PRESS DIGEST - Financial Times - March 27

Financial Times

INVESTORS RUSH TO PULL CASH OUT OF FUNDS

Figures from the Office of National Statistics have shown a large amount of withdrawals from life and pension funds by institutional investors during the last three months of 2008. The trend in recent years to close schemes to new investors has disrupted the supply of net new money given to fund managers, and many members of funds are beginning to withdraw funds as they reach retirement age. Institutional investors are also tending to sell the assets which remain relatively valuable.

PLUNGE IN SALES ADDS TO RETAILER WOES

Sales volumes in February fell by 1.9 percent on the month, a far greater drop than the 0.9 percent predicted by a variety of economists in a Reuters survey. Office of National Statistics data showed a 0.4 percent increase in sales from February 2008, a sharper decline from the 3.8 percent year-on-year increase recorded in January. "Today's figures from the ONS are the clearest indication yet of the weakening retail market in the UK," said Deloitte's head of retail, Tarlok Teji. It is also possible that underlying retail sales were even weaker, as the statistical device used by the ONS to calculate sales volumes from the value of retail sales may be obsolete.

RIO REVEALS ITS 'PLAN B' ON FUNDING

Guy Elliott, Rio Tinto's(RIO.L) chief financial officer, has reassured investors that the company have alternative fundraising strategies in place in case the planned investment in the company by the Chinese miner Chinalco is obstructed by regulators or shareholders. Elliott went on to say that Rio would "consider a rights issue, bond sale, or additional asset sales or debt rescheduling" to pay off $8.9 billion of debt by October and 10 billion dollars more in October 2010. The shares rose 163 pence to close at 23.82 pounds, the highest figure in four months.

RECESSION PROVIDES A SILVER LINING TO MOSS BROS SUITS

Menswear retailer Moss Bros has announced pre-tax losses of 9.3 million pounds ($13.57 million) in the year to January 31. Exceptional charges accounted for 4.3 million pounds worth of losses. Sales were down 3.2 percent on a like-for-like basis, but the group says the six weeks to mid-March have seen a 20 percent rise in suit sales. Shares were up 36 percent to 11.25 pence.

PROPERTY MARKET EXPOSURE HURTS LENDER

Davenham (DAV.L), an asset-backed lender to small and medium businesses, fell 30.4 million pounds into the red in the first half. Chief executive David Coates said that loans to small developers of residential housing, which had accounted for half the company's business, have been discontinued, and that the company is now focusing on recouping the money. Total revenue for the six months to December 31 was up just over one million pounds to 27 million pounds. Provisions were at 37.9 million pounds, with 31 million pounds worth being related to specific losses.