Aon UK cuts pension payments The British arm of one of the world's biggest insurance brokers is cutting its contributions to its workers' pensions by up to half, the FT reported. Aon said it believed it was the first large company in the UK to cut payments to its workers' defined contribution schemes, in a change that will mean employees have to pay up to three times current contributions to keep matching payments at existing levels. Pensions experts said the move by the insurance broker, which employs 5,000 people in the UK, could encourage other employers to follow suit. Spiralling pension costs are rising to the top of corporate agendas as employers struggle to cope with the deepening recession. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54555/aon-uk-cuts-pension-
| RBS to cut up to 9,000 jobs across globe Royal Bank of Scotland is cutting up to 9,000 jobs worldwide - including 4,500 in the UK - in areas such as technology and call centres in what is the biggest single job cull at a bank this year, the FT reported. The bank, which is majority owned by the UK government after being brought to its knees by the credit crunch, said it expected to make the cuts over the next two years although it believes the actual number of jobs lost will be "significantly" lower than this. RBS also said its latest placing and open offer had been snubbed by investors, meaning the government stake has risen from 58 per cent to 70 per cent. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54558/rbs-to-cut-up-to-900
| Pernod set to unveil €1bn rights issue Pernod Ricard, the French drinks group, is expected to announce a €1bn ($1.3bn) rights issue and a deal to sell its Wild Turkey bourbon brand, the FT reported. The deal to sell Wild Turkey - the most likely buyer of which is Campari - is expected to raise $575m for Pernod, which unveiled strong half-year results in February. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54556/pernod-set-to-unveil
| Pearl plans LSE flotation after restructuring Hugh Osmond's Pearl life assurance group is close to a restructuring that is expected to see it float on the London Stock Exchange later this year with a targeted market capitalisation of about £2bn. Mr Osmond is close to raising about £500m from new institutional investors to recapitalise the Pearl parent company, the FT said, citing people familiar with the situation. Pearl is also in advanced talks with its 17 lending banks, led by Lloyds Banking Group, on an exchange of debt for either new debt, equity or another type of instrument in an effort to reduce its £3bn debt burden. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54557/pearl-plans-lse-flot
| PartyGaming admits bank fraud PartyGaming, the online gambling company that became a sought-after stock on the FTSE 100 index in the UK, on Tuesday admitted to bank fraud and contravening other US laws as it paid a forfeiture of $105m (€79m) in order to escape prosecution by US authorities, the FT said. In a settlement that could signal long-awaited takeover activity in the industry, the company accepted it had violated laws relating to bank fraud, illegal gambling and wire fraud between 2001 and its exit from the US market in October 2006. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54560/partygaming-admits-b
| Taylor Wimpey in 11th-hour rescue deal Taylor Wimpey, the stricken UK housebuilder, has reached a refinancing agreement with its key creditors after more than nine months of negotiations, the FT reported. The company also revealed pre-tax losses of nearly £2bn and net debts of £1.57bn.The 11th-hour deal came on the eve of a deadline on Wednesday to seek approval from its creditors, and gives Taylor Wimpey hope for a way out of the debt problems that have seen the group lose more than 90 per cent of its equity value since 2007. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54563/taylor-wimpey-in-11t
| Ireland unveils emergency budget Ireland's finance minister warned on Tuesday that the nation faced "the challenge of [its] life", as he slapped higher taxes on the middle classes in an emergency budget aimed at tackling the spiralling economic crisis. Brian Lenihan outlined plans to set up a national asset management agency to take over an estimated €80bn-€90bn of bad loans extended by local domestic banks to developers and property companies that now look as if they will not be able to repay. Bankers told the FT Ireland would be the first European Union country to adopt a so-called "bad bank" model to clean up the balance sheets of its main banks in the hope this would restore lending to the real economy. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54559/ireland-unveils-emer
| Europe concerned over sterling slide The pound's slide against the euro has begun to trigger concerns on the continent that the UK is seeking to gain a competitive advantage over its European Union partners, the FT reported. Sterling has fallen by more than 25 per cent on a trade-weighted basis since the autumn of 2007, raising the question as to whether Britain is letting its currency fall to help its exporters at a time when the eurozone is falling more deeply into recession. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54566/europe-concerned-ove
| CDS market's Big Bang arrives The financial industry will on Wednesday overhaul how it writes contracts in the credit derivatives world - an effort to rebuff criticism that the vast sector could pose a systemic threat, the FT reported. More than 1,400 banks and asset managers will adopt a new "big bang" protocol, which will make it easier for investors to know what will happen to credit derivatives contracts if debt defaults occur. The US market will also introduce a standardised pricing system for CDS contracts. The moves follow mounting criticism of the credit derivatives world, which some regulators claim contributed to problems at AIG. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54561/cds-markets-big-bang
| Grube to step down as EADS chairman Rüdiger Grube signalled that he would step down as chairman of EADS, the Franco-German defence group, when he takes over as chief executive of Deutsche Bahn, the German state railway, later this year, the FT said. This has raised new questions about the balance of power at EADS. The parent company of Airbus is controlled equally by Daimler on the German side and the French state and Lagardère on the other side, an arrangement that means top jobs have to be carefully balanced out. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54564/grube-to-step-down-a
| Blankfein attacks US job rules Lloyd Blankfein, Goldman Sachs' chief executive, on Tuesday stepped into the heated political debate over Wall Street's future, calling for an overhaul of bankers' pay and attacking new laws preventing financial groups from hiring foreigners, the FT reported. Mr Blankfein told a group of fund managers in Washington that, in hindsight, some of the industry's decisions on pay looked "self-serving and greedy" and called for radical changes in compensation structures, including paying senior executives mostly in deferred stock and clawing back bonuses from underperforming bankers. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54565/blankfein-attacks-us
| French state is BNP's biggest investor The French state has become the largest shareholder in BNP Paribas, the country's biggest bank, with a 17 per cent stake, according to a disclosure yesterday by the regulator, the FT said. This follows BNP's decision to take €5.1bn ($6.8bn) of state support in the form of preference shares to shore up its balance sheet. The stake puts the state well ahead of Axa, BNP's second largest shareholder, which holds 4.83 per cent. However, unlike other shareholders, the government's stake carries no voting rights, no seats on the board and cannot be converted into ordinary shares. See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54562/french-state-is-bnps
| Overnight markets: Sell Asian markets moved sharply lower on Wednesday, falling for a second consecutive session as traders digested losses at Alcoa and Daiwa Securities. Alcoa, the world's largest aluminum producer, posted a larger-than-expected quarterly loss of $497m while Daiwa warned it would report an annual loss after booking a Y17.4bn ($173m) decline in the value of its securities holdings. The MSCI Asia Pacific Index was trading more than 2 per cent lower by lunchtime in Tokyo, as all markets expect the Philippines declined. Asian markets (Wed)
04:30 BST
Nikkei down 174.22 (-1.97%) at 8,658.63
Topix down 19.01 (0.02%) at 813.59
Hang Seng down 555.51 (-3.74%) at 14,370.46 US markets (Tue)
S&P500 down 19.93 (-2.39%) at 815.55
DJIA down -186.29 (-2.34%) at 7789.56
Nasdaq down 45.10 (-2.81%) at 1561.61. European markets (Tue)
FTSE100 down 63.02 (-1.58%) at 3,930.52
Eurofirst 300 down 5.40 (-0.70%) at 760.69 Currencies
04:25 BST
€/$ 1.3196 (1.3360)
$/¥ 100.12 (100.64)
£/$ 1.4684 ( 1.4680) Commodities
04:05 BST
Brent Crude (ICE) down $0.54 at $50.68
Light Crude (Nymex) down $0.95 at $48.20
100 Oz Gold (Comex) up $2.60 at $885.90
Copper (Comex) up -$1.80 at $197.20 10-year government bond yields (%)
04:10 BST
US 2.88 (2.90)
UK 3.23 ( 3.45)
Germany 3.23 (3.23)
Japan 1.44 (1.46) Sources: FT, Bloomberg See this article online.
http://ftalphaville.ft.com/blog/2009/04/08/54554/overnight-markets-se
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