PRESS DIGEST - British business - Oct 31

The Times

HOUSEHOLD NAMES MAY HAVE TO GO AS PRICE RBS MUST PAY FOR USING TOXIC-ASSET PLAN

Royal Bank of Scotland (RBS.L) may be forced to sell major assets and overseas operations as part of an agreement with the government for its use of the Asset Protection Scheme. The European Commission is also pushing for the bank to sell its insurance division, which includes Churchill, Green Flag and Direct Line. However, the good news for RBS is that it may be allowed to exit the APS early and avoid paying the 16 billion pound insurance premium upfront. Instead it will pay an agreed pay-as-you-go premium dependent on the size of toxic assets to be insured.

THRESHERS GROUP'S COLLAPSE MAY MEAN 3,000 JOB LOSSES

KPMG said the collapse of First Quench, the owner of Threshers, Wine Rack and The Local, and the closure of 600 outlets, will lead to the loss of 3,000 jobs. KPMG said it had received requests from potential buyers of the stores, with industry insiders identifying potential bidders as Costcutter and EFB Retail. Richard Fleming at KPMG said First Quench had very little debt, but was losing an estimated 20 million pounds a year. He said two-thirds of the stores were profitable but the company was the victim of over-expansion and supermarket competition.

ROW BETWEEN BA AND CABIN CREW ESCALATES AS UNION SEEKS COURT ORDER TO PREVENT FORCED CHANGES

Unite, the union, said it would seek an injunction to prevent British Airways (BAY.L) imposing working practice changes on 14,000 cabin crew from November 16. The airline wants to reduce the number of cabin crew on the majority of long-haul flights as part of proposals to cut the cabin crew budget by 140 million pounds a year. Other proposals include a two-year pay freeze, a cap on allowances for long-haul travel, 1,000 voluntary redundancies and the movement of 3,000 workers to part-time positions. The union fears that once the changes are made, there will be little scope for future negotiation.

The Daily Telegraph

LUV IS IN THE AIR AT WPP AFTER IT CUTS 11,000 JOBS

Advertising group WPP (WPP.L) announced it expects to make further job cuts, after having already cut 11,232 jobs in the first nine months of this year. The group reported an 8.7 percent fall in third quarter revenues on Friday and chief executive Martin Sorrell said there was "further provision for severance in Q4". Referring to the current economic downturn, Sorrell said he would declare victory "when we get like-for-like growth". Sorrell also added to the various descriptions of the current economic downturn, characterising the recovery as LUV shaped -- an L shaped recovery for Western Europe, U shaped for North America and V shaped for the BRICS and Next 11.

SHIRE CHIEF HAILS DRUG FIGHTBACK

Shire (SHP.L) reported a 14 percent fall in third quarter revenue on Friday, due in part to the patent protection on its hyperactivity disorder drug Adderall XR reaching an end. Although revenues fell to 667 million dollars, sales excluding Adderall rose 20 percent to 532 million dollars. Chief executive Angus Russell said he was "immensely pleased" with the way the group had reacted to generic competition to Adderall. The group returned to the black in the third quarter, with a pre-tax profit of 89.6 million dollars.

THE AGE OF FREE BANKING DRAWS TO A CLOSE

New figures reveal almost half of high street banks' current accounts involve a fee for their use. According to personal finance research company Moneyfacts, in the past three years alone the number of current accounts that have an element of fee-charging attached has risen by 3.7 million. "We appear to be at a tipping point where it is likely that some sort of charge for a current account is seen as normal," says PricewaterhouseCoopers' Richard Kibble. "The number of people who are paying fees of some form has risen quite significantly over the past decade."

The Independent

LLOYDS POISED TO AGREE 2.5 BILLION POUND APS BREAK FEE