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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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Extend migrants’ benefits says EU

Category : Business, World News

The European Commission will unveil plans on Wednesday to extend the length of time home states must support their own citizens seeking work in other EU countries.

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France to enter recession, EU says

Category : Business, World News

The eurozone economy will shrink more than expected this year, with France sliding into recession, a European Commission report says.

Original post: France to enter recession, EU says

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Greece ‘to return to growth in 2014′

Category : Business

The European Commission and other international creditors to Greece say the country’s economy will start growing again next year.

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Brussels warns on Spain and Slovenia

Category : Business, World News

The European Commission has warned that Spain and Slovenia must quickly address the “imbalances” in their economies.

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Spain and Slovenia told to reform economies now or risk financial crisis

Category : Business

Brussels identifies 13 countries, including France, in need of urgent action, underlying growing scale of eurozone crisis

Spain and Slovenia have been given a stark warning by their eurozone partners to reform their economies rapidly or risk financial crisis.

In a hard-hitting report on the countries facing macroeconomic imbalances, such as overvalued housing markets or hefty government debts, the European commission identified a total of 13 member states – including France, the Netherlands and Belgium – which it said should take urgent action to restore the health of their economies.

The large number of countries involved underlined the growing scale of the eurozone crisis, which has been exacerbated by a deep recession in many of the single currency’s 17 member states. Christine Lagarde, managing director of the International Monetary Fund, warned on Wednesday of the emergence of a “three-speed” global economy, lumping the eurozone and Japan in the slowest lane among countries that “still have some distance to travel”.

The European commission’s harshest criticism was reserved for Spain and Slovenia, which were warned to agree reform proposals with Brussels next month or face potential sanctions under the EU’s new “excessive imbalance procedure”.

Slovenia, which has been forced to bail out its banking sector, has repeatedly been identified as the next domino to fall in the ongoing eurozone debt crisis, since Cyprus received a controversial bailout.

The commission warned that the close connection between Slovenia’s partly state-owned banks, which made reckless loans during the boom years, and the country’s public finances could jeopardise financial stability. “These challenges require urgent action in the areas of the financial sector, state-owned enterprises and microeconomic reforms in order to prevent a situation in which severe imbalances would steeply increase towards unsustainable levels,” it said.

Madrid also came under the spotlight. The commission warned that while the immediate threat of a full-blown international bailout had receded, the heavy debt hangover from Spain’s pre-crisis boom continued to present a serious threat.

The report formed part of the commission’s new Macroeconomic Imbalances Procedure, put in place in the wake of the financial crisis to identify problems within individual countries that could put the financial stability of the eurozone at risk.

Brussels stepped up the pressure on France over declining exports and rising public debt, saying the country’s “public sector indebtedness represents a vulnerability, not only for the country itself, but also for the euro area as a whole”.

The IMF recently warned that France could slip behind Italy and Spain if it failed to reform its struggling economy.

The UK also came in for criticism from the commission, which warned that the hoped-for recovery in the housing market could halt a necessary “correction” in prices, and prevent a reduction in household borrowing levels. That could leave homeowners dangerously exposed in future if interest rates go up, it warned.

“As a consequence of a combination of high house prices and the widespread and growing use of variable-rate mortgages, households are particularly exposed to interest rate changes,” it said, adding that the size of the UK economy meant future instability could, “generate spillovers to the other European economies”.

The Commission’s verdict came as details began to leak of the conditions Cyprus could face in exchange for its €10bn bailout. Nicosia is expected to be forced to sell €400m-worth of gold reserves as part of the deal.

EU probe to examine Mastercard fees

Category : World News

Credit card firm Mastercard is the focus of a European Commission probe into inter-bank fees.

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Bankers carry on unabashed, unscathed and unashamed | Nick cohen

Category : Business

The right’s folly lies in its inability to understand that bankers have barely been slapped

The self-pity of the British right swells in inverse proportion to its self-knowledge. Conservatives, of all people, ought to have been horrified when the state used taxpayers’ money to prop up lame-duck banks. Conservatives, who shout the loudest about scroungers living off the taxpayers, ought to have been the most concerned about sponging financiers.

In the 19th century, James Mill described the British empire “as a vast system of outdoor relief for the upper classes”. In the 21st, honest conservatives might describe the public purse “as a vast source of corporate welfare for the moneyed classes”. Yet honest conservatives have been replaced by paranoid fantasists. Fraser Nelson, a charming man who edits me when I write for the Spectator, and is without doubt my favourite rightwing loon, complains: “It has been almost five years since the crash and still the guilty men are being tracked down and subjected to what seems like a never-ending trial for financial war crimes.”

I remember Anthony Browne berating “cowboy” dentists and condemning London cabbies as a “white working-class mafia holding the capital to ransom” when he was a lowly reporter here at the Observer. Now he is chief executive of the British Bankers’ Association and his former hatred of rent-seekers has vanished. “We need to put banker bashing behind us,” he says of cowboys whose ransom demands would make the real mafia blush.

The right’s folly lies in its inability to understand that bankers have not been bashed. Indeed, they have barely been slapped. The courts have jailed no one responsible for the crash. Instead of “a never-ending trial for financial war crimes”, there have been no trials whatsoever. No one has sought to compensate the taxpayer by confiscating the bonuses taken in the bubble. The Financial Services Authority has barred only a handful of bankers from working in the UK financial sector. This palpable injustice allows me to summarise the coalition’s failure to convince the public that “we are all in this together” in a paragraph.

The taxpayer injected about £65bn into RBS and HBOS in share capital. Those shares are currently showing a loss of £20bn. The overall cost to taxpayers is incalculably higher because we must now manage in a zombie economy with a crippled banking system that can’t send credit to where it’s needed. Yet rather than punish those responsible, the coalition has cut their taxes.

The worst of it to my journalist’s mind is that the British have not been able to tell their own stories without fear of retribution. Hugh Tomlinson QC, the chairman of Hacked Off, a malign organisation that dumb liberals think is on their side, fought for months to stop the public knowing that Fred Goodwin was having an affair at the very moment when his bank was hurtling toward ruin. The parliamentary commission on banking standards‘ report on the collapse of HBOS, just published, has many virtues. Its greatest is that parliamentary privilege – a right to free speech Parliament will not extend to the rest of us – allows the commission to speak without authoritarian lawyers and judges blacking out the detail.

The commission’s account of how HBOS’s pre-tax losses reached £30bn breaks the bankers’ mythology. They thought they were the successors of the respectable Victorian Yorkshiremen, who founded the Halifax building society, and the equally prudent founders of the Bank of Scotland. To their minds, they were simply unlucky managers caught out by a crisis they could not have predicted. Sir Ronald Garrick, director and deputy chairman, said that the “HBOS Board was the best board I ever sat on”. Even with benefit of hindsight, Lord Stevenson, the chairman, says that far from being a giddy corporate dictatorship in which dissenters were fired, HBOS had an atmosphere “where people were able to be very direct and blunt”. What brought the bank down, he maintained, was the freeze in global wholesale money markets the day after Lehman Brothers went bust.

It was the same line Gordon Brown endlessly parroted. “A crisis that began in America” destroyed the British banking system. If it had not been for sub-prime loans in California and Bush’s refusal to bail out Lehmans all would have been well.

The banking commission, a strange but surprisingly intelligent group of MPs, peers and – only in England! – His Grace the Archbishop of Canterbury, takes the wishful thinking apart with admirable brutality. Lord Stevenson and his colleagues’ version of events “represents a model of self-delusion”, it says. HBOS suffered from a solvency, not a liquidity, crisis.

The once respectable Bank of Scotland and Halifax went on an “aggressive, asset-led growth” that took the “quick and easy path to expansion without acknowledging the risks inherent in that strategy”. Because HBOS was trying to muscle into new markets, it took risks sensible bankers would not take. In short, Americans did not kill HBOS: it committed suicide.

It is not as if the managers were not warned. The banking commission skates over the staggering case of Paul Moore, HBOS’s head of regulatory risk in 2004, who tried to talk sense into James Crosby, the chief executive. Crosby fired his risk manager for warning of a risk.

The subsequent careers of the two men sum up the degradation of the last decade. Moore went into the street and burst into tears. He did not know how to tell his wife he had lost his job. Because he had spoken out of turn, not only would no other bank hire him, no head hunter would put him on its books. By contrast, Brown knighted Crosby, and promoted him to serve on the Financial Services Authority. The man who had sacked his risk manager for warning of a risk was now protecting the banking system. Small wonder this country’s bust.

There is a more glaring fault. The banking commission condemns the FSA but, like the Tories and Labour, it will not recommend breaking up the banks by splitting their high street businesses from the investment business. Banks that were too big to fail and had to be bailed out by taxpayers in 2008 are still too big to fail in 2013.

Grasp this point, and the complaints about “banker bashing” turn from the ridiculous into something more sinister. The banking lobby is so unscathed – so unbashed, unbattered and unbruised – it has the muscle to prevent an urgent and necessary reform and can act as if the crisis never happened.

HBOS: the bank that couldn’t say no

Category : Business

Report lays bare reckless risk and leadership failures, and attacks board for trying to blame failure on 2008 crash

Banking group HBOS was not driven to point of bankruptcy by the global financial meltdown, but by its own strategy of high-risk lending, over-ambitious growth targets and poor controls, according to a hard-hitting report by the parliamentary commission on banking standards.

The report, which found that HBOS had a funding gap between its loans and deposits of more than £200bn at the time of its downfall, reveals that a “brash” culture developed inside the bank following its creation in 2001.

The funding gap meant it had to rely on borrowing from other banks in the wholesale markets. While this was the “immediate cause” of the collapse of HBOS, it was not the “fundamental issue” the report found. Instead, it concluded that if the problems at the bank had only been ones of liquidity, it would not have needed a combined capital injection of £28bn from the taxpayer and Lloyds to keep it afloat and “there would have been no losses to the UK taxpayer”. Instead, the report says, the key problem was vast, and reckless, lending to UK and overseas companies.

Lord Turnbull, the member of the commission who led the HBOS investigation, said: “This is a story of a retail and commercial bank, rather than an investment bank, brought down by ill-judged lending, poor risk control and inadequate liquidity. Its strategy was flawed from the start.”

Sir Charles Dunstone, the founder of Carphone Warehouse and former non-executive director of HBOS, had pointed out in his evidence that under the Vickers ring-fencing proposals intended to shield retail banks from riskier investment banking operations, nearly all of HBOS would have been inside the fence.

In 2001, the bank’s chief executive, Sir James Crosby, set ambitious targets for returns to shareholders. He planned to ramp up lending in an attempt to challenge the “big four” banks. But HBOS had a risk department – meant to be on alert for bad lending decisions – that could not keep up with the pace of growth, and a management structure that left decisions about lending to division heads.

The damning report begins with a warning by a former finance director of HBOS telling the board in January 2004 that the Financial Services Authority felt that the rapid growth being pursued “may have given rise to an accident waiting to happen”.

But it notes that the FSA – disbanded by the government last weekend – failed to act on its own concerns. “The picture that emerges is that the FSA’s regulation of HBOS was thoroughly inadequate,” the report said.

“From 2004 until the later part of 2007, the FSA was not so much the dog that did not bark as a dog barking up the wrong tree,” the report said, as the regulator moved its focus from prudential risks to a new regulatory system that let banks mark their own homework – using their own models to measure risks – and implement new rules on treating customers fairly.

“The experience of the regulation of HBOS demonstrates the fundamental weakness in the regulatory approach prior to the financial crisis and as that crisis unfolded. Too much supervision was undertaken at a too low a level – without sufficient engagement of the senior leadership within the FSA.”

While the FSA missed opportunities to prevent HBOS from “pursuing the path that led to its own downfall … Ultimate responsibility for the bank’s chosen path lies, however, not with the regulator but with the board itself.”

The commission estimated that £47bn of losses was incurred – £25bn in the corporate division, £15bn in Australia and Ireland, and £7bn in the bank’s own HQ in its Treasury operations. The report says that those losses on their own would have been enough to bring the bank down. “Both the relative scale of such large losses and the fact that they were incurred in three separate divisions suggests a systemic management failure across the organisation. Together they would have led to insolvency,” the report said.

To illustrate the scale of the risks being taken on, the report said that in the corporate bank in 2001 the biggest exposure to one single borrower was less than £1m. By 2008 there were nine customers who had each been lent £1bn. One borrower had been advanced £3bn.

“The roots of all these mistakes can be traced to a culture of perilously high risk lending. The picture that emerges is of a corporate bank that found it hard to say ‘no’,” the report said.

The commissioners said they were “extremely disappointed” that HBOS management had tried to blame the closure of wholesale markets rather than the risky lending. In early 2008, the chairman, Lord Stevenson, had argued that the bank was a “highly conservative institution”. But the report said: “Far from being a highly conservative institution in a safe harbour, HBOS was in a storm-tossed sea.”

In the days after Lehman Brothers collapsed in September 2008, some £35bn was withdrawn from customer deposits at HBOS. The bank was rescued by Lloyds three days after the Lehman crash. Eventually £20bn of taxpayer funds was used to prop up the enlarged bank while Lloyds used another £8bn to shore up the troubled loan book.

A Treasury spokesman said: “The failure of HBOS was a symptom of the financial crisis and the regulatory system in place at that time.”

China Education Alliance, Inc. (CEAI: OTCQX U.S.) | China Education Alliance Receives S.E.C. Letter Regarding Non-Compliance of Former Auditor

Category : Stocks, World News

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China Education Alliance Receives S.E.C. Letter Regarding Non-Compliance of Former Auditor

PR Newswire

HARBIN, China, March 21, 2013

HARBIN, China, March 21, 2013 /PRNewswire/ — China Education Alliance, Inc. (“China Education Alliance” or the “Company”, OTCQX: CEAI), a China-based education resource and services company

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TGS Announces Commercial Agreement to Sell Fugro’s 2D Multi-Client Library

Category : World News

ASKER, NORWAY–(Marketwire – Mar 18, 2013) – TGS-NOPEC Geophysical Company ASA (“TGS”) announces a commercial agreement to sell Fugro’s 2D multi-client library. As a result of this agreement, Fugro provides TGS with an exclusive right to licence and market the majority of Fugro’s multi-client 2D library and receive commission fees on the sales of this data. 

Link: TGS Announces Commercial Agreement to Sell Fugro’s 2D Multi-Client Library

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