Financial Times Summary

Tue 29 Jul 2008

Merrill Lynch
Merrill Lynch yesterday moved to bolster its depleted balance sheet by raising £4.3bn through a public share offering while selling $11.1bn worth of toxic mortgage securities and taking a fresh $5.7bn writedown. The surprise move comes 10 days after Merrill reported a $4.6bn second quarter loss, including a $9.4bn writedown, and announced asset sales aimed at raising $8bn in much needed capital.

Abbey
Abbey, owned by Spanish bank Santander, will say today it took nearly two in five UK mortgages written in the second quarter, beating bigger rivals such as HBOS. The lender, which reports its first half results today, has taken advantage of the turmoil at mortgage rivals as they grapple with the impact of closure of the wholesale loan markets.

Morgan Stanley
Armins Rusis has taken a leap after 17 years at Morgan Stanley from his post as Head of Credit for North America, to join Markit, the derivatives trading platform.

FSA
The Financial Services Authority has levied its biggest-ever penalty on an insurance broker by fining a unit of Insurance Australia Group £735,000 for cancelling hundreds of incorrectly price car insurance policies. The City watchdog said that in cancelling 4,550 policies, Hastings Insurance Services, part of IAG, had failed to treat its customers.

Barclays
Cassa di Risparmio di San Marino, a bank based in the tiny Italian republic, is suing Barclays of the UK over the structuring and sales of five "complex credit-linked notes". The securities involved were issued in 2004 and 2005 and bought by the San Marino-based company for about £355m, a statement released yesterday claimed.

Lloyds TSB
Financial stocks led the market lower with Lloyds TSB under pressure after a leading broker suggested its dividend was in jeopardy. Lloyds reports half year figures tomorrow and is expected by analysts to announce a maintained interim dividend of 11.2p a share. But Cazenove was telling was telling clients yesterday that the dividend was unsustainable and the final payment, which is due next year, could be cut by 40%.

Lloyds TSB
The Financial Services Authority has appointed a former Lloyds TSB executive to head its retail markets division at a crucial time for the banking industry. John Pain, of Lloyds TSB, joins the City watchdog when high street banks are reeling from falling profits and higher bad debt charges because of the assets linked to US subprime mortgages.

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