Azure Global

Thursday, 22 August 2013

GlaxoSmithKline China scandal: British man arrested

British embassy confirms arrest of risk consultant Peter Humphrey, who was detained with his wife, Yu Yingzeng, in July

A British risk consultant held in China since mid-July amid an investigation into the country's pharmaceutical industry has been arrested, the British embassy in Beijing and his family said on Wednesday.

Peter Humphrey and his wife, Yu Yingzeng, were detained in Shanghai on 10 July as police investigated bribery allegations against GlaxoSmithKline.

In China, an arrest typically means police believe they have enough evidence for a case to be brought to trial. Detentions can last for weeks and end in release without charges being filed.

It was not immediately clear if Humphrey's arrest was directly related to the investigation of GSK, which has been accused by China of funnelling up to 3bn yuan (£312m) to travel agencies to facilitate bribes to doctors and officials.

China has taken a tough stance on corruption and high prices in the pharmaceutical industry as it widens access to healthcare, bringing an estimated $1tn healthcare bill by 2020.

"We can confirm the arrest of a British national, Peter Humphrey, in Shanghai on Monday19 August. We are currently providing consular assistance," a British embassy spokeswoman, Hannah Oussedik, told Reuters by phone.

A Chinese employee walks into a GlaxoSmithKline office in Beijing. Peter Humphrey and Yu Yingzeng were detained as police investigated bribery allegations involving the companyOussedik declined to offer additional information about the reasons for Humphrey's arrest. The US embassy in Beijing could not be reached immediately to confirm whether Yu had also been arrested. The US consulate in Shanghai declined to comment.

Shanghai police did not respond to a request for comment.

A statement issued by a member of Humphrey's family said both Humphrey and Yu had been arrested.

A source close to the family said they had not yet been told which charges would be laid against Humphrey, or when, but the statement said lawyers had told the family that the couple were detained last month because they had broken a law related to buying private information.

Humphrey and Yu co-founded ChinaWhys, a business risk advisory firm that has done work with drug companies, including GSK, separate sources familiar with the matter have said.

Humphrey worked as a journalist for Reuters in the 1980s and 90s. The ChinaWhys website says he has been a risk management specialist and corporate detective for 14 years.

In March 2010, four executives from mining giant Rio Tinto were jailed for taking bribes and stealing commercial secrets. Three of those executives were Chinese while the fourth was a Chinese-born Australian.

Article Source : http://www.guardian.co.uk

Azure Global’s vision is to be widely recognized as a reputed firm of financial business advisors, achieving real growth for ambitious companies and to become the first choice for F&A outsourcing for accountancy practices and businesses alike and if u want to Setup ur business in United Kingdom then its not difficult in this modern age for more info visit our site Azure Global and join us also On Facebook

UK government borrowing rises unexpectedly in July

Public sector net borrowing in July was £100m, compared with an £800m surplus in the same month last year

The Treasury ran up a rare July deficit last month, raising doubts about the coalition's progress in tackling the black hole in Britain's public finances.

July traditionally sees a surplus as it is a strong month for tax receipts, with quarterly corporation tax payments due. But the Office for National Statistics said the government had to borrow £100m last month, compared with the £800m surplus it ran up in the same month last year.

Once the boost from banking the proceeds of the government's quantitative easing programme were excluded, the deficit increased to £500m.

Taking the first four months of the financial year together, the underlying picture was of a £36.8bn shortfall, up from £35.2bn over the same period in 2012-13.

That was an increase of 4.7% – a larger rise than the independent Office for Budget Responsibility (OBR) is expecting for the fiscal year as a whole.

Chris Leslie, shadow financial secretary to the Treasury, said: "Another month of disappointing figures raises very serious concerns that borrowing continues to be way off track." He said a future Labour government would "make different choices and work for a strong and sustained recovery which delivers on living standards for the many. That's the way to get the deficit down and do so in a fairer and more balanced way".

However, the Treasury insisted the figures should not be taken as evidence that its deficit-busting strategy is failing, stressing that one-off factors had affected the figures.

Unusually large transfers to Whitehall departments including health and international development took place in July, it said, and a change to the way local authorities are funded had also skewed the results.

With growing evidence that the economy is starting to pick up, after flirting with recession at the turn of the year, the Treasury is hoping that stronger growth will boost tax revenues and ease the pain of tackling the deficit.

Tax revenues in July were £2.2bn higher than last year, a 4.2% rise to £54.4bn, the ONS said.

A Treasury spokeswoman said: "Strong tax receipts in July confirm that the economy is moving from rescue to recovery.

"There is still a long way to go as the UK recovers from the biggest economic crisis in living memory, and the government is sticking to the economic plan that has already cut the deficit by a third and enabled the private sector to create over 1.3 million new jobs."

She added that once volatile North Sea oil taxes were excluded, corporation tax receipts were 10% higher in July than a year earlier.

Peter Dixon, UK economist at Commerzbank, said: "All in all, it's only a very small deficit, we're not going to get too carried away about it. At this stage, we are probably on track to meet the government's forecasts for the year as a whole, but the UK still has a lot of work to do to get its finances back in order."

The ONS also published its latest estimate of last year's public finance totals, which showed public sector net borrowing for 2012-13 as a whole, excluding temporary factors, at £116.5bn – £2bn lower than a year earlier, and stronger than the £120.9bn deficit expected by the OBR in its latest forecast.

That means George Osborne can argue that he continued to make at least some progress in deficit reduction last year, despite the fragile state of the economy.

However, with the Exchequer still running up deficits, Britain's national debt has continued to rise. The ONS said it hit £1.19tn at the end of July – equivalent to 74.5% of GDP.

When he delivered his first "emergency" budget in June 2010, the chancellor said he expected public sector debt to peak at 70.3% of GDP this year.

Article Source : http://www.guardian.co.uk

India's rupee hits another record low against US dollar

Seen until recently as an inexorably rising economic power, India now looks dangerously exposed to violent market swings

India's rupee hit another record low against the dollar on Wednesday, despite policymakers taking fresh measures to try to put a floor under the sliding currency and stave off a full-blown financial crisis.

Until recently, India was constantly bracketed with China as an inexorably rising economic power; but with growth slowing sharply, the country is now among the hardest-hit of a string of developing countries that look dangerously exposed to violent swings in global markets.

When central bankers embarked on the drastic policy of quantitative easing – untested on such a large scale – they always knew it was extremely risky but judged that the price of a prolonged slump across the rich world was greater than the threat of inflating unsustainable bubbles in the world's financial markets. That judgment is about to be put to the test.

As imports become more expensive, the Indian authorities will have to try to control inflation without clobbering growth.The Federal Reserve's $85bn (£54.2bn)-a-month bond-buying spree unleashed a global tidal wave of cheap money, which flooded into emerging markets.

Since May, when Fed chairman Ben Bernanke announced his plans to "taper", and eventually halt, QE as the US recovers, these investment flows have gone into reverse. Governments in developing countries face plunging currencies and stock markets together with rising borrowing costs and some analysts are even starting to draw comparisons with the devastating Asian financial crisis of 1997-98.

India

Raghuram Rajan, the former chief economist of the International Monetary Fund, faces a baptism of fire when he starts his new job as governor of the Indian central bank next month.

With the rupee plunging to record lows against the dollar, the authorities in New Delhi face a severe test, trying to control the likely surge in inflation, as imports become more expensive, without clobbering growth. As Leif Eskesen of HSBC puts it, "the balancing act between currency stabilisation and growth protection is not easy". So far, the authorities have merely stoked the rising sense of panic in financial markets. Their latest batch of policies, announced on Tuesday night, included a promise to inject liquidity into financial markets by buying $1.2bn-worth of bonds but brought only a brief period of calm before the sell-off resumed.

If investors lose confidence in India's ability to fund its growing current account deficits, they could pile out of government bonds, pushing up interest rates across the board and squeezing the life out of the economy.

Thailand

Bangkok was the crucible of the Asian financial crisis that struck in 1997, as Thailand became the first country to call for help from the International Monetary Fund after a doomed (and costly) effort to defend its currency, the baht, against speculators.

Few analysts believe the country faces a repeat of that chaotic period but fears about the outlook for Thailand were exacerbated earlier this week by news that its economy has slipped into recession. The 0.3% decline in GDP in the second quarter, following a 1.7% contraction between January and March, marked a dramatic turnaround from 6% growth last year.

Bangkok's stock market saw a run-up of 50% between early 2011 and May; but even before investors' "taper tantrum", there had been doubts about the sustainability of its economic model, which has become increasingly reliant on rapid credit growth, with household debt rising to a worrying 80% of GDP. The Set index of leading Thai shares has dropped by more than 15% since May.

Indonesia

Indonesia's currency, the rupiah, has slipped to its lowest level against the dollar for four years, and share prices have plunged by more than 10% in the past week alone, as investors digest the risks that the Fed could soon start phasing out QE.

As well as a reversal of investment flows, Indonesia is also being hit by falling commodity prices, sparked by concerns that China's economy is slowing. That helped the country's current account deficit to increase to 4.4% of GDP in the second quarter of this year — close to levels last seen in 1996, before the Asian financial crisis, and raising the alarming prospect of a balance of payments crisis if interest rates continue to rise.

Indonesia looks particularly vulnerable to what economists call a "sudden stop" in capital flows, since as much as a third of its government bonds are owned by foreigners. During the late-90s crisis, Indonesia was forced to seek a $40bn bailout from the IMF. The controversial policies imposed in exchange for the rescue package sparked widespread protests, and led to the overthrow of the Suharto regime.

Brazil

Brazil came through the Great Recession of 2008-09 in relatively good shape, helping to feed market euphoria about a "decoupling" between the struggling West and fast-growing developing countries. Foreign investors poured $350bn into the country between 2003 and the end of last year in direct investments alone.

But growth has slowed sharply in the past couple of years and the risks of a downturn have been exacerbated by the tremors rocking global markets.

Dilma Rousseff's government has faced its own domestic political problems, including a spate of protests in June and July. But investors' worries over the Fed's plans to withdraw QE – and fears of a slowdown in China, a major market for Brazil's critical commodity exports, have left analysts scrambling to downgrade their growth forecasts. Many expect growth of little more than 2% this year, and the Brazilian real has hit a four year low.

A depreciation may be good news in the long term, helping to improve the country's trade performance; but in the short term, it will boost inflation, adding to the problems of the central bank, which has already been tightening policy to try and bring wage rises under control.

China

After a decade in which it joined the ranks of the world's economic superpowers, China's future growth path looks increasingly in doubt.

Unlike many of its fellow emerging market players, China's financial markets remain only partially open to foreign investors, so it may be less at risk from a reversal in capital flows as a result of QE coming to an end. However, Beijing has plenty of problems of its own, not least an alarming legacy of bad loans from the credit boom that was deliberately unleashed to cushion the Chinese economy against the knock on effects of the global financial crisis.

Chinese authorities have repeatedly made clear their intention to try and switch from an export-dependent model of growth, to a more balanced, consumer-led pattern. Even if that switch is managed smoothly, it will hit exporters of the commodities and investment goods, such as machine tools, for which the country has been so hungry in recent years. But there are growing fears of a "hard landing", if this radical transition goes awry.

Analysts at HSBC argue that a China crash, rather than the end of the Fed's QE programme, actually presents the greatest risk of a sudden and damaging reversal in global capital flows, from the emerging world back to the safe haven of developed countries.

Article Source : http://www.guardian.co.uk

Wednesday, 21 August 2013

Tony Hayward's interim chairman role at Glencore could become permanent

Former BP boss revealed as surprise candidate for chairman as company announces $7.7bn writedown

Tony Hayward, the former boss of BP best remembered for being forced to resign from the oil group over his handling of the Gulf of Mexico disaster, has been revealed as a surprise candidate for the next permanent chairman of mining-cum-trading group GlencoreXstrata.

Hayward is currently interim chairman of the group formed in May's $44bn (£28bn) takeover of miner Xstrata by commodity trader Glencore, but had been thought to be merely holding the role temporarily as the combined group searched for a permanent replacement.

However, as GlencoreXstrata announced its first results as a combined company – which included an expected writedown of the value of Xstrata's mines by $7.7bn – chief executive Ivan Glasenberg surprised mining observers by saying that Hayward is being considered for the role. "Of course he's a candidate," Glasenberg said. "We'll have to see for the future."

Privately, Glasenberg's advisers later attempted to distance the company from the boss's comments. If Hayward did become chairman it would shock the City for a number of reasons. He is still widely associated with the string of gaffes that forced him out of BP, when his words and actions following the company's Deepwater Horizon oil spill were widely criticised. Second, he is serving as chief executive of the oil group Genel.

An appointment of Hayward could also serve as a reminder of how Glencore got embroiled in an embarrassing PR mess when allowing Hayward's predecessor at BP, Lord Browne, to be announced by broadcasters as its first public chairman when it floated in 2011. In fact, Glencore had chosen Simon Murray.

The continuing search for someone who can lead the board of GlencoreXstrata, which the stock market now values at £39bn, was one of the issues that emerged as the company said it now valued Xstrata's assets at $7bn less than it had acquired them for. Glencore paid in shares, rather than cash, when it completed its drawn-out takeover of Xstrata in May. The Glencore share price that day implied the $44bn price tag, although the shares have since lost 14% owing to a fall in commodity prices as the Chinese economy has slowed, and closed Tuesday down 4.8p at 297.15p.

Tony Hayward is still widely associated with the string of gaffes that forced him out of BP.Financial director Steven Kalmin said: "We just had to value the [Xstrata] business with a blank sheet of paper. There are clearly areas where we have taken a fairly conservative approach to value in the current environment, including the greenfield, early-stage projects in which Xstrata had committed spending."

Glencore did not explain the drop in value of the Xstrata side of the business in detail, although much of it is believed to relate to early-stage projects and greenfield operations, mines that Xstrata was building from scratch and which have long been unpopular with Glasenberg. They include a $5bn nickel operation, Koniambo in New Caledonia.

The company said that total revenues in the first half of 2013 fell 2% to $121.4bn, while the firm recorded an $8.9bn loss due to the writedowns.

Glasenberg signalled a new age of austerity for the company by stating that it was focusing on "the disciplined allocation of capital". However, the group added that its progress on integrating Xstrata into the enlarged business had "exceeded its expectations", and cost savings would be "materially in excess" of the previous guidance of $500m a year.

Glencore's takeover of Xstrata was one of the most drawn out in recent City memory. The deal had long been an ambition of Glasenberg's and was announced in February 2012, but a string of rows over the price – followed by Qatar's sovereign wealth fund taking a sizeable stake in Xstrata and then threatening to block the deal – forced the chief executive into increasing his bid by almost 9%.

Tuesday's write-down in Glencore's value is seen as the latest knock to its shareholders – of which Glasenberg is still the largest – and comes after the company floated at 530p.

Article Source : http://www.guardian.co.uk

Tuesday, 20 August 2013

If Greece needs a third bailout, Europe had better find a formula that sticks

A better approach would see Greece's lenders take more pain up-front – but is Germany prepared to support that?

So, Greece will soon need a third bailout. German finance minister Wolfgang Schäuble admitted as much on Tuesday – and was even prepared to say so during the pre-election period in Germany. One assumes Schäuble deemed it safe to dive into these politically contentious waters only because he also stuck to the party line that Athens would receive no more debt forgiveness.

What a shame. If a third bailout is required the time has come for the euro-powers to find a formula that sticks. A small loan package, to fill the hole already identified by the International Monetary Fund, would represent another dose of medicine that isn't working. The Greek economy, weighed down by austerity measures, would stumble along for a while – but a fourth package would loom sooner or later.

Germany's finance minister Wolfgang Schäuble.

A better approach would see Greece's lenders take more pain up-front – get the debt down to manageable levels and hope to see economic growth reduce the burden further. Is Germany, after the election, prepared to support that idea? If it's not, we'll be talking about a fresh eurozone crisis by the end of the year.

Article Source : http://www.guardian.co.uk

Barclays branch chief vows culture change at scandal-hit bank

Ashok Vaswani pledges action to cut customer complaints, including PPI issues which have cost Barclays £4bn

Humility is not a word often associated with bankers but the head o f Barclays' high-street branch network insists that that is what guides him.

Ashok Vaswani, who has a key role in a new management team charged with altering the culture at the scandal-hit bank, says: "If you are not humble you cannot learn. It is a core value that drives me a lot."

Sitting in a meeting room above a busy branch on Borough high street, London, the 52-year-old is keen to get across the message that he wants to put customers at the heart of everything done by himself and his 30,000 branch staff across the UK.

He describes the data recording complaints against the bank as horrendous. There were 381,740 complaints in the first six months of this year. He insists, though, he is cutting out problems such as requirements for customers to send faxes and inform the bank of their travel plans to be able to use a credit card abroad.

In the last six months of 2012 Barclays was the most complained about bank in Britain – by some measures with more than 400,000 complaints.

"I want to put the company out there to say we are totally committed to driving these complaints down," Vaswani said.

Referring to Barclays' slogan promoting itself as the "go to" bank – a line devised by his boss, Antony Jenkins, after he was promoted to chief executive in the wake of the Libor scandal, – Vaswani said: "What is 'go to'? Antony would say it was an emotional connectiveness to the brand. You can't build emotional connectiveness with a brand if you've got so many complaints."

Vaswani joined Barclays in 2010. He knew Jenkins from their work at the vast US banking empire of Citigroup

Ashok Vaswani faces creating a better service for bank users, after almost 400,000 customer complaints over six monthsHe arrived in the Middle East with just $14 in his pocket and met the India-born daughter of a client whom he later married. Their daughter was born in Dubai.

From there he went to Turkey, Brussels, New York and Singapore, then back to New York. No sooner had he arrived in London than he was running Barclays' African operations. He gained his current role, that of running 1,577 UK branches, and 797 branches elsewhere in Europe, by stepping into Jenkins' shoes when he moved up from retail chief to the top job.

He got a Singaporean passport after falling in love with the island city state while running Citi's Asian operations, a career route that left him returning to New York 15 times a year to visit his wife and daughter who preferred to stay in the US.

During the banking crisis, when Citi incurred heavy losses, he was working in private equity with former colleagues from Citi before returning to banking again with Barclays.

He says he now intends to publish Barclays' complaints data every three months, twice as often as required by the Financial Conduct Authority, and to outline the key causes of complaints.

Payment protection insurance has been a leading cause of customer anger, and has cost Barclays £4bn. The bank had 381,740 complaints in the first six months of the year. Vaswani would rather focus on the numbers without PPI, where complaints were down 46% to 91,215 in the first six months of the year.

Vaswani is keen on digital banking, technology and social media. He has ruled out job cuts.

As a member of the executive committee he finds his pay does not need to be disclosed. It seems likely he receives about £2m a year. He admits that, as "for any normal person, money is important" but what motivates him, he says, is his desire to improve the banking culture.

In a lecture this year to the Oxford Centre for Hindu Studies he defined culture as being about "how you behave when no one else is looking". It a definition that was used by Bob Diamond, the former Barclays CEO ousted during the Libor scandal, and Vaswani admitted that culture could be hard to instil across a large workforce.

"This is about looking at the end of the assignment, looking at myself in the mirror and saying I was a trustee for a great company and a great franchise and I did everything humanly possible to make it a better franchise [for the successor]," he says.

An only child, his mother, an Indian government official, was his main motivator after his father, a businessman, died when he was six. If his father had lived longer his career path could have been different, he suggests. But it was his mother, he says, who encouraged humility, and it was the opening of his mind to learning that "was the huge thing" she gave him.

Article Source : http://www.guardian.co.uk

UK banks defer bonuses to beat top tax rate

Bonuses across the economy were all but flat in the year to March 2013 – but finance payouts up 4% to £38.6bn once April figures are taken into account

Britain's best-paid workers delayed bonus payments worth up to £1.7bn until April to take advantage of George Osborne's 5p cut in the top rate of tax, according to evidence collected by the Office for National Statistics.

Bonuses across the economy were all but flat in the year to March 2013, increasing by 1% compared with the same period a year ago, to £36.9bn, or an average £1,400 per employee.

But the ONS said the picture was distorted by firms deferring payouts until April, when those earning over £150,000 a year would pay income tax at 45p instead of 50p in the pound.

Payouts were £1.7bn higher in April than the same month last year, with the banking and finance sector accounting for £700m of the increase.

Some of the rise since April 2012 is likely to reflect a more generous bonus round – taking January to April together, bonuses in the finance sector were up by 13% on last year, at £10.3bn. But the ONS said businesses had reported deliberately deferring their bonus rounds so that employees could benefit from the tax cut.

If the £1.7bn had been handed over to staff before the 50p top rate was scrapped it would have brought the Treasury an extra £85m.

Reducing the 50p rate of tax brought in by Alistair Darling at the height of the economic crisis in 2009 was the most controversial policy in last year's "omnishambles" budget.

Treasury officials insisted yesterday that the higher rate had generated little, if any, extra revenue. A spokesman said the bonus data were, "broadly in line with the Budget forecast".

However, labour market expert John Philpott, of consultancy the Jobs Economist, said, "I just find it deplorable: there should have been a failsafe built into the policy that allowed for some sort of clawback if that behaviour was seen to occur. I don't see why that's any less immoral than all the tax avoidance practices the coalition have criticised."

Labour said the data helped hammer home its argument that the majority of people in Britain are suffering a "cost of living crisis", while the lucky few are thriving.

Chris Leslie, shadow financial secretary to the Treasury, said, "working people are worse off under the Tories as prices continue to rise faster than wages. But while ordinary families on low and middle incomes are seeing their living standards fall those at the top are reaping the benefits of David Cameron's tax cut for millionaires."

Taking the 2012-13 financial year as a whole – and excluding the April payouts – finance workers banked the biggest bonuses, according to the ONS, taking home an average of £11,900 per employee.

The sector was followed by mining and quarrying, where the average bonus was £6,700; and IT, where it was £4,400.

The Leadenhall Building (the Cheesegrater) & 20 Fenchurch Street (the Walkie Talkie) dominate the City skyline. Finance bonuses are up on 2012.Excluding the financial sector, total bonuses across the rest of the economy in 2012-13 were £23.6bn, almost as high as during 2007-08, before the UK plunged into recession.

Despite high-profile stories about lavish payouts for top public sector bosses, bonuses remain largely a private sector phenomenon, the ONS data shows.

The average bonus in the public sector was £300 per employee – falling to £100 once the bailed-out banks, including Royal Bank of Scotland, are excluded. Private sector employees received bonuses worth on average £1,700.

Tuesday's findings about financial services firms delaying payments to cut their employees' tax bills will fuel controversy about remuneration practices in the sector, after research showed that many firms were planning to increase salaries, to bump up their staff's total pay as the European Union prepares to cap bonuses.

Article Source : http://www.guardian.co.uk