PRESS DIGEST - Financial Times - Oct 2

Financial Times

FSA POISED TO REVIVE REGULATORY COMMITTEE TO VET BANK DIRECTORS

The City is set to return to some of its former methods of conducting business by setting up a regulatory committee to vet the appointment of directors of British banks. Sources close to the process say Sir Brian Pitman, former head of Lloyds (LLOY.L), and former Barclays (BARC.L) chairman Sir Peter Middleton have been chosen by the Financial Service Authority to serve on a panel it hopes to have running by the end of the year. However, the idea has been criticised by some who say it formalises an old boys' network of elderly white men who are unlikely to upset the status quo.

STAMP DUTY ON SHARES BREAKS EU LAW

A fundamental aspect of Britain's stamp duty regime was thrown into doubt on Thursday when the European Court of Justice ruled that "stamp duty reserve tax" (SDRT) breached European Union law. The case bought by HSBC (HSBA.L) concerned a bill for 27 million pounds of SDRT during its takeover of French bank CCF in 2000. The court ruled the levy on shares offered to CCF investors via a French clearing system was contrary to the capital duty directive that governs indirect taxes on capital raising. The ruling is expected to prompt big refund claims by multinationals against the Treasury.

CREDIT GROWS TIGHTER FOR HOME BUYERS

The Bank of England's credit conditions survey for the three months to the middle of September has revealed a mixed outlook on the cost and availability of credit to households and businesses. A reduction in the availability of mortgages reflects deterioration in the cost and availability of banks' own funds, while corporate borrowers have found credit becoming cheaper and easier to obtain as banks moved to boost market share. For homeowners, lenders said improved prospects for house prices should encourage more secure lending towards the end of the year. Overall, the survey showed demand for mortgages for house purchases had risen.

LSE IN TALKS TO BUY TURQUOISE

The London Stock Exchange (LSE.L) is interested in acquiring Turquoise and is in exclusive talks with the share trading platform's bank shareholders. Turquoise was launched only a year ago with the intent of challenging the 208-year old LSE and the move is seen as a sign that relations between banks and exchanges are improving, as they band together to offset the effects of increased regulation. The move is also seen as part of new LSE chief executive Xavier Rolet's plan to rebuild the business by rebuilding relationships with the banks, who are the exchange's biggest customers.

WINE CELLAR FORCED INTO ADMINISTRATION

Off-licence and convenience store operator Wine Cellar has gone into administration, with the loss of around 320 jobs. Yesterday, administrator Deloitte announced the "pre-pack" sale of the majority of Wine Cellar's outlets to drinks distributor EFB Retail. Wine Cellar faced difficulty competing with supermarkets and, with quarterly rent payments due, found itself in a position where it could no longer continue trading. The sale to EFB will secure around 640 jobs at outlets and a further 60 head office jobs.

SPECIAL OFFERS HELP DOMINO'S REGAIN SALES MOMENTUM

Aggressive advertising and a focus on special offers helped fuel a 10.8 percent rise in third quarter like-for-like sales at Domino's Pizza. The firm benefited from cost conscious consumers staying home and was also able to take advantage of falling advertising rates -- targeting shows such as Britain's Got Talent. Chief executive Chris Moore said: "Our tactical marketing campaigns have played a major part in our success." Domino's has opened 30 stores this year and plans to open another 20 by the end of the year, but faces increased competition from rivals who also plan a number of new store openings.

REDHALL SHARES DROP 14 PERCENT ON ORDER VOLUMES WARNING

Industrial engineering group Redhall (RHL.L) has warned of lower-than-expected volumes in the chemical and nuclear sectors and a marginal drop in forecast profits. As a result its shares fell 14 percent, or 25 pence, to 156 pence. Its broker Altium reduced its pre-tax profits forecast from 6.8 million pounds to 6.4 million pounds and left dividend forecasts unchanged at 4.4 pence for this year, and 4.8 pence for 2010. The warning follows a drop in expected work on the decommissioning of the Sellafield nuclear plant. New chief executive Simon Foster was keen to highlight the continuing growth of the company's order book from 110 million pounds in June to 117 million pounds.

ICAP SEES SHIFT TO E-BROKING

Icap (IAP.L), the inter-dealer broker, said over-the-counter derivatives markets had "reached an inflection point" that could result in a move away from the more traditional voice broking to deals made electronically. Chief operating officer Mark Yallop said regulatory pressure to move more OTC trades on to exchanges and other electronic trading platforms had provided a boost for e-broking in areas such as interest rate swaps. Icap confirmed its expectation that adjusted full-year profits for the year to March 2010 would meet market expectations and be in the region of 309 million to 354 million pounds.

FLYING FLOWERS' UK MOVE COULD SEE REVENUES WILT

Flower delivery business Flying Flowers is to move from Jersey to the UK in order to improve the quality and speed of its service, a move that could cost the company 250,000 pounds in VAT. However, this is seen as a short-term loss of revenue. Parent company Flying Brands (FBD_u.L) was criticised by Sir Tom Hunter, its largest shareholder, in January after the company issued a profit warning, but it recently announced a 78 percent rise in first-half pre-tax profit to 1.9 million pounds after reducing costs and improving sales.

Prepared for Reuters by Durrants