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Equilibrium's finance and investment news roundup

In this week's roundup we bring news of £504 million fines for Deutsche Bank in relation to anti-money laundering controls, an assets sale from Shell to Chrysaor, a guilty verdict for a former HBOS manager accused of corruption and fraud, and a warning from Weetabix that it may have to increase prices due to the lower pound. 

 

Deutsche Bank fined £504m by regulators

Deutsche Bank has been hit by fines totalling £504 million by regulators in the UK and the US. The bank was fined by authorities in New York for $425 million (£341 million) and by the UK's Financial Conduct Authority (FCA) for £163 million in relation to a Russian money laundering plan.

The £163 million penalty is the largest fine ever handed out by the FCA or its predecessor the Financial Services Authority. The FCA explained that inadequate controls imposed by the bank meant that clients were able to illegally move $10 billion out of Russia through shares purchased and sold in the bank's offices in Moscow, New York and London.

As part of the scheme, so called 'mirror trades' were conducted between 2011 and 2015 that involved stocks being bought in roubles before being sold at the same time in US dollars. Regulators said Deutsche Bank had numerous opportunities to detect and stop the scheme. 

Chrysaor to buy North Sea assets from Shell for $3.8bn   

Shell has announced it is to sell off more than $3 billion (£2.4 billion) worth of assets in the North Sea to the private-equity backed oil company Chrysaor. The deal will involve Chrysaor buying a package of assets thought to be worth around half of Shell's UK portfolio and is expected to be completed by the end of 2017.

It is hoped that the move will aid the oil industry in the North Sea, where production has faltered since the late 1990s.

In a statement, Chief Executive Officer of Chrysaor Phil Kirk said: "This acquisition reflects Chrysaor's and Harbour's belief that the UK North Sea has material future potential for oil and gas production." 

Guilty verdict for former HBOS manager accused of corruption

A former HBOS manager, along with five other people, has been found guilty of corruption and fraud. The activities have cost the bank's shareholders and business customers hundreds of millions of pounds and the case has been described as one of the biggest and most complex that the Crown Prosecution Service's (CPS) special fraud division has ever handled.

Lynden Scourfield, a former HBOS manager, pleaded guilty to six counts, including corruption, after he told customers to use a turnaround firm in exchange for bribes.

Stephen Rowland, a CPS Special Prosecutor, said of the case: "It involved millions of documents, a lot of the material we had to look at was electronic and of course in this day and age the capacity for electronic media is huge." 

Weetabix 'latest company to warn of price hikes due to lower pound'

Weetabix has warned that it may be forced to raise its prices this year. The cereal maker is the latest company to indicate it may have to up prices due to the impact of the lower pound, the fall of which was sparked by Britain's decision to leave the European Union last June.

The company has announced it is investing £30 million in its UK manufacturing sites; however, it warned it may have to increase prices because wheat is priced in dollar terms and this means the purchase of dollar-listed items costs more.   

Weetabix has followed the likes of EasyJet and Next in warning that sterling's fall could result in price hikes for customers.

 

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