eperformance spent 35m buy-
ing Scottish customer care ex-
pert BeCogent to take advantage
of Scotlands outsourcing skills
and reputation.
Big business
Teleperformance is based in 50
countries with 280 contact cen-
tres employing 110,000 people,
yet Scotland is renowned interna-
tionally as a proven business proc-
ess outsourcing (BPO) location.
The nation employs 90,000
people in the BPO sector,which is
one in every 30 employees in the
country, according to a report by
Taylor & Anderson. The industry
has grown by 30,000 employees
since 2003 and serves companies
in the financial services, media
and communications, telecoms
and utilities industries.
Teleperformances UK clients,
which include the Home Of ce
and the NHS Blood Transfusion
Service, are represented in Scot-
land by 3,000 staf at call centres
in Erskine, Airdrie. Kilmarnock
and Glasgow.
Why here?
Scotland appeals to companies
choosing to outsource because of
the language and its infrastruc-
ture while clients also retain the
local control they worry about
losing when their call centres are
based overseas.
Teleperformance helps house-
hold brands acquire customers
by creating databases,generating
sales leads and taking telesales
orders.The call centres also boost
consumer loyalty and retention
levels with welcome calls and af-
ter sales advice lines.
Technical and troubleshooting
support is provided, while com-
panies are outsourcing their debt
management to reduce customer
arrears. Teleperformance also of-
fers back-office processing ser-
vices such as print, data capture,
payment processing and inbound
call handling.
Understanding the benefits
Teleperformances COO Kenny
Morris expects to see more pub-
lic sector work being outsourced
to Scotland as the UK govern-
ment seeks cost savings.
We are an extension of our cli-
ents operations and by outsourc-
ing to us they can concentrate on
what they do best, he says. We
are also adding value to their
businesses using interactive an-
alytics and predictive technolo-
gies. We show them the power of
harnessing their people and their
customers.
Among the other pan-Europe-
an BPOs based in Scotland are call
centre operators HEROtsc and Re-
sponse, IBM, consultants Logi-
ca, Capgemini and technical sup-
port provider Sykes Enterprises.
Providers have access to a labour
pool of 2.6m in Scotlands central
belt between the Highlands to the
north and the Southern Uplands
to the south.
The 62 colleges of further and
higher education in Scotland of-
fer training geared to the needs
of BPOs with courses designed
with providers like Teleperfor-
mance. There is training in call
handling working to nationally-
recognised standards covering
how to generate sales leads, how
to offer products and services
and tips on carrying out research
over the telephone.
Question: O How can an
organisation enjoy the benets
of outsourcing without having
to off-shore?
Answer: O Look closer to
home. Scotland has one of
the most mature outsourcing
markets in the world.
STEVE HEMSLEY
CHANGE
FACTS
Scotlands growth O in BPO
is attributed to a well-trained
workforce, a exible labour mar-
ket and lower salary costs. Ac-
cording to a UK Contact Cen-
tres Report by Contact Babel,
the salary for a new call cen-
tre agent in Scotland is 13,804
compared with 20,125 in Lon-
don and 15,357 in the north
east of England.
Scotland has O seen the larg-
est growth of any UK region in
new contact centre jobs and is
expected to add about 13,000
posts by 2014.
More than O 10% of BPO pro-
viders in Scotland have dedi-
cated language services and
there are about 190,000 foreign
nationals in Scotland, many of
them students.
MOVE TO THE HIGHER GROUND
From the big cities of Glasgow and
Edinburgh, to the tranquility of the
Highlands, Scotland has so much to
offer to individuals and to businesses,
and it is becoming a great option for
outsourcing closer to home
PHOTO: NAMESURNAME
QUESTION & ANSWER
How does a company O
choose the right outsourcing
partner?
!
Outsourcing is like a mar-
riage so you must know
your provider intimately. Be
clear about their strengths and
weaknesses. There should be a
cultural t so ensure there is a
match in business cultures even
if the workers way of life is dif-
ferent. Will a time zone difer-
ence be an issue for your busi-
ness? If so, South Africa would
be a good choice or, if you want
24-hour business and customer
support, outsourcing to India
might be preferable.
What questions should we O
be asking?
!
You need to consider how
important it is that an out-
sourcers staf speak clear Eng-
lish. This is as crucial as saving
money if a providers employees
will be talking to your customers.
If you want to combine cost sav-
ings with good English support
choose a country like South Africa
or the Philippines.Ask what spe-
cialist skills and knowledge staf
have,perhaps in IT or nance,and
who are their clients. It is crucial
the provider can perform as well
or preferably better than an inter-
nal department.
Does it really matter where O
in the world the outsource
provider is based?
!
Yes. The political situation
locally could have an impact
on the service a company pro-
vides and its employees. India
has a stable government but
there have been issues in North
Africa. Egypt is tipped as a big IT
and business process outsourc-
ing destination but recent politi-
cal unrest has made many com-
panies nervous because they wor-
ry about business continuity. We
set up a successful customer
service and call centre operation
in Egypt in 2007.
Whats the biggest mistake O
a company can make when
choosing to outsource?
!
Dont choose a provider and
location based solely on the
cheapest price.Cost must be bal-
anced with the factors above
otherwise a short-term cost sav-
ing could bite you in the future
when your brand and reputa-
tion are damaged.
Kenny Morris,
COO,
Teleperformance
CHOOSE THE
RIGHT PARTNER
2
STEP
All the big players
come here.
Scotland. The home of golf
and BPO solutions.
Weve got quite a reputation for invention, discovery
and innovation. From modern economics and the game
of golf to the creation of some of the largest and most
sophisticated call centres in Europe. And with a highly
skilled workforce, and thriving financial and business
service industries to call upon, Scotland has also become
a global centre for shared service centres. The fact is,
whether its in electronics and life sciences or finance
and energy, we strive to set standards. Our passion for
success and hunger to win, combined with our world-
class academic institutions, outstanding research and
superb facilities are financially irresistible. We can
develop your products and help shape your business.
And thats precisely why companies invest in Scotland.
To see what we can do for your business, visit www.sdi.co.uk/golfpo
SCOTLAND. SUCCESS LIKES IT HERE.
Question: What can a company do to nd the best people and
ensure they want to stay once they join?
Answer: Hand over the entire recruitment process to a company
that knows where the talent is and how to woo it.
Let the experts nd your
new high performers
STEVE HEMSLEY
INSPIRATION
LEADER TO LEADER
Companies may not be hiring the
quantity of people they once did but
the quality of those they do recruit
must be top notch. Yet nding and
hiring new people and ensuring they
settle in costs time and money, and
there is enormous pressure on both.
It is why many organisations are
contracting out their entire recruit-
ment process to specialists. In fact,
recruitment process outsourcing
(RPO) can be an attractive solution
for hard-pressed human resources
departments.
War on talent
Les Duncan, director at Hays Re-
source Management, appreciates
how changeable the recruitment
market can be. After all, his team
has been tasked with nding staf
for investment banks for more
than a decade.
Today, RPO is a vital cog in the
Hays machine which as a group
generates 2.4bn and places about
50,000 permanent and 300,000
temporary workers every year
around the globe.
Good employers need advice
so they dont make expensive re-
cruitment mistakes. The war on
talent is still raging despite the
unemployment figures even if
many companies are nervous
about signing up too many per-
manent staf.
It has meant more temporary
workers are being recruited, but
employers can be unclear about the
law and how much to pay people.
Saving time and money
The management and reduction of
cost is the top driver for outsourc-
ing but contracting out the en-
tire process means companies also
have peace of mind, says Duncan.
Agency workers are a exible op-
tion for employers but the law has
changed and we make sure com-
panies do not fall foul of the new
Agency Worker Regulations 2011.
Most RPO contracts are about
three years and companies can
make signicant savings. Duncan
claims that in some instances the
time it takes to advertise for candi-
dates, prole and interview them
and help them settle into their new
post can be cut by 50 per cent.
Often an employer wont have
the resources to recruit quickly and
will not know what to say to an em-
ployee to really tempt them, he says.
Candidates want a clear idea of the
prospects and career opportunities
while it is our job to get the employ-
ers brand into the market so the best
people want to join that company.
Handing over responsibility
RPO outsourcers take on the burden
of marketing a post and manage
time-consuming tasks such as car-
rying out telephone assessments.
Some employers ask Hays to com-
plete the entire process from adver-
tising to start date and beyond while
others prefer to be given a shortlist
and conduct nal interviews.
Clients are shifting to an inte-
grated outsourcing model where
they want temporary and perma-
nent recruitment included within
the same contract.
Global employers prefer to work
with providers that have of ces in
diferent countries. Hays has a lo-
cal presence across Europe and fur-
ther aeld in Brazil, Canada, Japan
and New Zealand.
Global recruitment can be a tricky
business for employers who must
navigate a cultural and legal mine-
eld to nd talented people. Local
RPO providers have an intimate
knowledge of the employment cul-
ture and the working ethos of a par-
ticular client. There can be huge
international competition for tal-
ent in sectors where there are skill
shortages, such as engineering or
energy project management.
When choosing an RPO provid-
er you need a company that under-
stands the industry as well as the em-
ployment market, says Duncan.
TRUST THE
EXPERTS
3
STEP
OCTOBER 2011 9 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
TRUST THE EXPERT
Les Duncan of Hays Resource
Management discusses the
benefits of outsourcing your
recruitment needs
PHOTO: PROVIDED BY HAYS
1
Be clear about what you
want to achieve from out-
sourcing your recruitment.
What is the issue you need help
with? Is it to nd a particular skill for
a hard to ll post or advice on tempo-
raryworkers payand conditions?
2
Do your research.Find out
which RPO companies
specialise in your industry
and whether they are experienced
at nding temporary or perma-
nent staf or both.
3
Dont be talked into paying
for technology you dont
need. A global company
with of ces all over the world will
need a more sophisticated solution
than a small domestic business with
one or two locations.
4
Remember,it is not all about
price.This is about finding
the best talent for your busi-
ness and keeping them happyso they
settle in and theydont want to leave
after a few months. Pay a sensible
price for a good service.
5
Be clear about the service
level you expect. Ask the
right questions such as
how big is the team working on
your account,what experience do
they have and what input will sen-
ior management have? What hap-
pens if something goes wrong? You
must do your due diligence.
DUNCANS TOP TIPS
FOR RECRUITMENT
PROCESS OUTSOURCIG
5
Personal Invitation
Exhibition Showcase featuring the latest recording, fraud
detection and analytics technology
Wednesday 23rd November 2011
Join us at this unique city venue for lunch and a glass of wine:
The Brewery, London, EC1Y 4SD
Doors Open 09.30 to 16.30
Complimentary lunch served at 12.45
Over 250 delegates attended last years event, register early to secure a space!
RSVP online at www.businesssystemsuk.co.uk/showcase2011
Event Hotline: 0800 458 2988
P u t t i n g t e c h n o l o g y t o w o r k
CALL RECORDING,
FRAUD DETECTION
& ANALYTICS
Showcase 2011
Exhibition Showcase featuring the latest recording, fraud detection and analytics technology
Wednesday 23rd November 2011
Join us at this unique city venue for lunch and a glass of wine:
The Brewery, London, EC1Y 4SD
Doors Open 09.30 to 16.30
Complimentary lunch served at 12.45
Over 250 delegates attended last year, there is no charge, so please register early to secure a space!
COMPANY PROFILE
PANEL OF EXPERTS
Joe Doyle
Vice President,
Global Marketing Sitel
Marc Silvester
EMEA Vice President and
Chief Technology Ofcer,
CSC
Matthias Mierisch
Chairman and CEO,
arvato UK & Ireland
Many companies that never consid-
ered outsourcing now view it as a core
part of their business strategy to reduce
operational costs, improve financial
management and strengthen customer
relationships. Competitive advantage
can be even more important than cost
reduction. Business processes such as
customer care, while not necessarily
core to a companys business, become
mission-critical in a downturn.
In the short term, companies will fo-
cus on revenue growth, cost reduction
and customer satisfaction and this will
drive links with outsourcers. Compa-
nies will move to a global sourcing or
a multi-shore approach and look to use
different emerging locations, such as
Serbia and Nicaragua, combined with
domestic onshore delivery. We predict
strong demand from the public sector
and more agents working from home.
Outsourcing has been about long
contracts and helping clients to change
their business over time but now there
is more flexibility to meet the busi-
ness needs in todays world. It is more
important for companies that there is
a real partnership and that an IT out-
source provider can deliver innova-
tive solutions for different inter-
nal business functions.
In the short term there will be a lot
of consolidation among providers be-
cause there is saturation in the market.
The demand for innovation and for out-
sourcers to demonstrate value will al-
so drive this. Longer term, we will see
a market develop for niche service pro-
viders who will have to negotiate com-
mercial agreements to work together
with end-users.
Guaranteed cost savings remain a
key driver for outsourcing in challeng-
ing economic times. But outsourcing
can also add value as organisations take
a more strategic view on how business
processes can be transformed to sup-
port overall management objectives.
Companies demand innovative solu-
tions and approaches and want part-
ners not vendors,which mean out-
sourcers must be more flexible.
Outsourcing is shifting towards a
more transformational, innovation-led
approach which will accelerate as glo-
bal growth remains sluggish. While in-
novation isnt a magic bullet,the behav-
iour and endeavour it represents can
be the missing piece in successful out-
sourcing relationships. A partnership
model based on trust, commitment and
shared reward will form the framework
for the next generation of deals.
More consumers want to self-serve
and solve their own query or issue and
interact with companies on their own
terms, whether that is outside of office
hours or via non-traditional means,
such as on social media platforms. New
technology, such as Intelligent Chat, is
allowing companies to not only reduce
costs but to provide their customers
with a better customer experience.
Cloud computing certainly ofers
a new approach to IT outsourcing but we
will see more outsourcing around the
maintenance of packaged applications
such as SAP and Oracle which will be-
come more outcome specic and small-
er in size. Technology will allow a busi-
ness function to outsource an IT process
as and when it needs to as a way to dem-
onstrate its value to the organisation.
Successful BPO contracts rely on
effective technology solutions. We are
seeing more demand for integrated and
complex service offerings as organi-
sations look to stitch together their
business processes across territories
and services. New technologies, such
as cloud-based solutions, collabora-
tion tools and social media platforms,
play an important role in delivering the
benefits of outsourcing.
Question 1:
How has the global economic
downturn changed the
way organisations view
outsourcing as an option for
their business?
Question 2:
What impact is new
technology having
on business process
outsourcing?
Question 3:
What does the future hold for
outsourcing in the short and
long term?
2011 KPMG LLP, a UK limited liability
partnership, is a subsidiary of KPMG Europe LLP
and a member rm of the KPMG network of
independent member rms afliated with KPMG
International Cooperative, a Swiss entity.
Unlock your sourcing potential
KPMG cuts through the complexity of delivering shared services and outsourcing transformation
across organisation, location, process, technology and the sourcing strategy. KPMG can help you:
To nd out how we can help you unlock the value of outsourcing,
contact Shamus Rae on +44 (0)207 694 3056 or shamus.rae@kpmg.co.uk
kpmg.co.uk
t %FWFMPQBTUSBUFHZUIBUQMBDFTUIFCVTJOFTT
services operating model at the heart of
enterprise wide transformation
t "DDFMFSBUFTVQQMJFSTFMFDUJPOEFWFMPQ
innovative commercial terms supported by
leading edge experience and knowledge
t .BYJNJTFCFOFmUTCZSFEVDJOHJNQMFNFOUBUJPO
timeframes and driving dened outcomes
t 1MBOBOEFYFDVUFDIBOHFUPNFFUUIF
needs across the enterprise
t %FWFMPQBnFYJCMFBOEBHJMFCVTJOFTT
services model that enables you to be
more responsive to changes in your
core markets
Ask the
experts!
For more information please
call 0845 345 2282
email info@catalystconsulting.co.uk
www. catalystconsulting.co.uk
T
E
R
R
E
S
T
R
I
A
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HIDDEN
BBC1, 9PM
Harry gets hold of Styles laptop,
which he searches for information,
giving him less than an hour to prevent
a disastrous event for the country.
THE FUTURE STATE OF WELFARE...
BBC2, 9PM
The journalist examines the
Governments plans to cut benefits
and assesses different methods of
handling welfare payments.
EXTRAORDINARY PEOPLE: THE...
CHANNEL5, 9PM
The story of Charla Nash, the
American woman mauled almost to
death by a chimpanzee two years ago
an attack that left her with no face.
BBC1
SKY SPORTS 1
7pmSky Sports News at Seven
7.30pmLive Victory Shield
Football. England v Wales (Kick-
off 7.35pm). 9.30pmCarling Cup
Football Special 10.30pmTime of
Our Lives 11.30pmThe Rugby
Club 12.30amRingside 1.30am
Premier League World 2am
Carling Cup Football Special 3am
The Rugby Club 4amRingside
5am-6amCarling Cup Football
Special
SKY SPORTS 2
7pmPremier League World
7.30pmLive Greyhound Racing.
The Henlow Derby Final. 10pm
WWE: Late Night Raw12am
WWE: NXT 1amWrestlemania
XXVII Highlights 2am-3amNFL:
Total Access
SKY SPORTS 3
5pmPGA Tour Golf 8pm
European Tour Golf 10pmPGA
Tour Golf 1am-2amRacemax
BRITISH EUROSPORT
3pmLive WTA Tennis 8.45pm
WTA Tennis 10.45pmCycling
12.15am-12.30amCycling 2012:
Olympic Course Guide
ESPN
6.45pmESPN Press Pass 7.15pm
Goal! 7.45pmLive Serie A 9.45pm
ESPN Kicks: Extra 10pmUFC: The
Ultimate Fighter 11pmGoal!
11.30pmESPN Press Pass 12am
World Series of Poker 1amLive
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4.30amESPN Press Pass 5am
Serie A Rivals 5.30am-6am
Goal Show
SKY LIVING
7pmCriminal Minds 8pmRinger
9pmFour Weddings 10pmSigned
By Katie Price 11pmBones 12am
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Scene Investigation 2.40am
Maury 3.30amBones 4.20am
Nothing to Declare UK
5.10am-6amJerry Springer
BBC THREE
7pmTop Gear 8pmDont Tell the
Bride 9pmWorlds Strictest
Parents Top 10 Tantrums 10pm
EastEnders 10.30pmRussell
Howards Good News 11pmFamily
Guy 11.45pmAmerican Dad!
12.30amWorlds Strictest
Parents Top 10 Tantrums 1.30am
Dont Tell the Bride 2.30am
Wilfred 3.10amSmall Teen,
Bigger World 4.10am-5.10am
Dont Tell the Bride
E4
7pmHollyoaks 7.35pmHow I Met
Your Mother 8pmBig Bang
Theory 8.30pmPerfect Couples
9pmHow I Met Your Mother
9.30pmHappy Endings 10pmThe
Inbetweeners Top 10 Moments
Part One 10.35pmShow and Tell
11.25pmChris Moyles Quiz Night
12.15amBig Bang Theory 1.10am
Scrubs 2amHow I Met Your
Mother 2.20amShow and Tell
3.05amChris Moyles Quiz Night
3.50amRules of Engagement
4.10amDesperate Housewives
4.50am-6amUgly Betty
HISTORY
7pmAmerica: The Story of the US
8pmPawn Stars 8.30pm
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Road Truckers 10pmStorage
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TVPICK
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16
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38
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
column, but it must be in a
separate block.
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 Cleanse the entire
body (5)
4 Hidden storage
space (5)
7 Bituminous pitch (7)
8 Observe (3)
9 Jack (5)
11 Lift (5)
12 Pack of cards used for
fortune-telling (5)
14 Be overcome by a
sudden fear (5)
16 Organ of locomotion
and balance in shes (3)
17 Study of the body (7)
19 Battleground of
World War I (5)
20 Boundary (5)
DOWN
1 Cartridge containing
an explosive charge
but no bullet (5)
2 Bathroom xture (3)
3 Wipe of (5)
4 Captivate (5)
5 Bufer (7)
6 Consequence (5)
10 Word formed from
the initial letters of a
multi-word name (7)
12 Bunches of feathers
or hair (5)
13 Tantalise (5)
14 Product of an
oyster (5)
15 Church cellar (5)
18 Unit of electrical
resistance (3)
R
N
G
O
A S
E
D
U
4

4

S E E D Y A S S A M
C U R H E
A R A B L E A R I A
N B V N N
T E A R J E R K E R
Y S O R E X A
W H I T E D W A R F
Z D N C R
E D G Y C A S T L E
T L E O S
A M B L E A W A S H
6 7 8 9 2 1 3
2 6 7 8 8 2 9 7
1 4 3 2 7 6 8 9
4 8 9 2 6 6 8
3 9 1 6 4 3 2 5
8 2 4 3 1
3 8 9 6 5 7 9 7
1 7 3 1 2 7 4
7 9 8 3 4 1 5 2
2 5 9 8 7 3 6 1
4 1 2 9 5 8 6
4
4
4
4
4
4
4
4
4
WORDWHEEL
The nine-letter word was
HINDRANCE
Lifestyle | TV&Games
NETFLIX TO
LAUNCH IN THE UK
WHAT YOU NEED TO
KNOW, PAGE 32
31
US film-streaming giant Netflix comes to the
UK next year. Here, Helena Lee helps you
decide if the service will be the one for you
Netflix streams to
your TV via set boxes
like Apple TV (right),
the wii (below), and to
mobile devices (below
left).
Lifestyle | Technology
OUT OF OFFICE
HELENA LEE
EAT ABALONE AT NEW SOHO RAW BAR
Oyster lovers are spoilt for choice and the
newly-opened Wright Brothers raw bar in
Soho has an extensive selection. Sip
sparkling wine from the exclusively
English wine list, and order signature dish-
es such as Mottra caviar with brown toast
and crme frache, freshly-sliced abalone,
Cherrystone clams and sea urchin. Craft
and artisan beers are also on offer.
13 Kingly Street and G7/G8 Kingly Court,
W1B 5PW, thewrightbrothers.co.uk
SEE BOY GEORGE AT THE PRINCES
TRUST ROCK GALA
Let Boy George, Midge Ure, the
Whos Pete Townshend and
others entertain you and help
raise money for youth charity
the Princes Trust. The Royal
Albert Hall will be hosting
this one-off event.
23 November, tickets from 30 to 175
Call 020 7589 8212 for tickets, or visit
www.royalalberthall.com.
OSCAR-WINNERS ART
EXHIBITION
View an exhibition of the
paintings and sculptures of
Anthony Quinn, the acad-
emy award-winning
actor who starred in
Zorba the Greek. This is
his first solo exhibition
since his death in 2001.
Mortons Club, 2-30 November,
call 020 7499 0363
Left: raw oys-
ters in the nude.
Right: Boy
George head-
lines the Rock
Gala
Blockbusters
at the touch
of a button
N
ETFLIX, the US online film service,
announced on Monday that it will
be launching in the UK in 2012. The
company looks set to change the way
we watch movies, but already has some
tough competition. Here we tell you every-
thing you need to know.
What is Netflix?
Netflix is an online film service that can
stream straight to your TV and mobile
devices. It was originally founded in 1997 as
a postal film service, from which customers
could rent DVDs for a monthly fee. It start-
ed streaming films over the internet in
2007, and the company is now market
leader with over 25m members. For the UK,
the website claims that Netflix will offer
as many films and TV episodes as you
want instantly over the internet. Its
unlikely that it will launch the DVD rentals
over here since that area is already domi-
nated by Amazons Lovefilm.
How does streaming work?
Streaming means that you can watch the
films and TV programmes in real time over
the internet. This means that theres no
need to download files onto your computer
or device in order to watch later and you
can watch your film instantly. Its essential
that you have an internet connection and
an internet-ready device that Netflix is
compatible with.
What devices will support it?
Gamers will be happy predictions are that
youll be able to stream Netflix via the Wii,
Xbox, 360 and PS3 as well as set-top boxes
such as Apple TV, and enabled TVs from
Philips, Samsung and Vizio. When Google
TV was launched in 2010, it had a built-in
application for Netflix streaming. Mobile
devices such as the iPhone, iPad and more
recently, some Android phones, support a
Netflix app.
What are the benefits?
You will be able to watch
films instantly, and pause
and restart at will. Recent
reports indicate that
Netflix has been aggressive
in negotiating for film
rights. For its customers,
this may mean access to
the latest films and a wide
variety of blockbusters, old
and new.
How much is it?
Netflix hasnt released details of its price
plans, but its website says that customers
will pay a monthly fee for the film service.
In the US, Netflix lost 800,000 US sub-
scribers in the last quarter due to a price
hike, but it has kept the price and currently
charges $7.99 per month for unlimited
access. There are rumours that the UK price
may be set at 5 per month, which would
be very competitive (Lovefilms cheapest
package is 5.99 for 2 hours of streaming
and 3 discs a month).
What other options are available at the
moment?
Lovefilm is the closest competitor and has a
loyal following in the UK. It not only offers
physical DVDs, Blu-rays and video game
rentals, but also streams films and TV pro-
grammes. It is also built into Smart TV sys-
tems (Sony and Samsung), Sony Playstation
3 and PCs. Other film rental options are
from Apple iTunes (from any device that
runs iTunes), and Acetrax (through
Panasonic, LG and Samsung TVs). YouTube
will also be launching its film streaming
service via the YouTube channel.
What about TV on-demand?
Broadcasters and Cable TV providers
including Sky, Virgin and BT are increasing-
ly offering on-demand services. PictureBox
is a subscription service owned by NBC
Universal, and FilmFlex part of Virgin
Medias on demand service and a joint ven-
ture between Sony and Disney is con-
stantly updated with blockbusters and it
has a library of over 1,000 films. Sky
Anytime is an on-demand service that
holds 500 movies at any one time. Those
who subscribe to the Sky Movies channels
get it free. BTs effort is Film Club which
has films from Picturebox and Warner,
Sony and Film 4.
What can you do now?
Registration for Netflix has
opened for those interested.
Visit signup.netflix.com/global.
MANCHESTER CITY came from
behind to book their place in the
Carling Cup quarter-finals following a
devastating 5-2 win at Wolves.
Manager Roberto Mancini made 11
changes to the side which beat
Manchester United 6-1 on Sunday and
the gamble looked like it had back-
fired when Nenad Milijas fired the
home side into an early lead.
But three goals in three minutes
shortly before half-time from Adam
Johnson, Samir Nasri and Edin Dzeko
turned the tide in Citys favour. Luca
Scapuzzi and Dzeko again stretched
the lead before Jamie OHara added a
late consolation.
Elsewhere, a Luis Suarez brace, his
first strike a goal of the season con-
tender, helped Liverpool come from
behind to win 2-1 at Stoke, who had
taken a first-half lead through
Kenwyne Jones.
Finally, Blackburn secured a much
needed win for their under-fire man-
ager Steve Kean. Newcastle scored
twice in injury time to tie the match
at 2-2 and force an extra 30 minutes.
Rovers regained the lead through
Morten Gamst Pedersen, only for
Peter Lovenkrands to square the
match from the spot. But with a
shootout looming Gael Givet struck in
the 120th minute to seal a 4-3 victory.
Mancini rings the changes but the
goals flow again for rampant City
UEFA have delayed providing the
Football Association their written rea-
sons behind England striker Wayne
Rooneys three-match ban for anoth-
er week at a minimum.
The European governing body had
been expected to provide the FA with
the reasoned decisions for the ban
imposed on the England striker for
kicking Miodrag Dzudovoic during
the 2-2 draw with Montenegro by
today.
But an FA statement released yes-
terday said: The FA has today been
advised by Uefa that we may not be
provided with the written reasons
regarding Wayne Rooneys three
match suspension for another week
at a minimum.
Once the reasons are received, The
FA will determine on any appeal after
discussions with Fabio Capello and
Wayne Rooney.
The FA will make a decision based
on Uefas rationale, but it would be a
surprise if there is no appeal, given
that a three-match international ban
would rule the Manchester United
star out of all of Englands group
matches at the Euro 2012 finals.
National team coach Capello last
week dropped a clear hint that
Rooney will be going to next sum-
mers tournament regardless.
FA made to wait as Uefa delay
explanation of Rooney suspension
FOOTBALL
BY JAMES GOLDMAN
FOOTBALL
ARSENAL majority shareholder Stan

Kroenke is poised to address fans in
person for the first time when he
attends the clubs AGM this morn-
ing but wont answer questions.
The American sports tycoon, who
took control of the club earlier this
year in a deal that valued it at 730m,
is set to outline his vision at the meet-
ing at Emirates Stadium.
Kroenke, whose publicity-shy
nature has earned him the nickname
Silent Stan, is not expected to answer
questions, which have been pre-
approved by Gunners staff.
The 64-year-old is then expected to
remain in London until the weekend
so that he can attend his first Arsenal
away game on Saturday, when they
travel across London to Chelsea.
Manager Arsene Wenger, chief
executive Ivan Gazidis and chairman
Peter Hill-Wood will, as usual, answer
shareholder questions and can
expect a tougher grilling than usual
following a turbulent few months.
Kroenke has attended the last two
Arsenal AGMs but declined invita-
tions from shareholders to speak.
The Gunners asked shareholders to
submit questions in advance of the
AGM. However, the club insist it is
only in order to avoid repetition and
not an attempt to weed out any
uncomfortable topics.
Kroenke to
outline plan
to Gunners
EMBATTLED Chelsea skipper John
Terry will retain the captaincy of his
country for next months friendlies
even if the investigation into his
alleged racist slur against Anton
Ferdinand has not been resolved.
England host world and European
champions Spain on 12 November at
Wembley three days before Sweden
arrive in the capital.
The Football Association, however,
have no plans to suspend Terry as
skipper pending the outcome of
their inquiry, with the governing
body adopting an innocent-until-
proven-guilty policy.
The FA on Tuesday night launched
an inquiry into allegations Terry
racially abused Ferdinand during
his clubs stormy west London
derby defeat at Loftus Road on
Sunday.
Terry responded by vowing to
clear his name after strin-
gently denying the
claims, which are also
being assessed by
the Metropolitan
Police following an
anonymous com-
plaint.
Terry, who has
been cautioned
four times this
season, was rest-
ed from last
nights Carling
Cup tie at Everton
to avoid the possi-
bility of him
being suspended
for Saturdays visit of Arsenal.
Meanwhile, Lord Ouseley, chair-
man of the Kick It Out anti-racism
campaign group and a Football
Association Council member, has
encouraged Ferdinand to break his
silence on the matter.
Ferdinand, whose older brother
Rio was usurped as England captain
by Terry in March, is thought to have
notified his club he was unaware of
any race row until after Sundays
match had finished, prompting
Rangers to involve the FA.
But by thus far refusing, at the
very least, to make a statement,
Ouseley believes Ferdinand is under-
mining the work undertaken by his
organisation.
I have heard nothing from Anton
Ferdinand, said Ouseley. I
hope players when they
make complaints [and
then keep quiet] can see
they are actually letting
down all the people who
made sacrifices in the
past to get us to the posi-
tion we have got to now.
We want to give people
the confidence to come
forward, knowing that
they wont be victimised
or penalised, and know-
ing they
are doing
the game
the utmost
good, because it is
helping to deal
with all sorts of
unacceptable behaviour.
We have to root out
racism.
Race probe
wont prevent
Terry leading
out England
BY JAMES GOLDMAN
FOOTBALL
BY FRANK DALLERES
FOOTBALL
Sport
34
Arsenal shareholder Kroenke Picture: PA
Arsenal, Manchester United Crystal
Palace, Cardiff, Manchester City,
Liverpool, Chelsea, Blackburn.
* Ties to be played on 29 / 30 November
CARLING CUP | QUARTER FINALISTS
Sturridge now has
four goals in his
last four games
Picture: ACTION
IMAGES
Sturridge pounces to
seal cup win which
Villas-Boas dedicates
to his absent skipper
I
NDIAS one-day whitewash of
England highlights the signifi-
cance of home advantage. In total-
ly different conditions on the
Subcontinent, India were of course
far more comfortable and the roles
were utterly reversed. But if England
have pretensions of being the best
one-day team in the world then they
have to adapt far better.
Alastair Cooks men never looked
like they knew how to bat. Only on
one occasion did they almost make
300 runs, and even then should have
gone and racked up a bigger score.
The middle-order batsmen were
woeful, and coach Andy Flower has
said he intends to shake things up in
that department. But as poor as the
batting was, the bowling really was
not any better and, for me, the whole
make-up of the team needs to be
looked at.
For starters, Craig Kieswetters
place at the top of the order should
be reconsidered. In Tuesdays final
match, England needed one of the
openers to get a big score. Kieswetter
made 60 but then got out, and Im
just not sure he will ever be a man to
rely on for that sort of innings.
I would like to see one of the main
batsmen either Ian Bell or Kevin
Pietersen go first, with Kieswetter
shunted down the order or dropped.
Much depends on whether Johnny
Bairstow can match his glovework,
and Im not sure he can yet.
I was disappointed that Scott
Borthwick did not get more than one
game. Samit Patel had his chance on
turning pitches and batting down the
order but didnt really take advan-
tage, while Borthwick deserves an
extended run in the side.
The results on this tour do not
reflect well on Cook, but a captain is
only as good as the players at his dis-
posal. No matter what tactics were
employed Im not sure the results
would have been different.
Cook tried his best and has a rela-
tively inexperienced side to choose
from. Three automatic selections
Eoin Morgan, Stuart Broad and James
Anderson were missing and, while
you cant say that was the difference
between losing 5-0 and winning, they
would surely have improved perform-
ances.
I firmly expect to see an improve-
ment when they face Pakistan early
next year. Essentially, England are a
good team who just need to get some
key players back and rethink the two
or three places that arent automatic
picks.
Finally, lets not forget what a good
year it has been overall. An Ashes win
and a superb summer have con-
tributed to an excellent 12 months
Test-wise. In the one-day arena
England have been good at home,
they just seem to forget how to play
when they get on a plane.
Kieswetter not the answer
to Englands opening dilemna
ENGLAND coach Andy Flower has dis-
missed the suggestion that another
whitewash on the Subcontinent next
year could be avoided were he to make
his top players available for Indian
Premier League selection.
A 95-run defeat in Kolkata yesterday
sealed Englands 5-0 humiliation at the
hands of the world champions. Of
Englands batsmen only Ravi Bopara
and Kevin Pietersen, as well as the
injured Eoin Morgan, have IPL experi-
ence and a greater understanding of
conditions on the Subcontinent.
England will return to India next
year for a seven-game one-day series
but Flower believes a change of fortune
is unlikely to be triggered by a more
relaxed stance to allowing his players
the chance to play in the IPL.
A few of our batsmen play IPL crick-
et, said Flower said. Weve got quite a
lot of experience out here in the
Subcontinent I dont think thats an
excuse that we can make.
The IPL is quite a tricky situation.
Given the schedules we have and that
we make decisions to rest players at
certain times during the year, trying to
squeeze in the IPL is always going to
present certain challenges to us.
It is not all doom and gloom. But
we want to be better able to deliver our
skills here under pressure.
Relaxed IPL stance no guarantee
of improved showing, says Flower
CRICKET
Kieswetter has passed 50 only once in his last seven ODI innings Picture: ACTION IMAGES
CHELSEA manager Andre Villas-Boas
dedicated last nights Carling Cup vic-
tory to club captain John Terry.
The 30-year-old, currently being
investigated by the Fooball
Association following claims he
racially abused QPR defender Anton
Ferdinand, was rested ahead of
Saturdays London derby against
Arsenal.
In his absence, Saloman Kalou put
Chelsea ahead, benefiting from a
goalkeeping error by Jan Mucha, after
Nicolas Anelka missed an earlier
penalty.
Everton appeared to have found a
way back into the contest when
Chelsea goalkeeper Ross Turnbull saw
red when he tripped Louis Saha, but
Petr Cech, with his first touch, saved
Leighton Baines spot-kick.
Saha did level the match with five
minutes remaining with a powerful
header and there was still time for
Denis Stracqualursi to miss a sitter
before the additional 30 minutes
commenced.
The tide turned back in Chelseas
favour when Royston Drenthe was
dismissed for a second bookable
offence and Daniel Sturridge
pounced with four minutes remain-
ing to settle a pulsating match.
It was a very strong performance
and I think all the players would like
to dedicate this victory to John Terry,
said the Chelsea manager.
We were very committed, we
showed resilience and strength of
character once again.
We went down to 10 men, unfor-
tunately, once again and made things
even more difficult but we were able
to triumph in difficulty and these are
good signs for us.
We got one of the most difficult
draws, Everton away with one of their
strongest sides.
They showed they wanted to go
through this phase but we were able,
not only to play good football, but
show good commitment and desire.
It shows we are progressing and it
is very satisfying for everybody.
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email sport@cityam.com
CRICKET COMMENT
ANDY LLOYD
35
SPORT | IN BRIEF
Robson wins battle of Brit girls
TENNIS: Laura Robson battled to victory
against Heather Watson in the first
meeting between the British teenagers at
the Aegon GB Pro-Series Barnstaple.
Londoner Robson, 17, fought out a 6-1, 3-
6, 6-3 win over Guernsey 19-year-old
Watson to reach the quarter-finals. Im
sure were going play a fair few times in
the future and were friends, so it was
always going to be a tough match,
Robson said.
Wigglesworth blow for Sarries
RUGBY UNION: Saracens scrum-half
Richard Wigglesworth has been ruled out
for the rest of the season. The 28-year-
old damaged his anterior cruciate knee
ligament during Sundays LV= Cup clash
with Exeter. Wigglesworth, who was
part of Englands World Cup squad, will
miss the whole of the 2012 Six Nations.
BY JAMES GOLDMAN
FOOTBALL
1
2
EVERTON
CHELSEA
D-day in Stamford
Bridge land vote
CHELSEAS future at Stamford Bridge
is set to become clearer today when a
key vote takes place over ownership of
the stadiums freehold. Shareholders in
Chelsea Pitch Owners, a supporter-led
group, will meet tomorrow morning
discuss the clubs offer to buy back the
land, and later cast their votes. The
club need 75 per cent of the vote to
win. Chelsea want the freehold to
allow it to sell the stadium and move
to a new ground, which they promise
will be within a three-mile radius if
done before 2020. Campaigners Say
No CPO are urging shareholders to
reject the deal as they still have a num-
ber of questions about the offer, which
they plan to raise at the meeting.
Results
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Cityam 2011-10-27

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