General News

Banks and Bank Credit Card Accounting

It's going to be exciting week next week for RBS and Lloyds Bank shareholders with both AGMs on Thursday in Scotland - we expect to issue a report on events. Indeed it's going to be an exciting period ahead because the law suits by those investors in the RBS rights issue who have not yet settled, and an action over the takeover of HBOS by LloydsTSB, are both getting into court in the next few months. Having Fred Goodwin on the witness ...

Open-Ended Property Funds – Our Views

ShareSoc has now submitted our response to the consultation by the FRC on "Illiquid Assets and Open-Ended Investment Funds". This follows on from the problems experienced last year where property funds had to close to redemptions but it can affect other types of funds also such as private equity ones. In summary after listening to a number of our members on this topic, we have chosen to say that although we would not be opposed to the banning of such funds entirely, ...

Finance Bill and Tax Changes

Shorting Shares – An Example of Motives

One of the most peculiar stories in the last week was the revelation that the attack on the Borussia Dortmund football team's bus was not a terrorist attack after all. According to German police it was done by an individual investor who hoped to profit by shorting the shares. By killing or injuring their star players, he expected their publicly quoted share price to fall sharply. Indeed the share price did fall by 3% but as the injuries suffered were relatively minor ...

A General Election – What Should Be In the Manifestos?

There is to be a General Election on the 8th June in case you have not heard. That has the unfortunate consequence on freezing Government business, with the prospect of changes of Ministers thereafter. Any formal consultations - for example on improved Corporate Governance and remuneration restraints - will be deferred. So the key question now is what would we like to see in the manifestos of the leading political parties? Here's my list: A commitment to ensure that private shareholders in ...

Hard Hitting BEIS Report on Corporate Governance and Pay

The BEIS Commons Select Committee have today published a strongly worded report on Corporate Governance after its recent hearings on the subject. Here are some of the key points they make: They agree with the Prime Minister that high levels of executive pay need to be tackled "for the benefit of society as a whole". They forcefully recommend that Long Term Incentive Plans (LTIPs) should be abolished as soon as possible because they create perverse incentives and are often a way ...

Response to FSCS Consultation

The Financial Services Compensation Scheme (FSCS) pays out if you have lost money as a result of an authorised financial services firm going bust or otherwise being unable to pay compensation for various failings - for example a bank or stockbroker. The scheme is funded by a levy on services firms. The Financial Conduct Authority (FCA has recently undertaken a public consultation on changes to the scheme. ShareSoc has submitted a response giving our views on behalf of our Members. At present ...

FT Article on RBS and Shareholder Committees

The Financial Times have published an article under the headline "Investors fight RBS snub to shareholder committee move". It covers the battle by ShareSoc to get the Royal Bank of Scotland to accept a resolution for their AGM to appoint a Shareholder Committee. See the ShareSoc campaign web page here for more explanation of the benefits of such a Committee and how RBS are currently thwarting shareholder democracy: https://www.sharesoc.org/campaigns/rbs/. One of the supporters of this concept to improve corporate governance and reign in ...

A Divorce Invoked and a Marriage Cancelled

Spring may be in the air but love is definitely not. As expected, Mrs May has issued a letter to the EU invoking Article 50. So the Brexit process is now commenced and we may be out in a couple of years. The UK stock market has of course discounted this already although there is some uncertainty about what the future impact will be. It depends a lot on the trade deal that can be negotiated. The other big item of news ...

Employee Directors at Sports Direct

It seems that controversial company Sports Direct (SPD) are likely to become the first UK public company to have a worker on their board. They plan to appoint an elected "Worker's Representative" who will attend and speak at board meetings although they would not formally be appointed as a director. A spokesman for Sports Direct said: "Having explored all options we believe this is the best way to ensure the Workers' Representative is free to champion the interests of all staff. ...