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THE FEDERAL Reserve paved the way

for a multi-billion dollar dividend


bonanza last night by passing 15
banks in its latest stress tests, allowing
them to return cash to shareholders.
The US central bank said most of
the largest American institutions
with the exception of Citigroup and
three others had sufficient capital
buffers even if a fresh global crisis
triggered a spike in unemployment
and a collapse in the housing market.
Bank of New York Mellon came out
top on the Feds wargaming, with a
core Tier 1 capital ratio of 13.1 per
cent, followed by State Street and
American Express on 12.5 per cent
and 10.8 per cent respectively.
JP Morgan Chase announced one of
the largest payouts, raising its quarter-
ly dividend by five cents to 30 cents
and pledging to buy back up to $15bn
of its shares.
American Express said it will buy
back up to $5bn of its own shares and
increase its dividend while Bank of
America passed the tests but has not
asked permission to make a payout.
The failure of Citi, however, shocked
analysts and sent its shares tumbling
nearly five per cent after-hours.
The market had been expecting the
USs third-largest bank to raise its divi-
dend for the first time since the finan-
cial crisis but the Fed said Citi, Ally
Financial and SunTrust came out
worst in its scenario with Tier 1 capital
ratios of 4.9 per cent, 4.4 per cent and
4.8 per cent respectively.
The regulator also failed MetLife,
the largest life insurer in the US, on
the basis of its risk-based capital ratio.
It was lower than any of the other
banks examined.
The Fed based its forecasts on a new
global slump including a rise in US
unemployment to 13 per cent, a drop
in house prices of 21 per cent, a halv-
ing in equity markets and another
downturn in Europe.
Overall it estimated the 19 bank
holding companies worst-case losses
at $534bn over the 27 months to the
end of 2013. Every institution tested,
however, is in a stronger position than
after the 2008 crisis, it said.
The Fed rushed out the results two
days early after JP Morgan broke ranks
and said the Fed had approved its
plans for a dividend increase.
JP Morgans statement provided a
late spark for the US market, which
posted its best day this year. The Dow
Jones industrial average jumped
217.97 points, or 1.68 per cent, to close
at 13,177.68.
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FTSE 100 5,955.91 +63.16 DOW 13,177.68 +217.97 NASDAQ 3,039.88 +56.22 /$ 1.57 +0.01 / 1.20 +0.01 /$ 1.31 -0.01
www.cityam.com Issue 1,591 Wednesday 14 March 2012 FREE
BUSINESS WITH PERSONALITY
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WALL STREET PASSES
CRUCIAL STRESS TEST
BY PETER EDWARDS
BANKING

But Fed says Citigroup, Ally, MetLife and SunTrust are barred from joining in dividend bonanza
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Banking special
4 CITYA.M. 14 MARCH 2012
THE FEDERAL Reserves stress test
results, released two days ahead of
schedule yesterday, put banks balance
sheets through a projected financial
meltdown over a two and a quarter
year period.
The Fed said the 19 banks taking
part would lose a total of $534bn
under the worst-case scenario, includ-
ing loan losses, market shock as well as
operational risks such as fraud, com-
puter systems failure and employee
lawsuits.
While some of the failed banks criti-
cised the Feds methods and stan-
dards, others were impressed by the
stringency of the probes.
Theres so much more credibility
when you actually have some of these
banks fail the stress tests, said Keith
Davis at Farr, Miller & Washington.
Tests looked at
fraud, lawsuits
and meltdown
BANKING

Angry banks
hit out at Fed
THE THREE US banks and an insurer
that failed Federal Reserve stress tests
last night signalled the start of a bat-
tle with the regulator.
MetLife, the largest life insurer in
the US, led the criticism after it was
denied permission for a $2bn (1.27bn)
share buyback and a 49 per cent
increase in its annual dividend. The
Fed judged its capital ratio in a new
crisis to be 6.3 but failed it on risk
grounds.
Chief executive Steve Kandarian
said the Feds assumptions were
bank-centric and wrong for insur-
ance companies. MetLife is regulated
as a bank holding company because of
its online retail banking operations
although they are being sold to
General Electric.
Citigroup, which caused the biggest
shock when its capital ratio came out
of the stress tests at 4.9 per cent, called
on the Fed to release more details of its
models and said it would engage fur-
ther with the regulator.
Ally Financial described the results
as inconsistent and said: The analy-
sis dramatically overstates potential
contingent mortgage risk, especially
with respect to new vintages of loans.
SunTrust said its own models are
significantly more favourable than
those of the Fed and said it expected to
beat quarterly earnings estimates.
BY PETER EDWARDS
BANKING

CAR LOANS SPEED UP AT CLOSE


BROTHERS
Close Brothers has reported strong
growth at its banking arm in the six
months to 31 January, but profits
were held back by its securities and
asset management divisions. Profits
at the banking division have grown
since the start of the financial crisis,
as it expanded into gaps left by larger
retail banks, such as motor finance.
TCHENGUIZ AND RAHIMIAN HALT
LEGAL DISPUTE
Vincent Tchenguiz and his former
friend Keyvan Rahimian have ended
their legal dispute a week into their
High Court trial. The billionaire prop-
erty investor was due to take to the
witness stand this week in a dispute
with Mr Rahimian, who was suing
him for over 6m. Mr Tchenguiz was
counter-suing for 2m.
AUDI IN TALKS TO BUY ITALYS DUCATI
Volkswagens Audi brand is in talks
to buy the Italian motorcycle maker
Ducati from its private equity owner,
as the German group seeks to extend
its automotive empire and fulfil its
chairmans ambition.
TCI TAKES ON COAL INDIA
The Childrens Investment Fund has
threatened legal action against state-
backed Coal India in a rare sign of
shareholder activism in India that
could further hamper New Delhis fal-
tering divestment programme, accus-
ing it of being reckless and lacking
integrity towards minority investors.
BLOCKADE ON LABORATORY TEST
ANIMALS HITS RESEARCH
Medical research is being put at risk
because Britains ferry operators and
airlines have capitulated to the
demands of animal rights activists
not to allow the transportation of
mice, rabbits and rats into the coun-
try for testing.
FSA CHIEF SAYS CONSUMERS ARE
BEING HOODWINKED
The head of the Financial Services
Authority has launched a broadside
against innovation in the City, accus-
ing parts of the Square Mile of devel-
oping complex products that mislead
regulators and hoodwink consumers,
in an interview with The Times.
M&S MOVES INTO SAVILE ROW, WHILE
LONG-SERVING DIRECTOR QUITS
The countrys biggest clothes retailer
has taken a lease on an office in the
heart of Londons tailoring district.
Marc Bolland, CEO, also hit back at
accusations the management team is
unhappy, after Andrew Skinner, the
non-food merchandising director and
member of the management commit-
tee, left the business after 28 years.
CABLE TO UP ATTACK ON EXEC PAY
Vince Cable will step up his war on fat-
cat pay by launching his controversial
plans to make corporate remunera-
tion reports subject to a binding vote
by investors, every year, he is expected
to say at a formal launch today.
RISK PROVISIONS CUT INTO GERMAN
CENTRAL BANK PROFIT
Deutsche Bundesbank President Jens
Weidmann said yesterday that higher
risk provisions weighed on the cen-
tral banks profit, reducing the
money it can transfer to the German
federal government.
FRENCH FLOUR INDUSTRY FINED
Frances antitrust watchdog yesterday
fined French flour millers for rigging
the domestic retail market for more
than 40 years. In addition, it fined
French and German flour producers
for restricting cross-border sales for
much of the past decade. The fines
totaled 242.4m, the fourth-largest
amount it has imposed since 2000.
WHAT THE OTHER PAPERS SAY THIS MORNING
Wall Street finally out of the woods
WALL STREETS financial crisis is
almost over or so the Federal Reserve
would like us to believe. It rushed out
the results of its stress tests of the 19
biggest US banks last night: just four
failed in all cases relatively narrow-
ly a test which gauged their ability to
withstand a financial shock that
includes unemployment hitting 13
per cent, a 21 per cent drop in house
prices, a 50 per cent slump in equity
markets and chaos caused by a bank
collapse elsewhere (read Europe). They
needed to be able to show that they
would retain Tier I common capital
above 5 per cent; only then would
they be allowed by the Fed to start
returning money to shareholders.
Some major institutions did well
enough to be allowed to launch mas-
sive dividend payouts and share buy-
backs, including JP Morgan and
American Express. So should we
rejoice? Is the Fed right that the crisis
is almost over, at least as defined by
the financial health and robustness of
Wall Streets largest institutions?
Investors certainly think so. The
Nasdaq finished over the 3,000 mark
for the first time since December
2000; the Dow reached 13,177, its best
level since before Lehman Brothers
went bust. The S&P 500 has had its
best start to the year since 1991.
Last nights developments are good
for London, where US banks such as
Goldman Sachs, Bank of America
Merrill Lynch, State Street, Bank of
New York and Morgan Stanley employ
tens of thousands of workers and indi-
rectly support many tens of thousands
others in fund management, law, con-
sulting, IT and recruitment, as well as
property, retail and all other walks of
life. That said, Citigroup failed the
test, as did insurers MetLife, another
big London employer.
Some critics believe US banks
should not have been allowed to pay
dividends until they met all of the
Basel III rules, even though these are
not actually binding yet. I disagree:
these tests were tough enough.
As Capital Economics points out,
banks were examined not just for
potential losses on loans and securi-
ties holdings, but also on trading and
counterparty positions under a severe
shock to global financial market rates
and prices. Such a scenario would
mean $534bn of losses over the next
nine quarters (including $341bn in
loan losses and $116bn in trading loss-
es), more than offsetting $294bn in
revenues. It is unlikely that US house
prices, which have collapsed and are
now cheap in many states, will plunge
a further 21 per cent on any realistic
scenario, so the test seems to make
sense, unlike some of the nonsense
recently released by the European
authorities. The US economy is recov-
ering, with much better job creation.
But while US banks are doing better,
the rest of the world isnt out of trou-
ble. Many institutions remain in crisis
in the Eurozone, though their imme-
diate problems have been camou-
flaged by the European Central Banks
Long-Term Refinancing Operations.
These have injected huge amounts of
liquidity into the system, which is
what central banks are meant to do in
contemporary monetary systems. But
the LTRO has also served to secretly
bail out insolvent institutions, which is
not right; numerous banks across the
Eurozone remain in dire straits, even
before any further sovereign crisis.
Wall Street is on the mend but huge
problems remain in the Eurozone and
Chinese financial systems. Until these
are tackled, the global economy will
remain under a cloud.
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
NEWS of the stress test results
helped send the Dow Jones industri-
al average to its highest level since
2007 yesterday, with a late spark
coming from JP Morgan and its divi-
dend announcement.
And the Nikkei opened above
10,000 this morning to hit a seven-
month high on the back of the
strong performance in US markets.
While stocks had been riding high
all day, buoyed by strong US retail
sales and supported by a slightly
improved outlook from the Federal
Reserve, the late push came from
financial stocks as the premature
stress test results trickled out.
The central bank said earlier in
the day that it expects moderate
growth over coming quarters with
the unemployment rate declining
gradually.
US Treasury debt prices tumbled,
while the dollar rose to an 11-month
high against the yen.
BY MARION DAKERS
MARKETS

Dow hits a four-year high


Federal Reserve chairman Ben Bernanke will keep monetary policy loose
EDITORS LETTER
ALLISTER HEATH
Editorial Statement
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self-regulation overseen by the Press Complaints
Commission. The PCC takes complaints about the
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on the Federal Reserve
to release more details
of its calculations
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SHARES in JP Morgan Chase soared
last night after it became the first
bank to say it would boost its divi-
dend after passing the Federal
Reserves stress tests.
The banks stock closed up more
than seven per cent at $43.39, making
it the highest riser on the Dow Jones,
after it said it would raise its quarter-
ly dividend by five cents to 30 cents
and buy back up to $15bn (9.55bn) of
shares.
Its core Tier 1 capital ratio came
through the tests at 5.9 per cent. The
bank has permission from the Fed to
purchase $12bn of stock this year
although it said its purchases will
depend on market conditions.
Chief executive Jamie Dimon
hailed the announcement, which
came after years of banks slashing or
suspending their dividends because
they needed to hoard capital follow-
ing the crisis.
We are pleased to be in a position
to increase our dividend and to estab-
lish a new equity repurchase pro-
gramme. We expect to generate
significant capital and deploy that
capital to the benefit of our share-
holders, he said.
The Fed had been due to publish its
test results tomorrow but rushed
them out yesterday night after JP
Morgan went public and said the reg-
ulator had approved its plans to
increase the dividend.
Dimon has long argued that banks
will have more capital than they need
as losses from the financial crisis are
reduced. His banks most recently
published figures showed fourth-
quarter net income of $3.72bn, or 90
cents a share.
Meanwhile Bank of America stock
rose 6.3 per cent yesterday to $8.49 on
the markets best day of the year.
Larry Peruzzi, senior equity trader
at Cabrera Capital Markets in Boston,
said the gains put us into fourth
gear here... The financials have been
such a drag on the whole market for
the last couple of years.
JP Morgan
sparks a US
divi bonanza
DEUTSCHE Bank is plotting an over-
haul of its corporate and investment
bank that could see up to 1,000 jobs
slashed, City A.M. has learned.
The cuts, which will not affect
Germany, come in addition to the 500
announced last October. That number
sparked surprise at the time because it
was significantly less than rivals.
But with Anshu Jain due to take over
as co-chief executive of the group in
June and revamping the whole top
management team, the investment
bank is now playing catch-up on job
slashing.
The cull will exclude Germany and
is unlikely to fall in the US, where the
bank is still hiring. Instead, the rest of
Europe and Asia will bear the brunt,
meaning London could see hundreds
of posts go.
Insiders said that the overhaul will
involve working out which divisions
are not pulling their weight, with
the possibility that whole business
lines could be shut down.
A source said bankers expect the
new management to bring a cultural
shift from a model where some older
execs almost had tenure to one more
focused on efficiencies and returns.
A spokesman for the bank declined
to comment on the strategic review
but said: We do not have a redundan-
cy programme.
Deutsche to cull
1,000 jobs in its
investment bank
BY PETER EDWARDS
BANKING

Banking special
CITYA.M. 14 MARCH 2012 5
15 OUT OF 19 BANKS PASSED THE STRESS TEST, HITTING OVER FIVE PER CENT CAPITAL
2013 Tier 1 common capital ratio Buybacks,
under stress with capital raisings dividends
BY JULIET SAMUEL
EXCLUSIVE

Ally Financial 4.4 (failed)


American Express 10.8 cleared to buy back up to $5bn,
dividend up to 20 cents
Bank of America 6.2
BNY Mellon 13.1 cleared to buy back $1.2bn stock,
13 cents dividend per quarter
BB&T Corp 6.4 dividend raised to 20 cents
Capital One 8.8
Citigroup 4.9 (failed)
Fifth Third Bancorp 6.3
Goldman Sachs 7.2 potentially raising divi and buyback
JP Morgan Chase 5.9 buyback of up to $15bn,
quarterly divi up to 30 cents
Keycorp 5.3 $344m buyback, possible divi rise
MetLife 6.3 (failed on risk-based
measurement)
Morgan Stanley 7.6 cleared to buy extra stake in
Morgan Stanley Smith Barney
PNC Financial Services 5.9 divi rise and modest buyback
Regions Financial 6.8 raising $900m
State Street 12.5
SunTrust 4.8 (failed)
US Bancorp 5.4 $100m buyback, divi up to 78 cents
Wells Fargo 6.3 dividend raised to 22 cents
INSURANCE giant Prudential has said
its future lies in Asia, underlining
fears that the firm will relocate from
London to Hong Kong if tough new
rules for insurers based in Europe are
implemented.
Speaking to reporters as he
announced a seven per cent increase
in worldwide operating profit to
2.07bn, chief executive Tidjane
Thiam added that he saw little
growth potential in the British busi-
ness.
He also reiterated that the hefty
capital requirements in Solvency II,
the EUs tough new rulebook for
insurers, would destroy its American
business.
I can tell you, fighting US competi-
tors who dont have to worry about
Solvency II, we just wont have a mar-
ket, we wont be able to sell any prod-
ucts at all, he said.
Prudential could avoid the rules if
it moved its base outside the EU.
Since 2008 the firms Asian profits
have tripled from 257m to 709m,
making Hong Kong a likely destina-
tion.
News that the firm was consider-
ing leaving the City prompted Mayor
Boris Johnson to launch a campaign
to keep its headquarters in London
as first revealed by City A.M.
Since then, David Cameron has
also pledged to fight against Solvency
II, which will be introduced from
2013 onwards.
Shares in the firm closed up 1.8 per
cent at 763p.
EU rules loom
as Prudential
eyes UK exit
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HEALTH ADVI CE,
ON YOUR DOORSTEP
BY JAMES WATERSON
INSURANCE

THE TREASURY is expecting imminent


EU approval for its 20-40bn credit eas-
ing programme this week ahead of the
budget, according to a Treasury
source.
The government has faced months
of negotiating a torturous path
between banks requirements and
European state aid rules that impose
strict parameters on stimulus pro-
grammes that target particular sectors
of a countrys economy.
As part of those conditions, partici-
pating in any such scheme must incur
a hefty fee for banks, which had
threatened to derail the policy.
But the Treasury is believed to have
worked out a solution so that most of
the UKs major banks are willing to
take part.
The scheme aims to make credit 100
basis points cheaper for small firms.
EU finally gives nod to Osbornes
20bn credit easing programme
BANKING

News
6 CITYA.M. 14 MARCH 2012
Chief executive Tidjane Thiam said Solvency II would put it at a disadvantage GETTY
Man from the Pru could hang up his hat
THE MAN from the Pru, that great
British icon, can hang up his bowler
hat: Prudential is no longer a British
company. Last year, for the first time,
Asia contributed more to its profits
than either the UK or the US.
On the face of it, things are still
pretty close. On an IFRS basis, Asia
generated a profit of 709m, around
34 per cent of the group total, com-
pared to a third each for the UK and
the US, which pulled in 683m and
694m respectively.
But take a look at new business
profit (NBP) a key measure of where
the growth is going to come from
and the comparison becomes stark.
Asia contributed over 1bn of NBP in
2011, around half of the group total,
compared to 815m from the US and
a paltry 260m from the UK.
Even excluding the threat of
Solvency II, a set of punitive new
rules for European insurers, there
seems to be little case for keeping
Prudentials HQ in the EU, where it
generates just 12 per cent of operat-
ing profit.
Hong Kong, Asias financial power-
house, looks like a more sensible bet,
and some analysts are even suggest-
ing that the insurer could cut its UK
operations loose altogether by break-
ing the group up.
As things stands, that option looks
rash. The mature UK business still
throws off huge amounts of cash
577m in 2011 allowing Prudential
to fund its rapid Asian expansion. But
that wont always be the case:
Prudential expects Asia to be generat-
ing enough cash by 2013 to sustain
itself independently.
Make no mistake: moving a com-
plex company like Prudential would
be an expensive headache. It would
have to get a huge amount of support
from shareholders, retain and move
key staff and deal with a new regula-
tory regime. Hong Kong is hardly a
light touch. But if Solvency II is imple-
mented in its currently planned
form, it will be a price worth paying.
BOTTOMLINE
Analysis by David Crow
ANALYSIS l Prudential PLC
p
7Mar 8Mar 9Mar 12Mar 13Mar
770
760
750
740
730
720
710
700
763.00
13 Mar
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24
TH
MAY 2012
Arriving
STANDARD Life beat expectations to
record a 28 per cent increase in its
earnings for 2011, helped by cost cut-
ting and a strong performance from
its Canadian unit.
The Edinburgh-based firm,
Britains fifth-biggest insurer, made a
pre-tax operating profit of 544m last
year, up from 425m.
Profits rose 70 per cent at its
Canadian division and there was a
64m gain from changes to its UK
staff pension scheme.
The company also managed to
boost its dividend by 6.2 per cent to
13.8p, well ahead of expectations.
Despite this the firm hinted that
new business growth had been slug-
gish in early 2012 and observers said
there was limited room for growth.
Todays results again demonstrate
that we are well on track to transform
the operational and financial per-
formance of Standard Life. We are
well positioned to benefit from mar-
ket changes and the new regulatory
environment, said chief executive
David Nish.
Marcus Barnard, an analyst at Oriel
Securities, said the results were better
than expected but added that he con-
tinues to see a fairly weak invest-
ment case as the firm is carrying a
lot of new business that has yet to
prove its profitability.
Its shares closed up 0.3 per cent.
Canada boost
for Standard
Life earnings
BY JAMES WATERSON
INSURANCE

HEALTHCARE group Bupa yesterday


announced pre-tax profits of 220m
for 2011, up from 118m the year
before.
This was assisted by improved per-
formance from overseas divisions,
with income up 14 per cent to 3.9bn.
But revenue in its traditional
Europe and North American markets
was down two per cent at 2.93bn.
Outgoing chief executive Ray King
said that although his firm achieved
satisfactory levels of occupancy at
UK care homes, they have been forced
to control costs to to mitigate the
worryingly inadequate public fund-
ing of residential aged care.
Global customer numbers were up
three per cent to 10.84m.
Bupa has no shareholders, allowing
profits to be re-invested into the com-
pany.
Bupa posts healthy profits but
boss warns of care funding crisis
HEALTHCARE

A TOP Bank of England official hit out


at European insurance regulations yes-
terday, saying the new rules may over-
whelm regulators and fail to cut down
risks in the industry.
Paul Tucker, deputy governor for
financial stability, said the Bank is dis-
mayed by how much it is costing the
industry and the regulator to adapt to
Solvency II, and warned it risks
being too complicated in its desire to
introduce a risk sensitive regime.
He expressed worries insurers may
become risky shadow banks, engag-
ing in poorly supervised activities.
The insurers can raise funds by lend-
ing securities like shares to financial
institutions, and then invest the earn-
ings in higher-yielding assets.
These are essential to the work-
ings of capital markets, he said, but
warned they lack transparency and
structure.
Like banks, they may borrow short-
term and lend long-term, leaving
them vulnerable to a run if creditors
doubt the firm can honour its obliga-
tions as happened to AIG, bringing
down the insurance giant in 2008.
One solution may be to make insur-
ers hold more capital, he suggested, to
make sure policyholders are well pro-
tected.
Solvency II is complex and
expensive, says Banks Tucker
BY TIM WALLACE
REGULATION

News
9 CITYA.M. 14 MARCH 2012
ZURICH Financial said yesterday it would propose outgoing Deutsche Bank chief executive
Josef Ackermann as its chairman after a shareholder meeting on 29 March. The 63-year-old
Swiss-born Ackermann will hand the reins of Deutsche to Anshu Jain and Juergen Fitschen
during the annual shareholders meeting at the end of May. Picture: GETTY
ANALYSIS l Standard Life PLC
p
7Mar 8Mar 9Mar 12Mar 13Mar
246
244
242
240
238
236
234
232
238.50
13 Mar
ACKERMANN UP FOR ZURICH CHAIR
THE UK government wants to borrow
cash on a perpetual or super long
basis, by offering bonds that may
never actually be paid off.
Some new loans will last for 100
years, twice as long as the current
longest maturing bonds.
In next weeks Budget chancellor
George Osborne is expected to unveil
the plan that he hopes will lock in
the governments current low rates of
interest.
Osborne believes the move could
save the Treasury billions in interest
payments over the next few years.
This is about locking in for the
future the tangible benefits of the
safe haven status we have today, a
Treasury source said last night.
The prize is lower debt interest
payments for taxpayers for decades to
come.
Treasury set to
introduce never
ending bonds
UK ECONOMY

News
10 CITYA.M. 14 MARCH 2012
THE PRICE of iPads, cans of stout,
and packets of foam sweet will all be
included in inflation calculations
from now on, as the Office for
National Statistics (ONS) changes its
calculations to reflect evolving
spending habits.
Every year the official statistics
agency updates its list of 18,000
goods and services in an attempt to
provide an accurate picture of the
changing price pressures facing con-
sumers.
Some items, like boiled sweets,
casserole dishes and certain types of
photographic film have fallen out of
favour with shoppers, while teen lit-
erature, like the Twilight books,
fruits like pineapples, and continen-
tal soft cheese are all being pur-
chased in increasing numbers.
The weights given to each item in
the basket have also been adjusted to
reflect changes in spending habits.
Alcohol, for example, has had its
weight reduced steadily since the
late 1990s, while housing costs
increased sharply as a proportion of
household spending from 1987
though to 2007, before flattening off.
Efforts have also been made to
bring the British measures in line
with European standards the TV
licence, for example, has been added
to the consumer price index calcula-
tion, as have subscription fees for
trade union and professional organi-
sation membership.
Such changes also bring the CPI
closer to the retail price index (RPI),
which has traditionally included
taxes as well as mortgage interest
payments.
Latest gadgets and
fashionable booze
added to ONS list
BY TIM WALLACE
UK ECONOMY

NEW ITEMS
Hot oat cereal
Soft continental cheese
Pineapple
Bag of chocolate sweets
Bag of non-chocolate sweets
Four cans of stout
Walking boots
Vehicle excise duty
Bundled comms service
Tablet computers
Television licence
Teenage fiction book
Chicken & chips takeaway
Baby wipes
Trade union subscription
4 cans of stout
Tablet computers
Bundled
communications
service
Hot oat cereal
DROPPED ITEMS
Candy coated chocolate
Bag of boiled/jellied sweets
Outdoor adventure boot
Glass casserole dish
Step ladder
Leisure centre membership
Develop & print 135/24 colour film
Subscription to cable TV
Glass casserole dish
Colour photographic film
Old-fashioned sweets
Step ladder
Cinven sews
up new fund
BUYOUT firm Cinven has
sparked hopes of a significant
recovery in private equity
fundraising by hitting a 3bn
(2.5bn) first close on its latest
fund.
The London-based firm took
around six months to raise the
cash and expects to have raised
5bn by the time it reaches its
final close, City A.M. under-
stands.
It comes just weeks after BC
Partners the owner of gyms
chain Fitness First and Swedish
cable group Com Hem pulled
in 6.5bn, in the largest
European fundraising since the
onset of the financial crisis.
Cinven offered discounts on
fees to early investors, like many
buyout groups who are compet-
ing for cash in a changed mar-
ketplace.
Yesterday it told investors it
had held a first close, which
allows it to start investing the
money.
It attracted existing and new
investors and will spend the
cash on its core sectors of busi-
ness and financial services, con-
sumer, healthcare, industry and
telecoms, media and technology.
The fundraising caps a busy
period for the European firm. It
has returned 2.8bn to investors
over the last year after lucrative
sales including healthcare
group Phadia and its stake in
travel bookings firm Amadeus.
BY PETER EDWARDS
PRIVATE EQUITY

Alliance Trusts activist shareholder


Laxey makes a fresh set of demands
ACTIVIST shareholder Laxey
Partners has renewed its battle
with investment fund Alliance
Trust by asking it to consider out-
sourcing the management of its
assets.
The hedge fund also called on
Alliance to look at how to improve
the performance of its invest-
ments and the discount at which
its shares trade relative to their
net asset value (NAV).
In a letter it urged the board to
reject a poor status quo over
fund management.
We believe that an external
manager would result in a lower
flat fee which, if allied to a per-
formance fee, would protect share-
holders from excessive charging
in falling markets and incentivises
the manager to maximise the
return to shareholders in all mar-
ket conditions.
It is a controversial move by the
two per cent shareholder. It hopes
to tap into lingering investor dis-
content following last years dis-
pute, when it lost a bid to force
Alliance to buy back shares when
its share price fell more than ten
per cent below NAV.
However Alliance, which last
week raised its dividend, is pri-
vately confident it can win anoth-
er battle.
The hedge funds resolutions
will be put to shareholders at
Alliances annual general meeting
on 27 April.
INVESTMENT

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capital city, Ottawa.
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453 Laurier Ave East,
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READ REVIEW

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9:12 PM
Pubs and bars
in the market
The Byward Market,
Ottawa, Ontario
READ REVIEW

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htttp://www.signaturesrestaurant.com
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Spectacular nature combined
with vibrant cities make Ontario
one of Canadas most diverse
destinations. Help celebrate
Canada Day in Ottawa on July 1
just like Wills & Kate did in 2011.
Experience Canadian cultural
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the exciting nightlife. And dont
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The full Mountie. For less.
August 15 27, 2011
BMW, the worlds largest premium car
maker, yesterday forecast it would
reach its long-term sales target four
years earlier than planned, presenting
rival Audi with a bigger challenge if it
hopes to catch up with the Munich-
based company.
BMW Group said sales would sur-
pass the 2m vehicle mark in 2016,
including its Mini and Rolls-Royce
brands, without profitability suffering
as a result.
We are targeting new record highs
in vehicle sales and pre-tax earnings
for 2012, chief executive Norbert
Reithofer said at the groups annual
news conference in Munich.
In order to accelerate growth, BMW
aims to expand its reach further into
emerging economies, coining the
term BRIKT markets for Brazil, Russia,
India, South Korea and Turkey.
BMW does not even include China
among the list, since it already sells
more cars there than in any other
country except the United States and
Germany.
2012 will be a decisive year for the
further internationalisation of the
BMW Group, Reithofer said.
BMW reaffirmed its core car busi-
ness would achieve an operating profit
margin of between eight and 10 per
cent sustainably going forward.
Reithofer said he expects car sales to
finish 2012 at the upper end of this
range, despite higher investments and
expenditure to improve engine effi-
ciency and expand its global manufac-
turing footprint.
BMW expects
sales to hit a
record in 2012
BY HARRY BANKS
AUTOMOTIVE

News
12 CITYA.M. 14 MARCH 2012
ANALYSIS l BMW AG

7Mar 8Mar 9Mar 12Mar 13Mar


72
71
70
69
68
67
70.74
13 Mar
BMW has forecast bumper sales growth for 2012 Picture: GETTY
www.RateSetter.com Customer Phoneline: 08442490115
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PHIL HAY | RBS
German manufacturing has a good reputation for well-made prod-
ucts thats always been why German cars have done well. People
will always go for the reliable choice.
DAN MCNAMEE | TREVOR SMITH
High net worth individuals in emerging markets are still making
more money, which theyll spend on luxury. Germanys manufactur-
ing base is more rationalised, and its cheaper to make cars there.
GABRIEL FEDERICI | MINTEL
When people think of Germany they think of efficiency and reliabili-
ty. Excellence combined with luxury always sells and even more in
times of recession. Its the same with the beauty market.
* These views are those of the individuals below and not necessarily those of their company
CITY VIEWS: WHY IS GERMANYS UPMARKET
CAR SECTOR DOING SO WELL?* Interviews by Lauren Davidson
NEWS | IN BRIEF
Jaguar adds 1,000 jobs in the UK
Jaguar Land Rover announced yesterday
it will create 1,000 new jobs at its
Merseyside factory, to help supply the
significant demand for some of its
most popular models. The company
named the Range Rover Evoque and
Land Rover Freelander 2 as among the
in-demand models that will boost the
workforce in Halewood to almost 4,500.
Porsche posts bumper profit
Porsche posted the highest profit last
year in the German sports-car makers
80-year history, powered by sales of the
Cayenne sports-utility vehicle and the
Panamera sedan. Operating profit rose
22 per cent to 2.05bn (1.7bn) while
revenue increased 18 per cent to
10.9bn, the company said yesterday in
an e-mailed statement. Vehicle sales
increased 22 per cent to 119,000 units
last year with the Cayenne, Porsches
best-selling model, accounting for about
60,000 cars. Panamera sales rose by a
fifth to about 28,000 units.
Inchcape sees demand in Asia
Car dealer Inchcape posted a higher full-
year profit yesterday as demand for pre-
mium vehicles in the Asia-Pacific and
emerging markets drove growth, offset-
ting supply issues in Japan. Inchcape said
it was confident of its earnings growth
potential in 2012, helped by continued
exposure to fast-growing emerging
economies and market share gains driven
by new products from its brand partners.
The London-based firm, which sells and
distributes cars for manufacturers such as
Toyota, Mercedes-Benz and BMW in 26
countries, said it would pay a final divi-
dend of 7.4p, taking its total dividend to
11p, up two-thirds from a year ago.
Weir drops offer for Ludowici
WEIR shares jumped 2.6 per cent yes-
terday after it ended its pursuit of
Australian machinery maker
Ludowici.
The FTSE 100 engineering group,
which last month had its A$10 a
share bid trumped by Danish rival
FLSmidth, said yesterday it would
make no further offer and had with-
drawn from the race.
Its offer lapsed in February while
the Australian regulators were exam-
ining FLSmidths offer.
FLSmidth last week got clearance
for its A$324m (217m) or A$11 a
share offer, despite its chief executive
pledging to not raise its initial bid in
January before then hiking it by more
than 50 per cent.
Weir had asked the watchdogs to
look at his comments, as under
Australian law a company that
declares a bid final can be held to
that statement and prevented from
raising its offer.
Weir chief executive Keith
Cochrane said yesterday: Whilst
Ludowici represented an attractive
opportunity to expand our market
leading Australian business, our
focus in any acquisition is to create
value for Weir shareholders.
A materially higher offer would
not have met the rigorous financial
criteria which we apply to all acquisi-
tions.
FLSmidth and Weir have been
attracted to Ludowici, which makes
coal centrifuges and other mining
equipment, by its exposure to
Australias fast-growing coal and iron
ore mining sectors.
BY MARION DAKERS
INDUSTRY

SHARES in support services group


Mitie leaped as much as 8.5 per cent
during trading yesterday after it
said it was the preferred bidder for a
contract with Lloyds Banking
Group.
The contract news which would
see the winning bidder provide inte-
grated facilities and energy manage-
ment for the entire Lloyds branch
network and offices sent Mities
shares to their highest level since
April 2009.
Earlier this year Mitie partnered
with the UKs prison service to bid
for a 15-year management contract
for services to nine prisons.
Its shares have risen more than 17
per cent since the start of the year
following a series of contract wins.
They closed yesterday up six per
cent at 285p.
Mitie climbs most in three
years on Lloyds work win
SUPPORT SERVICES

News
13 CITYA.M. 14 MARCH 2012
ANTOFAGASTA cut back on dividends
yesterday to spend more on a new gen-
eration of growth projects, a shift that
the copper miner said was also behind
the abrupt departure last week of its
long-standing chief executive.
The Chilean miner disappointed
market hopes for another bumper pay-
out, announcing a full year dividend
of less than half 2010 levels, though
profits rose 32 per cent on strong
metal prices.
The groups dividend cut followed
the unexpected exit of chief executive
Marcelo Awad on 7 March.
MINING

Antofagasta
cuts dividend
RUSSIAN billionaire Viktor
Vekselberg quit yesterday as chair-
man of the worlds largest alumini-
um producer, UC Rusal, saying the
heavily indebted company was in
deep crisis after a long battle with
rival oligarch Oleg Deripaska.
Vekselbergs exit widens a rift
with controlling shareholder
Deripaska, who had sought to build
a Russian metals and mining busi-
ness on a global scale by merging
Rusal with Norilsk Nickel, the
worlds top nickel and palladium
miner.
MINING

Rusal chairman
quits the firm
WHAT DO YOU MAKE OF THE OUTLOOK FOR G4S?
By Elizabeth Fournier
JONATHAN JACKSON
KILLIK & CO
2012 will see G4S
benefit from the Olympic
Games ... Recent contract
wins and extensions are
expected to drive further top
line growth, but following
todays guidance on borrowing costs, we
would expect to see some modest down-
grades to consensus earnings estimates.
ROBERT MORTON
INVESTEC
Overall the
group achieved
a good level of organic
growth in the period,
even if results are
behind our expecta-
tions. We will be reducing our forecasts
for the current and next year by around
three per cent.
CAROLINE DE LA SOUJEOLE | SEYMOUR PIERCE
The outlook statement is a mixed bag: the statement mentions
good trading momentum, an encouraging outlook in secure solutions but
no improvement in the outlook for the more cyclical Cash Solutions.
Contract phasing and mobilization costs may impact margins in the short
term although for the year as a whole they are expected to recover. On
balance the positives outweigh the negatives with organic growth antici-
pated to be higher than the 4.5 per cent achieved in FY11.


SECURITY group G4S was one of the
biggest losers on the FTSE 100 yester-
day after it posted a 17 per cent slump
in profits and admitted a 50m hit on
its failed merger with a Danish cater-
ing firm.
Pre-tax profit fell to 279m for 2011,
a turbulent year in which G4S was
forced to scrap a 5.2bn tie-up with
ISS, which would have created a sup-
port services giant with more than 1m
staff.
The collapse of the deal left G4S
with fees bill of 50m and prompted
chief executive Nick Buckles to turn
down a bonus.
Yesterday Buckles revealed the
64m acquisition of a facilities services
firm in Brazil at the end of last year
and vowed to focus on expansion there
as well as in India and China. G4S has
set aside 200m to buy more compa-
nies in security and facilities manage-
ment.
Brazil is the fourth-largest security
market in the world. We have some
capability and a footprint there, but
we need to acquire more and that is
really our main objective for this year,
Buckles said.
The firm, which also runs prisons,
provides cash-guarding services and is
the official security provider for the
2012 Olympic Games, posted an oper-
ating profit of 531m for the year, 1m
ahead of 2010. It said it would pay a
final dividend of 5.11 pence to give a
total of 8.53p, up eight per cent on the
previous year.
Shares closed down 2.07 per cent to
283.5p.
G4S profit is
hit by failed
deal with ISS
BY PETER EDWARDS
SUPPORT SERVICES

ANALYSIS l G4S PLC


p
7Mar 8Mar 9Mar 12Mar 13Mar
295.0
292.5
290.0
287.5
285.0
282.5
280.0
277.5
283.05
13 Mar
G4S chief Nick
Buckles said the
failed merger
with ISS cost the
firm 50m in fees
QR SCAN HERE
ftfftI.tem
FINANCE, LEGAL & I.T.
SALARIES UP TO
250K 1000
OVER
JOBS
WWW.CITYAMCAREERS.COM























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14 CITYA.M. 14 MARCH 2012
The Capitalist
Got A Story? Email thecapitalist@cityam.com
TARGETS EXCEEDED AS WE DRAW TO
A CLOSE DEBUT CHARITY APPEAL
incredible 1.5m. Included in this fig-
ure is a number of large corporate
gifts from the likes of Lloyds Banking
Group and Bank of America Merrill
Lynch.
The funds will be used by our
appeal charity partner, Opportunity
International, to enable some of the
poorest people in Malawi to help
themselves out of poverty. Your dona-
tions will help Opportunity, whose
patron is Princess Anne, provide small
business expansion loans, savings
accounts and microinsurance cover to
over 10,000 people.
We are working closely with
Opportunity to see how the appeal
funds are put to work, says Allister
Heath, editor of City A.M.
We will report back to you in June,
six months on from the appeal, bring-
ing the key facts, gures and stories
that will be the direct result of your
generosity.
Opportunity CEO Edward Fox
explained that our support is especial-
ly important right now: Malawis cur-
rent economic challenges include
massive shortages of fuel, food and
foreign exchange. As is always the
case, this is hitting the poorest people
hardest. This is why your generosity is
so timely.
By helping us extend our nancial
services to more poor people, you will
help them have a better chance of
One of Opportunitys clients
W
HEN a group of us sat down
to dinner with Princess
Anne last autumn to dis-
cuss this newspapers first-
ever charity appeal, City A.M.
managing director Lawson Muncaster
set an initial financial target of
250,000, an amount that seemed to
those present to be both ambitious
and stretching.
Now, as we close proceedings, we
are delighted to report that our initial
hopes have been massively exceeded.
In the weeks following the appeal
in December, readers continued to
give, raising our total to 753,325.
Thanks to gift aid and the UK govern-
ments pound for pound match, our
appeal total has now exceeded an
growing their businesses, increasing
their protability, providing for their
families and saving for that inevitable
rainy day.
Our nal 1.5m total was made pos-
sible by the governments UK Aid
Match scheme that matched public
appeal donations pound for pound.
Andrew Mitchell, secretary of state for
International Development, said:
"This is a hugely generous response
from the readers of City A.M. Weve
matched readers donations pound
for pound in recognition of this over-
whelming public support for
Opportunity Internationals work.
FINANCIAL firms must work harder
to align their business models with
the interests of customers rather
than pursuing aggressive
approaches that could result in mis-
selling, the FSA has said.
In its assessment of the risks fac-
ing consumers, the City watchdog
said that increasing complexity of
products and cost-cutting has
increased the risk of customers
being ripped off.
The FSAs Martin Wheatley also
revealed that he is not a fan of the
UKs predominant retail banking
model of free banking.
THE FINANCIAL Services Authority
(FSA) has fined Nicholas Kyprios, head
of European credit sales at Credit
Suisse in London, 210,000 for
improper market conduct in disclos-
ing client confidential information
ahead of a significant bond issue in
November 2009.
The regulators fine follows on
closely from a series of punishments
handed out to a number of market
participants, including Andrew
Osborne of Bank of America Merrill
Lynch, in relation to an equity fund-
raising for Punch Taverns, also in
2009.
Credit Suisse acted on behalf of
Liberty Global during its takeover of
UnityMedia, which was part-financed
by a 2.5bn bond issue.
So that he could market the bond
to clients, on 9 November 2009,
Kyprios was wall-crossed regarding
the takeover and the proposed bond
issue.
He was given confidential informa-
tion by Credit Suisse, told that it was
inside information and instructed in
writing not to disclose it to third par-
ties.
Kyprios then told a fund manager
he was getting warmer when asked
questions about the bond issue.
Tracey McDermott (pictured), act-
ing director of enforcement and
financial crime, said: While the FSA
accepts that he did not set out to dis-
close the information, Kyprios con-
duct in trying to push to the limit
what he could say resulted in him
crossing the line.
Kyprios remains at Credit Suisse
but he has lost part of his bonus. The
bank said yesterday: We deeply
regret that one of our employees was
sanctioned by the
UK FSA for
breaches relat-
ed to our
information
policies.
C r e d i t
S u i s s e s
decision to
retain its
employee
was seen as
a bold one
yesterday.
Credit Suisse
banker hit by
210,000 fine
SIMON Mackenzie-Smith, who has
been drafted in to reinforce Bank of
America Merrill Lynchs battered UK
corporate broking unit, has hired
Peter Luck from UBS as he strives to
retain the banks long list of clients
following a raft of executive depar-
tures.
Luck will be a senior player in the
team at Merrill Lynch, which in
recent months has lost its two heads,
Simon Fraser and Mark Astaire, as
well as one of its star deal-makers,
Andrew Osborne.
Mackenzie-Smith has been in this
position before. Colleagues speak of
the time in 2004 when a number of
colleagues left for Morgan Stanley,
leaving the Merrill team bereft of
experienced corporate brokers.
Merrill has the second highest
number of FTSE 100 clients of any of
the banks and will be desperate to
hang on to as many of these as it can,
given that lucrative ancillary busi-
ness usually follows on from a
broking relationship.
Astaire is on three months garden-
ing leave before joining Barclays
Capital. BarCap is expanding its
broking coverage and recently found
itself added to the team for Xstrata in
its merger talks with Glencore.
BofA Merrill Lynch moves to
boost weakened broking unit
LLOYDS and RBS have implemented
around 1,900 job cuts in the UK as
part of the headcount slashes they
both announced last year.
The news prompted calls by Unite
the union for the government to
intervene to prevent the job losses.
Unites David Fleming said: How
can there be any justification for the
government not intervening as these
much needed jobs are lost?
At Lloyds, 1,300 jobs will go, while
300 will be moved abroad, meaning
workers will have to move to keep
their roles. RBS is cutting 460 but
creating 150 jobs.
Lloyds and RBS
make job culls
FSA warns City
against rip-offs
REGULATION

BANKING

BY DAVID HELLIER
ADVISERS

News
15 CITYA.M. 14 MARCH 2012
Simon Mackenzie-Smith is boosting the banks depleted broking team Picture: CITY A.M.
BY DAVID HELLIER
REGULATION

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News
17 CITYA.M. 14 MARCH 2012
Duddy (pictured) has repeatedly
defended Argos store portfolio of
759, arguing that none of them are
losing money, while a big clo-
sure programme would come
with a heavy restructuring
cost.
He plans to review 180
stores as they come up for
lease renewal or have break
clauses over the next five
years.
Duddy is likely to high-
light tomorrow that
the decline in sales
in the fourth quar-
ter slowed, after Argos reported an
8.8 per cent slump in sales over the
18 weeks to 31 December.
City analysts already expect a
60 per cent fall in pre-tax profits
to 99m for the year to 25
February at Home Retail,
which also owns DIY retailer
Homebase, after a profit
warning in January.
Shares in the company,
which have lost over half
their value in the last
year, closed up
five per cent at
110p.
HOME RETAIL Groups profits for
2013 are expected to fall significant-
ly short of expectations as sales at its
troubled retailer Argos suffer from
falling consumer demand and com-
petition online.
Analysts believe chief executive
Terry Duddy and John Walden, the
new managing director of Argos
who joined last month, will issue a
profit warning sooner rather than
later as Walden focuses on over-
hauling the group, analysts reckon.
The risk of material downgrades
at the companys fourth quarter
results on Thursday or at its full year
results in May seem high, one ana-
lyst told City A.M, warning the group
could ditch its final dividend.
He predicts pre-tax profits for 2013
could fall as much as 25 per cent
below City expectations of 84.1m.
Last week, Philip Dorgan, an ana-
lyst at Panmure Gordon, slashed his
profit forecasts for the company by
as much as 35 per cent citing the
continued management inaction
on store closures.
Alluding to interviews in which
Walden said he had been given a
blank piece of paper on Argos,
Dorgan said he needs to start writ-
ing a list of store closures on it.
Home Retail in line
for profit warning
BY KASMIRA JEFFORD
RETAIL

Tesco boss Philip Clarke can look forward to annual growth of 6.8 per cent Pic: GETTY
TESCO may be losing market share in
the UK, but the supermarket chain is
forecast to grow faster than its three
main global rivals over the next three
years, according to research by retail
analyst IGD.
The grocer is set to grow at an annu-
al rate of 6.8 per cent between 2011
and 2015, compared with Walmart at
4.85 per cent, Metro at five per cent
and Carrefour at 4.2 per cent, IGD said.
However, Asdas owner Walmart
will still keep its title as worlds largest
retailer with sales of 387m (323m)
by 2015. That is nearly triple the value
of Carrefours sales of 134m over the
same period, while Tescos turnover
will be 98m and Metros 81m.
The key to growth for these global
retailers will be presence in the right
markets at the right time. The domes-
tic markets remain critical for
Carrefour, Metro, Tesco and Walmart,
but they are also increasingly relying
on emerging markets to sustain strong
growth, Joanne Denney-Finch, IGDs
chief executive, said.
Tescos international markets, par-
ticularly China, Turkey and India, will
be key to driving long-term growth.
Tesco: the fastest
growing of the top
four global grocers
BY KASMIRA JEFFORD
RETAIL

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MORE NEWS
ONLINE
www.cityam.com
ANALYSIS l Home Retail Group PLC
p
7Mar 8Mar 9Mar 12Mar 13Mar
112
110
108
106
104
102
110.00
13 Mar
TESCO is looking to make major
changes to its pension scheme, which
will see the supermarkets 172,000
staff wait two years longer to obtain
their full pension.
The grocer has begun a consultation
about extending the retirement age
for members of its pension scheme
from 65 to 67 from 1 June as it looks to
ease burgeoning costs, due in part due
to people living longer.
However, Tesco emphasised that it
will be keeping its defined benefit
scheme open to new members and
that staff could still choose to retire
after the age of 55.
The defined benefit scheme, which
has a total 293,000 members, is based
on average pay throughout workers
careers and Tesco remains one of the
few large companies to offer such ben-
efits.
Tesco also plans to switch from the
Retail Price Index to the currently
lower Consumer Price Index to meas-
ure contributions to staff pension pots.
Supermarkets
pension age to
increase to 67
RETAIL
ANALYSIS l Tesco PLC
p
7Mar 8Mar 9Mar 12Mar 13Mar
322.5
320.0
317.5
315.0
312.5
310.0
320.60
13 Mar

ASTRAZENECA said yesterday it


was suing the Food and Drug
Administration (FDA) after the US
regulator refused to delay the mar-
ket entry later this month of gener-
ic versions of top-selling
antipsychotic Seroquel.
The drugmaker is seeking an
injunction barring the FDA from
granting final marketing approval
of generic forms of the drug,
whose chemical name is quetiap-
ine, until 2 December 2012, or at
least until a federal court has a
chance to review the agencys
action.
Last week, the FDA denied
AstraZenecas Citizen Petitions
requesting the agency withhold
approving any generic with
labelling that did not have certain
warning language required for its
branded version.
Generic copies of the original
instant-release form of Seroquel
are due to hit the US market on 26
March when AstraZeneca's patent
expires an event that will have a
significant impact on both sales
and profits.
AstraZeneca is currently budget-
ing for a 2012 revenue fall at the
group level of more than 10 per
cent, in large part as a result of loss
of exclusivity on Seroquel in both
the US and Europe.
Seroquel is a particularly prof-
itable medicine for the drugmaker
and analysts at Berenberg estimate
its loss could knock 330 basis
points off the groups pre-R&D
margin.
With acid reflux treatment
Nexium also facing US generics in
2014 and top-selling cholesterol
fighter Crestor losing patent pro-
tection in 2016, AstraZeneca is step-
ping up the drive to buy in
replacement products through a
series of acquisitions.
Shares in AstraZeneca closed up
0.3 per cent at 23.84 yesterday,
valuing the firm at 37.5bn.
AstraZeneca
sues FDA over
generic drug
BY HARRY BANKS
PHARMA

News
18 CITYA.M. 14 MARCH 2012
NEWS | IN BRIEF
GlobeOp investor switches sides
SS&Cs takeover advances towards
GlobeOp Financial Services got a boost
yesterday when a prominent sharehold-
er withdrew its support for a rival bid
for the hedge fund administrator.
Aberforth Partners, which controls
around three per cent of GlobeOp stock,
said it no longer intended to comply
with its letter of intent in favour of
TPGs potential offer. GlobeOps inde-
pendent directors said last week they
would be willing to recommend SS&Cs
517m bid if and when it occurs, having
previously backed TPG.
Game shares take a fresh fall
Game shares crashed a further 10 per
cent yesterday, leaving the stock worth
a shade over a penny and the firm with
a market cap of 4.5m, as it fights for
its survival on the high street. The group
warned on Monday that it was uncer-
tain whether discussions with lenders
and suppliers would succeed, and that
the stock could be left worthless, just
weeks after securing a new loan facility
from its banks. Rival Gamestop, restruc-
turing group Hilco and private equity
firm OpCapita have all been touted as
likely suitors for the firm.
Hedge fund launches rebound
The number of new hedge funds surged
last year to the highest level since 2007,
despite one of the most miserable annu-
al performances in the industry's history,
according to data released yesterday.
The number of new hedge funds totaled
1,113 in 2011, according to fund tracker
Hedge Fund Research. While that figure
did not eclipse the 1,197 launches in
2007, it was the most openings since the
financial crisis.
In association with
PoliticsHome.com
Apply to join today at
www.cityam.com/panel
PoliticsHome.com PoliticsHome.com
What policies do you expect to see
in next weeks coalition Budget?
This week we are asking members of
our Voice of the City panel, run in
conjunction with PoliticsHome, what
they are expecting to see in next
Wednesdays Budget.
Will George Osborne make conces-
sions for the Liberal Democrats, for
example on a mansion tax?
Or will the chancellor budge on his
fuel duty plans?
And what surprise policies are you
hoping Osborne pulls out of his red
box on the day?
To answer the above question and
more, apply to join the panel at
www.cityam.com/panel.
NATIONAL Lottery operator Camelot
has launched a judicial review against
the Gambling Commission for mak-
ing a fundamental error in approv-
ing the Health Lottery, recently
launched by Richard Desmond.
Camelot said it has been in ongo-
ing correspondence with the
Commission since the Health Lottery
was founded in September by
Desmonds Northern and Shell, which
owns Channel 5 and the Daily
Express, but had not received a satis-
factory response.
Camelot chief executive
Dianne Thompson (pictured)
said the law only allows for
one national lottery, along-
side smaller local draws.
But she claimed the
Health Lottery contravenes
this legislation as it is brand-
ed, advertised and televised
across the nation,
with tickets avail-
able all around
the country.
Thompson said:
We believe that
the Health
Lottery is in clear breach of this cru-
cial market separation envisaged by
Parliament.
She argued the existence of a rival
nationwide draw has a devastating
effect on how much money goes to
good causes and the Treasury via the
National Lottery.
A letter from the Gambling
Commissions lawyers said Camelots
claim has no arguable grounds and
no realistic prospect of success and
requires us to use only the most dra-
conian of our regulatory powers.
Commission boss Martin Hall called
Camelots claims devoid of merit.
Camelot, represented by Lord
Pannick QC, will lodge formal
papers with the High Court
early next week.
The judicial review will
examine whether the
process used by the
Gambling Commission to
reach its decision in approv-
ing the Health Lottery
was sound. If the
court finds in
favour of
Camelot, the
claim can pro-
ceed to a hear-
ing.
TABLET and smartphone chip design-
er Arm has unveiled a micro-proces-
sor that will see hundreds of devices
connected to the internet to save time
and power.
The worlds most energy-efficient
chip design, dubbed Flycatcher, will
be used to control appliances such as
white goods, traffic lights and med-
ical devices without sacrificing power
consumption or space.
The Cambridge-based company
said its chip design would create an
internet of things for example,
traffic lights could be controlled via
the internet to ease congestion on
busy roads or after accidents, while
white goods such as dishwashers
could turn themselves off to save
energy if the homes electricity net-
work is being over-used.
Medical devices such as stetho-
scopes might be able to send informa-
tion to doctors surgeries.
Arm said it expects electricity
demand to outstrip supply within the
next 20 years, but the Flycatcher
design will be able to run for years on
minimal battery power and will cre-
ate a smart network of devices.
The chip just 1mm by 1mm is
expected to sell for between 13p and
20p. Arm will collect a one to two per
cent royalty, creating a strong rev-
enue stream within a decade.
Cisco forecasts there will be 25bn
connected devices by 2015 and 50bn
by 2020, compared to the 10-15bn
today.
ARM unveils its new chip designed to
save energy and control traffic lights
CHIPMAKER Intel is developing an
internet-based TV service for con-
sumers in a strategic shift from its
traditional business, and has report-
edly reached out to media companies
in a bid to obtain the rights to shows.
The worlds top chipmaker plans to
create a virtual cable operator that
would offer TV channels in a bundle
over the internet via television sets,
computers, tablets and smartphones.
The product, which the chip com-
pany wants to roll out before the end
of the year, could use an Intel set-top
box and Intels name.
In October, Intel wound down its
efforts to make chips for digital
smart TVs, although it continues to
make chips for set-top boxes.
At the same time, it formed the
Intel Media business group, headed
by former BBC executive Erik
Huggers, aimed at promoting digital
content on Intel-based platforms.
An Intel spokeswoman declined to
comment.
Intel plans strategic shift
toward internet television
TECHNOLOGY

REBEKAH Brooks was arrested yester-


day morning as police swooped on six
people suspected of conspiracy to per-
vert the course of justice.
The former News International
chief executive was arrested at her
Oxfordshire home alongside her hus-
band, racehorse trainer Charlie
Brooks, in the latest move from Oper-
ation Weeting the Metropolitan
Police Services inquiry into the phone-
hacking of voicemail boxes.
News International confirmed that
its head of security Mark Hanna was
also arrested yesterday.
The other three people arrested
were a 39 year old man from his home
in Hampshire, a 46 year old man from
West London and a 48 year old man at
a business address in East London.
Unlike previous arrests of former
and current journalists from The Sun,
these were not prompted by informa-
tion passed to the police by News
Corps management and standards
committee.
This brings the number of people
held under Operation Weeting to 23.
Brooks was held for 48 hours in July
on suspicion of conspiring to intercept
communications, and has also been
arrested on suspicion of corruption
under the Operation Elveden investi-
gation of illicit payments to police.
THE NEXT generation of mobile con-
nectivity could be in the UK this year
after Ofcom yesterday issued approval
for Everything Everywhere to update
the airwaves it already owns for 4G
use.
This comes less than a week after
Apple revealed its new iPad would
offer a fourth generation (4G) connec-
tion, which will give a significantly
faster internet speed for mobile
devices and enhance services such as
video streaming, high-definition gam-
ing and social network usage.
With Ofcoms approval, telecoms
hybrid Everything Everywhere will
now be able to start upgrading its cur-
rent airwaves, which are on the
1800MHz spectrum, for 4G use.
This means 4G could hit UK air-
waves before the other mobile opera-
tors are given a chance to bid for
airwaves on the 800MHz spectrum
which currently hosts analogue TV
in an auction early next year.
Ofcom said Everything
Everywheres change of spectrum use
is likely to bring material benefits to
consumers including faster mobile
broadband speeds and... potentially
wider mobile coverage in rural areas.
A Vodafone spokesperson said it
came as a surprise that the regulator
is now considering giving the largest
player in the market permission to use
its existing spectrum for 4G.
The rival mobile network provider
argued that the lack of competition
would hinder the full benefits of 4G
being realised: We seriously doubt
that consumers best interests will be
served by giving one company a signif-
icant head start.
But Ofcom said it believed its deci-
sion on this matter would not distort
competition.
There is a four week window to sub-
mit views on the proposed change.
Ofcom gives approval for 4G
BY LAUREN DAVIDSON
TELECOMS

Desmond hit
by challenge
to his lottery
BY LAUREN DAVIDSON
LEISURE

BY LAUREN DAVIDSON
TECHNOLOGY

News
19 CITYA.M. 14 MARCH 2012
Former IBM chief executive Sam Palmisano was paid $31.8m (20.2m) by the tech com-
pany in 2011 his last year at the helm before being replaced by Ginni Rometty. This is
slightly more than the $31.7m, including a $1.8m salary, he made the year before.
Picture: REUTERS
FORMER IBM CHIEF EARNED $31.8M LAST YEAR
Rebekah Brooks and her husband Charlie were two of six people arrested as part of Operation Weeting yesterday Picture: GETTY
Ex-News International chief Rebekah
Brooks arrested as part of Met probe
MEDIA

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BUSINESS secretary Vince Cable (pic-
tured) yesterday used new data
showing an increase in the
number of women on UK cor-
porate boards to rail against
the idea of mandatory quo-
tas, saying it would be
inappropriate for
Europe to impose
them.
A report released by
the department of
business, innovation
and skills yesterday
coincided with
Cranfield School of
Ma na g e me nt s
annual survey show-
ing the largest-ever
annual increase in
the percentage of
women on boards in
the year since Lord
Davies published his 10
recommendations.
I believe that we are finally seeing a
culture change taking place right at
the very heart of British business in
relation to how women are seen with-
in the workforce, said Lord Davies
yesterday.
The report showed that 17
companies in the FTSE 100 had
already reached the target set
by Lord Davies of reaching
25 per cent female board
representation by 2015,
with a further 28 firms
close to the goal at
between 20-25 per cent.
This report provides
real evidence that busi-
ness is taking the issue
of board diversity seri-
ously and is voluntarily
working to bring about
the necessary changes. It
demonstrates why we do
not support the notion of
quotas and why we think it
would be inappropriate for
Europe to impose them,
said Cable.
Cable: Quotas
for boards are
inappropriate
THE 1,000 tonne diggers that will
carve out Crossrails path across
London were unveiled by Mayor of
London Boris Johnson yesterday.
Ada and Phyllis, the two giant bor-
ing machines, are set to start digging
at Royal Oak in west London next
week, as part of the four-mile first
leg of the Crossrail train tunnel net-
work.
The 150m-long machines will dig
east through Bond Street and
Tottenham Court Road, arriving in
Farringdon by autumn 2013.
The two diggers, the first of eight
machines that will eventually work
on the route over the next three
years, were named after early com-
puter scientist Ada Lovelace and
Phyllis Pearsall, who compiled the
London A to Z.
The 73-mile Crossrail project is
due to open in 2018, spanning sta-
tions from Maidenhead and
Heathrow in the west to Shenfield
and Abbey Wood in the east.
Crossrail chairman Terry Morgan
said: The start of tunnelling is a
hugely significant and symbolic
milestone. Massive progress has been
made since the start of Crossrail con-
struction in May 2009 with work
underway at nearly twenty sites
along the route.
Ada and Phyllis
get started on
Crossrail tunnel
BY ELIZABETH FOURNIER
CORPORATE GOVERNANCE

TRANSPORT

News
20 CITYA.M. 14 MARCH 2012
SARKO TAKES FIRST ROUND POLL LEAD
FRENCH President Nicolas Sarkozy overtook socialist challenger Francois Hollande for
the first time yesterday in an opinion poll on the first round of Frances April-May elec-
tion after attacking the European Unions trade and immigration policies. The conserva-
tive incumbent was still shown losing to Hollande in a second-round runoff, but by a
narrower margin of nine points, down from 13 points a fortnight ago.
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GREECE will have to slash spending
even further in the coming years if it is
to meet agreed fiscal targets underpin-
ning the second international bailout
for Athens, a European Commission
(EC) report has said.
The country needs to cut an addi-
tional 5.5 per cent of GDP from govern-
ment spending in 2013 and 2014,
according to the Compliance Report,
written by the EUs executive.
It describes the progress of Greek
reforms necessary for the release of
new Eurozone money to Athens and
recommends the first disbursement
be made as soon as possible.
The report, obtained by Reuters,
said a package of savings adopted by
Greece in early 2012 worth 1.5 per cent
of GDP should allow Athens to meet
the target of bringing the primary
deficit down to one per cent this year.
However, current projections
reveal large fiscal gaps in 2013-14, the
Commission report said, adding that
the shortfall for the two years totalled
5.5 per cent.
Therefore, substantial additional
expenditure cuts will have to be
announced and adopted by Greece in
the coming months, in particular
when Greece updates its medium-
term budget in May 2012.
The report said that in preparation
for the new cuts the government was
reviewing public spending pro-
grammes, focusing on savings in social
transfers, defence and the restructur-
ing of central and local administra-
tion.
There would be job cuts in the pub-
lic sector according to a redundancy
and recruitment rule of one entry for
five exits. Athens is to further cut phar-
maceutical spending and operational
spending of hospitals as well as wel-
fare cash benefits.
Greece set to
miss targets
BY HARRY BANKS
EUROZONE

A GROWING competitiveness gap


threatens the stability and even exis-
tence of the Eurozone, European
Central Bank President Mario Draghi
warned yesterday.
Increasingly larger and persistent
current account deficits have resulted
from significant losses of national
competitiveness, Draghi told a con-
ference in Paris.
These current account imbalances
within the euro area should be a
source of concern for policy makers.
Draghi noted that wage costs had
risen 2.5 times as quickly in those
Eurozone countries which were run-
ning a balance of payments deficit
compared with those in surplus.
Unless we proceed with our struc-
tural reforms all together, it will be
difficult to keep the area together, he
said.
Draghi: Eurozone may fall apart
if competitiveness is not boosted
EUROZONE

EUROPEAN stocks jumped yesterday


on hopes that the German economy
is picking up speed.
The ZEW index of sentiment
increased for the fourth consecutive
month, rising sharply from 5.4 in
February to 22.3 in March its high-
est level since June 2010.
Currently, it seems as if the crisis
in the Eurozone has taken a pause
for breath, said ZEW president Dr
Wolfgang Franz.
In Germany, due to the good
employment situation, domestic
demand is likely to continue to stim-
ulate growth. Nevertheless, risks
remain due to the low business activ-
ity in important European countries
and the disruptions in the banking
sector.
Germanys DAX stock index rose
1.37 per cent in the day, the French
CAC jumped 1.72 per cent and the
FTSE100 rose 1.07 per cent.
Meanwhile Italy received a further
boost as the government paid just 1.4
per cent to borrow 8.5bn (7.1bn) in
one-year debt, down sharply from the
2.23 per cent paid a month ago, indi-
cating investors are increasingly con-
vinced that Prime Minister Mario
Montis efforts to cut the deficit and
reform the economy will work.
European markets rejoice as
Germanys confidence soars
BY TIM WALLACE
EUROZONE

News
21 CITYA.M. 14 MARCH 2012
CHAMPAGNE SALES ON THE RISE
THIRSTY drinkers in emerging economies shrugged off worries over the global economy
last year, splashing out more of their hard-earned cash on imported champagne. China,
Russia and Brazil all imported more than a million bottles of champagne each, while
Indias appetite spiked by a head-spinning 58.7 per cent to 290,286 bottles. But Britain
remains the biggest consumer, importing 34.5m bottles. Picture: GETTY
THE UKS trade deficit rose in
January as the weak EU
economies bought fewer British
goods and services, official fig-
ures showed yesterday.
However, chancellor
George Osborne (pictured
right) is closer to his goal of
rebalancing the economy
towards foreign sales as
exports to non-EU countries
rose sharply, the figures
from the Office for National
Statistics revealed.
Goods imports rose 2.6 per
cent in the month from
34.4bn to 32.75bn, outstrip-
ping the two per cent rise in
exports, from 25.56bn to
26.06bn, increasing the
deficit from 7.18bn to
7.53bn.
Meanwhile services
exports and imports
both fell by 2.7 per cent,
with imports down to 9.45bn
and exports down to 15.24bn,
leaving a surplus of 5.78bn.
The overall trade deficit
increased from 1.2bn in
December to 1.8bn in January,
though that still repre-
sents an improve-
ment from
N o v e m b e r s
3.2bn.
By region,
goods exports to
the EU fell 0.3
per cent to
13.14bn while
imports from
the coun-
tries rose
1.4 per
cent
to 17bn, increasing the deficit
to 3.85bn.
Meanwhile goods exports to
non-EU countries jumped 4.4 per
cent to 12.92bn, faster than the
3.9 per cent rise in imports,
which rose to 16.6bn to leave a
deficit of 3.68bn.
Car and oil exports were par-
ticularly important, rising
0.5bn and 0.3bn respectively.
Despite the monthly deterio-
ration and discouraging EU
trade data, the deficit has been
declining overall importantly,
the UK is now on a more
favourable trading position with
emerging Asia, said Daniel
Solomon from the Centre for
Economics and Business
Research.
This trend is likely to contin-
ue as the effects of the latest
round of quantitative easing
feed into the economy, pushing
down real interest rates and
putting further downward
pressure on the pound.
UK trade deficit up
as EU exports drop
BY TIM WALLACE
UK ECONOMY

ACTIVITY jumped in the housing market in January


as first-time buyers rushed to beat the end of the
stamp duty holiday this month, but house prices
fell in January according to government data.
Figures from the Council of Mortgage Lenders
(CML) showed a 23 per cent rise in lending to first-
time buyers compared with January 2011.
However, higher levels of activity did not boost
prices, according to the Department for
Communities and Local Government (DCLG),
whose seasonally adjusted prices index showed a
fall of 0.7 per cent in the month, to an average of
206,523.
Furthermore, data from the Financial Services
Authority shows that outstanding mortgage debt
barely changed in the final quarter of 2011, up just
0.1 per cent on the quarter to 1,218bn.
The DCLG data reinforce our view that house
prices will drift downwards the coming months in
the face of relatively low consumer confidence,
said economist Howard Archer from IHS Global
Insight. Despite a recent limited pick up, housing
market activity is still low compared to long-term
norms.
Housing market
gets brief boost
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News
22 CITYA.M. 14 MARCH 2012
NEWS | IN BRIEF
Japan invests in Chinese debt
Japan will buy 65bn yuan (6.5bn) of
Chinese government debt, the country's
finance minister said yesterday, giving
China a mark of approval in the credibility
of the yuan as an international currency.
Other countries are investing in China
through state agencies, but Japans
investment is by far the biggest in the
yuan.
Layoffs cost 28.6bn in Britain
Almost 2.7m people have been made
redundant in Britain over the last four
years, according to research from the
Chartered Institute of Personnel and
Development. The layoffs have cost
employers a total of 28.6bn, the report
estimates, while the loss of output to the
economy amounts to between 87bn and
135bn.
Its not easy to please all of two-speed Europe
W
HAT is the economic future
for Europe and what role
does public opinion play in
it? Tomorrow sees the
YouGov-Cambridge Symposium on
Public Opinion, Economic
Governance and the Future Of
Europe where speakers such as
Alistair Darling, Francis Maude, Lord
Griffiths and Jim ONeill will discuss
just that.
YouGov-Cambridge has conducted
what the editor of this newspaper yes-
terday called the most sophisticated
polling on European attitudes yet to be
conducted a cross-country national-
ly representative survey of 11,000 peo-
ple.
While Allister discussed the colli-
sion course that the UK and Europe
are heading for in terms of greater or
less integration, I want to focus on a
particular policy area and show how it
makes governing in such an environ-
ment problematic.
Strong majorities in France,
Germany and Italy back an EU-wide
tax on financial trading but in Britain
support is much lower just 29 per
cent are in favour, although 44 per
cent neither support nor oppose.
When we tally this with other
polling, it shows people tend to be in
favour of taxes that will be paid by
other people. The assumption can be
made that in Britain we see it hitting
us more than on continental Europe
and therefore dislike it.
With public opinion as it is, can it be
a surprise that politicians on both
sides of the channel are taking the
opposing stances that they are?
Ill mention just one other finding
of note in terms of what people think
of the state of their countries econo-
my; over three-quarters of Brits,
Italians and Germans say their econo-
my is doing badly, compared to 20 per
cent of Germans, 31 per cent of Danes,
21 per cent of Swedes and three per
cent of Norwegians. With such diver-
gent views of where we are, finding
convergence will be difficult.
Stephan Shakespeare is the chief executive
of YouGov
BRANDINDEX
STEPHAN SHAKESPEARE
ANALYSIS l Percent who support
finanical trading tax
F
r
a
n
c
e
G
e
r
m
a
n
y
I
t
a
l
y
D
e
n
m
a
r
k
S
w
e
d
e
n
U
K
70
60
50
40
30
20
10
0
ANALYSIS l Percent who think economy
is doing badly
F
r
a
n
c
e
G
e
r
m
a
n
y
N
o
r
w
a
y
I
t
a
l
y
D
e
n
m
a
r
k
S
w
e
d
e
n
U
K
70
60
90
80
50
40
30
20
10
0
BRITAINS economy is finally set to recover,
according to analysis of forward-looking indica-
tors published yesterday.
A study of indicators like industrial orders,
expected output, consumer confidence and share
prices point to only a brief downturn, before a
recovery in a few months time.
The Conference Boards leading economic
index (LEI) rose 0.9 points in January after falling
0.5 in December and 0.6 in November.
The sharp increase in the LEI for the UK, its
first increase in six months, helps to reverse at
least part of the recent decline in the index, sug-
gesting that a stabilization in the downward
trend of the LEI may be underway, said
Conference Board economist Jean-Claude Manini.
The recovery in risk appetite on financial mar-
kets which started in December has been fol-
lowed by an improvement in business and
consumer confidence.
Together with the modest improvement in
current economic conditions, the data is consis-
tent with the outlook of a short, shallow contrac-
tion.
Rising confidence
helps UK outlook
UK ECONOMY

Troika Dialog
Troika Dialog, a subsidiary of Sberbank
of Russia, has appointed Andy Smith as
managing director and head of equity
research. Prior to joining Troika, Smith
was head of research at MF Global and
ICAP Equities, and senior portfolio
manager at Millenium Capital.
Pelham Bell Pottinger
The financial and corporate communi-
cations arm of Bell Pottinger, the UKs
largest public relations company, has
appointed a new strategic committee
to develop new avenues of growth.
Joining the committee will be Baroness
Patience Wheatcroft, former editor-in-
chief of The Wall Street Journal
Europe, Alison Carnwath, chairman of
Land Securities, John Danilovich, for-
mer US ambassador to Brazil, and
Peter Kiernan, vice-chairman of
Hawkpoint.
Martin Currie
Darren Cannon is joining the specialist
investment management firm as chief
operating officer. He will report to chief
executive Willie Watt. Cannon comes to
Martin Currie from Schroders, where
he was head of derivatives and data
services since 2006. He previously
worked at UBS Global Asset
Management as global head of opera-
tions.
Pioneer Investments
The investment management firm has
appointed David Hanratty as head of
global strategic partners and UK and
Ireland distribution. He is relocating to
London from Dublin as part of the com-
panys decision, last year, to develop its
UK investment centre.
Curzon Partnership
The executive search firm has
appointed finance specialist James
Colhoun as a partner. Colhoun joins
Curzon from Spencer Stuart, where
he was formerly partner and head of
its market-leading UK chief financial
officer practice.
McQueen
Mark Slater is joining McQueen, the
specialist corporate finance adviser, to
lead and develop its debt advisory prac-
tice. Slater has wide experience of the
debt markets, and joins the company
from Nomura. He previously worked for
Deutsche Bank and WestLB.
CITY MOVES | WHOS SWITCHING JOBS Edited by Tom Welsh
+44 (0)20 7092 0053
morganmckinley.com
To appear in CITYMOVES please email your career
updates and pictures to citymoves@cityam.com SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
in association with
Banks boost rally
across Wall Street
T
HE US stock market posted its
best day this year, with yester-
days late spark coming from
JPMorgan Chase & Co after the
bank announced it will raise its div-
idend.
Stocks gained throughout the ses-
sion, helped by stronger-than-
expected retail sales and benign
comments from the US Federal
Reserve, which said recent strains
on financial markets were easing.
The Dow Jones industrial average
shot up 217.97 points, or 1.68 per
cent, to 13,177.68 at the close. The
Standard & Poors 500 Index rose
24.87 points, or 1.81 per cent, to
1,395.96. The Nasdaq Composite
Index climbed 56.22 points, or 1.88
per cent, to 3,039.88.
The S&P 500 closed at a level not
seen since June 2008 in a sign that
the market foresees more strength
in the US economy in coming
months. The index, already up 11
per cent this year, has risen for five
straight days and appears set for
more gains.
Banks led the way with a power-
ful kick into the close. JP Morgan
Chase & Co surged seven per cent to
$43.39 and was the Dows top gainer
after announcing it will raise its div-
idend and unveiling a $15bn stock-
buyback program. Bank of America
gained 6.3 per cent to $8.49 while
an S&P index of financial stocks
climbed 3.9 per cent.
That kind of put us into fourth
gear here, said Larry Peruzzi, sen-
ior equity trader at Cabrera Capital
Markets Inc in Boston. The finan-
cials have been such a drag on the
whole market for the last couple of
years.
The Nasdaq Composite hit an
intraday high at 3,039.89, its high-
est mark since November 2000.
Yesterday marked the first time
that the Nasdaq closed above 3,000
and the Dow ended above 13,000 on
the same day.
The S&P 500s move above 1,390
puts the broad-market index in
position to surpass 1,400, which
could bring out more buyers. The
S&P 500 index reached 1,396.13, its
highest intraday level since June
2008.
Data in the United States once
again indicated a slowly improving
domestic economy, as retail sales
recorded their largest gain in five
months in February despite rising
gasoline prices.
Volume was light, with about
7.38bn shares traded on the New
York Stock Exchange, the American
Stock Exchange and Nasdaq, below
last year's daily average of 7.84bn.
B
RITAINS FTSE 100 closed at its
highest level this year yester-
day as banks and miners ral-
lied after encouraging
economic data out of Europe and
the US, although volumes were weak
and traders said the market could be
nearing its top.
Londons blue chip index closed
up 63.16 points, or 1.1 per cent at
5,955.91, but volumes were thin with
the FTSE 100 trading 83 per cent of a
subdued 90-day average.
Investors appetite was given a
boost by German ZEW sentiment
data which beat expectations by a
large margin, and US retail sales
posted their largest gain in five
months in February.
The data fuelled Wall Street gains,
where the Dow Jones industrial aver-
age is trading at a near four-year
high.
Orrin Sharp-Pierson, equity strate-
gist at BNP Paribas, said equities are
beginning to look expensive despite
the recent rebound in global indus-
trial activity.
He said the data likely staves off
further earnings downgrades for
equities, but at the current level it
doesnt suggest meaningful
upgrades either, which is what
would be needed to support further
re-ratings.
Banking and mining stocks were
the main drivers of FTSE 100 gains,
as risk appetite improved.
Part state-owned British banks
Lloyds and Royal Bank of Scotland
rose 2.8 and 1.5 per cent respectively,
after they announced a total of 1,900
job cuts as the banks streamline
operations to improve profitability
following the financial crisis.
Citigroup repeated its buy rat-
ing on Lloyds. But, highlighting
uncertainty surrounding the UK
bank and the sector, cut its earnings
forecasts for 2012 and 2013 by up to
18 per cent. Citi also kept its neu-
tral rating on Royal Bank of
Scotland.
The sector has been blighted by
concerns over exposure to Europes
debt crisis. But as concerns over
Greece defaulting have dissipated,
lessening the chance of a full blown
financial crisis, volatiltiy -- a gauge of
investor fear -- has fallen.
(Volatility indexes) are pricing in
a slow and steady increase equity
markets, without any further
shocks. However, given the last five
years of turmoil, it would be a sur-
prise if such a Panglossian (opti-
mistic) future existed, a
London-based trader said.
International airlines rose 4.5 per
cent as pilots at Spanish airline
Iberia, part of International Airlines
Group, called off a series of strikes
intended to protest against the start-
up of a low-cost airline.
Results helped Prudential up 4.8
per cent, after Britains biggest insur-
er met forecasts with a seven per
cent increase in its 2011 profit,
helped by strong Asia growth.
Peer Standard Life gained 0.4 per
cent having posted a better-than-
expected 28 per cent increase in 2011
profit and 6.2 per cent increase in
dividend.
Shore Capital said despite valua-
tion support and Standard Lifes div-
idend yield attraction it preferred
annuity companies such as Legal &
General and Prudential.
Legal & General added 3.4 per cent
ahead of results due out today.
Inchcape gained 11 per cent after
the multi-national car dealer report-
ed better-than-expected results for
2011, driven by demand for premi-
um vehicles in the Asia-Pacific and
emerging markets.
Financials and miners lift the
FTSE to a new high for 2012
THELONDON
REPORT
THENEW YORK
REPORT
BEST OF THE BROKERS
To appear in Best of the Brokers email your research to notes@cityam.com
ANALYSIS l Micro Focus International PLC
480
475
470
465
460
455
450
445
7Mar 8Mar 9Mar 12Mar 13Mar
p
471.20
13 Mar
MICRO FOCUS
Numis rates the FTSE 250-listed business software firm as a buy and
raises its target price to 590p, saying the companys shares remain materi-
ally cheap. The broker says that the market is undervaluing the firms cash
generation, stable performance and expectations of modest growth, and
says its views were confirmed by a February management statement
which showed $22m of cash was generated in the third quarter.
ANALYSIS l Anheuser Busch Inbev SA
55
54
53
52
51
7Mar 8Mar 9Mar 12Mar 13Mar

54.33
13 Mar
ANHEUSER BUSCH INBEV
JP Morgan Cazenove maintains its overweight rating on the brewing
group but raises its target price from 57 to 61 after the company beat
its estimates for organic growth in the fourth quarter of last year despite
investing further in the brand and distribution footprint. The broker now
expects a further increase in the dividend to 1.71 for 2012 and 2.74 in
2013, as well as a $4bn share buyback.
ANALYSIS l Cookson Group PLC
730
720
710
700
690
680
670
660
7Mar 8Mar 9Mar 12Mar 13Mar
p
723.00
13 Mar
COOKSON
Investec rates the material sciences group as a buy with an increased tar-
get price of 780p, saying that its quality as an core investment has improved
considerably. Profits comfortably exceeded the brokers estimates, largely due
to a surge in the groups performance materials business, while net debt fell to
1.05x Ebitda. The company should also make further progress on the back of
good forecasts for steel, car and electronic systems production.
7Mar 8Mar 9Mar 12Mar 13Mar
6,000
5,800
5,850
5,900
5,950
ANALYSIS l FTSE
5,955.91
13 Mar
KPMG Forensic
KPMG has announced the appointment of
James Siswick as director of its financial serv-
ices forensic team. He will help drive the
expansion of the firms financial crime busi-
ness, with anti-money laundering and sanc-
tions as his key areas of interest. Siswick joins
after fourteen years at Deloitte, where he
most recently worked as director in the enter-
prise risk team. He has wide experience in
advising large financial firms on the implica-
tions of new regulatory pressures.
News
23 CITYA.M. 14 MARCH 2012
T
HERE will be no winners in the French
presidential election this April. One lead-
ing candidate is the unrepentant socialist
Francois Hollande, who thinks 75 per cent
is an optimal tax rate. The other is Nicolas
Sarkozy, who has just managed to nudge himself
into the lead with a desperate speech calling for
two of the pillars of modern European liberal-
ism free trade and open borders to be
smashed to pieces. As if to prove that France has
no shortage of presidential candidates youd
cross the street to avoid, Marine Le Pen of
Frances National Front has now announced that
she has enough support to run.
How has this happened? Together, these three
frontrunners for head of state are polling an
astonishing 71.5 per cent support from the
French people, despite policies that are illiberal,
impractical and potentially disastrous for France.
In 2009, Sarkozy said he wanted the world to
see the victory of the European model. Today he
finds himself cynically grubbing for votes by call-
ing for buy European laws and threatening to
unilaterally tear up the Schengen agreement,
actions at odds with the founding principles of
the Europe he was supposed to be celebrating.
The astonishing thing about Francois
Hollande is not that he wants to tax Frances rich
at an eye-watering rate, nor that while mouthing
along to talk of cutting Frances budget deficit he
wants to lower the French retirement age to 60
rather than raise it in line with other nations, it
is that he is apparently a moderate by the stan-
dards of the French left.
Theres certainly little moderate about Marine
Le Pen. Sarkozy may have called for immigration
to be cut in half, but Le Pen wants it to reach 5
per cent of current levels. And Sarkozys new-
found enthusiasm for protectionism probably
owes something to Le Pens earlier declarations
that she was the only candidate for protection-
ism.
While Le Pen has been working to decontami-
nate the image of her party from the days of her
father, Jean-Marie Le Pen, it remains wedded to
nation above all, even it seems, over political
sense, rejecting the benefits of free trade for an
illusory protection.
As Sarkozy shows, the real problem here is
that the political centre is shifting in France, and
not for the better. The moderate socialist has to
call finance his greatest enemy, the moderate
right-winger sees no option but to inveigh
against free trade. Meanwhile the cleaned-up
nationalists have just changed their hairstyles
enough to look respectable.
France needs a modern equivalent of Frederic
Bastiat, whose nineteenth-century essays remain
a model of clarity and economic sense. Bastiat
famously dismissed socialism as legal plunder
and warned that the plans differ, but the plan-
ners are all alike. In his famous argument of the
negative railroad, Bastiat pointed out that pro-
tectionism simply sacrificed consumer interests
to producer interests. Imagine Europes free
trade zone as an unbroken railroad. Consumers
benefit from the low prices as goods travel freely
and producers from the larger marketplace.
Then protectionists say they want the line to
break at the French border, so they can force
French consumers to pay more to local produc-
ers. But why stop there? If one break is good,
more are even better, until we end with a rail-
road reduced to nothing but breaks in the line. It
is an elegant argument, and characteristic of his
thought. The slogan if goods do not cross bor-
ders, soldiers will is often attributed to Bastiat,
and certainly it reflects his understanding that
hate and violence gather where greed and spe-
cial interests cause trade to fail.
In 1850, as now, France was caught in a
moment of crisis, swayed between the desire for
extremism from both sides. Bastiat travelled to
Paris to argue for another way: a smaller govern-
ment with less room for the corruption of spe-
cial interests, more freedom for individual
citizens to use their own money as they felt
right, an unbroken railway of trade bringing
peace and prosperity to all.
Bastiat lost that fight, but his words live on to
haunt France, an awkward reminder that eco-
nomic and political liberty is not some Anglo
Saxon quirk but the most effective and just sys-
tem that human reason can uncover, humble in
its limits and generous in its respect for every
person. It took a Frenchman to express many of
these ideas better than anyone else ever has,
more than a century and a half later. These ideas
are as Gallic as they are universal, and that they
are without honour today in Bastiats own coun-
try is a tragedy.
Of course, Frances loss could be Britains gain.
That would require us to listen to Bastiat our-
selves and lower UK tax rates enough to get
Frances best and brightest to emigrate.
But here we stand. Frances right wants tighter
borders and the poverty and aggression that
breeds. Frances left wants to maintain the fic-
tion that everyone can go on living at the
expense of everyone else. And no one will take a
stand and tell his countrymen that in this elec-
tion every candidate deserves to lose.
Marc Sidwell is City A.M.s business features editor.
24
The Forum
CITYA.M. 14 MARCH 2012
The political centre is
shifting in France, and not
for the better.
The three frontrunners for
Frances presidency will all
lead down the wrong track
cityam.com/forum
MARC SIDWELL
Agree? Disagree? Got a sharp comment?
The Forum wants you to join the debate.
COMMENT NOW ON
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Top responses will be reprinted in The Forum.
25
We must remove
some perverse
incentives to see
better behaviour
Smarter choices
on tax should be
agreed on by all
T
HE debate between the Occupy move-
ment and its City neighbours was never
clarified, but essentially was about big-
ger or smaller government. Not surpris-
ingly those receiving benefits but not paying
tax want more of both, while those paying the
bills want less. Close proximity sadly did little
to diminish the caricatures of greedy banker
and welfare scrounger, two extremes that
have been exploited by politicians and others
allowing outrage in both camps but no solu-
tion. The reality perhaps, to steal a quip from
Samuel Johnson, is that there was never going
to be an agreement between the protesters in
their tents and the city workers in their glass
and steel boxes in that they were always argu-
ing from different premises.
Politicians are well aware of the notion that
if you rob Peter to pay Paul you can always rely
on the vote of Paul and this is partly behind
the mess of benefits and reliefs that fund
these grievances. As a first step to reducing
some of these, and making society a little
more harmonious, we might consider chang-
ing some of the incentives we have in place,
many of them perverse. And if there is one
thing we spend a lot of time looking at in
financial markets, it is the effect of incentives
on behaviour.
If we wanted a sign that taxes are too high,
then the fact that the civil service is employ-
ing people as consultants and thus allowing
them to pay themselves as small companies is
pretty convincing. This is not illegal of course,
though it sticks in the craw somewhat that
many if not most of the left-leaning politi-
cians, media and entertainment types calling
for higher taxes on the rich avoid paying tax
themselves in this way.
But why not extend this notion of the indi-
vidual as a company to help with the unem-
ployed? In particular the disincentive to go
back to work produced by a loss of benefit and
Flight of fancy
[Re:A third runway at Heathrow
isn't enough. Let's allow regional
airports to take off, yesterday]
Paul Kehoe sets out some salient
facts based on the business evi-
dence. Integrated transport is the
way forward, along with removal
of the complex structures
imposed on the aviation industry
to control prices, including fuel
subsidies. Part of the solution is a
high speed rail link between our
major cities. Im saddened, howev-
er, that Kehoe fails to allude to the
environmental elements of the
debate. Weve signed up to legally-
binding climate targets and avia-
tion growth takes us in the wrong
direction. I, and the Royal Society
for the Protection of Birds, are
opposed to new airports. We
favour smart development, har-
nessing the benefits of nature to
add value to the economic and
social gains which new infrastruc-
ture brings, especially if it spreads
those benefits across the UK.
Tim Webb, RSPB
Speak your mind
The Forum is open for you to take
part. Got a sharp comment on one
of todays columns or rapid
response topics? Do you have
another subject relating to busi-
ness and the economy you want
to share your opinion on? We
want to hear your views.
Readers are invited to comment
on the web: cityam.com/forum; by
email: theforum@cityam.com; and
on Twitter: @cityamforum. The
best responses will be reprinted in
The Forum.
RAPID RESPONSES
MARK TINKER
BY JAMIE WHYTE
CITYA.M. 14 MARCH 2012
The Forum
V
INCE Cable, the
business secre-
tary, wrote to the
Prime Minister
last week, lamenting the
lack of a clear economic
vision. He thinks the
government must
decide how we will
earn our living in the future.
By we, Cable was not referring to David
Cameron and himself. How they will earn a living is
clear, at least until the next election. He was refer-
ring to the rest of us. Cable thinks government min-
isters should decide how the entire population will
earn a living.
Cable does not advocate a Bolshevik-style com-
mand economy; he will not force us, on threat of the
Gulag, to invest our capital or labour in his vision. He
prefers a caring kind of command economy, in
which ministers get us to comply by way of subsi-
dies and taxes (which you must pay on threat of
imprisonment). For example, he wants RBS, a bank
purchased by the government with taxpayers
funds, to provide subsidised loans to the businesses
he favours.
Though Cable may disagree with the Bolsheviks
about how to coerce us, he agrees with them about
the merits of economic coercion. He thinks we
would be better off if the millions of little and, often,
competing visions of individual Brits were replaced
by a single, co-ordinated vision imposed by a busi-
ness secretary or other governmental entity.
Why does Cable believe this? His letter to
Cameron provides a clue. In it, he explained that his
time working for Shell Oil taught him of the need for
long-term planning.
Maybe long-term planning is a good idea for com-
panies, maybe not. The uncertainty of the distant
future makes it debatable. But why is this relevant
to economic policy? Cable labours under a popular
but peculiar conception of the national economy. He
thinks of it as a single, very large company: UK plc.
Once you think of a nation as a big company, you
naturally think that government ministers, like cor-
porate managers, should decide how to allocate the
nations resources. You see entrepreneurs, investors
and other participants in the apparently private
economy as mere employees of the great collective
enterprise, to be bossed around or otherwise manip-
ulated by the duly appointed managers.
Anyone who cares for his liberty should be
appalled by this idea, as should those who care only
for their prosperity. Cables faith in central planning
requires an absurd admiration of politicians and
bureaucrats.
Cable would have us believe that, sitting in their
offices in Whitehall, politicians can make better
investment decisions than industry insiders who are
risking their own money. Then we are supposed to
believe that, possessed of this miraculous knowl-
edge, politicians will not use it to start profitable
businesses of their own but will force the profits on
people who are too dim to see the business opportu-
nities for themselves. Praise them!
As if to confirm the folly of thus empowering
politicians, Cable revealed his vision to Cameron. We
should return to making objects rather than selling
services. It is lucky Cable was not business secre-
tary in 1929; he would have rejected all that new
fangled manufacturing and recommended returning
to an agrarian economy.
Jamie Whyte is a senior fellow of the Cobden
Centre.
Vince Cables vision for
UK plc neglects liberty
Email: theforum@cityam.com
Twitter: @cityamforum
In association with
a sharp rise in income tax. The Liberal
Democrats want to raise the tax threshold, but
why not allow the existing annual threshold to
be carried forward for up to five years and
allow part of the tax loss to be used up in each
year of new employment? Double the tax relief
when it is most needed. While we are at it, why
not allow tax thresholds within the family unit
to be transferable, helping single-earner fami-
lies?
There are many other ideas, but space for
only one. Much has been talked about reduc-
ing tax relief on pension contributions, but, as
pointed out in this paper, this produces double
taxation and continues the perverse disincen-
tive to do a good thing, which is to save. One
radical, yet simple, solution would be to
acknowledge that income tax and national
insurance (NI) are both taxes on labour and
thus combine them, lifting the upper limit on
NI, but at the same time reducing the higher
rates of tax so that the total amount paid is the
same. Thus with 12 per cent NI, the 40 per cent
rate drops to 28 per cent and the 50 per cent
rate to 38 per cent. Tax relief on pension contri-
butions would drop, but then so would the
subsequent tax take on the pension. It would
of course also reduce the incentive to be a con-
sultant.
Mark Tinker is a global fund manager at Axa. The
opinions expressed in this article are those of the
author.
Keeping the worlds most complex
event on the right side of the law
Tim Jones explains
why Freshfields is the
official legal services
provider to the 2012
London Olympics
Q.
WHAT WAS YOUR BRANDS PRIMARY
REASON FOR BEING INVOLVED WITH
THE GAMES?
A.
Wed been involved for a long time,
since 2003 when we worked on the
bid. It seemed a longshot then, but
we still thought that there was a strong
case for bidding as it would keep London in
the forefront of global attention. Were a
global firm and the international nature of
the London business world is critical for us.
London 2012 is an extraordinary opportu-
nity when you think of who else has been
hosting the big sporting events recently:
China for the Beijing Games; South Africa
for the World Cup; next up, Winter Games
in Russia, then South Korea; Summer
Games in Brazil; football in Brazil,
Russia and Qatar. All the new and
emerging markets are absolutely
represented but the one place,
in this extraordinarily impor-
tant decade when were trying
to redefine the world order a
little bit, the one developed
market that has the opportu-
nity to really set its stall out to
the world is London.
On a more micro level, it is
fantastic being part of the spon-
sor group many of them are
clients and strengthening and deep-
ening our relationships is a great oppor-
tunity for us. Clients in general are just
fascinated by the Olympics. Every event we
organise with Olympic speakers is fantasti-
cally well-attended and has great feedback.
Of course if someone has picked you to
do the legal work for the most complex
event in the world thats also a good thing
in its own right. One of the reasons I think
we were selected was because were able to
handle problems across a very wide range
of legal disciplines. Litigation, planning,
competition law, employment we have
strong practices across all those areas.
Were not a one-trick pony. This involve-
ment allows us to say to the world: the
Olympic and Paralympic Games present a
pretty complex set of legal problems, its
not transactional like a single IPO or M&A
deal, its about a longstanding relationship
with a client over many years, servicing all
their needs across a whole range of disci-
plines. Everyone knows what the Olympics
is, so its an opportunity to demonstrate
that breadth.
Theres also an
internal strand its a
very cohesive thing to
have in the office. Some peo-
ple dont like sport but add in the
Paralympics and the Cultural Olympiad
and you reach almost everyone. In a big,
outward-facing office, you need things that
bring you together internally.
Were still using it for recruitment, too.
The people were recruiting now wont
arrive until its a memory, but were using
it to say to people this is the sort of thing
we like to do and the sort of thing we
entrust to our junior lawyers, as they have
been a lot of our secondees to the London
organising committee (Locog).
Q.
HOW DID YOU STRUCTURE THE CASE
FOR INVOLVEMENT INTERNALLY?
A.
At the time the decision was taken,
we had work to do on all the fronts
Ive mentioned and this seemed to be
a very effective catalyst across all of the
areas where we had identified things we
wanted to do. We did feel in 2008 that
Freshfields was not perhaps recognised as a
brand in the way that some of our competi-
tors were and that the strength and range
of our practices wasnt fully recognised. So
it ticked a lot of boxes.
Q.
WHAT ARE THE MOST CRUCIAL
COMMERCIAL OPPORTUNITIES OF THE
GAMES FOR YOU?
A.
By the time we get to the Games we
should feel weve done our part.
Were not supplying 1m plastic cups
or something. Whats interesting are the
future opportunities. Were on the Sochi
legal panel for the Winter Games in 2014.
Thats quite a narrow group of potential
clients, but more broadly we will be able to
use this for a while as a case study and
demonstration of what Freshfields is about.
Q.
HOW ARE YOU HANDLING TICKETS
AND HOSPITALITY?
A.
Weve given every permanent mem-
ber of staff in the London office,
some 2,000 people, an Olympic or
Paralympic ticket, just as a thank you. Then
we are inviting UK clients and senior peo-
ple from our international clients to come
and be in London and the take up has been
very good on that score. Quite apart from
the running and jumping, the Olympics is
an incredibly important business event
because it brings everyone here.
Q.
WHAT HAS SURPRISED YOU MOST
ABOUT YOUR INVOLVEMENT?
A.
I probably shouldnt have been, but
just how much legal work there is
involved. Its certainly often supris-
ing to outsiders. The Locog legal team has
had to deal with tens of thousands of con-
tracts and arrangements. The scale of legal
involvement that theyve been managing
and weve been supporting has been
extraordinary: from intellectual property
protection for Olympic symbols to real
estate arrangements for pre-existing venues
like Wimbledon to questions around the
tax status of athletes.
Tim Jones is Freshfields Bruckhaus Deringers
lead partner for London 2012.
The Locog
legal team has
had to deal
with tens of
thousands of
contracts
135 DAYS TO GO
COUNTDOWN
TO THE LONDON
2012
OLYMPIC
GAMES
Q A
&
Business Features
26
WORDS BY MARC SIDWELL
Helping London to set out its stall to the world Picture: Laura Lean / CITY A.M.
T
HE Federal Open Market
Committee (FOMC) followed expec-
tations by holding rates yesterday,
and at the same time dispelled the
possibility of an immediate third round
of quantitative easing (QE3). Federal
Reserve chairman Ben Bernanke pointed
to an improving economic situation,
though checked any untoward optimism
by acknowledging that economic growth
would be moderate. The central bank
said its benchmark interest rate will stay
between 0 per cent and 0.25 per cent
until at least late 2014, though Richmond
Fed president Jeffrey Lacker dissented,
stating that he does not expect economic
conditions to warrant ultra-low rates
until late 2014.
STEADY GROWTH
Earlier in the day, the Commerce
Department reported that February
retail sales rose by 1.1 percent. Though
this rise was in line with analysts expec-
tations, they do come as part of a contin-
uing trend of strong data releases
following on from the non-farm payroll
figures on Friday that indicated that
more than 200,000 jobs had been created
in February.
This continuing barrage of strong eco-
nomic data took the wind out of expecta-
tions of QE3 but Bernanke said that he
would continue with Operation Twist
the Federal Reserve program of selling
short-dated debt from its reserves and
using the proceeds to buy long-dated
debt securities with the aim of flattening
the yield curve and pushing long-term
interest rates downward to the Feds
near-zero per cent target.
MORE TO COME
Though the dollar rallied yesterday after
The decision by Ben
Bernanke to hold off
aided the greenback,
writes Craig Drake
The Fed chairman did not rule out future action Picture: GETTY
Dollar boosted by Fed
QE3 stimulus restraint
I
S THE Greek debt restructuring a turning point in
the EU debt crisis? Despite the announcement of
a Greek debt restructuring, the country's debt
woes are far from resolved. Even with the suc-
cessful debt swap, the Greek debt burden will remain
above 120 per cent of gross domestic product, which
the IMF considers unsustainable. The Greek economy
continues to weaken. As austerity measures kick in,
the economy may experience more rapid weakening.
This presents a challenging backdrop ahead of Greek
elections to be held in April or May. Polls indicate that
those in opposition to mandated austerity measures
are leading. The election could result in the formation
of a new government that rejects adherence to the
demand for Greek austerity. If the new government
rejects the bailout terms, Greek debt will have to be
restructured again. Some have argued that within a
year, another restructuring is inevitable. All Greece
has done is buy time.
The debt swap forced private sector bondholders
to take a substantial loss and this could shatter trust
in the EU bond markets. Some bondholders may
take legal action challenging the conditions of the
debt swap which could further erode confidence in
EU bonds. Bond yields dipped in Spain and Italy
after the announcement of the debt swap but rose
in Portugal. Some are now asking whether Portugal
is the next weakest link and EU country at risk of a
debt default.
So what does this mean for the UK economy and
sterling? Around 50 per cent of UK trade is with the
EU, and austerity measures and possible broadening
of an EU credit crunch increases the risk of an EU
and UK recession. Although the UK has limited debt
exposure to Greece, European banks will face large
losses if Greece needs future bailouts and Portugal
needs debt relief. EU banks will have less money to
lend which could result in reduced trade between
the UK and EU. UK industrial and manufacturing
production has been weak. This may force the Bank
of England to expand quantitative easing, which
may be a moderate short-term negative for sterling.
The currency may see additional selling as Greek
debt swap euphoria fades and focus shifts to
Portugal and Spain.
RESOLUTION
OF GREEK DEBT
CRISIS IS KEY
ZOE FIDDES
UK BRANCH MANAGER, EASY-FOREX
the Fed chairman made no reference to
the possibility of a third round of QE,
Bernanke still holds the option in
reserve. Many predict that we will see
QE3 in the next three to six months, with
Fed purchases of Treasuries and mort-
gage-backed securities sterilised using
reverse repos and longer-dated Treasuries
in order to try and combat the inflation-
ary effects of the measures.
DOLLAR GAINS
The lack of another full-blown monetary
stimulus operation and a generally dol-
lar positive statement continued the
risk-off moves as the dollar climbed
against the euro, sliding back below the
$1.3100 mark after positive news from
Greece took the pair to $1.3108 in the US
session, taking euro-dollar down 0.5 per
cent on the day. News that ratings agency
Fitch had upgraded its ratings of Greek
debt from restricted default to B- had
boosted the common currency, but the
FOMC statement checked euro gains. And
with few betting on the long-term stabil-
ity of the Eurozone, dont be surprised to
see this trend reversed.
Wealth Management| Foreign Exchange
27 CITYA.M. 14 MARCH 2012
LON GD ONCE FIX AM...........1694.75 -10.50
SILVER LDN FIX AM ..................33.63 -0.03
MAPLE LEAF 1 OZ ....................36.02 -0.20
LON PLATINUM AM................1698.00 14.00
LON PALLADIUM AM...............700.00 -6.00
ALUMINIUM CASH .................2166.00 -3.00
COPPER CASH ......................8401.00 11.00
LEAD CASH...........................2085.00 -5.00
NICKEL CASH......................18995.00 250.00
TIN CASH.............................22900.00 245.00
ZINC CASH ............................2027.00 0.00
BRENT SPOT INDEX................125.17 -0.41
SOYA .....................................1330.50 -1.25
COCOA..................................2415.00 -25.00
COFFEE...................................182.60 -3.00
KRUG.....................................1760.80 -5.10
WHEAT ....................................169.00 0.38
AIR LIQUIDE........................................99.62 0.79 100.65 80.90
ALLIANZ..............................................90.21 1.10 107.45 56.16
ANHEUS-BUSCH INBEV ....................54.33 0.52 54.55 33.85
ARCELORMITTAL...............................15.50 0.58 26.40 10.47
AXA......................................................12.22 0.28 15.97 7.88
BANCO SANTANDER...........................6.17 0.19 8.42 4.94
BASF SE..............................................66.62 1.10 70.22 42.19
BAYER.................................................55.63 0.66 59.44 35.36
BBVA......................................................6.49 0.19 8.81 4.94
BMW ....................................................70.74 -0.31 73.85 43.49
BNP PARIBAS.....................................37.42 0.85 55.44 22.72
CARREFOUR ......................................19.04 0.45 28.45 14.66
CRH PLC .............................................16.22 0.35 17.03 10.28
DAIMLER.............................................47.72 0.05 53.95 29.02
DANONE..............................................53.30 0.50 53.39 41.92
DEUTSCHE BANK..............................36.90 1.26 44.56 20.79
DEUTSCHE BOERSE .........................48.37 0.12 57.68 35.65
DEUTSCHE TELEKOM.........................8.81 0.10 11.38 7.88
E.ON.....................................................17.08 0.26 23.54 12.50
ENEL......................................................2.85 0.04 4.86 2.78
ENI .......................................................18.31 0.31 18.31 11.83
FRANCE TELECOM............................11.27 0.18 15.98 10.92
GDF SUEZ ...........................................19.86 0.36 28.98 17.65
GENERALI ASS...................................12.66 0.13 16.44 10.34
IBERDROLA..........................................4.40 0.11 5.95 4.16
INDITEX ...............................................68.94 0.94 70.15 50.92
ING GROEP CVA...................................6.84 0.22 9.50 4.21
INTESA SANPAOLO.............................1.49 0.06 2.27 0.85
KON.PHILIPS ELECTR.......................15.69 0.29 23.48 12.01
L'OREAL..............................................90.00 0.77 91.24 68.83
LVMH..................................................134.60 2.15 134.70 94.16
MUNICH RE .......................................111.55 2.85 116.95 77.80
NOKIA....................................................3.81 0.02 6.36 3.33
REPSOL YPF.......................................19.50 0.32 24.90 17.31
RWE.....................................................35.76 0.30 48.28 21.15
SAINT-GOBAIN...................................36.20 1.07 47.64 26.07
SANOFI ................................................58.96 0.84 58.96 42.85
SAP......................................................53.48 0.78 53.82 32.88
SCHNEIDER ELECTRIC.....................51.50 0.99 61.83 35.00
SIEMENS .............................................75.97 1.17 99.39 62.13
SOCIETE GENERALE.........................24.58 0.59 49.47 14.32
TELECOM ITALIA..................................0.86 0.01 1.15 0.70
TELEFONICA ......................................12.62 0.27 18.34 12.32
TOTAL..................................................42.66 0.60 43.73 29.40
UNIBAIL-RODAMCO SE...................153.00 2.80 162.95 123.30
UNICREDIT............................................4.05 0.15 12.44 2.20
UNILEVER CVA...................................26.05 0.18 27.16 20.90
VINCI ....................................................40.00 0.33 45.48 28.46
VIVENDI ...............................................14.34 0.21 21.37 13.54
VOLKSWAGEN VORZ ......................137.60 -2.20 152.20 86.40
Price Chg High Low
EUSHARES
WORLD INDICES
FTSE 100 . . . . . . . . . . . . . . 5955.91 63.16 1.07
FTSE 250 INDEX. . . . . . . . 11750.07 186.17 1.61
FTSE UK ALL SHARE . . . . 3092.66 34.76 1.14
FTSE AIMALL SH . . . . . . . . 806.63 6.60 0.82
DOWJONES INDUS 30 . . 13177.68 217.97 1.68
S&P 500 . . . . . . . . . . . . . . . 1395.95 24.86 1.81
NASDAQ COMPOSITE . . . 3039.88 56.22 1.88
FTSEUROFIRST 300 . . . . . 1095.34 18.24 1.69
NIKKEI 225 . . . . . . . . . . . . . 9899.08 9.22 0.09
DAX 30 PERFORMANCE. . 6995.91 94.56 1.37
CAC 40 . . . . . . . . . . . . . . . . 3550.16 60.10 1.72
SHANGHAI SE INDEX . . . . 2455.80 20.94 0.86
HANG SENG. . . . . . . . . . . 21339.70 205.52 0.97
S&P/ASX 20 INDEX . . . . . . 2517.60 0.00 0.00
ASX ALL ORDINARIES . . . 4336.50 0.00 0.00
BOVESPA SAO PAOLO. . 68394.33 2009.57 3.03
ISEQ OVERALL INDEX . . . 3267.41 57.38 1.79
STRAITS TIMES . . . . . . . . . 2904.76 -1.93 -0.07
IGBM. . . . . . . . . . . . . . . . . . . 843.97 19.70 2.39
SWISS MARKET INDEX. . . 6260.02 70.16 1.13
Price Chg %chg
3M........................................................88.75 1.21 98.19 68.63
ABBOTT LABS ...................................58.93 0.70 58.98 46.29
ALCOA ................................................10.31 0.44 18.47 8.45
ALTRIA GROUP..................................30.10 -0.34 30.71 23.20
AMAZON.COM..................................184.59 1.20 246.71 160.59
AMERICAN EXPRESS........................54.25 1.48 54.45 41.30
AMGEN INC.........................................68.91 0.88 70.00 47.66
APPLE...............................................568.10 16.10 568.18 310.50
AT&T....................................................31.63 0.19 31.94 27.27
BANK OF AMERICA.............................8.49 0.50 14.43 4.92
BERKSHIRE HATAW B.......................80.76 1.22 85.52 65.35
BOEING CO.........................................74.31 0.71 80.65 56.01
CATERPILLAR..................................113.30 4.36 116.95 67.54
CHEVRON..........................................111.19 1.19 111.31 86.68
CISCO SYSTEMS................................20.22 0.39 20.49 13.30
CITIGROUP.........................................36.45 2.16 46.90 21.40
COCA-COLA.......................................70.25 0.10 71.77 61.29
COMCAST CLASS A..........................30.04 0.43 30.05 19.19
CONOCOPHILLIPS.............................77.76 0.45 81.80 58.65
DU PONT(EI) DE NMR........................52.68 1.48 57.50 37.10
EMC CORP..........................................29.62 0.59 29.68 19.84
EXXON MOBIL....................................86.86 1.31 88.13 63.47
GENERAL ELECTRIC.........................19.59 0.46 20.85 14.02
GOLDMAN SACHS GRP..................124.54 7.55 164.40 84.27
GOOGLE A........................................617.78 12.63 670.25 473.02
HEWLETT PACKARD.........................24.57 0.53 43.28 19.92
HOME DEPOT.....................................49.14 0.55 49.17 28.13
IBM.....................................................203.78 2.78 203.90 151.71
INTEL CORP .......................................27.49 0.51 27.50 19.16
J.P.MORGAN CHASE.........................43.39 2.85 47.80 27.85
JOHNSON & JOHNSON.....................65.33 0.23 68.05 55.76
KRAFT FOODS A................................38.52 0.40 39.06 24.30
MC DONALD'S CORP ........................96.78 0.12 102.22 72.89
MERCK AND CO. NEW......................38.28 0.18 39.43 29.47
MICROSOFT........................................32.67 0.63 32.69 23.65
OCCID. PETROLEUM.........................99.98 1.54 117.89 66.36
ORACLE CORP...................................30.13 0.42 36.50 24.72
PEPSICO.............................................64.34 0.40 71.89 58.50
PFIZER ................................................22.01 0.47 22.17 16.63
PHILIP MORRIS INTL .........................85.71 1.17 85.76 60.45
PROCTER AND GAMBLE ..................67.90 0.19 67.90 56.57
QUALCOMM INC ................................64.85 1.00 64.89 45.98
SCHLUMBERGER ..............................74.77 0.75 95.53 54.79
TRAVELERS CIES..............................58.41 0.80 64.17 45.97
UNITED TECHNOLOGIE ....................86.57 2.58 91.83 66.87
VERIZON COMMS ..............................39.48 0.16 40.48 32.28
VISA CL A..........................................117.27 0.74 119.36 70.45
WAL-MART STORES..........................61.00 0.32 62.63 48.31
WALT DISNEY CO ..............................44.01 1.67 44.13 28.19
WELLS FARGO & CO.........................33.33 1.82 33.58 22.58
COMMODITIES CREDIT & RATES
BoE IR Overnight ............................0.500 0.00
BoE IR 7 days.................................0.500 0.00
BoE IR 1 month ..............................0.500 0.00
BoE IR 3 months ............................0.500 0.00
BoE IR 6 months ............................0.500 0.00
LIBOR Euro - overnight ..................0.263 0.00
LIBOR Euro - 12 months ................1.500 -0.01
LIBOR USD - overnight...................0.143 0.00
LIBOR USD - 12 months.................1.056 0.00
HaIifax mortgage rate .....................3.990 -0.02
Euro Base Rate ...............................1.500 0.00
Finance house base rate................1.500 0.00
US Fed funds...................................0.250 0.00
US Iong bond yieId .........................3.240 0.07
European repo rate.........................0.170 0.00
Euro Euribor ....................................0.317 0.00
The vix index ...................................15.89 0.25
The baItic dry index ........................837.0 13.0
Markit iBoxx...................................243.82 0.06
Markit iTraxx..................................134.06 1.64
Price Chg High Low
Price Chg %chg Price Chg %chg Price Chg %chg
USSHARES
BAE Systems . . . . . .314.2 1.1 340.8 248.1
Chemring Group . . . .432.8 10.1 736.5 368.8
Cobham . . . . . . . . . . .217.7 -2.9 236.5 165.9
Meggitt . . . . . . . . . . . .408.1 8.7 408.7 304.9
QinetiQ Group . . . . . .152.0 1.2 153.2 101.5
RoIIs-Royce HoIdi . . .836.0 12.5 837.5 557.5
Senior . . . . . . . . . . . . .191.0 -0.5 201.0 132.6
UItra EIectronics . . .1774.0 33.0 1776.0 1305.0
GKN . . . . . . . . . . . . . .216.0 5.0 245.0 157.0
BarcIays . . . . . . . . . . .239.6 3.7 308.9 138.9
HSBC HoIdings . . . . .572.4 16.3 667.2 463.5
LIoyds Banking Gr . . .34.6 0.9 62.4 21.8
RoyaI Bank of Sco . . .25.8 0.4 44.4 17.3
Standard Chartere .1605.0 41.5 1690.0 1169.5
AG Barr . . . . . . . . . .1205.0 35.0 1395.0 1031.0
Britvic . . . . . . . . . . . . .389.8 3.3 444.0 289.9
Diageo . . . . . . . . . . .1552.0 -1.0 1558.5 1112.0
SABMiIIer . . . . . . . . .2660.0 23.0 2666.5 1979.0
AZ EIectronic Mat . . .296.0 6.0 338.1 206.1
Croda Internation . .2234.0 29.0 2249.0 1572.0
EIementis . . . . . . . . . .196.1 6.6 196.5 107.5
Johnson Matthey . .2403.0 28.0 2406.3 1523.0
Victrex . . . . . . . . . . .1372.0 26.0 1590.0 1025.0
YuIe Catto & Co . . . . .210.0 1.6 253.0 148.0
C/$ 1.3076 0.0080
C/ 0.8327 0.0084
C/ 108.42 0.1318
/C 1.2008 0.0117
/$ 1.5702 0.0063
/ 130.18 1.4422
FTSE 100
5955.91
63.16
FTSE 250
11750.07
186.17
FTSE ALLSHARE
3092.66
34.76
DOW
13177.68
217.97
NASDAQ
3039.88
56.22
S&P 500
1395.95
24.86
Smith (DS) . . . . . . . . .183.7 2.1 184.2 113.3
Smiths Group . . . . .1101.0 27.0 1340.0 869.5
Brown (N.) Group . . .231.9 -0.6 304.5 227.0
Carpetright . . . . . . . . .649.5 44.0 749.0 375.0
Debenhams . . . . . . . . .74.5 3.3 75.4 51.2
Dignity . . . . . . . . . . . .844.5 30.5 854.5 690.0
Dixons RetaiI . . . . . . .14.8 0.4 19.9 9.4
DuneImGroup . . . . . .492.0 3.4 524.5 383.9
HaIfords Group . . . . .305.8 4.4 405.9 268.6
Home RetaiI Group . .110.0 5.4 228.5 72.5
Inchcape . . . . . . . . . .418.2 41.3 426.6 268.1
JD Sports Fashion . .780.0 13.5 1030.0 570.0
Kesa EIectricaIs . . . . .72.0 1.1 151.4 60.2
Kingfisher . . . . . . . . .294.0 7.2 296.5 217.0
Marks & Spencer G . .362.1 4.2 402.2 301.8
Next . . . . . . . . . . . . .2793.0 36.0 2810.0 1868.0
Sports Direct Int . . . .293.6 9.2 296.1 180.0
WH Smith . . . . . . . . . .547.0 9.5 559.0 433.8
Smith & Nephew . . . .633.0 1.0 715.0 521.0
Synergy HeaIth . . . . .831.0 5.5 981.0 808.0
Barratt DeveIopme . .149.3 7.5 150.0 67.5
BeIIway . . . . . . . . . . . .846.5 20.5 856.5 540.5
BerkeIey Group Ho .1406.0 -8.0 1424.0 960.0
BaIfour Beatty . . . . . .289.5 2.5 348.6 214.6
CRH . . . . . . . . . . . . .1351.0 13.0 1687.0 1053.0
GaIIiford Try . . . . . . . .620.0 13.0 630.0 332.8
Kier Group . . . . . . . .1241.0 8.0 1489.0 1097.0
Drax Group . . . . . . . .526.0 6.5 581.5 371.9
SSE . . . . . . . . . . . . . .1312.0 7.0 1423.0 1184.0
Domino Printing S . .670.0 10.0 701.5 434.3
HaIma . . . . . . . . . . . . .404.7 4.0 429.6 306.3
Laird . . . . . . . . . . . . . .199.8 5.9 207.0 127.9
Morgan CrucibIe C . .351.4 4.1 360.0 224.0
Oxford Instrument .1210.0 15.0 1216.0 600.5
Renishaw . . . . . . . . .1464.0 87.0 1886.0 800.0
Spectris . . . . . . . . . .1801.0 54.0 1820.0 1039.0
Aberforth SmaIIer . . .649.0 14.5 714.0 494.0
AIIiance Trust . . . . . .378.0 4.2 392.7 310.2
Bankers Inv Trust . . .428.0 4.1 428.0 346.5
BH GIobaI Ltd. GB .1196.0 4.0 1212.0 1058.0
BH GIobaI Ltd. US . . . .11.9 -0.1 12.2 10.4
BH Macro Ltd. EUR . . .19.7 0.0 20.2 16.3
BH Macro Ltd. GBP 2045.0 9.0 2078.0 1661.0
BH Macro Ltd. USD . . .19.7 -0.0 20.2 16.2
BIackRock WorId M .713.0 4.5 815.5 574.5
BIueCrest AIIBIue . . .164.8 0.6 176.2 160.6
British Assets Tr . . . .129.0 2.8 139.4 109.0
British Empire Se . . .445.6 1.6 533.0 404.0
CaIedonia Investm .1532.0 7.0 1800.0 1337.0
City of London In . . .302.4 4.3 306.9 257.0
Dexion AbsoIute L . .139.9 0.3 150.0 130.0
Edinburgh Dragon . .252.3 3.5 253.0 201.4
Edinburgh Inv Tru . . .501.0 6.1 501.0 414.9
EIectra Private E . . .1695.0 21.0 1755.0 1287.0
F&C Inv Trust . . . . . .316.7 3.7 327.9 261.5
FideIity China Sp . . . . .87.6 2.1 114.3 70.0
FideIity European . .1152.0 14.0 1287.0 912.0
HeraId Inv Trust . . . . .524.5 10.0 545.5 419.0
HICL Infrastructu . . . .119.9 0.5 121.3 112.7
Impax Environment .103.3 1.7 125.4 88.5
John Laing Infras . . .109.9 0.2 110.6 103.8
JPMorgan American .954.5 9.0 956.5 721.5
JPMorgan Asian In . .202.8 1.3 244.0 170.1
JPMorgan Emerging .575.5 11.5 610.5 480.1
JPMorgan European .742.5 12.5 983.5 624.0
JPMorgan Indian I . . .388.0 5.5 459.0 313.1
JPMorgan Russian .597.5 6.5 741.0 415.1
Law Debenture Cor . .391.2 7.3 391.5 321.0
MercantiIe Inv Tr . . .1054.0 24.0 1119.0 823.0
Merchants Trust . . . .391.1 6.1 431.8 341.5
Monks Inv Trust . . . .341.9 3.2 367.9 298.1
Murray Income Tru . .674.0 14.5 674.0 568.0
Murray Internatio . .1002.0 16.0 1002.0 818.5
PerpetuaI Income . . .273.4 4.4 276.0 236.5
PersonaI Assets T .34930.0 65.0 35350.030210.0
PoIar Cap TechnoI . .383.0 2.2 389.2 299.5
RIT CapitaI Partn . . .1240.0 11.0 1360.0 1173.0
Scottish Inv Trus . . . .490.6 4.6 524.0 417.0
Scottish Mortgage . .703.0 6.0 781.0 565.0
SVG CapitaI . . . . . . . .279.0 0.0 282.0 165.1
TempIe Bar Inv Tr . . .970.0 28.0 970.0 791.0
TempIeton Emergin .624.5 4.0 684.5 497.0
TR Property Inv T . . .158.9 2.9 206.1 136.2
TR Property Inv T . . . .72.0 2.7 94.0 59.8
Witan Inv Trust . . . . .498.0 6.3 533.0 401.5
3i Group . . . . . . . . . . .210.0 13.6 301.1 166.9
3i Infrastructure . . . .122.2 0.2 125.2 113.4
Aberdeen Asset Ma .256.0 -0.8 265.8 167.8
Ashmore Group . . . .380.7 -1.1 420.0 301.5
Brewin DoIphin Ho . .170.1 5.2 176.5 113.7
CameIIia . . . . . . . . . .9785.0 -78.010950.0 8800.0
CharIes TayIor Co . . .133.5 0.0 165.0 115.6
City of London Gr . . . .66.5 0.0 93.6 61.3
City of London In . . .356.3 0.8 440.0 304.3
CIose Brothers Gr . . .790.0 33.0 865.5 590.0
CoIIins Stewart H . . . .99.0 -0.3 99.3 48.5
F&C Asset Managem .72.0 0.9 81.7 56.1
Hargreaves Lansdo .480.3 8.3 646.5 402.5
HeIphire Group . . . . . . .2.3 0.0 16.0 1.4
Henderson Group . . .119.0 4.0 173.1 95.1
Highway CapitaI . . . . .13.0 0.0 21.0 7.0
ICAP . . . . . . . . . . . . . .394.0 -0.9 541.5 311.6
IG Group HoIdings . .453.2 -13.2 502.5 393.6
Intermediate Capi . . .282.5 14.2 345.0 197.9
InternationaI Per . . . .253.7 8.7 388.8 148.5
InternationaI Pub . . .120.7 -0.1 121.5 108.6
Investec . . . . . . . . . . .414.9 8.5 522.0 318.4
IP Group . . . . . . . . . . .117.5 1.8 118.1 36.0
Jupiter Fund Mana . .245.0 -0.2 323.2 184.9
Liontrust Asset M . . .109.0 6.5 111.0 57.9
LMS CapitaI . . . . . . . . .58.3 0.0 64.8 54.0
London Finance & . . .19.5 0.0 23.5 18.1
London Stock Exch .997.0 33.5 1076.0 756.5
Lonrho . . . . . . . . . . . . .11.8 -0.3 19.8 8.9
Man Group . . . . . . . . .139.5 2.0 264.4 104.5
Paragon Group Of . .188.5 6.5 206.1 134.6
Provident Financi . .1136.0 2.0 1145.0 915.0
Rathbone Brothers .1273.0 23.0 1290.0 977.0
Record . . . . . . . . . . . . .11.0 0.0 35.5 10.8
RSM Tenon Group . . . .7.2 0.2 43.5 5.6
Schroders . . . . . . . .1589.0 19.0 1906.0 1183.0
Schroders (Non-Vo .1276.0 18.0 1554.0 970.0
TuIIett Prebon . . . . . .338.5 8.5 428.6 262.3
WaIker Crips Grou . . .45.0 4.5 51.5 40.0
BT Group . . . . . . . . . .217.8 1.2 218.8 161.0
CabIe & WireIess . . . .32.5 -0.1 50.6 31.3
CabIe & WireIess . . . .36.9 0.4 66.4 14.2
COLT Group SA . . . .100.0 -0.4 154.0 84.1
KCOM Group . . . . . . . .69.5 0.2 84.0 58.5
TaIkTaIk TeIecom . . .143.2 1.1 150.0 118.9
TeIecomPIus . . . . . . .660.0 23.5 802.0 440.0
Booker Group . . . . . . .78.9 2.5 80.0 54.5
Greggs . . . . . . . . . . . .558.0 3.0 562.0 445.0
Morrison (Wm) Sup .303.0 1.4 328.0 268.5
Ocado Group . . . . . . .111.4 2.6 237.0 52.9
Sainsbury (J) . . . . . . .304.7 4.8 362.8 263.5
Tesco . . . . . . . . . . . . .320.6 1.6 420.1 310.5
Associated Britis . .1219.0 7.0 1228.0 940.0
Cranswick . . . . . . . . .832.5 12.0 845.0 588.5
Dairy Crest Group . . .353.3 10.1 409.7 311.0
Devro . . . . . . . . . . . . .330.0 -2.2 333.2 232.0
Tate & LyIe . . . . . . . . .717.5 6.0 720.5 520.0
UniIever . . . . . . . . . .2106.0 -1.0 2189.0 1796.0
Mondi . . . . . . . . . . . . .617.5 12.5 664.0 413.5
Centrica . . . . . . . . . . .314.1 4.2 333.0 278.8
InternationaI Pow . . .368.5 5.0 369.9 279.4
NationaI Grid . . . . . . .657.0 2.5 658.2 543.5
Pennon Group . . . . . .731.0 3.5 737.5 584.5
Severn Trent . . . . . .1606.0 9.0 1612.7 1375.0
United UtiIities . . . . .622.0 6.0 637.0 551.0
Cookson Group . . . . .723.0 20.0 724.5 395.8
Rexam . . . . . . . . . . . .423.0 6.3 425.2 299.8
RPC Group . . . . . . . .382.0 14.0 393.2 231.5
Price Chg High Low
Bovis Homes Group .516.0 13.5 520.0 326.5
Persimmon . . . . . . . .680.0 10.0 706.5 374.0
Reckitt Benckiser . .3582.0 14.0 3597.0 3015.0
Redrow . . . . . . . . . . . .134.7 1.8 139.0 103.5
TayIor Wimpey . . . . . . .52.1 2.1 52.7 28.7
Bodycote . . . . . . . . . .426.5 10.9 426.5 225.6
Fenner . . . . . . . . . . . .481.0 6.7 483.7 280.0
IMI . . . . . . . . . . . . . . .1014.0 24.5 1119.0 636.5
MeIrose . . . . . . . . . . .410.4 4.3 410.4 268.0
Northgate . . . . . . . . . .240.8 -4.2 346.7 190.9
Rotork . . . . . . . . . . .2059.0 0.0 2099.0 1501.0
Spirax-Sarco Engi . .2184.0 38.0 2184.2 1649.0
Weir Group . . . . . . .1992.0 51.0 2236.0 1375.0
Evraz . . . . . . . . . . . . .409.3 5.2 460.5 315.0
Ferrexpo . . . . . . . . . . .333.2 14.3 499.0 238.7
TaIvivaara Mining . . .277.8 -1.2 589.0 195.2
BBAAviation . . . . . . .214.1 6.0 223.4 156.0
Stobart Group Ltd . . .136.0 3.5 152.8 112.0
AdmiraI Group . . . . .1185.0 15.0 1754.0 787.0
AmIin . . . . . . . . . . . . .343.6 2.5 427.0 270.6
BeazIey . . . . . . . . . . . .139.6 2.2 151.8 109.6
Informa . . . . . . . . . . . .443.8 4.2 446.0 313.9
ITE Group . . . . . . . . . .237.2 1.2 258.2 157.7
ITV . . . . . . . . . . . . . . . . .86.8 -0.3 88.0 51.7
Johnston Press . . . . . . .7.1 -0.2 9.0 4.1
MecomGroup . . . . . .163.0 6.5 310.0 134.5
Moneysupermarket. .130.0 0.8 130.8 85.5
Pearson . . . . . . . . . .1221.0 2.0 1255.0 1038.0
PerformGroup . . . . .315.0 9.0 317.7 150.0
Reed EIsevier . . . . . .551.0 4.5 578.0 461.3
Rightmove . . . . . . . .1400.0 9.0 1446.0 933.0
STV Group . . . . . . . . .108.0 -0.5 168.0 76.3
Tarsus Group . . . . . .142.8 -0.3 165.0 119.5
Trinity Mirror . . . . . . . .39.0 -0.3 54.3 37.5
UBM . . . . . . . . . . . . . .619.5 10.5 620.5 416.0
UTV Media . . . . . . . . .142.5 1.5 150.0 92.5
WiImington Group . .101.3 4.0 160.0 78.5
WPP . . . . . . . . . . . . . .835.0 13.5 838.0 578.0
YeII Group . . . . . . . . . . .4.0 0.1 11.0 3.4
African Barrick G . . .435.0 6.8 616.5 393.5
AIIied GoId Minin . . .124.3 2.3 263.3 34.4
AngIo American . . .2606.5 31.5 3344.0 2138.5
AngIo Pacific Gro . . .335.7 0.7 339.3 237.9
Antofagasta . . . . . . .1241.0 -29.0 1491.0 900.5
Aquarius PIatinum . .154.9 6.5 370.0 130.9
BHP BiIIiton . . . . . . .2047.0 33.5 2631.5 1667.0
CatIin Group Ltd. . . .420.0 0.8 449.0 334.0
Hiscox Ltd. . . . . . . . . .415.0 3.7 424.7 340.5
Jardine LIoyd Tho . . .697.5 3.0 764.5 576.0
Lancashire HoIdin . . .769.0 11.0 790.5 532.5
RSA Insurance Gro . .110.8 1.5 139.8 99.6
Aviva . . . . . . . . . . . . . .361.2 4.7 452.7 275.3
LegaI & GeneraI G . . .125.3 4.1 125.9 89.8
OId MutuaI . . . . . . . . .164.2 1.6 164.6 98.1
Phoenix Group HoI . .575.0 20.0 688.0 451.1
PrudentiaI . . . . . . . . .763.0 35.0 777.0 509.0
ResoIution Ltd. . . . . .269.1 4.1 316.1 229.5
St James's PIace . . . .352.0 2.4 376.0 294.0
Standard Life . . . . . . .238.5 0.9 246.0 172.0
4Imprint Group . . . . .270.0 0.0 295.0 200.0
Aegis Group . . . . . . .180.5 3.3 180.6 115.7
BIoomsbury PubIis . .116.8 -1.3 138.0 91.3
British Sky Broad . . .701.5 7.0 850.0 618.5
Centaur Media . . . . . . .42.0 0.0 60.0 32.5
Chime Communicati .223.3 -2.8 298.5 163.0
Creston . . . . . . . . . . . .61.0 0.0 121.0 47.0
DaiIy MaiI and Ge . . .443.0 10.1 516.0 343.4
Euromoney Institu . .755.0 38.5 772.0 522.5
Future . . . . . . . . . . . . . .12.3 0.3 26.5 8.3
Haynes PubIishing . .215.0 0.0 257.0 192.0
Huntsworth . . . . . . . . .47.8 1.0 76.3 32.3
Bumi . . . . . . . . . . . . . .776.0 -1.0 795.8 759.5
Centamin (DI) . . . . . . . .84.4 -0.7 154.2 78.5
Eurasian NaturaI . . .682.5 8.0 973.5 522.0
FresniIIo . . . . . . . . . .1830.0 19.0 2150.0 1302.0
GemDiamonds Ltd. .249.5 7.5 291.0 179.8
GIencore Internat . . .418.2 6.9 531.1 348.0
HochschiId Mining . .515.0 11.0 657.0 365.9
Kazakhmys . . . . . . . .986.0 30.5 1493.0 730.0
Kenmare Resources . .50.5 -1.3 61.5 31.0
Lonmin . . . . . . . . . . .1084.0 19.0 1760.0 941.0
New WorId Resourc .478.8 2.1 1060.0 409.4
PetropavIovsk . . . . . .666.5 -5.5 1073.0 543.5
PoIymetaI Interna . .1010.0 2.0 1175.0 877.0
RandgoId Resource 7110.0 -55.0 7565.0 4425.0
Rio Tinto . . . . . . . . .3533.0 82.5 4595.0 2712.5
Vedanta Resources 1430.0 61.0 2518.0 928.0
Xstrata . . . . . . . . . . .1165.0 10.0 1550.0 764.0
Inmarsat . . . . . . . . . . .469.4 -8.5 628.5 389.3
Vodafone Group . . . .170.8 0.3 182.7 155.1
Genesis Emerging . .517.0 7.0 548.5 424.0
Afren . . . . . . . . . . . . . .133.1 2.6 171.2 73.6
BG Group . . . . . . . . .1518.5 14.5 1564.5 1144.0
BP . . . . . . . . . . . . . . . .498.9 3.2 504.6 363.2
Cairn Energy . . . . . . .333.4 3.5 531.8 291.9
EnQuest . . . . . . . . . . .129.6 0.1 158.5 85.7
Essar Energy . . . . . .110.7 2.4 496.6 101.6
ExiIIon Energy . . . . . .220.2 16.2 469.7 184.2
Heritage OiI . . . . . . . .161.8 -0.3 332.2 158.0
Ophir Energy . . . . . . .439.0 7.0 450.0 184.5
Premier OiI . . . . . . . . .420.5 4.7 520.5 310.0
RoyaI Dutch SheII . .2281.0 9.0 2402.0 1883.5
RoyaI Dutch SheII . .2310.0 13.5 2489.0 1890.5
SaIamander Energy .233.0 0.0 317.6 182.3
Soco Internationa . . .327.8 15.8 400.0 278.0
TuIIow OiI . . . . . . . . .1454.0 16.0 1601.0 945.5
Amec . . . . . . . . . . . .1171.0 7.0 1207.0 740.5
Hunting . . . . . . . . . . .937.5 20.5 939.5 530.0
Kentz Corporation . .466.4 9.4 508.0 347.0
LampreII . . . . . . . . . . .339.2 2.9 395.2 220.7
Petrofac Ltd. . . . . . .1691.0 -2.0 1711.0 1108.0
Wood Group (John) .729.5 12.5 763.5 469.9
Burberry Group . . . .1572.0 17.0 1600.0 1092.0
PZ Cussons . . . . . . . .319.0 10.2 387.9 285.0
Supergroup . . . . . . . .627.5 11.0 1600.0 435.2
AstraZeneca . . . . . .2885.0 8.5 3194.0 2543.5
BTG . . . . . . . . . . . . . .363.1 7.6 365.0 210.3
Genus . . . . . . . . . . . .1320.0 5.0 1368.0 853.5
GIaxoSmithKIine . . .1442.5 16.0 1497.0 1138.5
Hikma Pharmaceuti .772.0 26.0 869.0 555.5
Shire PIc . . . . . . . . . .2230.0 -14.0 2300.0 1748.0
CapitaI & Countie . . .197.6 3.3 203.7 153.4
Daejan HoIdings . . .2925.0 25.0 3030.0 2282.0
F&C CommerciaI Pr .102.0 0.7 108.0 92.6
Grainger . . . . . . . . . . .116.0 6.5 133.2 77.3
London & Stamford .114.7 0.4 140.0 103.9
SaviIIs . . . . . . . . . . . . .392.9 15.9 427.1 256.2
UK CommerciaI Pro . .72.8 0.2 85.5 65.1
Unite Group . . . . . . . .207.6 5.9 224.1 152.9
Big YeIIow Group . . .316.6 7.1 344.4 218.0
British Land Co . . . . .502.0 5.7 629.5 444.0
CapitaI Shopping . . .349.6 4.2 408.6 288.7
Derwent London . . .1797.0 30.0 1880.0 1400.0
Great PortIand Es . . .373.2 3.6 445.0 312.9
Hammerson . . . . . . . .429.0 5.1 490.9 345.2
Hansteen HoIdings . . .79.0 3.0 89.5 68.0
Land Securities G . . .740.0 12.0 885.0 612.0
SEGRO . . . . . . . . . . . .253.8 3.6 331.3 195.0
Shaftesbury . . . . . . . .520.0 8.0 539.0 441.2
Aveva Group . . . . . .1726.0 26.0 1799.0 1298.0
Computacenter . . . . .441.2 31.2 490.0 324.7
Fidessa Group . . . . .1636.0 32.0 2109.0 1444.0
Invensys . . . . . . . . . . .203.5 3.0 357.3 180.9
Logica . . . . . . . . . . . . .93.6 2.2 144.8 59.0
Micro Focus Inter . . .471.2 15.2 477.2 242.9
Misys . . . . . . . . . . . . .328.0 0.0 420.2 214.9
Sage Group . . . . . . . .301.6 3.7 312.4 231.7
SDL . . . . . . . . . . . . . . .749.0 37.0 756.0 586.0
TeIecity Group . . . . . .717.0 10.5 720.0 450.5
Aggreko . . . . . . . . . .2315.0 15.0 2322.0 1474.8
Ashtead Group . . . . .270.2 5.6 270.3 99.4
Atkins (WS) . . . . . . . .794.0 10.5 820.0 490.2
Babcock Internati . . .764.5 5.0 765.5 550.5
Berendsen . . . . . . . . .540.5 16.5 568.0 402.7
BunzI . . . . . . . . . . . .1000.0 0.5 1005.0 676.5
Cape . . . . . . . . . . . . . .465.0 0.4 591.5 295.0
Capita . . . . . . . . . . . . .750.5 4.5 767.0 611.5
CariIIion . . . . . . . . . . .314.8 -0.3 403.2 281.0
De La Rue . . . . . . . . .957.0 -3.5 1001.0 730.0
DipIoma . . . . . . . . . . .415.0 17.9 425.5 263.5
EIectrocomponents .250.6 5.5 294.9 182.2
Experian . . . . . . . . . . .975.0 10.0 975.5 665.0
FiItrona PLC . . . . . . . .465.4 0.7 468.8 293.0
G4S . . . . . . . . . . . . . . .283.5 -6.0 292.1 219.9
Hays . . . . . . . . . . . . . . .86.0 1.2 119.6 58.9
Homeserve . . . . . . . .235.8 5.9 532.0 214.7
Howden Joinery Gr . .126.1 2.5 128.4 93.1
Interserve . . . . . . . . . .293.0 -5.0 341.3 245.8
Intertek Group . . . . .2495.0 40.0 2508.0 1744.0
MichaeI Page Inte . . .478.7 1.4 567.0 323.0
Mitie Group . . . . . . . .285.0 16.6 291.1 195.9
PayPoint . . . . . . . . . . .606.5 29.0 606.5 395.0
Premier FarneII . . . . .215.4 4.8 301.0 144.5
Regus . . . . . . . . . . . . .112.0 3.2 119.0 64.0
RentokiI InitiaI . . . . . . .82.5 0.5 100.9 58.2
RPS Group . . . . . . . . .231.9 0.5 253.0 156.6
Serco Group . . . . . . .538.5 3.5 597.5 458.0
Shanks Group . . . . . .101.0 0.0 130.9 90.8
SIG . . . . . . . . . . . . . . .115.5 3.4 153.5 77.0
Travis Perkins . . . . .1082.0 12.0 1090.0 715.0
WoIseIey . . . . . . . . .2471.0 32.0 2500.0 1404.0
ARM HoIdings . . . . . .573.0 0.5 645.0 464.0
CSR . . . . . . . . . . . . . .255.7 5.4 391.4 154.1
Imagination Techn . .652.5 14.5 658.0 296.9
Spirent Communica .153.7 -0.2 156.5 105.8
British American . .3245.0 20.0 3257.5 2300.0
ImperiaI Tobacco . .2575.0 -1.0 2587.0 1878.0
Betfair Group . . . . . . .886.5 2.5 1030.0 567.0
Bwin.party Digita . . .164.5 1.8 204.0 100.6
CarnivaI . . . . . . . . . .2000.0 53.0 2642.0 1742.0
Compass Group . . . .666.0 6.5 668.0 512.5
Domino's Pizza UK . .457.3 7.3 526.0 377.0
easyJet . . . . . . . . . . . .441.2 5.4 478.4 302.5
FirstGroup . . . . . . . . .288.9 3.4 370.2 282.5
Go-Ahead Group . . .1300.0 5.0 1598.0 1190.0
Greene King . . . . . . .512.5 7.0 521.5 410.0
InterContinentaI . . .1497.0 49.0 1498.0 955.0
InternationaI Con . . .170.4 7.2 258.7 132.0
JD Wetherspoon . . . .435.0 18.0 468.3 380.5
Ladbrokes . . . . . . . . .161.8 1.4 162.0 114.0
Marston's . . . . . . . . . . .99.5 1.7 112.0 84.6
MiIIennium& Copt . .501.0 6.0 540.0 371.2
MitcheIIs & ButIe . . . .276.0 14.3 336.8 215.6
NationaI Express . . .244.8 1.6 270.2 201.6
Rank Group . . . . . . . .132.0 2.0 153.7 109.5
Restaurant Group . . .303.0 7.3 335.0 254.9
Spirit Pub Compan . . .60.5 0.5 61.0 35.3
Stagecoach Group . .268.2 4.8 287.4 200.0
TUI TraveI . . . . . . . . . .196.0 4.0 250.0 136.7
Whitbread . . . . . . . .1719.0 28.0 1737.0 1409.0
WiIIiamHiII . . . . . . . . .249.2 5.0 250.1 176.8
Abcam . . . . . . . . . . . .344.0 -1.0 460.0 320.0
Advanced MedicaI . . .82.8 -1.8 96.0 64.8
AIbemarIe & Bond . .352.5 -2.5 400.1 281.0
Amerisur Resource . .25.5 1.5 29.0 9.5
Andor TechnoIogy . .530.0 -0.8 685.0 387.1
ArchipeIago Resou . . .63.5 1.0 79.0 55.5
ASOS . . . . . . . . . . . .1716.0 -20.0 2468.0 1142.0
AureIian OiI & Ga . . . .19.0 0.0 78.3 16.0
Avanti Communicat .247.0 2.8 499.8 239.3
BIinkx . . . . . . . . . . . . . .76.8 -1.0 158.0 50.5
Borders & Souther . . .71.0 -3.5 80.5 43.5
BowLeven . . . . . . . . . .95.8 -1.0 382.3 62.0
Brooks MacdonaId 1345.0 15.0 1372.5 940.0
CIuff GoId . . . . . . . . . . .95.0 -0.3 119.0 66.5
Cove Energy . . . . . . .209.0 5.8 242.0 61.0
Daisy Group . . . . . . .109.0 0.0 127.0 88.0
EMIS Group . . . . . . . .510.0 50.0 580.0 397.5
Faroe PetroIeum . . . .160.5 2.5 183.3 130.0
GuIfsands PetroIe . . .160.0 6.0 329.3 142.5
GWPharmaceuticaI . .93.8 -0.8 130.0 78.5
H&T Group . . . . . . . . .326.0 -1.5 395.0 285.0
Hargreaves Servic .1240.0 -2.0 1258.0 855.0
HeaIthcare Locums . . . .1.9 -0.3 2.4 1.9
Immunodiagnostic . .361.1 -1.4 1218.0 288.8
ImpeIIamGroup . . . .346.0 -6.5 387.5 225.0
Iomart Group . . . . . . .133.0 -4.0 151.0 85.5
James HaIstead . . . . .490.0 -15.0 516.4 410.0
London Mining . . . . .297.0 2.0 436.5 257.5
Lupus CapitaI . . . . . .128.0 13.0 150.0 86.0
M. P. Evans Group . .444.0 -14.5 475.0 371.0
Majestic Wine . . . . . .429.0 10.5 510.0 315.0
May Gurney Integr . .295.0 7.5 302.0 234.0
Monitise . . . . . . . . . . . .36.8 -0.3 40.0 20.5
MuIberry Group . . . .1984.0 -1.0 1995.0 1290.0
Nanoco Group . . . . . . .73.0 -1.0 93.3 38.0
NauticaI PetroIeu . . .340.8 0.8 444.3 223.5
NichoIs . . . . . . . . . . . .634.0 4.0 642.0 410.0
Numis Corporation . . .97.0 0.0 119.6 72.0
Pan African Resou . . .16.8 0.3 18.3 9.5
Patagonia GoId . . . . . .39.5 1.0 70.0 36.0
Prezzo . . . . . . . . . . . . .67.0 -1.5 71.5 53.5
Pursuit Dynamics . . . .75.0 -3.0 392.0 67.0
Rockhopper ExpIor .367.3 8.3 393.5 141.0
RWS HoIdings . . . . . .527.8 2.8 540.0 370.0
Secure Trust Bank .1072.5 0.0 1072.5 755.0
Songbird Estates . . .112.0 -2.0 160.3 103.0
VaIiant PetroIeum . . .534.5 -2.5 628.5 400.0
Young & Co's Brew . .667.5 0.0 712.0 565.0
Inchcape . . . . . . . . . .418.2 11.0
ExiIIon Energy . . . . . .220.2 7.9
Computacenter . . . . .441.2 7.6
Carpetright . . . . . . . .649.5 7.3
3i Group . . . . . . . . . . .210.0 6.9
Renishaw . . . . . . . . .1464.0 6.3
Mitie Group . . . . . . . .285.0 6.2
Grainger . . . . . . . . . . .116.0 5.9
MitcheIIs & ButIer . . .276.0 5.5
Euromoney Institut . .755.0 5.4
IG Group HoIdings . .453.2 -2.8
Kenmare Resources . .50.5 -2.4
Antofagasta . . . . . . .1241.0 -2.3
G4S . . . . . . . . . . . . . . .283.5 -2.1
Inmarsat . . . . . . . . . . .469.4 -1.8
Northgate . . . . . . . . . .240.8 -1.7
Interserve . . . . . . . . . .293.0 -1.7
Cobham . . . . . . . . . . .217.7 -1.3
Bumi . . . . . . . . . . . . . .776.0 -1.0
PetropavIovsk . . . . . .666.5 -0.8
Risers FaIIers
MAIN CHANGES UK 350
Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low
Price Chg High Low Price Chg High Low
GILTS
AEROSPACE & DEFENCE
CONSTRUCTION & MATERIALS
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FINANCIAL SERVICES
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FORESTRY & PAPER
GAS, WATER & MULTIUTILITIES
GENERAL RETAILERS
HEALTH CARE EQUIPMENT & S.
HHOLD GDS & HOME CONSTR.
INDUSTRIAL ENGINEERING
INDUSTRIAL TRANSPORTATION
MEDIA
LIFE INSURANCE
PERSONAL GOODS
PHARMACEUTICALS & BIOTECH
REAL ESTATE INVEST. & SERV.
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AUTOMOBILES & PARTS
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BEVERAGES
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MINING
NONEQUITY INVESTM. COMM.
Tsy 5.250 12 . . . .101.13 -0.01 105.3 101.1
Tsy 9.000 12 . . . .103.36 0.49 111.1 102.4
Tsy 2.500 13 . . . .283.38 0.01 287.7 282.0
Tsy 4.500 13 . . . .103.97 -0.02 106.5 103.9
Tsy 8.000 13 . . . . .111.56 -0.05 116.9 111.5
Tsy 5.000 14 . . . . .111.18 -0.09 112.9 109.3
Tsy 8.000 15 . . . .126.95 -0.16 129.2 123.8
Tsy 4.750 15 . . . . .114.10 -0.16 115.4 109.1
Tsy 4.000 16 . . . . .113.54 -0.23 114.7 105.6
Tsy 2.500 16 . . . .343.59 -0.12 344.2 318.0
Tsy 12.000 17 . . . .119.92 0.00 128.6 119.1
Tsy 1.250 17 . . . . .115.45 -0.24 116.6 108.4
Tsy 8.750 17 . . . .140.60 -0.33 141.9 133.3
Tsy 5.000 18 . . . .121.40 -0.40 122.5 110.6
Tsy 4.500 19 . . . . .119.76 -0.49 120.7 106.5
Tsy 3.750 19 . . . . .114.67 -0.48 115.6 100.7
Tsy 2.500 20 . . . .364.40 -0.34 367.1 322.1
Tsy 4.750 20 . . . .122.16 -0.52 123.5 107.7
Tsy 8.000 21 . . . .150.85 -0.60 153.4 134.8
Tsy 1.875 22 . . . .126.32 -0.41 129.1 113.3
Tsy 4.000 22 . . . . .116.36 -0.66 118.2 100.0
Tsy 2.500 24 . . . .327.07 -0.40 334.7 282.2
Tsy 5.000 25 . . . .127.75 -0.72 130.6 108.5
Tsy 1.250 27 . . . .122.55 -0.38 127.0 106.6
Tsy 4.250 27 . . . . .118.84 -0.80 122.7 99.1
Tsy 6.000 28 . . . .143.36 -0.79 148.0 120.7
Tsy 4.125 30 . . . .312.25 -0.36 322.8 268.3
Tsy 4.750 30 . . . .125.59 -0.92 130.5 104.3
Tsy 4.250 32 . . . . .118.12 -0.98 123.1 97.5
Tsy 4.250 36 . . . . .118.34 -1.11 123.9 96.8
Tsy 4.750 38 . . . .128.04 -1.13 134.2 105.0
Tsy 4.500 42 . . . .124.53 -1.21 130.8 101.3
% %
Wealth Management | Markets
28 CITYA.M. 14 MARCH 2012
THE A-CLASS FOR YOUNGER BUYERS
The Mercedes-Benz A-Class has never been much of a looker due to
its tall, one-box form. But now Mercedes is hoping to attract new and
younger buyers who would otherwise have bought a BMW 1-Series
or Audi A3. Its new A-Class is lower, sportier and cooler thanks to its
more conventional hatchback form and contemporary styling.
CAR TALK BY RYAN BORROFF
NISSAN HATCHBACK TO BE BUILT IN THE UK
Ok so the name is rubbish but Nissan's new compact hatchback
called Invitation is hugely significant, not least because it will be
built in the UK when it goes into production in 2013. The model will
be built alongside the highly popular Juke crossover at Nissan's
Sunderland plant. Expect the name to change.
FASTEST BENTLEY EVER IS PREVIEWED
The Geneva motor show revealed some surprising introductions.
Bentleys EXP 9 F SUV concept will be the fastest and most expen-
sive 4x4 ever if it makes production which is likely as it would
mean an all-important lucrative third model for Bentley and markets
like China, Russia, and the Middle East are almost certain to love it.
Third gen Boxter has a real kick
Y
es sir we do have a swimming pool
but Im afraid you cannot swim in it
because there is a car in it. And so
there was, a new Porsche Boxster,
slap bang in the middle of the swimming
pool at the Kube Hotel in St Tropez.
No swim then, how disappointing. But
then thats the Kube Hotel for you. Light
switches are un-intuitively placed and the
door handle requires three full turns of
the handle no one anywhere on Earth
expects to turn a door knob three full
turns anti clockwise to open a door. The
whole place seems as if style has been val-
ued to the detriment of genuine substance.
The same cannot be said for Porsches
new Boxster. If the Boxster was derided as
a poor mans 911 when it was launched
back in 1996 then how about this? The all-
new third generation of its mid-engined
drop-top could be described as the poor
mans Carrera GT; so much does it resem-
ble that iconic flagship supercar at the
front. From the rear its new duck tail
spoiler which rather marvellously is
integrated into the tail lights is as beau-
tiful a rear end as Ive seen on a roadster.
The new Boxster is lighter, a little big-
ger and has cleaner, more fuel efficient
and more powerful engines. The car is
lower, longer and has a wider running
track and larger wheels a designers
dream which contribute greatly to the
styling of a car that for the first time
looks like its reached maturity. Not only
is this Porsches best looking roadster
since the 550 Spyder but I am struggling
to imagine how the company will ever
improve on it.
For the first time the car has electro-
mechanical power steering which results
in more comfortable, easier driving at
lower speeds but which is weighted for
more feedback the faster one travels.
There will be a lot of fuss made about this
compromise. Using an electro-mechanical
system over a traditional hydraulic one
(the former requires energy only during
steering, the latter requires constant ener-
gy) helps with fuel efficiency but I find
the steering to be direct and well weight-
ed and I struggle to find any real criticism
of it.
From St Tropez we drove the 265hp, 2.7-
litre Boxster and the 315hp, 3.4-litre
Boxster S deep into the Maritime Alps
Porsches cheapest
offering doesnt feel
one bit like the poor
mans option
THE VERDICT:
DESIGN hhhhh
PERFORMANCE hhhhh
PRACTICALITY hhhhi
VALUE FOR MONEY hhhhi
THE FACTS:
PORSCHE BOXSTER PDK
PRICE: 39,511
0-62MPH: 5.5secsec
TOP SPEED: 162mph
CO2 G/KM: 180g/km
MPG COMBINED: 36.7mpg
over some incredible roads. Both had
Porsches PDK semi-automatic, dual-
clutched transmission, though we also
drove the more demanding manual gear-
box Boxster S. Both engines provide
enough aural entertainment with the roof
open, yet driving is surprisingly refined
with the roof closed. The Boxster S provid-
ed more power from the bottom up, but it
was the entry-level 2.7-litre Boxster, with
Sport Plus engaged, that won us over. That
is not to say that it is the better car.
Obviously, it lacks some of the immediate
power availability of the S, but still we
enjoyed its engine. The 2.7-litre Boxster
demanded to be wound up, but with revs
spinning and carrying our speed through
the bends, the engine was at its best, and
was very rewarding in terms of thrills. I
found paddle shifting the dual-clutched
PDK system more fun than shifting the tra-
ditional gearbox. But it is the Boxsters
improved capability to soak up bumps plus
even better cornering ability that is so
remarkable. It made for as entertaining
and as committed a mountain motoring
easy when youre in the mood for more
modest progress. Even the roof is trouble-
free and raises and folds down in just nine
seconds at up to speeds of 30mph. I cant
usually stand faffing around with drop
tops. But Porsche may have just built its
most complete car ever. And I think the
entry-level Boxster is the one I would buy.
experience as I have had. High jinks indeed
on a beautiful sunny morning on the Cote
dAzur.
Considering that this is the cheapest
Porsche your money can buy, a car that is
now capable of returning 36.7mpg, the
Porsche Boxster is staggeringly good fun.
Yet the driving remains comfortable and
Porsches cheapest
offering is still a great
ride.
Lifestyle | Motoring
29
WORDS BY
RYAN BORROFF
CITYA.M. 14 MARCH 2012
T
E
R
R
E
S
T
R
I
A
L
WATERLOO ROAD
BBC1, 8PM
Zack takes a DNA test to confirm
his suspicions about his parentage
and when Jez finds out what he is
doing, he is devastated.
ROGER & VAL HAVE JUST GOT IN
BBC2, 10PM
The Stevensons prepare to welcome
guests for dinner. Comedy, starring
Dawn French and Alfred Molina. Last
in the series.
NCIS
CHANNEL5, 9PM
Abby becomes personally involved in
the case of a murdered naval scientist
who she regards as a kindred spirit.
Drama, starring Pauley Perrette.
BBC1
SKY SPORTS 1
6pmLive Masters Tennis 12am
UEFA Champions League
Highlights 1amA League Football
1.30amFIFA Futbol Mundial 2am
Youre on Sky Sports! 3amUEFA
Champions League Highlights 4am
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T
W
G
A
O R
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4



4



4
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E E C O U P O N
P I A F M F R
T V S E L F I S H
E R E A A T
T E S T M A T C H E S
C B H A D O
C O M P A S S Z L
V O L B A R E
D E V O T E R M
R R D E A D E N
3 2 6 1 4 2 3 1
9 6 8 7 8 4 9 6
4 9 3 2 1
3 1 1 8 3 9 4
5 3 2 4 9 6 7 8 1
6 9 1 2
3 8 1 6 2 5 9 7 4
5 3 8 7 9 9 5
2 5 1 7 8
7 4 1 2 3 9 6 8
9 8 5 7 1 3 5 2
4
4
4
4
4
4
4
4
4
WORDWHEEL
The nine-letter word was
BRONCHIAL
Lifestyle | TV&Games
CITYA.M. 14 MARCH 2012 30
Punter | Cheltenham
31
BETFAIR
63
25
FREE BET*
New customers
only, sign up with
code CHL225.
WILLIAM
HILL
7
RACING TRADER BILL ESDAILE PREVIEWS THE CHAMPION CHASE AND RSA
A pot of gold at the
end of the Rainbow
awaits for Finians
T
HE Sportingbet.com Queen
Mother Champion Chase is
always one of the most
thrilling races of the National
Hunt season, but this years renewal
has already been written off as a poor
contest. That is unfair on reigning
champion Sizing Europe who slaugh-
tered his rivals from the front in this
race last year, following up his 2010
Arkle victory.
Henry De Bromheads 10-year-old
has looked brilliant in his last two
victories at Sandown and
Punchestown and he clearly loves
Cheltenham. The ground is going to
be right up his street and Andrew
Lynch will probably try to dictate
things from the front, just as he did
12 months ago.
Sizing Europe is easily the most
likely winner of the race, but he was
10/1 when we tipped him last year
and is now a best price 10/11 with
Coral. That is just too short for me
and there are also a number of stats
against him. Only one of the last 12
winners was aged 10 or older, while
Master Minded is the only back-to-
back winner since Viking Flagship in
1995.
He looks the perfect lay in-running
on Betfair as he will surely trade very
short if hitting a decent rhythm over
his fences. Yes, he may well keep
everything at bay, but the
Cheltenham hill has found out good
horses in the past and he could trade
artificially short rounding the home
bend.
Big Zeb was firmly put in his place
by Sizing Europe at Punchestown last
time, but that run was too bad to be
true and is probably best ignored.
That said, the 2010 champion is now
11 and he would have to replicate
Moscow Flyers achievement of win-
ning back his crown at the same age.
Colm Murphys pride and joy should
finish in the front three, but Id be
surprised if he can win.
Nicky Henderson last won this
race in 1992 with the exceptional
Remittance Man and many expect
him to win it next year with Sprinter
Sacre. However, I actually think he
can land the prize this time with
FINIANS RAINBOW, last years Arkle
runner-up.
Michael Buckleys nine-year-old
was a decent novice chaser last term
and most likely would have won the
Arkle had he not gone off so quick in
front. He appears to have calmed
down quite a bit this season and
although some were disappointed
with his run behind Somersby in the
Victor Chandler Chase, I actually
thought it was a good performance.
Henderson has always loved
Finians Rainbow and reports from
the yard suggest he has been work-
ing really well. There is sure to be
plenty of pace in this line-up and
that should suit him perfectly. He
used to always pull himself to the
front, but I think Barry Geraghty will
look to play his cards late and try to
do the two Irish runners up the hill.
Its a monumental task trying to
beat Sizing Europe over this course
and distance on this ground, but
those who run well in the Arkle have
an excellent record in this race. Coral
are a best price 9/2 and that really is
an each-way bet to nothing.
As for the rest, we are already on
WISHFULL THINKING at 25/1 and
that isnt a bad bet seeing as hes no
bigger than 16/1 now. But, he has
been a huge disappointment so far
this campaign and Philip Hobbs isnt
sure hes got to grips with his breath-
ing yet. He should never be written
off because hes a very talented ani-
mal, but Im not particularly confi-
dent.
Kauto Stone ran a shocker at Ascot
last time when he was very keen and
the quicker pace in this contest
should rectify that problem.
However, I think he needs soft
ground and Id be surprised if he has
the tactical speed to stay with the top
dogs coming down the hill. Realt
Dubh, Gauvain and Im So Lucky will
all be trying to nick a place, but they
will surely struggle to beat the mar-
ket leaders.
The will he, wont he saga of
whether Grands Crus will run in the
RSA Chase or Gold Cup is finally over
and connections have decided to
keep him to the novice route. He was
electric on his last start in the
Feltham at Kempton when he won in
a quicker time than Kauto Stars King
George. He has some excellent form
at Cheltenham and will be many peo-
ples idea of todays banker.
However, the RSA is a notoriously
tough race and they often go a mud-
dling pace which isnt likely to suit
the strong-pulling seven-year-old. I
also have my doubts as to whether he
truly stays this 3m1f trip and at
around 13/8 on Betfair, Im happy to
take him on.
So, who can beat him? The betting
indicates BOBS WORTH is the most
likely and I tend to agree. The son of
Bob Back has been beaten on his last
two starts, but he didnt seem to
enjoy going right-handed at Ascot
and Kempton. He is three from three
at Cheltenham, including last sea-
sons Albert Bartlett, and this race
has always looked like being the
ideal test for him.
My main worry is his jumping
because he hasnt looked an absolute
natural in his first three starts over
fences, but he has been off to jump-
ing expert Yogi Breisner and a return
to Prestbury Park could be exactly
what he needs. Id be happy to side
with Bobs Worth over Grands Crus in
a match with Sporting Index anyway.
First Lieutenant is another Festival
winner having landed last years
Neptune, but he has been very disap-
pointing so far over fences. However,
he has shown his liking for
Cheltenham and the better ground
will suit, so he cant be dismissed at
around 7/1 on Betfair.
Join Together has excelled over
this course this season and he looks
very much an old school chaser. He is
not dismissed at 6/1 with Coral, but
Im not sure hell have enough speed
for this race on good ground.
POINTERS...
BOBS WORTH 2.40pm Cheltenham
FINIANS RAINBOW e/w 3.20pm Cheltenham
ALREADY ADVISED
WISHFULL THINKING 25/1 e/w
3.20pm Cheltenham
Finians Rainbow goes for the Champion Chase Picture: GETTY
Punter | Cheltenham
32 CITYA.M. 14 MARCH 2012
RACING TRADER BILL ESDAILE PREVIEWS THE NEPTUNE AND THE
NATIONAL HUNT CHASE
S
OMEONE asked me the other day
if there was one horse I really fan-
cied at this years Cheltenham
Festival and without a moments
delay I told him MONKSLAND in the
Neptune Investment Management
Novices Hurdle.
Regular readers of this column may
have followed my advice already and
backed Noel Meades runner at 14/1 last
month, but I still reckon he is worth sup-
porting at 5/1 with Coral. The five-year-
old first caught my eye when winning
on his hurdling debut over an inade-
quate two miles in December, before
bolting up in a Grade Two over an extra
half mile the following month.
Now, it wasnt just what he beat that
day (the runner-up Lyreen Legend was
beaten 4 lengths and has won a Grade
Two since), it was the effortless manner
in which he did it. His trainer immedi-
ately spoke of the Neptune as a long-
term target and emphasised that
Monksland was desperate for decent
ground. Well, he gets his ideal condi-
tions today and is a confident selection
to follow in the footsteps of Nicanor who
won this race for the stable in 2006.
The most obvious danger on paper is
Nicky Hendersons Simonsig who looks
to have all the potential in the world.
The imposing grey didnt have to come
out of first gear when landing his prep
race at Kelso and was originally one of
the market leaders for the Supreme
Novices Hurdle. Connections opted to
re-route him to this race as jockey Barry
Geraghty felt that his hurdling would be
put under less pressure over the extra
half mile of the Neptune.
I just have a sneaky suspicion in the
back of my mind that Simonsig may well
travel like the winner to the top of the
hill, but might not get home. He looked
to be cruising in behind Philip Hobbs
Fingal Bay at Sandown earlier in the sea-
son, but stopped when popped the ques-
tion after the last. Geraghty and
Henderson were both quick to put the
disappointment down to fitness, but Im
not so sure. He is as short as 7/4 with one
high-street bookmaker and Id far rather
be a layer at that price than a backer.
In fact, I will be looking to lay
Simonsig in-running at the top of the
hill on Betfair as I can see him trading
extremely short at that point. There is
every chance he could trade at odds-on a
long way out and thats when Ill be
reaching for the lay button.
As for the rest, I respect Alan Kings
Batonnier who was an impressive win-
ner over course and distance in
December. He looks sure to run a solid
race but would be surprised if he has the
class to beat Monksland. Ruby Walsh
partners Sous Les Cieux for Willie
Mullins and his price has collapsed as a
result. He is no bigger than the 6/1 avail-
able with Coral and thats pretty short
for a horse who has looked a little trip-
less.
The Mullins team may have better
luck in the days opening contest as they
saddle two of the top three in the bet-
ting in ALLEE GARDE and Soll. Finding
the winner of the 20-runner Diamond
Jubilee National Hunt Chase for amateur
riders over an energy-sapping four miles
is no easy feat, but Allee Garde may just
be a cut above these. Dont forget he was
beaten just over six lengths when third
to Last Instalment in a Grade One at
Leopardstown in December over three
miles. Thats his best bit of form to date
(and better than anything else on offer
here) and its no coincidence that it
came on decent good ground.
Patrick Mullins could have ridden Soll,
original ante-post favourite for the race,
but made the switch last week. He looks
fairly decent each-way value at 6/1 with
Paddy Power and as long as he can stay
out of trouble early, will surely play a
part in the finish.
As for the dangers, the Paul Nicholls
team are sweet on the chances of Harry
The Viking, while it would be no sur-
prise to see bold shows from Charlie
Longsdons pair Universal Soldier and
Strongbows Legend. However, Ill also be
throwing a few quid at another Irish
raider in the shape of FOUR COMMAND-
ERS at 16/1 with Paddy Power. The six-
year-old looked to be crying out for this
trip when running on at the death in a
three mile Grade Two last time and is a
sound jumper. His trainer Mouse Morris
is a master at preparing one for the
Festival and certainly doesnt bring one
over if they dont have a chance.
The two horses Id be tempted to
oppose on the index with Sporting Index
are Teaforthree and Alfie Spinner. That
may seem crazy to some people, particu-
larly as the former is challenging for
favouritism, but there is a method to my
madness. Firstly, I thought Teaforthree
had a hard race on very soft ground at
Chepstow at the back end of last month
and that may have left its mark. As for
Alfie Spinner, hes disappointed whenev-
er hes met good ground and he wont
get his conditions this afternoon.
Im at Cheltenham all week and you
can get my up-to-date views on Twitter
@BillEsdaile.
POINTERS...
ALLEE GARDE 1.30pm Cheltenham
FOUR COMMANDERS e/w 1.30pm Cheltenham
MONKSLAND 2.05pm Cheltenham
ALREADY ADVISED
MONKSLAND 14/1 e/w
2.05pm Cheltenham
Monksland
to outstay
Henderson
hotpot
Simonsig
in the
Neptune
Noel Meades Monksland
is a strong fancy in the
Neptune.
Picture: GETTY
CITYA.M. 14 MARCH 2012
Punter | Cheltenham
33
RACING TRADER BILL ESDAILE PREVIEWS TODAYS REMAINING RACES
The party will go on long into the
night should New Years Eve win
I
RELAND have had a stranglehold
on the Weatherbys Champion
Bumper since the race was intro-
duced in 1992 with 14 winners
compared with Britains five.
However, the home team have
bounced back in recent years, win-
ning the last two renewals with Cue
Card and Cheltenian.
That said, the one man all will fear
is Willie Mullins who simply has an
extraordinary record in the race. Last
years top Festival trainer has won it
six times and has two entered this
year, Champagne Fever, the mount of
his son Patrick, and Pique Sous, rid-
den by Ruby Walsh. The former won
well at Fairyhouse last time, but he
looks soft ground dependant, while
Walshs mount landed a
Leopardstown Bumper in style last
time and could be anything.
Pique Sous is not passed over light-
ly, but Irelands best hope looks to be
Moscow Mannon, who is going for a
four-timer. He has looked very good
on his last three starts, but he has an
inexperienced jockey in the saddle
and is short enough at 7/1 with Coral.
John Ferguson has made a stun-
ning start to life as a jumps trainer
with the cast-offs from Sheikh
Mohammeds Godolphin operation
and he can land the race with the
four-year-old NEW YEARS EVE. The
son of Derby winner Motivator
sluiced up at Market Rasen last time
and Barry Geraghty is a very interest-
ing jockey booking.
A slight concern is that only three
of the 19 winners of this race to date
were four-year-olds, but this fellow
could be a little bit special and is
worth backing at around 6/1 on
Betfair. The New One, Royal
Guardsman and Jezki are all dangers,
but they may not have enough speed
to live with the Ferguson runner.
Have a look at Sporting Indexs
match bets because Id be happy to
take on either of Mullins runners
with New Years Eve. He could be
quite a short price for next years
Supreme Novices Hurdle after this
race if he wins as well as is expected.
Alan King has a powerful squad at
his disposal this year and you have to
take notice when he says that
VENDOR is his best chance of a win-
ner at the Festival this year in the
Fred Winter. Fortunately for us, we
advised backing him a few weeks ago
at 8/1 and he is now a 7/2 shot with
both Coral and Paddy Power.
The French-bred won well at
Newbury on his sole British start,
despite a bad mistake at the last. King
has always said he thought Vendor
would be suited to better ground and
he has reportedly been working the
house down at Barbury Castle.
Apparently he is in the same league
as Grumeti and Balder Success and if
that is true a mark of 129 would seri-
ously underestimate his ability.
The main worry is his jumping
because he has fallen or unseated
three times in his seven-race career,
but he has done plenty of schooling
and there is certainly no reason to
jump ship now.
David Pipes Kazilian is a danger,
but I dont think hes beaten any-
thing and I definitely want to take on
Paul Nicholls Ulck Du Lin, who is yet
to race in this country. Hes been
backed purely because people think
hes another Sanctuaire and I will be
laying him for a place on Betfair, as
well as opposing him on the Sporting
Index race index.
It might be worth having a few
quid each-way on Venetia Williams
KAPGA DE CERISY at 20/1 with Coral.
The chestnut gelding improved
markedly for the better ground at
Sandown last time and I like the way
he battled up the hill. Williams is
always to be feared in the handicaps
at this meeting and this one could
easily sneak into the places.
Finding the winner of the 28-run-
ner Coral Cup hasnt been easy for
punters in recent years and you have
to go back to Xenophon in 2003 to
find the last winning favourite. This
years renewal looks as tricky as ever
with Get Me Out Of Here currently
heading the sponsors betting at 9/1.
Last years County Hurdle runner-
up looks sure to put up a bold bid off
top weight, but may struggle to defy a
mark of 155 considering no winner of
this contest has been rated higher
than 147 in 18 runnings. It has tradi-
tionally paid to follow an Irish runner
coming off the back of a break in this
race and Noel Meades SILVERHAND
looks just the type.
Our selection was last seen in
action over hurdles when sixth to
Moon Dice at Galway in July and
seems to run best when fresh. Its also
encouraging to note that Silverhand
was in the process of running a
stormer behind Spirit River in this
race back in 2010 when badly ham-
pered. He was staying on at the time
and would have finished much closer
if he hadnt been interfered with. He
looks decent each-way value at 25/1,
particularly with so many firms offer-
ing five places.
As for the rest, Im also keen to take
an each-way chance on the fast-
improving John Ferguson-trained
CAPE DUTCH at 18/1 with the spon-
sors. He was beaten by Edgardo Sol
over an inadequate two miles at this
track back in November and relished
the half mile step up in trip when
bolting up at Musselburgh last
month.
Jack Quinlan takes off a crucial
5lbs meaning that Cape Dutch will
feel like he is running loose with just
10 stone in the saddle. David Pipes
pairing of Poole Master and Balgarry
are hugely respected, but Id rather
take them on at the prices.
POINTERS...
SILVERHAND e/w 4.00pm Cheltenham
CAPE DUTCH e/w 4.00pm Cheltenham
KAPGA DE CERISY e/w 4.40pm Cheltenham
NEW YEARS EVE 5.15pm Cheltenham
ALREADY ADVISED
VENDOR 8/1 e/w
4.40pm Cheltenham Barry Geraghty is an interesting jockey booking on New Year's Eve. Picture: GETTY
Sport
34
LIVERPOOL captain Steven Gerrard
insists last nights morale-boosting
victory in the Merseyside derby will
count for nothing unless his side can
discover a level of consistency that
will turn them into Champions
League contenders.
Gerrard became the first player to
score a hat-trick in this fixture since
Ian Rush scored four times at
Goodison Park in 1982, as Liverpool
ended a depressing sequence of three
Premier League defeats in succession.
Despite last nights welcome three
points, Kenny Dalglishs side remain
10 points adrift of fourth placed
Arsenal and Gerrard challenged his
team-mates to ensure Liverpools
absence from Europes premier club
competition does not stretch into a
third season.
Its been frustrating, the inconsis-
tency weve been showing in the
league, very frustrating, he said. We
played very well at Arsenal and got
nothing, then we never turned up at
Sunderland. We need to find a level
of consistency where we go on a win-
ning streak, rather than win one and
lose one, because otherwise we find
ourselves in a position in the league
that we dont want.
After a typically frenetic opening,
Gerrard eventually brought order to
the contest in the 34th minute with a
delicate chip from the edge of the
penalty area which rendered four
Everton defenders and goalkeeper
Tim Howard helpless.
The England midfielder effectively
sealed victory six minutes after the
break after he rammed home a Luis
Suarez cut back and the Uruguayan
was the unselfish provider again in
injury time, allowing Gerrard to cap
his 400th Premier League appearance
in the grand manner.
LEICESTER centre Manu Tuilagi
remains hopeful that Englands inter-
im head coach Stuart Lancaster will
be appointed on a permanent basis by
the Rugby Football Union.
Tuilagi, who scored the opening try
in last weekends victory over France
in Paris, said: Personally I hope he
gets the job, but thats not my deci-
sion to make.
Phil Dowson, meanwhile, has been
retained in a 24-man England squad
ahead of Saturdays clash with Ireland
despite being knocked out by Wesley
Fofana during the win in Paris.
Gerrards derby day hat-trick helps
Liverpool rediscover winning habit
RUGBY UNION

Tuilagi hoping
Lancaster gets
England role
BY JAMES GOLDMAN
FOOTBALL

3
0
LIVERPOOL
EVERTON
Gerrard was making his 400th Premier
League appearance Picture: GETTY
A
FORTNIGHT ago you would
have given Chelsea little
chance of overturning a two-
goal deficit against this
vibrant Napoli side, but the sack-
ing of Andre Villas-Boas has
changed the atmosphere inside
the club and complexion of this
tie.
The temptation will be for
Chelsea to mimic Arsenals gung-
ho approach against AC Milan last
week, but with an away goal in
the bank Roberto di Matteo can
afford for his side to be a bit more
cautious.
Whatever the scenario, Napoli
will always look to play on the
counter and utilise the quality of
their three forwards Edinson
Cavani, Ezequiel Lavezzi and
Marik Hamsik.
Cavani in particular is a class
act he would thrive in the
Premier League and could easily
be replacement for Didier Drogba
at Stamford Bridge next season
so John Terrys return to fitness
could not be better timed.
Chelsea have been here before
in Europe as recently as
December in fact when they
brushed Valencia aside to qualify
for the knockout stages.
A repeat of the discipline and
intensity they showed that night
and the old guard of Drogba, Terry
and Frank Lampard are capable of
inspiring a season defining come-
back.
Trevor Steven is a former England foot-
baller who played in both the 1986 and
1990 World Cups and the 1988
European Championships.
Blues must
be patient
to complete
a comeback
FOOTBALL COMMENT
TREVOR STEVEN
CHELSEA captain John Terry
believes a recent change of man-
agement has provided the club
with the impetus and momentum
that will propel them past Napoli
this evening and into the quarter-
finals of the Champions League.
The Seria A side, who earned a
highly creditable draw away
against Manchester City in the
group stages, arrive in west London
confident of protecting a two-goal
lead from a first leg which con-
tributed to the sacking of Andre
Villas-Boas a fortnight ago.
Although Terry accepts the play-
ers must shoulder a large propor-
tion of blame for the Portugueses
demise, he rubbished recent sug-
gestions from Arsenals Wojciech
Szczesny and his former boss Luiz
Felipe Scolari that Chelseas senior
players run the club.
We couldnt seem to buy a win,
[then] we changed managers and
we get two wins, said Terry.
Roberto [di Matteo] and Eddie
[Newton] have come in and obvi-
ously weve done very well in the
first few games and its the
momentum that weve maybe
missed coming into these big
Champions League games.
Were all responsible for the
run of results. Unfortunately for
Andre it fell on his head. But I
think the players would also hold
their hands up and say, perfor-
mance-wise, we are to blame as
well.
As for the senior players run-
ning this football club, thats non-
sense. Thats just the perception
from outside. Roman [Abramovich]
and the board make the decisions.
People speculating from various
different clubs or previous man-
agers, thats complete nonsense.
Chelsea have failed to win any of
thier five previous home knockout
matches in the Champions League
and Terry is aware of the size of the
task ahead against a side who
scored six at the weekend, despite
resting their star striker Edinson
Cavani.
If it all goes well, it could go
down as one of the great nights of
Chelseas history, said Terry. Itll
be very tough. Seeing their last
game, too, when they won 6-3,
defensively, we need to be really
solid. Itll be a balance, and com-
munication will be key.
BY JAMES GOLDMAN
FOOTBALL

(1)
(3)
CHELSEA
NAPOLI
Terry vows
to complete
Italian job
Skipper quells talk of player power and calls for
unity ahead of Champions League salvage mission
35
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email sport@cityam.com
SPORT | IN BRIEF
Woods on target for Masters
GOLF: Tiger Woods hopes of playing at
the Masters next month have been
boosted by news that his Achilles tendon
injury which forced him to pull out of the
final round of last weekends WGC-
Cadillac Championship is not as bad as
first feared.
Bayern batter beleaguered Basel
FOOTBALL: Bayern Munich beat Basel
7-0 last night and 7-1 on aggregate to
progress to the last eight of the
Champions League. Inter crashed out on
the away goals rule despite beating
Marseille 2-1 at San Siro.
THE Paul Nicholls-trained Rock On
Ruby caused a major upset on the
opening day of the Cheltenham
Festival by dethroning odds-on
favourite Hurricane Fly and claim vic-
tory in the Champion Hurdle.
Ridden by Noel Fehily, who missed
the last two Cheltenham Festivals
through injury, the 11-1 shot passed
long-time leader Overrun, who fin-
ished second, and held off a late chal-
lenge from last years winner, who
came third.
Its just testament to the whole
team. Its a really tremendous effort
and everyone is going to be thrilled,
said Nicholls. This horse is a seven-
year-old, hes the right age, and its
brilliant. It was a great ride by Noel.
Hes a good man and has got a great
winner. This is awesome.
Rock On Ruby may have claimed
the days showpiece race, but Sprinter
Sacre produced the most eye-catching
performance by romping home in the
Arkle to help trainer Nicky
Henderson equal Fulke Walwyns
record of Cheltenham Festival win-
ners.
Sent off as an 8-11 favourite, the
much hyped six-year-old looked to
have plenty left in the tank as he
cruised to a seven-length success over
Cue Card under Barry Geraghty.
Celebrating his 40th Cheltenham
winner, Henderson said: We always
hoped he might be a bit special.
He was coming here to show off
and hes done it. Thats the way he
loves to do it. He is very flashy and
very showy.
That jumping was quite unreal.
He was always travelling and hes got
up the hill. Hes got so much speed
and scope, hes just a dreadful show-
off. That was really worth watching.
Geraghty, who has partnered
Cheltenham legends Moscow Flyer
and Kicking King in the past, was
equally fulsome in his praise of the
sports most exciting chaser.
He said: Hes unbelievable, he has
so much pace and scope Im not
sure Ive had the privilege to ride any-
thing like that. As long as he stays in
one piece, thats the main thing. The
way he jumped the third-last he gives
you some feel.
Hurricane Fly dethroned by
Nicholls and Rock On Ruby
Rock On Ruby claimed the Champion
Hurdle under Noel Fehily Picture: GETTY
BY JAMES GOLDMAN
HORSE RACING

FORMER WBA and IBF light-welter-


weight king Amir Khan insists he will
prove Decembers defeat against
Lamont Peterson was a one-off when
the pair meet again in two months
time.
The Bolton fighter admitted yester-
day that he struggled to make the
weight for the original bout in
Washington which was shrouded in
controversy. Khan aired concerns over
points deductions by referee Joseph
Cooper for pushing and also the role
of mystery man Mustafa Ameen at
the ringside.
The pair face each other again on
19 May in Las Vegas and Khan claims
he will return to the ring a more
streetwise boxer.
For this fight, were going to
change a lot of things. Ill train hard
and am not going to make any mis-
takes at all, said the 25-year-old.
Well see a different Amir Khan for
this fight. Ill be explosive, as always,
and maybe this fight can be one of
the fights of the year too. This fight
will be even tougher because we
know what to expect from each
other.
Khan: I wont
make the same
mistakes twice
BOXING

THE PUNTER ASSESSES


CHAMPION CHASE RIDDLE
BETTING GUIDE TO DAY TWO OF
CHELTENHAM FESTIVAL: P31-33