News

The Treasury is preparing to relax an implicit five-year ban on newly nationalised banks paying dividends, in an effort to keep the bailout on track. Banks asking the Government for £37bn in rescue finance ? Royal Bank of Scotland, Lloyds TSB and HBOS ? scented what they saw as a Treasury climbdown last night after day three of the package talks threatened to become mired in confusion, reports the Times.

Lloyds TSB was last night still trying to extract concessions from the Treasury that would allow the bank to pay its dividend while taking advantage of the Government's £37bn sector bailout, according to the Telegraph.

Peter Sands, the chief executive of Standard Chartered, has emerged as the main architect behind the bail-out. The banking plan unveiled by the Government on Monday and now being copied around the world is based on a blueprint drawn up by Mr Sands and by Richard Meddings, Standard Chartered's finance director, writes the Telegraph.

Allegations about BAE Systems' involvement in bribery may return to haunt the defence company on Thursday with publication of what is expected to be a critical report on Britain's record in tackling corporate corruption. The report, by the Organisation for Economic Co-operation and Development, is thought likely to attack Britain's record on prosecuting companies and individuals who have allegedly paid bribes to foreign officials in order to secure contracts, according to the Telegraph.

Investors pulled at least $43bn from US hedge funds in September as market turmoil led to unprecedented withdrawals, an analysis by a leading research house shows. The data from TrimTabs Investment Research - which was to be sent to clients late on Wednesday - come as hedge funds are working to prevent far bigger redemptions by the end of the year, when many funds give investors a chance to take out money, reports the Financial Times.

Chinese state-based aluminium producer Chinalco has become the latest major victim of Lehman Brothers' collapse as the bank's liquidators have frozen its £8bn stake in Rio Tinto. Chinalco is in urgent talks with liquidators in Hong Kong to try to retrieve the 12% stake, which it bought together with fellow aluminium company Alcoa in February, according to the Telegraph.

A senior director has left Woolworths and others are expected to follow, as the retailer's woes mount ahead of the critical Christmas trading period. The Independent said it learnt that Simon Turner, Woolworths' retail and distribution operations director, departed this week - just over one month after Steve Johnson became the chief executive.

Individual savings of up to €100,000 (£77,000) will be fully guaranteed under draft legislation presented by the European Commission today. The proposal is part of the package of measures that governments are putting in place to restore confidence in the ailing banking sector. If approved by EU Governments and the European Parliament, the measure, which would be introduced in two stages, would raise the protection enjoyed by savers in Britain from the £50,000 recently announced by the Government to almost £80,000, writes the Times.

The head of the City's chief regulator has publicly apologised for its failure to prevent the banking crisis. Hector Sants, the chief executive of the Financial Services Authority (FSA), admitted yesterday that the agency could have done more to prevent the collapse of Northern Rock and to avoid other financial disasters, according to the Times.

House prices are likely to fall by a further 15% and will not fully recover until 2015, new research says. According to upmarket estate agent Knight Frank, the housing market will continue to decline until late 2009 or early 2010 and will not return to the peak of levels it reached last year for at least another five years after that, the Telegraph reports.

The private equity firm Texas Pacific tried to approach Sir Philip Green, the retail tycoon, this week about the prospect of working together to buy the debt of Baugur, the beleaguered Icelandic investor. However, the American investor has been told that Mr Green is determined to press ahead with his attempt to snap up the group, writes the Independent.