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“PPI complaints end 29 August 2019. What will you do?” asked the FCA's adverts, attempting to finally bring to an end the 8-year long PPI claims bonanza. The answer seems to be the typically British “leave it to the last minute”. 

The deadline may have passed, but the scandal is not over yet for the UK's high street banks. Royal Bank of Scotland is first out of the gates with a post-deadline update. It thought the mis-selling scandal would cost it up to £5.3bn — the amount of provisions it had made up to the end of June this year. 

A spike in last-minute claims was always anticipated. What RBS's announcement today reveals is just how many people dilly-dallyed before getting their claims in. The bank had used £4.9bn of its £5.3bn in provisions by the end of June, meaning it thought more than 92 per cent of the likely claims were in. Now it plans to take another incremental charge at its third-quarter results of up to £900m — an increase of up to 15 per cent on the previous provisions. 

RBS's exposure to PPI mis-selling has been much lower than Lloyds and Barclays. Even with the extra hit from the last minute claims rush, that hierarchy of horrors won't change. 

The UK's most senior banking regulator recently warned British banks would need “a generation” to fix the cultural issues that led to the scandal. The banks will be hoping it wraps up sooner than that. 


Results are starting to trickle in after the summer lull. Of those out today the biggest is Barratt Developments, the UK housebuilder, which reported a 2.3 per cent year-on-year fall in revenues for the year to June but a 9 per cent increase in pre-tax profits. The housing market has been hit by Brexit uncertainty as homeowners fret about a sharp shock to property prices if there is a no-deal Brexit. But Barratt reckons it has long-term undersupply, Help to Buy and low interest rates in its favour (plus net cash of £766m in case it needs to tough it out). 

Homewares retailer Dunelm posted a 5 per cent increase in revenues to £1.1bn and a 35 per cent rise in full-year profits to £126m. Like-for-like sales were even higher, up 11 per cent year-on-year. Profit growth was down to higher sales, improved margins and “better operational grip”, Dunelm said. But like Barratt, it depends on the fickle UK consumer continuing to spend through Brexit turbulence. Dunelm notes that if the UK leaves on October 31, that falls within its peak winter season, leaving it with a “cautious outlook” for the year ahead. 

Halfords, meanwhile, reported a 4 per cent decline in total revenues for the 20 weeks to mid-August, with an increase in online and business-to-business sales more than offset by the impact of “the challenging retail backdrop and tough weather comparators year-on-year” (when things are bad, it's always the weather). Underlying profits last year were already down 18 per cent from the year before. Now Halfords reckons they will be even lower this year — in the range of £50m-£55m for the 2020 financial year rather than £59m for 2019. 

Elsewhere, there are results out from Just Group, the insurer. Statutory pre-tax profits were up but underlying profits down as it scales back new business as part of efforts to improve its capital position. It has “managed sales down” by 30 per cent. 

Job moves

Asset manager Columbia Threadneedle has lost a second senior European executive. Mark Burgess plans to take a career break from his twin role as chief investment officer for Europe, the Middle East and Africa and deputy global chief investment office and will leave on September 27. His exit follows that of Michelle Scrimgeour, Columbia Threadneedle’s chief executive in Europe, who was appointed in February as chief executive of Legal & General’s £1tn investment arm.

We're looking to feature more job moves. If you're in senior management and moving jobs or you know someone who is, let us know about it at quote@ft.com

Markets speed-read

Sterling is once again the markets story of the moment — though there's generally some more positive sentiment around the Brexit developments and Hong Kong chief executive Carrie Lam's move to withdraw the controversial extradition bill. The pound has rallied since Prime Minister Boris Johnson's defeat last night to climb 0.4 per cent to $1.2129. Elsewhere in markets, the FTSE 100 opened 0.6 per cent per cent higher, and the Hang Seng index of HK stocks rallied 3.5 per cent.

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Beyond the Square Mile

Marty Chavez, the co-head of Goldman Sachs’ securities division — once seen as a contender for the chief executive’s chair — is leaving the firm. Mr Chavez, 55, will be replaced by Marc Nachmann, a London-based, 25-year veteran of the firm who was previously co-head of Goldman’s global investment banking division. The reshuffle comes ahead of a long-awaited investor day at which chief executive David Solomon (pictured) has promised to reveal further details of a pivot from Goldman’s investment banking and trading roots towards consumer banking and serving smaller companies. Read more

Shares of Uber and Lyft dropped to record lows on Tuesday as investors digested the implications of a proposed California law that could upend their business models by forcing them to change how they treat drivers. 

Mediaset and Vivendi are set for the latest showdown in a two-year stand-off that has pitted their billionaire owners, former Italian prime minister Silvio Berlusconi and French industrialist Vincent Bolloré, against each other.

Closing quote — essential comment before you go

Lex The gulf between Generation Rent and their older, richer landlords is widening and there is a case for rebalancing the housing market towards first-time buyers. If he becomes chancellor, John McDonnell should consider deregulating planning and imposing a tax on land banks. This article is part of our series: The Corbyn Revolution.

Kate Burgess In return for selling its mortgage book, Tesco nets about £100m and a useful cure for what has become a chronic headache.

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