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Issue 1,273 Monday 29 November 2010
EUROPE AGREES €85BN
BAILOUT FOR IRELAND
EUROZONE CRISIS
▲
BY STEVE DINNEEN
IRELAND last night agreed an €85bn
(£72.2bn) bailout package after a
crunch meeting with European
finance ministers.
It accepted a total of €67.5bn in
external support as well as raiding its
state pension scheme for €12.5bn. A
further €5bn from Ireland’s cash
reserves was also committed.
The beleaguered nation will imme-
diately inject €10bn to recapitalise its
ailing banks, with a further €25bn
being placed in a contingency fund.
The central bank yesterday revealed
Bank of Ireland and Allied Irish Banks
will require at least €7.5bn in extra
funds to meet new capital require-
ment rules.
The remaining €50bn of the bailout
will go towards the general running
of the country, including paying the
wages of public sector workers.
The €67.5bn of external support is
made up of a €22.5bn loan from the
International Monetary Fund (IMF);
€22.5bn from the European Financial
Stability Mechanism (EFSM); €17.7bn
from the European Financial Stability
Fund (EFSF); and €4.8bn in bilateral
loans from non-Eurozone nations.
The UK will contribute a total of
€7.9bn to the package. This consists of
a €3.8bn bilateral loan; 4.5 per cent of
the €22.5bn IMF contribution,
totalling just over €1bn; and 13.8 per
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cent of the EFSM, coming to €3.1bn.
The average rate of interest on the
loan will be 5.8 per cent over a seven
year period. However, EU ministers
determined to punish Ireland have
slapped a six per cent rate of interest
on the European portion of the loan,
compared to just three per cent, ris-
ing to four per cent in 2013, on the
IMF slice.
Interest payments on the loans will
account for a staggering 20 per cent of
Ireland’s tax revenue by 2014.
The EU hinted that private bond-
holders would need to take more of
the pain when a replacement fund for
the ESFM is formed in 2013.
German chancellor Angela Merkel
has long argued for bondholders to
take a so-called “haircut” when coun-
tries are bailed out.
George Osborne announced the UK
will not be a part of the new fund, in a
move seen as a concession for the UK’s
contribution to the bailout.
The UK currently provides 13.8 per
cent of the €60bn ESFM. It does not
provide funds for the €566bn EFSF.
A dejected Prime Minister Brian
Cowen attempted to put a positive
spin on the announcement, saying
Ireland will be allowed to keep its Irish protestors burn a picture of Prime Minister Brian Cowen Picture: GETTY
12.5 per cent rate of corporation tax.
European nations led by Austria Cowen also confirmed he will call a such as Portugal and Spain – cent and Italy’s to four, sparking fears
had campaigned for Ireland to be general election in the New Year after appeared to grow at the end of last they could follow Greece, whose
forced to increase the rate as punish- the bailout has been received. week, with yields on Portuguese yields are at nine per cent.
ment for accepting the rescue pack- The possibility of contagion spread- bonds soaring to seven per cent. ALLISTER HEATH: P2, MORE: P16-17
age. ing to the other peripheral nations – Spain’s yields also shot up to five per BUSINESS FEATURE: P28
£/$ ▼ 1.56 -0.02 £/¤ 1.18 unc ¤/$ ▼ 1.32 -0.01 Certified Distribution
30/08/10 – 03/10/10 is 110,015
 2 News
Ireland’s bailout won’t halt contagion
EDITOR’S LETTER
ALLISTER HEATH
ONLY the naïve will believe that
Ireland’s bailout will halt the
Eurozone crisis. It is too late for that;
the best that the EU/IMF/UK plan will
achieve is to slightly delay contagion.
The 6 per cent interest rate on the
EU portion of the loans is far too high,
especially given that Eire’s inflation
rate is so low. There will be no haircuts
for senior bondholders, though hold-
ers of subordinated debt will rightly
be hit – a system will be introduced
under which private bondholders
could be made to share the burden of
any future Eurozone sovereign debt
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Deputy Editor David Hellier
News Editor David Crow
Night Editor Katie Hope
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Lifestyle Editor Zoe Strimpel
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WHAT THE OTHER PAPERS SAY THIS MORNING
AMAZON SEEKS TO EXPAND GLOBALLY
Amazon says it plans to revamp its
international e-commerce platform
to make it easier for the company to
reach customers in new markets. The
online retailer, the world’s largest by
number of visitors, operates online
businesses in six countries outside
the US. It says it has set up a new
team that will create “the architectur-
al underpinnings to greatly simplify
country expansions”, by translating
content into different languages and
adjusting taxes, prices and delivery
options to better suit customers’ loca-
tions.
TNK-BP TO UNVEIL OIL TRADING
OPERATION
TNK-BP, the Russian oil and gas group
half-owned by BP, is setting up an
international trading arm in the lat-
est sign of the company’s ambitious
growth plans overseas.
restructuring, subject to a case-by-case
evaluation “without any automatici-
ty.” A clear system whereby losses are
shared is desperately needed. It’s a
scandal the bailout culture has still
not come to an end. One of the sur-
prises was that Ireland will have to tap
into its National Pension Reserve
Fund, which has €24.5bn under man-
agement. That is a good move.
It is galling the UK is being forced to
put its hand in its pocket, even though
it isn’t part of the euro. But at least
nobody believes we are about to be
contaminated by the crisis. The coali-
tion’s relatively tough budget has seen
to that. But the respite may be only
temporary. The UK faces unsustain-
able commitments and an ageing pop-
ulation. The Adam Smith Institute
identifies three fiscal scenarios. The
worst, where present spending plans
are followed to 2015-16 and all subse-
quent “proceeds of growth” used to
fund higher spending, would result in
another crisis by 2019. The second,
where the proceeds of growth are split
Tube strike
begins... again
TRANSPORT
▲
BY STEVE DINNEEN
A FOURTH “pointless” underground
strike began last night, leaving mil-
lions struggling to get to work this
morning.
The strike, which began at 7pm yes-
terday, will continue until 7pm
tonight, with many services not fully
resuming until tomorrow morning.
London Underground (LU) officials
had hoped to strike an eleventh hour
deal with its workers but talks
between the two collapsed on Friday.
RMT union boss Bob
Crow says job cuts in
underground offices
could affect safety on
the tube network.
PROPHOTONIX DELAYS AIM MOVE
ProPhotonix, a specialist in light-
emitting diode light engines, is
expected today to postpone its flota-
tion on Aim for the third time since it
began trying to raise up to £6m in the
summer. The company, which is now
not expected to come to market until
the end of January, has also halved its
target fundraising to £3m.
PORSCHE SEEKS BACKING FOR RIGHTS
ISSUE
Porsche is hoping for shareholder
approval tomorrow for the launch of
a €5bn (£4.2bn) rights issue aimed at
cutting the German sports car
maker’s high debt ahead of a planned
merger with Volkswagen next year.
Industry insiders and some analysts
expect preference shareholders to
approve the rights issue, in spite of a
voting threshold of 75 per cent and
opposition from a number of smaller
German institutional investors. This
month, Porsche’s preference share
price enjoyed a rapid rise.
50:50 between spending hikes and
debt cuts from 2015-16, would delay
calamity till 2031. The third, where
spending is held constant, would elim-
inate the national debt by 2041.
The Institute argues that the best
way to achieve spending restraint is
for the state to move away from being
the insurer of first resort and become
instead a safety net. The majority of
people would provide for themselves,
while the state’s focus will only be on
the most needy. Miles Saltiel, author
of the report, says the government
should mandate a minimum health-
care package that everyone would be
forced to buy, and would fund premi-
ums for those unable to afford them.
Service providers – such as hospitals –
would be privatised, raising £236bn
after recapitalising PFI obligations of
£28.9bn. The report proposes a tax and
regulatory regime to foster private
provision of incapacity, income and
mortgage insurance. State support
would focus on the poor. Education
and pensions would also be reformed.
Mike Brown, managing director of
LU, branded the strike “pointless and
unnecessary,” adding it will “achieve
nothing whatsoever”.
An LU spokesman said: “We will
run as many tube services as we can
but some lines may have a restricted
service and some stations will be
closed. It is not possible to say exactly
what services we will be able to run
and the situation may change
throughout the day.”
Unions claim job cuts at under-
ground stations could have a knock-
on effect on safety on the tube
network. RMT boss Bob Crow said: “It
is incredible that LU management
would not agree to a 12-week suspen-
sion of the cuts to allow a thorough
safety evaluation on the impact on
each station of their cuts plans.”
Icy conditions on roads leading
into London are expected to heap fur-
TRAIN BOSSES LINED UP TO OWN
TRACK AND STATIONS AS WELL
Commuters into London from Essex
and East Anglia and train passengers
in Liverpool could be the guinea pigs
in a radical break-up and part-privati-
sation of Network Rail. The
Department for Transport is set to
consider reforms that could promote
the “vertical integration” of parts of
the network, allowing train operators
to own the tracks and stations they
use.
FANCY A HOME IN A PRETTY LITTLE
MARKET TOWN? IT WILL COST YOU
£30,000 EXTRA
People wanting to live in England’s
smaller market towns are having to
pay £29,319 extra to buy a home,
despite nationwide falls in house
prices. Research published today by
Lloyds TSB shows that houses in mar-
ket towns cost an average £231,163.
While fiscal consolidation has saved
us from the Eurozone’s fate, we can-
not be complacent. Public spending
will explode again as soon as the aus-
terity phase ends – and we are already
taxed more than is sensible. The coali-
tion has focused on belt-tightening,
decimation and efficiency gains.
What we really need is radical struc-
tural change in the way services are
funded and operated. This will eventu-
ally be forced upon us – so we might
as well get thinking now.
WE NEED YOUR HELP
City A.M.’s annual readership survey
begins today. This is a vital way for us
to find out what you, our readers, real-
ly want so that we can improve your
paper further. So please help us.
Everybody who fills in the survey will
be entered into a draw to win a trip for
two to a Sandals luxury resort in St
Lucia – and there will also be Bollinger
to be won. Please turn to p9 and
www.cityamsurvey.com – many, many
thanks. allister.heath@cityam.com
FAST FACTS | HOW TO BEAT THE TUBE STRIKE
● Walk or cycle
Underground bosses are urging people
who live in central London to get on their
bikes in a bid to ease pressure on the
services they are able to maintain. Those
living further afield should bear in mind
the icy conditions and low temperatures
expected throughout the day.
● Go by river
Extra boat services will be laid on to give
commuters more options. Those coming
to and from the City can get boat servic-
es from piers including Putney. With the
extra traffic expected on the roads, boats
will be among the quickest ways of tra-
versing the city. Expect queues.
● Avoid the Circle Line
The entire Circle Line is expected to be
closed all day, with bosses saying most
stops are already covered by other
lines.
ther pressure on the already strained
transport network.
Today’s strike is the fourth this year
over job losses at ticket booths.
Officials argue fewer staff are needed
due to the prevalence of self-service
Oyster cards.
Last strike London Underground
FASHION MOGUL KEVIN STANFORD IS
HAUNTED BY GHOST
Kevin Stanford, the owner of the All
Saints clothing chain, has been forced
to shell out £2.5m of his own fortune,
after personally guaranteeing a bank
loan to his failed fashion brand Ghost.
He formerly owned 50 per cent of
Ghost, which had 32 shops across the
UK and went into administration two
years ago, owing £5m to VB
Investment Bank.
FORMER CBS CHIEF JOINS PEEP SHOW
MAKER ALL3MEDIA
Nancy Tellem, who was head of the
CBS Network Television
Entertainment Group for five years
until 2009, has been appointed
All3Media's US non-executive board
member. She is All3Media's second
high-profile hiring to its burgeoning
international operation in recent
months.
CITYA.M. 29 NOVEMBER 201
NEWS | IN BRIEF
Blackstone eyes Southern Cross
Private equity firm Blackstone is consid-
ering a takeover bid of Southern Cross.
The British care home operator said last
week it was in early-stage talks with
other potential buyers after private
equity firm Towerbrook Capital
announced it was no longer interested in
making an offer. Blackstone owned
Southern Cross before listing it in 2006
and is reportedly now keen on launching
a takeover of the listed operating com-
pany and its property company, with a
view to combining them. Blackstone and
Southern Cross could not be reached for
comment yesterday.
Dubai considers state sell-off
Dubai may sell off stakes in state-owned
companies, top financial officials said
yesterday, as the Gulf Arab emirate tries
to dig itself out of a $100bn-plus
(£64bn) debt pile. The emirate suffered
a blow to its reputation a year ago when
state-linked conglomerate Dubai World
announced it would ask creditors for a
standstill agreement on almost $25bn in
debt. "Dubai World is now on a sound
financial footing," said finance chairman
Sheikh Ahmed bin Saeed al-Maktoum.
● Take the Northern or District Lines
All Northern Line branches are expected
to remain open. District line trains will
run between Ealing Broadway and
Barking, and between Wimbledon and
Barking. There will also be some services
to Upminster.
● Be wary of the Central Line
Central line LU intends to initially operate
a service on the outer sections between
Ealing Broadway/West Ruislip and White
City and between Epping/Hainault and
Liverpool Street.
● Check airport transport
The Piccadilly line will not serve the cen-
tral area but London Underground plans
to run a service to Heathrow terminals 1,
2 and 3 from Acton Town.
● Avoid driving where possible
Extra traffic will cause jams all day.
said it kept around 40 per cent of its
services running and carried 50 per
cent of its usual passenger load.
Overall it said 95 per cent of its usual
Oyster journeys were carried out
across the transport network, with
extra busses and boats helping to ease
pressure.
COTY NEARS DEAL TO ACQUIRE
NAIL-POLISH MAKER OPI
Coty Inc., one of the world’s largest
fragrance companies, is close to an
agreement to acquire nail-polish
maker OPI Products Inc. for about $1
bn, people familiar with the matter
said. Talks were continuing yesterday,
and a deal could be announced as
early as today, these people said. But
the negotiations could still fall apart,
they added.
J&J SUFFERS ANOTHER
MANUFACTURING BLOW
The US Food and Drug
Administration cited a Johnson &
Johnson drug manufacturing plant
in Puerto Rico for various deficien-
cies. FDA officials found that J&J
failed to follow quality-control proce-
dures, and released into the market
drug products that should have been
rejected for quality violations.
CITYA.M. 29 NOVEMBER 2010
US government scrambles to
limit damage from WikiLeaks
▲
WORLD AFFAIRS
BY JENNY FORSYTH
WHISTLEBLOWER website WikiLeaks
yesterday released a cache of classi-
fied documents that left the US gov-
ernment scrambling to limit the
damage.
The 250,000 US diplomatic cables,
which have been sighted by newspa-
pers around the world, provided can-
did views of foreign leaders and
BP sells stake
in Pan Am for
$7bn to Bridas
▲
OIL
BY HARRY BANKS
BP YESTERDAY said it had agreed to
sell its stake in Argentina-based oil
and gas group Pan American Energy
(PAE) to Bridas Corp, half-owned by
China’s CNOOC, for $7bn (£4.5bn), as
it raises cash to pay for the Gulf oil
spill.
The planned sale of the 60 per cent
interest, which sources previously
said was under discussion and which
was for a price in line with analysts’
estimates, brings to $2bn the amount
that BP has raised, or agreed sales on,
in recent months.
BP has said it expects the costs of
the Gulf of Mexico oil spill -- the
United States’ worst ever -- to hit
$40bn and said it would sell assets
worth $25-$30bn by the end of next
year to pay for it.
Bridas already owns a 40 per cent
stake in Pan American Energy, which
BP said was Argentina’s second-
largest producer of oil and gas.
Bridas was owned entirely by the
family of Argentine tycoon Carlos
Bulgheroni until CNOOC agreed to
buy a 50 per cent stake for $3.1bn in
Treasury to launch consultation
into taxation of foreign profits
▲
POLITICS
GEORGE Osborne will today launch a
consultation on the much-maligned
rules that govern the taxation of for-
eign profits, which have been blamed
for the departure of several high-pro-
file multinationals in recent years.
The Treasury is expected to propose
a more “territorial” approach to the so-
called controlled foreign companies
(CFC) rules, which would restrict the
Revenue’s right to impose tax on prof-
its earned in low-tax jurisdictions.
An aide to the chancellor said he
wanted to prove he was serious about
his pledge to make Britain the most
competitive corporate tax regime in
News 3
sensitive information on terrorism Yesterday the White House con-
and nuclear proliferation. demned WikiLeaks’ “reckless and
Reports say the documents show dangerous action”, saying it could
Saudi donors remain chief financiers endanger lives and risk hurting rela-
of militant groups like al Qaeda and tions with friendly countries.
that Chinese government operatives “When the substance of private
have waged a coordinated campaign conversations is printed on the front
of computer sabotage targeting the pages of newspapers across the world,
United States and its allies. it can deeply impact not only US for-
They also criticise UK military oper- eign policy interests, but those of our
ations in Afghanistan and David allies and friends around the world,”
Cameron before the general election. said spokesman Robert Gibbs Julian Assange is founder of WikiLeaks Picture: GETTY
March.
The 60 per cent stake BP is selling
represents reserves of 917m barrels of
oil equivalent (boe) and production of
143,000 boe per day.
US oil major Exxon Mobil Corp is
seeking to sell its Argentine unit Esso,
LONDON
which controls hundreds of service
stations and a refinery.
CITY TO
“Today’s agreement demonstrates
both the high quality and attractive-
ness of the assets throughout BP’s
global portfolio and also the compa-
ny’s ability to meet our significant STOCKHOLM
financial commitments arising from
the Gulf of Mexico tragedy,” Bob FROM £65
ONE WAY
Dudley, BP’s chief executive, said.
ANALYSIS l BP 436.00
460 26 Nov
p
440
420
400
380
6 Sep 24 Sep 14 Oct 3 Nov 23 Nov
the G20 group of industrialised
nations.
The Treasury must now perform a
delicate balancing act, and reform the
rules without foregoing significant
revenues. In the past, Osborne has low-
ered headline rates by scrapping reliefs
and allowances, a method that aides
say he is keen to use again.
But some firms are worried that
they will get higher tax bills as a result
of the reforms.
One option under consideration is
to abolish CFC rules but in turn limit
deduction of interest costs in respect
of foreign profits – a compromise that
would risk alienating overseas
investors.
 6 News
Samsonite to
consider $1bn
share issue
▲
CONSUMER
BY MARION DAKERS
LUGGAGE maker Samsonite is con-
sidering a $1bn (£640bn) public offer-
ing in Hong Kong, a debt refinancing
or a trade sale, people close to the
company confirmed yesterday.
Samsonite has signed up Goldman
Sachs to help examine its options,
though the evaluation is at an early
stage and a decision is expected to
take months rather than weeks, one
source said.
CVC acquired Samsonite from a
group of private equity owners in
July 2007 for a total of $1.7bn, includ-
ing debt, but handed a 40 per cent
stake in the firm to RBS last year
when the lender agreed to reduce
Samsonite’s debts from $800m to
$240m.
The company has come close to
breaching its banking covenenants.
US-headquartered Samsonite was
hit hard by the downturn in travel
during the financial crisis but sales
of its suitcases have since recovered
and it is on course to post a profit of
£128m this year.
The company sells luggage and
accessories under the Samsonite,
Lacoste and Timberland brand
names, and pledged earlier in the
year to double its sales in emerging
markets such as India every two
years.
CVC, which manages $38bn in
funds, owns 53 companies world-
wide.
The firm owns stakes in Formula
One Group, the AA and Madame
Tussauds owner Merlin.
Samsonite, CVC and Goldman
Sachs declined to comment yester-
day, while RBS did not return calls
for comment.
FAST FACTS | SAMSONITE
● Luggage manufacturer Samsonite was
founded in 1910 in Denver, Colorado
● The company had a turnover of £802.5m in
2008, although sales have declined since the
financial crisis
CITYA.M. 29 NNOVEMBER 2010
Macquarie
HARRY POTTER BATTLES HAIRY PRINCESS
buys into asset
firm Bluestone
M&A
▲
AUSTRALIAN bank Macquarie has
acquired a 17.5 per cent stake in capi-
tal and asset management group
Bluestone for between £5 and £10m,
it announced yesterday.
While no price tag has been put on
the all-cash deal, sources said the
price paid by Macquarie would be
based on an open market multiplier
of between eight to 12 times
Bluestone’s profits, which are expect-
ed to be AS$6.4m (£3.9m) for the year
ending June.
Based on that figure, a conservative
valuation for Bluestone would be
£31.6m (AS$51.2m) while at the upper
end it be £47.5m (AS$76.8m). That
would put Macquarie’s stake at
between £5.5m and £8.3m
The proceeds of the capital raised
are to be used to support Bluestone’s
expansion into the UK, Ireland and
mainland Europe, the company said.
Bluestone’s chairman, Alistair
Jeffery, said that he looked forward to
developing the relationship with
Macquarie in the coming years.
“In our view there are a wide range
of attractive investment opportuni-
ties emerging in the wake of the glob-
HARRY Potter led the worldwide box office for a second weekend yesterday, but the boy al financial crisis, and this
wizard had a close shave with a hairy princess – Walt Disney’s Rapunzel story “Tangled - investment positions Bluestone to
in North America. The seventh movie in the hit franchise, "Harry Potter and the Deathly benefit from the diverse opportuni-
Hallows Part 1," sold $163.5m (£104.9m) worth of tickets globally, Warner Bros said. ties we are seeing,” he added.
 If you’re thinking...
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 The Capitalist
8 CITYA.M. 29 NOVEMBER 2010
EDITED BY
JEREMY HAZLEHURST
GOT A STORY? EMAIL
thecapitalist@cityam.com

ALAN SUGAR A Christian

BECOMES A
CHRISTIAN
COVER STAR
ALAN Sugar likes to boast that he was in
the Jewish Lads Brigade in Hackney, flew
Jewish comedian Jackie Mason over from
New York for his 40th birthday party and
when a contestant on The Apprentice
told him “I’m Catholic and I give you my
word”, he replied: “I’m Jewish and I
couldn’t give a toss.”
A funny choice to be the face of a cam-
paign to convert people to Christianity,
then. But the Scottish branch of the
Assemblies of God, a fundamentalist
Christian group, has somewhat bizarrely
put Lord Alan on the front of its latest
magazine, as an example to its congrega-
tion on how to evangelise.
The accompanying article says
Christians should be more like the for-
mer Amstrad chief executive when try-
ing to recruit to the church. “In business
terms, it should be the easiest thing in
the world for us to promote faith in
Christ because we believe 100 per cent in
our product,” it argues.
“Lord Sugar has no involvement what-
soever with this organisation and we
have had no approach for permission for
his name or likeness to be used in this
article,” his spokesman told Scotland on
Sunday.
The Capitalist can’t help thinking that
they could have put the message across
more simply, with a picture of Lord
Sugar wagging a finger and a dirty great
headline reading “Sinners: You’re Fried”.
PLANE TASTES
HE made his name flogging reasonably
priced clothes to the British people
when he was chief executive of M&S,
and is still the company’s chairman, but
as he counts down to leaving the job –
he will stand down in 2011 – it seems
that Sir Stuart Rose’s tastes have become
a little more highfalutin.
Asked in a newspaper over the week-
end what he wanted for Christmas,
the high street supremo respond-
ed that he hoped to receive a
plane. More specifically, “a
TBM 850 single-engined
high-performance turbo-
prop, built by Socota,
powered by an 850HP
P&W PT6A-66D engine.”
Tricky to fit in a stock-
ing. I bet he gets pants,
like the rest of us. From
M&S.
church in
Scotland is
using the
Jewish Lord
Sugar as an
example of
how to
evangelise
To Stuart, hope it’s what you wanted.
who coined the terms BRICs to describe
the emerging economies of Brazil,
Russia, India and China – has been hold-
ing forth on the future of the euro.
The picture he paints is not positive.
But it seems he sees laughter in the
Lord Sugar, left: scari- darkness. He said that “very extreme”
er than God? outcomes are possible for Eurozone
countries, if they don’t come together
Below: an emu or a and start some sort of fiscal union.
black swan? “There are elements of the black swan
concept that seem rather applicable to
Pictures: GETTY, REX the EMU story,” he quipped.
Some economists are loath to speak
out right now. It’s good to see that some
are prepared to say that the euro is a
turkey.
ALL IN ON RED
YOU might recall that a couple of weeks
ago a box of vintage Bordeaux was sold
for £43,000 at auction in Hong Kong.
Well, it’s been bettered. A casino in
Singapore has gone, er, all in on red by
splurging £111,000 on a case of
Burgundy. Which, if your maths
isn’t immediately up to it, comes
in at £9,250 a bottle. The wine in
question was a Romanée Conti
1971, which has been described
as having a “perfumed mix of
spiced tea, smoked beef jerky and
abundant earth.” Gary Boom, MD
of wine auction expert Bordeaux
Index, who has recently hired a rep-
resentative just to look after the grow-
ing market is Singapore, said that
demand is being driven there by “gift-
giving”. Good times.

BLACK EMUS
THEY probably aren’t laughing in
Dublin or Madrid, but maybe it’s best
to keep a sense of humour about the
euro’s latest disasters. Goldman Sachs
chief economist Jim O’Neill – the man

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 10 News
HSBC shuffles
managers to
focus on Asia
▲
BANKING
BY MATTHEW WEST
HSBC reshuffled a number of senior
managers over the weekend with new
group chief executive Stuart Gulliver
pointing to an increased focus on
emerging markets when he takes
over.
Gulliver, who becomes boss of
HSBC in January, said: “With the mas-
sive wealth creation we see in emerg-
ing markets today, the logic for HSBC
to build a world-class global wealth
business for our customers is
absolutely compelling.”
“After the financial crisis... config-
uring HSBC to realise its full potential
in retail banking was always going to
be my first priority,” he added.
He announced that Paul Thurston,
the current head of the bank’s UK
retail business, will become chief
executive of global retail banking and
wealth management from 1 March
2011.
Thurston will move from London
to Hong Kong, following Gulliver,
who is also moving there himself in
recognition of the growing impor-
tance of the Asian market.
He will have responsibility for
directing the bank’s retail banking
business globally and lead the devel-
opment of HSBC’s retail wealth man-
agement business.
Brian Robertson, currently group
chief risk officer, will replace
Thurston as head of UK retail opera-
tions at the bank on 3 December.
Joe Garner will be appointed
deputy chief executive under
Robertson and will head up the per-
sonal financial services and commer-
cial banking businesses in the UK.
Replacing Robertson as group chief
risk officer will be Marc Moses, who
will also be appointed as group man-
aging director and sit on the board
for risk and compliance issues.
A recent survey by Merrill Lynch
and Capgemini showed that the com-
bined wealth of Asian millionaires
has overtaken that of Europeans.
Paul Thurston (left) becomes
head of global retail. Brian
Robertson (right) replaces
him in the UK.
Joe Garner (right) will work
under Robertson while Marc
Moses (left) takes over risk.
CITYA.M. 29 NOVEMBER 2010
Metro Bank
beats its own
growth targets
▲
BANKING
BY MARION DAKERS
METRO Bank, set up in July to rival the
high street banks, has hit its annual
targets in the first three months of
business, chairman and co-founder
Anthony Thomson said yesterday.
Metro, which has four branches in
London, will now accelerate its expan-
sion with eight additional outlets in
the next year including banks in
Kensington, Uxbridge and Croydon.
Thomson, who founded the bank
with American entrepreneur Vernon
Hill with £75m initial funding, said its
targets were agreed with watchdogs
but will not be made public yet.
“Nobody has any terms of reference
for us,” Thomson told City A.M. yester-
day. “We are the first new bank in
more than 100 years and no-one
knows what a good number of cus-
tomers would be for us. But we agreed
a number of annual targets with the
FSA as part of our business plan, which
we have now surpassed.”
The bank is gearing up to raise extra
money from investors, including the
billionaire Reuben brothers, to ramp
up expansion. Thomson said Metro
was on course to go public within
three years of opening.
The bank remains focused on
expanding within the M25, he added,
with plans for 200 to 250 branches in
Greater London in the next decade.
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 12 News
If
lif e
Demand for homes has plummeted
Demand for
homes falling,
g i ve s finds survey
▲
PROPERTY
BY PHILIP WALLER
DEMAND for homes fell at the fastest
rate for nearly two years last month
as buyer confidence dipped, industry
yo u
figures showed.
The number of new buyers register-
ing with agents fell by 4.3 per cent in
November, according to the monthly
national housing survey from proper-
ty website Hometrack.
The monthly fall was the fifth in a
row and the biggest since January
2009, the survey of more than 5,100
agents and surveyors showed.
Hometrack said the figures meant
the normal seasonal slowdown in the
housing market in the run-up to
Christmas had kicked in a month ear-
lier than usual.
It said near-term prices would
remain under pressure and were like-
ly to fall two per cent by the end of
2011.
Hometrack’s research director
Sentance repeats call for
lem o n s Bank to lift interest rates
▲
FINANCIAL SERVICES
THE Bank of England (BoE) should
embark on a gradual rise in interest
rates to avoid the need for a damaging
sharp increase later on, policymaker
Andrew Sentance said yesterday.
Sentance, the most hawkish mem-
ber of the nine-strong Monetary Policy
Committee (MPC), said the BoE’s infla-
tion forecasts had consistently under-
estimated the upside impact from
rising global energy and commodity
prices.
Writing in a Sunday newspaper,
Sentance said the BoE’s forecasts had
Picture: Micha Theiner/City A.M.
Richard Donnell said economic con-
cerns amid recent spending cuts,
together with expectations of a peri-
od of retrenchment in house prices,
were driving the weakness.
“It is inevitable this trend will con-
tinue as we move into the New Year,”
he said.
The group said prices had come
under greatest pressure in southern
England, where they recovered most
strongly in 2009 and earlier this year,
while prices did not firm up as much
in the Midlands and north.
The number of properties for sale
fell by 0.4 per cent in November, the
first time in nine months that the
survey had shown a fall in supply.
“A continued reduction in the sup-
ply of homes for sale seems inevitable
in the coming months as vendors
either reduce asking prices or with-
draw property from the market,” the
group said. “We expect this to act as a
support to pricing in the second part
of 2011.”
also persistently overstated the down-
ward pressure on inflation from spare
capacity in the British economy.
Annual consumer price inflation
rose unexpectedly to a four-month
high of 3.2 per cent in October, forcing
BoE Governor Mervyn King to write
another letter to government explain-
ing why inflation remains so far above
its two per cent target.
“It is now time for monetary policy
in the UK to get back to business and
for interest rates to rise gradually
towards normal levels,” said Sentance,
who has been arguing for an interest
rise since June.
CITYA.M. 29 NOVEMBER 2010
OBR head Robert Chote will unveil his first forecast tomorrow
OBR expected
to upgrade
its forecasts
▲
UK ECONOMY
BY JULIAN HARRIS
BETTER than predicted growth has
been recorded in the UK this year, the
government’s spending watchdog is
expected to announce today.
The economy was forecast to grow
by 1.2 per cent in June’s emergency
Budget, but the prediction could
increase to 1.8 per cent in light of sur-
prisingly high growth.
In the three months to September,
the economy expanded by 0.8 per
cent, leaving GDP 2.8 per cent higher
than the same time in 2009.
The Office for Budget
Responsibility (OBR) will release its
latest outlook on the economy at
lunchtime today.
In the afternoon chancellor George
Osborne will give his autumn state-
ment to parliament, outlining the
prospects for the government’s fiscal
situation.
The deficit for this year could even
undershoot the government’s target
of £149bn.
Less government sector job losses
than expected, says Item report
▲
UK ECONOMY
GOVERNMENT sector job losses have
been overstated, according to a report
out today.
The Ernst and Young Item Club
(Item) expects job cuts of 400,000
across this parliament, below current
estimates of 490,000.
The revision is due to greater sav-
ings from welfare reform, leaving
more funds for Whitehall budgets.
News 13
ECONOMIST VIEWS: WILL THE OBR REVISE ITS FORECASTS? Interviews by Julian Harris
MICHAEL SAUNDERS | CITIGROUP
“ Growth is exceeding predictions despite Irish troubles, and business investment is strong. The
OBR can revise down this year’s deficit forecast by £10bn, and next year’s by around £25bn.
GEORGE BUCKLEY | DEUTSCHE BANK ”
“ The OBR may revise up its growth forecasts this year, yet forecasts for following years seem
too optimistic. Going forward, there is a risk that the deficit does not fall as quickly as is hoped.
ALAN CLARKE | BNP PARIBAS ”
“ The UK remains ahead of schedule, and growth should be revised up to around 1.7 or 1.8 per
cent. But real incomes will continue to fall in 2011, and fiscal consolidation could bite harder.
”
“If current trends are replicated
over the whole fiscal year, the public
sector net borrowing requirement
would come in around £145bn,” said
Howard Archer of IHS Global Insight.
Government borrowing increased
in October – £10.3bn, up from
£10.1bn in October 2009 – yet overall
borrowing tightened in the second
and third quarters of the year, as tax
revenues increased.
However, the OBR’s figures will not
include contingent liabilities, such as
the €7.5bn (£6.37bn) bailout to Ireland.
While the OBR may revise up
growth figures for this year, its fore-
casts for following years remain opti-
mistic, say economists. For 2011 the
OBR has predicted a 2.3 per cent
increase in GDP, and expects growth
in subsequent years to reach close to
three per cent.
“We think the OBR’s forecast for
2011 is likely to prove optimistic. We
forecast 1.7 per cent,” said Archer.
However, growth in excess of two per
cent “is certainly not out of the ques-
tion,” he added.
Departmental spending will be
£11bn higher than set out in June’s
emergency Budget, the report says.
The Item report expects the govern-
ment to better its deficit target for
2010 by £10bn, largely due to increas-
es in revenue from corporation tax,
VAT and income tax.
It adds business investment is at
least two per cent higher than expect-
ed this year, despite government pro-
jections of a half per cent fall.
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CITYA.M. 29 NOVEMBER 2010 News 15

Christmas
Traffic free day earns
shopping? London shops £250m
RETAIL last year’s average of £120.

▲
BY JULIAN HARRIS Cutting edge consumer electron-
ics led the way, with large sales
Save OVER £250m was spent in West
End shops this weekend, as con-
in 3D televisions and 4G smart
phones.

£12 * sumers took advantage of the

sixth annual traffic-free “VIP
Day” in Oxford Street and
Paco Rabanne Lady Million, 80ml.
West End price £59.95, Regent Street.
Heathrow price £47.95
And retailers are delighted
with a reported boom in sales of
“big ticket” items, after recent
data pointed to a slump in peo-
ple’s willingness to splash out on
major purchases.
“Many stores have reported
over a 10 per cent rise in sales of
big ticket items,” said Richard
Dickinson of New West End
Company, a collaboration of
large West End stores.
Shoppers spent an average of
£200 each, a huge jump from
VIP Day (“Very Important
Pedestrians”) saw 1,000 buses re-
routed. Benefiting from the
surge of on-foot shoppers was
Starlight, a charity for seriously
and terminally ill children.
American Express pledged to
donate £1 every time a card was
used over the weekend.
And the day is a boon for the
local economy, according to
councillor Brian Connell of
Westminster Council.
“More than 350,000 jobs are
dependent on the West End’s
ongoing success,’ he said. “VIP
day is a great way for shoppers to
stock up before Christmas." Pedestrians claim the traffic free streets to pick up bargains Picture: GETTY

US Black Friday retail Time to leave... Service sector morale

sales show small rise hit by consumer slump
US RETAIL UK ECONOMY
▲

BY JULIAN HARRIS
AMERICAN retail sales have
edged up slightly from the same
time last year, it was revealed
over the weekend.
Consumers spent $10.69bn
(£6.9bn) on Black Friday, the day
after Thanksgiving when
Americans traditionally kick off
their festive shopping.
Last year Black Friday sales
totalled $10.66bn. The 0.3 per
cent rise this year is lower than
the 0.5 per cent rise experienced
between 2008 and 2009.
However, early promotional
offers may have warped the sales
figures, according to researchers
at ShopperTrak who compile the
data.
The first two weeks of
November saw sales increasing
by over six per cent compared to
the same time in 2009.
“We have a deal driven con-
sumer in 2010 and that con-
sumer responded to some of the
earliest deep discounts we’ve
Heathrow price £676.63
even seen for the holidays,” said
ShopperTrak founder Bill Martin.
Americans are still shopping
in large numbers, but may be
allowing for difficult economic
circumstances, he added.
Last week the government
revised up its forecast for US
unemployment to 8.9—9.1 per
cent for 2011.
“This means the American
shopper has adapted to the eco-
nomic climate over the last cou-
ple of years and is possibly
spending more wisely as the holi-
day season begins,” said Martin.
▲
Save. *
BY JULIAN HARRIS
£118 37 CONSUMER service businesses
such as bars and restaurants are
Bally, MAE-MD from the Moritz Collection. suffering from sluggish demand,
West End price £795, according to a survey released
today.
Optimism plummeted 22 per-
centage points among consumer
service executives, who have seen
the value and volume of their
businesses hit.
Employers’ organisation the
CBI surveyed 169 service sector
firms, covering both consumer
services and professional services
such as accountancy.
Thirty per cent of consumer-
sector respondents said the value
of their business had risen this
quarter, yet 38 per cent reported
a fall. And the same balance (-8
per cent) expect a decline in
value of trade over the next
three months.
The poor results were a sur-
prise, after modest growth had
been expected.
The outlook is a little rosier for
professional services. While senti-
ment is still negative (at -4 per
cent), it has recovered from its
August low of -17 per cent.
Volume of business in profes-
sional services is narrowly up,
increasing by a percentage point
to three per cent.
Yet Ian McCafferty of the CBI
said uncertainty over consumer
demand is causing a fall in busi-
ness optimism.
“Consumers are cutting back
on leisure spending, leading to a
surprise fall in business volumes
and flat profits,” he said.

John Lewis
stores defy Shopping on web ...the country.
cold snap hits £3k a second Save. *

RETAIL internet sales. Research by internet shopping than their £771 49

▲

RETAIL
▲

BY JULIAN HARRIS
SNOWSTORMS could not stop the
boom in John Lewis sales, the depart-
ment store announced yesterday.
Sales last week were just short of
£100m, up 8.7 per cent on the same
time last year.
And the Oxford Street branch
recorded its best ever November week.
Children’s toys are predictably sell-
ing well in the run up to Christmas,
but Nat Wakely, director of selling
operations for John Lewis, also report-
ed a rush for “big kids’ toys” such as
iPads and Kindles.
Consumers may be making big pur-
chases before the new year when VAT
increases to 20 per cent, said Howard
Archer of IHS Global Insight.
BY JULIAN HARRIS
ONLINE sales of £3,000 per sec-
ond will be made on Visa cards
today, totalling £265m, accord-
ing to the company.
Visa has coined today Mega
Monday, as internet shoppers
click through their Christmas
shopping lists.
Many will have received their
November pay packages and be
looking for cheap deals online.
Sales are expected to peak at
lunchtime and in the early
evening as workers return
home.
Visa cards account for £1 in
every £4 spent in the UK,
reflecting an overall increase in
Deloitte suggests 23 per cent of
December purchases will be
made online, totalling £8bn.
And government data for
October showed an increase in
“non-store” sales (mostly inter-
net or mail-order purchases) of
12 per cent on the previous
year. Visa expects today’s online
sales to be 5.5 per cent up on
the equivalent Monday last
year.
Internet sales are far from
their peak, according to Ian
Geddes, UK Head of Retail at
Deloitte. “Online sales could
account for close to 20 per cent
of total retail spend by the end
of the next decade,” he said.
UK consumers are keener on
counterparts in mainland Breitling Blackbird,
gents stainless steel automatic.
Europe, the research showed. A West End price £5,180,
recent survey showed over half Heathrow price £4,408.51
(54 per cent) of British respon-
dents willing to buy Christmas
gifts online, compared to only a
third (33 per cent) elsewhere in
Europe.
A phenomenon sparked by
the growth in online sales is
Christmas Day shopping,
which has become one of the That’s because Heathrow has the best of West End shopping – but
busiest days of the year as peo- always for less. Buy on the way, and you’ve Christmas wrapped up.
ple seek out early bargains. Heathrow Christmas shopping.
“People can now sit on the The West End for less.
sofa enjoying Christmas with
the family whilst surfing the
sales on their iPad. We expect
Christmas Day spending to con- *For more information on our prices, go to Heathrow.com.
Products subject to availability.
tinue to increase,” said Geddes.
 16 News CITYA.M. 29 NOVEMBER 2010

UK to pay €7.9bn for

€85bn Ireland rescue
ately available to recapitalise its ministers in Brussels yesterday.
▲

EUROZONE CRISIS
BY STEVE DINNEEN
THE bailout of Ireland will cost the
UK a total of €7.9bn (£6.37bn) after
the beleaguered nation agreed an
€85bn rescue package yesterday.
George Osborne agreed to stump
up a bilateral loan of €3.8bn on top of
the UK’s committment to the
International Monetary Fund (IMF)
and the European Financial Stability
Mechanism (EFSM).
The UK will pay 4.5 per cent of the
€22.5bn IMF contribution, totalling
just over €1bn and 13.8 per cent of
the EFSM, coming to €3.1bn.
Altogether Ireland will accept
€67.5bn of external support. It will
also raid its own reserves to the tune
of €17.5bn. Of this, it will take €12.5bn
from its state pension fund, with the
remaining €5bn coming from cash
reserves.
Ireland will make €10bn immedi-
stricken banks, with a further €25bn
being set aside in a euro contingency
fund to be allocated if they require
more money in the future.
The remaining €50bn will go
towards general running of the coun-
try, including paying the civil service.
Interest payments on the loans will
account for a staggering 20 per cent
of Ireland’s tax revenue by 2014.
The average rate of interest on the
loan will be a relatively large 5.8 per
cent. However, reflecting the increas-
ingly hardline approach Germany
has been lobbying for, the Eurozone
portion of the loan will come with a
punative six per cent rate of interest.
The IMF portion of the loan will
come with a three per cent rate of
interest, rising to four per cent in
2013. The average duration of the
loans is seven years.
The deal was thrashed out during a
crunch meeting of European finance
Ireland will be bracing for an anti-
European backlash when news of the
punative interest rate hits home.
Anger in the country is already
boiling over into sporadic bursts of
violence and masked protestors yes-
terday burned pictures of Cowen on
the streets of Dublin.
A defeated looking Prime Minister
Brian Cowen welcomed the deal yes-
terday. He said: “This agreement is
necessary for our country and our
people. The final agreed programme
represents the best available deal for
Ireland.
“The significant loans being pro-
vided to Ireland are necessary to
allow us to fund our budgets over the
coming years.”
Cowen added the loans will pro-
vide money Ireland had already
planned to borrow on the interna-
tional markets and that the rate of
interest was comparatively low.

Greece could get 11 years No haircuts for senior Larry Fink says
to repay its €110bn debts bondholders at banks euro will drop
to $1.20 level
receives its last instalment in 2013. said: “In relation to the question of
▲

EUROZONE CRISIS
▲

EUROZONE CRISIS
Most critical are the first two years, senior bondholders, there is no agree-
THE EU and the IMF could extend the when the bulk of the debt to the EU SENIOR bondholders in Irish banks ment from the European Union for
▲

period in which Greece must repay its
bailout loans by five years, to make it
easier for it to service its debt, an IMF
official has said.
“We have the possibility to extend
the repayment period... from about
six years to around 11,” Poul
Thomsen, the IMF official in charge
of the Greek bailout, said.
Greek, EU and IMF officials have
repeatedly mooted the possibility of
extending the period in which Greece
must repay its €110bn (£93.43bn)
bailout loans.
But the IMF official was more spe-
cific on how the repayment period
could be stretched after Greece
and IMF falls due. Under current
repayment schedules, Greece’s gross
borrowing needs will balloon above
€70bn a year in 2014-15 from around
€55bn a year in 2011-2013.
“(As things stand now) Greece must
repay the bulk of its €110bn loans in
the first two years after the pro-
gramme expires,” Thomsen said.
“This (the extension) would give
markets the signal: ‘Don’t worry
about the repayment of the €110bn,
this is not going to affect your
claims'," he added.
Greece in May became the first
Eurozone member to turn to its part-
ners and to the IMF for help.
escaped the bailout without taking a
hit yesterday.
Finance minister Brian Lenihan
said the government needs to impose
“big haircuts” on junior bondholders
but said there was no appetite for
forcing losses onto senior holders.
European finance ministers decided,
as expected, that imposing haircuts
would have a detrimental effect on
markets.
German Chancellor Angela Merkel
has been pushing for investors who
gain from exposure to banks to take a
share in the risk if they run into trou-
ble.
Irish Prime Minister Brian Cowen
[shifting losses] because of the impact
we believe it would have in relation
the stability of the entire financial
system itself and the impact it would
have across European banking gener-
ally.”
Ireland said two years ago senior
bondholders would not take a hit if
banks ran into trouble.
German Chancellor
Angela Merkel had urged
policymakers to “share
the risk” of bailouts with
bondholders
EUROZONE CRISIS
LARRY Fink, the founder of
BlackRock, has warned the euro will
depreciate “considerably” against the
dollar, to $1.25 or $1.20, as a result of
the Eurozone crisis.
Fink said the dollar would have
been even stronger were it not for the
US Federal Reserve’s decision to begin
another round of quantitative easing.
He said the euro would continue to
take a battering because of the “fun-
damental problem” that the banking
sector owns the bulk of European sov-
ereign credit. Fink added Eurozone
banks and nations should reduce
their reliance on short-term funding.
CITYA.M. 29 NOVEMBER 2010 News 17

ANALYSIS l How the €85bn bailout is made up * Including bilateral loans

UK
IRISH EUROZONE BILATERAL
CONTRIBUTION €17.7bn LOAN
€17.5bn PENSION €3.8bn
FUND
€12.5bn
SWEDEN
EFSF* €0.6bn
IMF €22.5bn
€22.5bn
CASH RESERVES DENMARK
€5bn €0.4bn
UK
CONTRIBUTION
€1.0125bn UK
CONTRIBUTION
A red-eyed Irish €3.1bn
finance minister
Brian Lenihan at
the crunch meeting
BAILOUT EFSM
€22.5bn
in Brussels yester-
day (left); chancel-
€85bn
lor George Osborne
talking to French EXTERNAL
finance minister
Christine Lagarde
SUPPORT
(inset top) and a
dejected Prime
€67.5bn EUROPE
Minister Brian €45bn
Cowen in Dublin.

Picture: GETTY,
REUTERS

UK will not take part in Emerald Isle to Irish banks require extra
new bailout mechanism keep 12.5pc rate €8bn to boost capital levels
for corporate tax
Mechanism (EFSM) in 2013. It current- below 10.5 per cent the government
▲

EUROZONE CRISIS
▲

EUROZONE CRISIS
ly has a share in the €60bn fund but is says it will inject more cash.
▲

THE UK will not take part in new res-
cue fund for troubled Eurozone
nations.
Chancellor George Osborne won an
important concession from the EU in
return for pledging a bi-lateral loan of
€3.8bn (£3.23bn) to Ireland.
The UK will not contribute to the a
new fund, due to replace the
European Financial Stability
Tory eurosceptic John
Redwood will be pleased
the UK will not be joining
the replacement fund to
the EFSM in 2013
not a part of the €566bn European
Financial Stability Fund (EFSF), also
due to be replaced.
The move means the UK will be less
exposed to Eurozone crises moving
forward and is likely to please Tory
eurosceptics.
Germany and France have champi-
oned the proposals for the new mech-
anism and are supported by the
European Commission.
Key changes to the fund will mean
vastly increased private sector involve-
ment in the resolution of future
Eurozone debt crises. The new rules
will also differentiate between liquid-
ity and solvency crises in the 16
Eurozone countries.
MINING
IRELAND’S bailout will not require it
to raise its corporation tax rate, Prime
Minister Brian Cowen said yesterday.
Eurozone nations had heaped pres-
sure on Ireland to slash its much-
envied 12.5 per cent rate.
Austria had led calls for the belea-
guered nation to be forced to hike the
rate as punishment for its financial
failures.
The rate has allowed it to compete
as a major business hub. Firms includ-
ing Google and Microsoft have their
European domicile there and soon-to-
merge Greencore and Northern Foods
say they plan to move to Ireland for
tax purposes.
IRISH banks require an additional
€8bn to be injected in order to meet
tough new capital requirements, the
country’s central bank indicated yester-
day night.
Allied Irish Bank, 19 per cent owned
by the state, will need almost €5.3bn
(£4.5bn) before March in order to
achieve a core Tier 1 capital ratio of 14
per cent.
Bank of Ireland, 36 per cent govern-
ment owned, will require €2.2bn of
capital to be injected to hit its target of
12 per cent.
The Irish central bank has raised its
core Tier 1 capital ratio targets, a meas-
ure of financial strength, from eight
per cent. If the banks’ capital ratios dip
Irish Prime Minister Brian Cowen
yesterday announced €35bn of the
€85bn bailout package will be used to
recapitalise the stricken banks.
Around €10m of this will be injected
immediately.
A Bank of Ireland spokesman said:
“The bank intends to seek to generate
the required capital through a combi-
nation of internal capital management
initiatives, support from existing share-
holders and other capital markets
sources.”
The bank is 36 per cent owned by
Irish taxpayers.
Around €3bn of the €7.9bn total UK
contribution will go directly to prop up
the Irish banking system.
 18 News
Myners to join board of
children’s charity ARK
▲
PHILANTHROPY
BY MARTIN WILLIAMS
LORD MYNERS will today be appoint-
ed to the board of trustees for the
international children’s charity ARK
(Absolute Return for Kids).
Myners, who started his career as a
teacher, described ARK as a “tremen-
dously innovative and dynamic chari-
ty”.
A former chairman of Marks &
Spencer, Myners was headhunted by
ex-Prime Minister Gordon Brown to
be City minister in 2008. He
became the centre of contro-
versy after allegedly agreeing
to a “compromise deal” over
Sir Fred Goodwin’s pension,
allowing the former RBS boss
to increase his pension pot by
£8m.
Myners said: “ARK can
claim a genuinely catalytic
impact on public policy in
a number of countries.”
CITYA.M. 29 NOVEMBER 2010
Absolute Return for Kids – founded
by French hedge fund manager Arpad
Busson – runs academy schools in
the UK, including a Church of
England academy in West London.
Next year, the charity is also plan-
ning to open two London primaries
under the coalition’s free schools
programme.
ARK also raises contribu-
tions for children who are
victims of abuse, illness,
disability and poverty.
Arpad Busson with fiancée Uma Thurman Pictures: Micha Theiner/City A.M.
CITYA.M. 29 NOVEMBER 2010
Ferrovial to kick
off sale of BAA
stake this week
INFRASTRUCTURE
▲
BY PHILIP WALLER
SPANISH builder Ferrovial plans to
begin the sale of a tenth of airport
operator BAA this week to cut its
€24.5bn (£20.8bn) debt.
The group is understood to have
hired investment banks Goldman
Sachs and HSBC to sell a 10 per cent
stake in BAA, which owns London’s
Heathrow and Stansted airports as
well as Southampton, Edinburgh,
Glasgow and Aberdeen airports.
Ferrovial owns 55.9 per cent of the
parent of BAA, in which Britannia
Airport Partners, managed by
Canada’s Caisse de Depot et
Placement du Quebec, owns 26.5 per
cent and Singapore sovereign wealth
fund GIC holds 17.6 per cent.
It unveiled the sale plan in October
and expects to complete it in 2011.
Qantas boss points
finger at Rolls-Royce
AVIATION
▲
BY HARRY BANKS
QANTAS Airways chief executive
Alan Joyce has said an engine fail-
ure on an A380 superjumbo should
be blamed on the engine’s design
and had nothing to do with the air-
line’s operations.
A mid-flight failure of a Rolls-
Royce Trent 900 engine on 4
November forced Qantas to ground
its six-plane A380 fleet. The airline
resumed some A380 operations on
Saturday but four of the planes
remain grounded.
Joyce told the Australian
Broadcasting Corporation (ABC)
yesterday that his airline per-
formed “exceptionally well” over
the incident, which forced an
Thomas Cook plans Chinese tie-up
as it moves in to emerging markets
▲
LEISURE
TOUR operator Thomas Cook is
hoping to forge a tie-up with a
Chinese travel company to expand
into tiger economies.
The holiday group is under-
stood to want to move into the
Chinese market by 2012 as part of
its drive to cash in on growth in
emerging markets.
The company last week
announced a deal to buy just over
half of Russian travel agent VAO
Intourist to help it expand in
Russia and other former Soviet
Analysts estimate the stake could
fetch up to €200m, which Ferrovial is
likely to use to finance new infra-
structure projects.
Ferrovial would be able to more
than halve its debt by removing BAA’s
debt from its own balance sheet.
BAA sold Gatwick airport to the
owner of London City airport, Global
Infrastructure Partners, for £1.5bn
faced with watchdog concern over its
dominance of UK airports.
Last month, an appeal court over-
turned BAA’s successful challenge of
the Competition Commission’s order
in March 2009 for it to sell Stansted
and either Edinburgh or Glasgow.
BAA and Ferrovial declined to com-
ment. The financial crisis hit Ferrovial
hard and forced it to sell assets after it
headed up a consortium to buy BAA at
a time when funding for such acquisi-
tions was relatively inexpensive.
A380 with 459 on board to make
an emergency landing in
Singapore.
“It was a new engine and it was
absolutely clearly nothing to do
with anything Qantas was doing,”
Joyce said. “It was an engine that
didn’t perform to the parameters
that we would’ve expected.”
Although he admitted the bill
was “still mounting”, he said that
Qantas’s handling of the incident
had probably enhanced its brand
rather than damaged it.
“In the research we’re doing,
people are aware that this was a
Rolls-Royce problem, so that when
we survey the general population
the vast majority of people know
that there’s a problem with the
design of the engines,” he said.
republics.
It is also present in India after
buying back a business in the
country in 2008 that it sold to the
Dubai Financial Group a couple of
years beforehand.
Chief executive Manny
Fontenla-Novoa said: “The move
into Russia is in line with our
established strategy of capturing
growth in emerging markets.”
Broker Numis Securities expects
Thomas Cook to report annual
earnings of £394.4m on
Wednesday, down from £414.9m a
year ago.
JAPANESE AIRLINE ATTACKS BOEING DELAYS
THE launch customer for Boeing’s 787 Dreamliner has hit out at the US aircraft giant
over delays to the aircraft. All Nippon Airways (ANA), which was due to have begun tak-
ing deliveries in 2008, said the delays were disappointing. ANA chief executive Shinichiro
Ito said he was unsure if there would be more delays.
Safety remained Qantas’s top pri-
ority, he said, adding that Qantas
was maintaining some restrictions
on its A380s, and they would not
yet be operating across the Pacific
to Los Angeles. Joyce said that deci-
sion was taken in consultation
with Rolls-Royce and Airbus.
ANALYSIS l Rolls Royce 616.50
660
p
640
620
600
580
560
540
6 Sep 24 Sep 14 Oct 3 Nov
The broker said it preferred
rival TUI Travel as an investment,
citing a disappointing pre-close
trading update and worse-than-
expected costs.
“Subsequently, the company
has announced the merger of its
high street operations with Co-
operative Travel; this deal has not
yet had merger clearance.
“High levels of ‘exceptional’
costs have been a recurrent fea-
ture for the tour operators, result-
ing in a questionable quality of
earnings.
“We prefer TUI Travel.”
News 19
Tie-up between
BA and Iberia
to face the vote
AVIATION
▲
INVESTORS in British Airways and
Spain’s Iberia are due to vote today on
a £5.6bn merger to create a new giant
of the skies.
Shareholders are due to vote in
London and Madrid on whether to
approve the tie-up to create a holding
company known as International
Airlines Group (IAG).
It would mark another step in con-
solidation that has led to ties between
Air France and KLM and Lufthansa,
Swiss and Austrian Airlines.
Traditional flag carriers are team-
ing up to cut costs in the face of the
economic downturn and competition
from budget airlines.
In IAG, BA and Iberia would each
keep their identities and operations,
but would have access to each other’s
networks, including Iberia’s Latin
and South American routes.
BA chief executive Willie Walsh
would become chief executive of the
new group and Iberia chairman
Picture: GETTY Antonio Vazquez would be chairman.
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 20 News CITYA.M. 29 NOVEMBER 2010

Irish most
Silverfleet charitable
eyes Hunter’s despite crisis
Office chain

▲
PHILANTHROPY
BY MARTIN WILLIAMS
IRELAND puts more time into philan-
thropy than other countries, despite
its economic crisis, according to
research published today.
RETAIL TJ Hughes chief executive Sue Twenty per cent of high net worth
▲

BY MARION DAKERS Tennant. individuals in Ireland spend at least

HIGH STREET shoe retailer Office is
likely to be bought by Silverfleet
Capital after the private equity firm
entered exclusive talks with current
owner Sir Tom Hunter, a source close
to the deal said yesterday.
The exclusivity agreement all but
scuppers the chances of Blackstone
and PAI Capital, who had pursued
Office since Sir Tom’s company West
Coast Capital hired corporate advis-
ers Hawkpoint and Financo in June
to examine the options for the firm.
Sir Tom is said to be looking for
bids of up to £200m for the chain of
around 120 outlets in the UK and
Ireland. West Coast, used by the
Scottish entrepreneur as a buyout
vehicle, acquired Office for £15.5m
in 2003, when the brand had fewer
than 25 branches.
Office – which is one of the most
profitable parts of West Coast – post-
ed underlying earnings of £18.6m for
the year to the end of January 2010,
on sales of £135.7m.
Silverfleet Capital also owns TJ
Hughes, the discount furniture and
clothing retailer, following a £56m
management buyout deal in 2003.
The private equity group axed
plans to sell the retailer earlier this
month, leading to the departure of
Silverfleet’s diverse portfolio also
includes Schneider Group, an online
retailer, artificial sausage casings
maker Kalle and Orizon, a temporary
staffing agency.
Earlier this year, it sold its stake in
French jeweller Histoire D’Or.
West Coast and Silverfleet
declined to comment, while
Blackstone and PAI did not return
calls yesterday.
When the business was first put
on the market in the summer, Office
chief executive Brian McCluskey
said: “West Coast has held the busi-
ness for seven years now, so this is
timeous in the lifecycle of private
equity, particularly given we have
received several unsolicited
approaches for the business.”
West Coast, which also owns fash-
ion retailer USC, posted a pre-tax
profit of £6.9m in the year to 31
January 2010, compared to a loss of
£66,322 a year earlier.
FAST FACTS | OFFICE
● Posted earnings of £18.6m on sales of
£135.7m in the year to January 2010
● Trades from 120 stores and concessions in
the UK and Ireland
● Has been owned by West Coast since 2003
Silverstreet is in talks to buy shoe store Office
SIR TOM HUNTER
WEST COAST
CAPITAL
Scotland’s first self-made billionaire
began his career by selling trainers out
of a van. He built his sportswear busi-
ness into Sports Division, one of the
UK’s largest clothing retailers with a
market value of £250m when it was
sold to JJB in 1998.
Hunter went on to set up West
Coast Capital in 2001 as an invest-
ment vehicle and holding company for
his £1.1bn fortune, most of which has
been earmarked for charities.
He runs the Clinton-Hunter
Picture: Micha Theiner/City A.M.
Development Initiative with Bill
Clinton, which was set up with £60m
to fund projects in developing commu-
nities. He also set up the Hunter
Foundation with his wife Marion in
1998 to fund education projects, help-
ing to earn him a knighthood in 2005.
His philanthropic plans were scaled
back during the financial crisis, when
his investments in building firms
helped wipe out more than half of his
fortune and cost him his place as the
richest man in Scotland on the Sunday
Times rich list in 2008.
His investments have since recov-
ered, and his wealth is now estimated
to be back above £1bn.
Hunter was born in 1961 in
Ayrshire and studied business at the
University of Strathclyde, where he
now sponsors the Hunter Centre for
Entrepreneurship.
five hours a week doing charity work,
more than anywhere else in the
world. The research also shows that
charitable spending is likely to
increase after retirement.
As well as committing their time,
30 per cent of wealthy Irish individu-
als consider philanthropy a spending
priority. The report suggests that per-
sonal connections to communities
and causes are the driving force
behind their contributions.
Two thousand high net worth indi-
viduals around the world were sur-
veyed by Barclays Wealth, giving a
snapshot of how the rich are giving.
The report used both money and time
as indicators and is the first of its
kind.
The findings underline the concept
that philanthropy is universal, with
nearly a quarter of those surveyed
globally saying it was in their top
spending priorities.
Emma Turner, director of client
philanthropy at Barclays Wealth com-
mented: “This report provides a
strong sense of how the global com-
munity is really engaging with philan-
thropy – above and beyond simply
donating money.”
Other leading countries in philan-
thropy include India, South Africa
and the US

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 22 Interview CITYA.M. 29 NOVEMBER 2010

The sweet seller’s son who wants

to hold the chancellor to account
Andrew Tyrie, chair
of the Treasury
select committee,
gives David Crow a
history lesson

V
ISITING Andrew Tyrie’s office is
like being called to see the head-
master in an old-fashioned board-
ing school. The chairman of the
Treasury select committee occupies a
grand corner office in Westminster’s
Norman Shaw North building, the former
Scotland Yard HQ that now provides office
space for MPs. Appropriately enough,
Tyrie begins with a history lesson, having
correctly surmised that I am not old
enough to have lived through the Winter
of Discontent. Peering over a pair of large,
round glasses, he recounts how he
stopped his grandmother from dying of
hypothermia.
“We used to keep her warm by heating
up water on a Calor Gas stove, in the dark,
by candle-light. I kid you not,” says Tyrie, a
Tory MP who became the Treasury com-
mittee’s first elected chairman in June.
“These Calor Gas things were like gold
dust. We’d cluster round the heat, and
then put the water into hot water bottles,
and that would keep an octogenarian lady
alive. It was a very different world.”
His point is that the very “moral fabric”
of the country was at risk in the 1970s and
early 1980s, and there was very little
agreement over how to solve Britain’s The committee can now stop the chan- Andrew Tyrie in his keep going? And then there’s us: there are a little reminiscent of a certain grocer’s
problems; politics was dominated by “hot cellor from hiring or firing the OBR head, Westminster office corporations and individuals – they’ve daughter, and Tyrie credits it with his pas-
disputes about the fundamental tenets of ensuring they “can’t be pushed out into last week also made their mistakes,” he says. “It’s sion for standing up for Britain’s “wealth
policy”. the cold” if their forecasts prove politically ridiculous then to pillory only one group creators”, those who own or work for pri-
Conversely, Tyrie says the British politi- unpalatable. “They can’t appoint a stooge Picture: and to put all the blame on them, vate firms.
cal class now broadly agrees on how to and they can’t dismiss someone who’s Micha Theiner although it’s convenient for the other Despite coming from the same political
deal with the parlous public finances, being awkward. I’ve got a veto on both of /City A.M. seven or eight.” party, Tyrie has been a rather effective
which were ravaged by the latest financial those. That’s hugely helpful.” Tyrie is more concerned with counter- thorn in the side of the chancellor – at
crisis. “If you look in the Commons, under- Tyrie breaks ranks with the chancellor ing the “special pleading” that inevitably times more effective than the official
neath all the clashing of cymbals that over whether or not the OBR should be takes place in a period of fiscal retrench- opposition. Tony Blair – who also enjoyed
takes place inevitably in partisan politics, allowed to cost opposition policies, a possi- ment, with public sector groups and pri- a weak opposition – used to decapitate
there’s quite a degree of consensus about bility that has been roundly dismissed by vate firms lining up to argue why certain powerful Labour committee chairmen by
the need for fiscal retrenchment, about Osborne. “I do think this would improve areas of spending should be spared the giving them junior jobs in government,
the need to deal with the deficit and, the quality of debate, around election axe. “We mustn’t allow these people to where they were forced to take the agreed
broadly speaking, even the pace,” he time particularly,” says Tyrie. “There’s take advantage of us, to entrench their line. In his memoirs, Chris Mullin, the for-
explains. always this claim and counter claim about special interests. If we manage to get their mer MP, recalls how he swapped the chair-
Labour wanted to halve the structural what costs what. It would depoliticise slice of the cake reduced, taxes could be manship of the Home Affairs committee
deficit over four years, which implied some of the work that officials maybe get lower than they would otherwise be.” for a lowly post working under John
eliminating it altogether over seven, says cajoled into doing in Whitehall.” The son of a sweetshop owner who later Prescott. Stymied and silenced, he eventu-
Tyrie, whereas the coalition wants to elim- Elsewhere, Tyrie is proving particularly branched into furniture stores, Tyrie says ally resigned and returned to the commit-
inate it over five. He concedes the differ- vocal over plans to replace Gordon his early memories of his father are of tee.
ences over timing, but insists “the view Brown’s tripartite system of regulation “someone thinking about what the tak- Tyrie assures me that he will avoid the
that we have to take quite radical deci- with a new “twin peaks” model. A long ings are, about what’s coming in and allure of a government job. “I have no
sions on fiscal retrenchment is orthodoxy time opponent of the tripartite model – going out”. It’s a history that is more than plans to be a minister – I’ve just got myself
across the whole of the political class”. which he dismisses as a “complete disas- elected to a wonderful job and I’m enjoy-
Such a state of affairs suits Tyrie, who ter” that resulted in “pass the parcel” ing it a lot and learning a lot. I couldn’t be
says he has never been a particularly parti-
san MP. Having run Ken Clarke’s campaign
responsibility – he is adamant that any
new system should give supremacy to the “I’m not one of nature’s banker bashers. It’s doing this job at a more interesting time
and it is tough and testing, but what do
to become leader of the Conservative chancellor. “I’ll be looking at who’s in you want to do in life?”
party in 2001 and again in 2005, most charge when there’s a crisis: as soon as ridiclulous to pillory only one group. They’ve ‘I’ve never been one of these people who
would place him on the more left-wing there’s taxpayer money involved, or any spends his whole time thinking there’s
end of the Tory scale.
In a neat coincidence, Tyrie was an
chance of taxpayer money becoming
involved, it has got to be the chancellor,”
made blunders – but so has everybody else” something else he should be doing.”

ardent campaigner for a change in the he says.

way select committee chairmen were
elected. Previously, the powerful posts
were doled out by the whips, ensuring the
chosen few were amenable to party lead-
ers (commons whispers have it that David
Cameron would have preferred Michael
Fallon, Tyrie’s opponent).
Armed with his mandate, Tyrie has set
about making the Treasury committee
more powerful than ever before. In an
early victory, he secured a so-called “dou-
ble lock” over the appointment of the
head of the Office of Budget
Responsibility, the body created by George
Osborne to bring independence to the
Treasury’s economic forecasts.
As chairman of the Treasury committee
hearings, Tyrie is one of the few politi-
cians who can haul publicity-shy figures
in for a rare dressing down, in the closest
thing Britain has to public hearings. His
predecessor, Labour’s John McFall, gained
notoriety for his fiery questioning of
hedge fund managers, but Tyrie has little
time for populist point scoring.
“I’m not one of nature’s banker bashers.
I think we’ve done quite a bit of that.
They’ve made their share of blunders but
so did almost everybody else, whether it’s
the ratings agencies, the auditors, politi-
cians, senior ministers, the governor of
the Bank of England, the FSA, do I need to
CV | ANDREW TYRIE
Age: 53
Education:
•Felsted independent school in Essex
•Trinity College, Oxford, studying PPE
•College of Europe, obtaining a postgraduate
Certificate of Advanced European Studies
•Wolfson College, Cambridge, earning an MPhil.
Before parliament:
•1981-1983: Worked at BP’s group head office
•1983-1989: Advisor to advisor to Nigel Lawson and
John Major, then Chancellors of the Exchequer
Compiled by Martin Williams
•1990-1991: Fellow at Nuffield College Oxford
•1992-1997: Senior economist at the European Bank
for Reconstruction and Development
In parliament
•1997: Elected MP for Chichester
•2003-2004: Shadow Financial Secretary to Treasury
•2004-2005: Shadow Paymaster General
•2005-present: Founder and Chairman of the All-Party
Parliamentary Group on Extraordinary Rendition
•2010-present: Chairman of the Treasury Select
Committee and the Joint Committee on Tax Law
CITYA.M. 29 NOVEMBER 2010
Germany will say auf wiedersehen to euro
CNBC COMMENT
GUY JOHNSON
N
EXT year will see the first mem-
ber of the single currency start-
ing to talk seriously about
leaving the Eurozone. That
country will be the nation with the
strongest and the most dynamic econ-
Madagascar Oil joins AIM
▲
ENERGY
BY MARION DAKERS
MADAGASCAR Oil will become the
latest energy firm to list in London
when its shares begin trading on AIM
today.
The firm has raised £50.5m by plac-
ing a 27.65 per cent stake with
investors ahead of the float this
morning, it said yesterday, translat-
ing to a total market capitalisation of
around £183m.
Madagascar Oil said it plans to use
omy in Europe. That country will be
Germany.
The survival of the euro is no
longer up for debate. If 2010 has
proved anything it is that the produc-
tivity divide between core and periph-
ery is too great to be spanned by a
single currency. The only real ques-
tion is how does the breakdown hap-
pen and which countries Berlin is
prepared to take with it?
Labelling countries “winners” and
“losers” in this process would though
be a mistake. Germany may initially
look like a “winner” but there will be
considerable pain for the country’s
exporters as its new/old currency
appreciates rapidly. On the other
the money to explore and develop its
five onshore oil blocks in Western
Madagascar, with a focus on the
Tsimiroro field, which the firm
believes holds up to 965m barrels of
oil resources.
Chairman and chief executive
Laurie Hunter said: “We are delight-
ed that the AIM flotation of the com-
pany has been completed
successfully and we now look for-
ward to working with our new insti-
tutional shareholders and existing
shareholders, whom we would like to
hand, a country like Ireland will feel
much better about its prospects once
the pain of separation has passed.
Though it must be admitted that the
actual breakdown will not be an easy
process. Every country in the region
has the bulk of its debts in euros.
Consequently, for many nations there
will need to be a debt restructuring.
This will not be a pleasant experience
for debtors or creditors, though many
are increasingly aware that it is on
the horizon.
GERMAN DEPARTURE HAS BENEFITS
Once this episode is over, almost
everybody will be much happier. The
Germans will no longer have to grind
thank for their ongoing support of
the company as we continue to
grow.”
Madagascar, which is based in
Bermuda and has offices in the US,
hopes to follow in the footsteps of
firms such as Energy XXI, which last
week said it was planning a move to
the main market after five years on
the AIM.
It was joined on AIM last
Wednesday by Jubilant Energy, an
Indian power company that raised
nearly £55m through its float.
their teeth about bailing out the rest
of Europe and the rest of Europe will
find that growth is now possible with
a more competitive currency. Indeed,
many countries might be in for a peri-
od of strong growth and improved
employment similar to that seen
when the UK left the European
exchange rate mechanism.
It must be noted that it’s likely that
the euro won’t break down fully.
There will remain a group of coun-
tries that are close enough economi-
cally to remain linked. This is the
group of nations, with Germany as
the hegemonic power, which from
the outset should have pursued inte-
gration but critically should also have
ANGELA PEACE
STRAND HANSON
Strand Hanson is acting as nominated
adviser for Madagascar during its
move to AIM, while Mirabaud
Securities is lead manager and joint
broker and GMP Securities is joint bro-
ker.
Angela Peace, a director of corpo-
rate finance at Strand Hanson, has
been with Strand since 2000. She has
worked with numerous AIM compa-
News 23
been brave enough to say “no” to
those that did not measure up. In the
end they were doing nobody any
favours by allowing countries to fudge
their entry criteria.
The only problem that lies in the
way of this rational outcome is that
much of Europe is currently burdened
by a political elite that can’t admit
that it was wrong. There seems to be
no desire amongst these politicians to
recognise that a single currency was a
mistake for many nations and that it’s
time to find an exit strategy. The peo-
ple of Europe need better leadership
and they need it now.
Guy Johnson co-anchors European Closing
Bell weekdays on CNBC
nies on M&A and equity transactions,
and her client list includes North River
Resources, Asian Plantations and
Kalahari Minerals.
David Altberg, a manager at Strand
Hanson, qualified as a solicitor with
Brechers and worked for Rosenblatt
Solicitors before joining the firm in
2007.
Rory Scott, a partner at Swiss bro-
ker Mirabaud, also has a wealth of
experience of AIM-listed resources
companies, and counts Firestone
Diamonds, Chaarat Gold and African
Minerals among his clients.
Nick Morgan and Chris Beltgens
both joined the oil and gas team at
GMP Securities in January from
Tristone and Macquarie respectively.
Over 17 years ICAP Charity Day has
raised US$119 million for charities
across the globe and changed the
lives of thousands of people.

This year on Wednesday 8th December we

look forward to our customers, staff, suppliers
and of course the charities and their patrons
working together for the big global
ICAP Charity Day.

www.icapcharityday.com

CHARITY DAY
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2010
WEDNESDAY 8TH DECEMBER

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CITYA.M. 29 NOVEMBER 2010 Politics 25

Apprentices not just for sorcerers and Sugar

by Alan Sugar? Or Disney’s accident-
prone mop-splitting sorcerer’s appren-
tice? Think again.
We don’t often see apprentices in
London, and more rarely still in the
glittering spires of the City itself.
London has 14 per cent of the coun-
try’s population, but just five per cent
CITY COMMENT of its apprentices. That’s because
apprenticeships are seen traditionally
ANTHONY BROWNE as based around manufacturing or
construction – not suitable for our
pany had no need for apprentices
because they didn’t need any photo-
copying. But such attitudes shed most
light on those who hold them.
Increasingly, apprenticeships are
geared towards the services sector,
from retail to creative industries and
financial services. City firms are slowly
turning to apprenticeships, seeing
them as a useful way to recruit and
train talented youngsters – at the gov-
ernment’s expense. The total numbers
They argue that it is in their own busi-
ness interest to do so. It is not an act of
charity, but it is still good for society –
it helps tackle London’s high rate of
youth unemployment, giving opportu-
nities to talented youngsters.
It also benefits the sector as a whole,
showing it is not an exclusive club of
overpaid university graduates. That’s a
myth-defying message to calm the
wrath of the banker bashers.
We want to change the culture of
employers in London to see the advan-
tages of apprenticeships – our ambi-
tion is to create over 20,000
apprenticeships in this current aca-
demic year.
The Mayor is doing his bit, creating
over a thousand apprenticeships in the
Greater London Authority group, but
it is financial services that are our
number one target. You might in the
near future get a letter from Boris urg-
ing you to take the apprenticeship

T
HINK you know what an appren-
tice is? A working class youth in
oily blue overalls with a spanner
in his hands? The super self-con-
fident types given missions impossible
white-collar workforce.
Many financial firms have a knee-
jerk bias against apprentices, seeing
them as too downmarket. One City fig-
ure caused outrage by saying his com-
are still small, but some high profile
companies are opening their doors –
the Bank of New York Mellon, Legal
and General, Royal Sun Alliance and
Zurich Insurance all take apprentices.
apprenticeships in London. Working
with national government and his
own ambassador for training and
enterprise, Tim Campbell, the Mayor is
launching a campaign this week to get
plunge. But even if you don’t, you
should still come on in. There aren’t
any oily blue overalls in sight.
Anthony Browne is policy director for the
Mayor of London, Boris Johnson.

Shadow chancellor IN QUOTES | HOW ALAN JOHNSON CONTRADICTED HIS BOSS

Alan Johnson said
Labour’s policy to
keep a 50p top rate ● Ed Miliband, 10 June the morning and that I care about is that
of tax would be "Let me say plainly: I would keep the top rate Britain is a fundamentally unequal society and
reviewed before the of income tax at 50p permanently." that’s the reason I said what I said about the
next general elec- 50p rate.”
tion ● Alan Johnson, 15 November
"We might not see the need for a 50p tax ● Alan Johnson, yesterday
Picture: GETTY rate in five years' time." "What me and Ed agree on is that we need a
50p tax rate now, we will need it at the next
● Ed Miliband, 22 November general election, but we will look at it closer
“One of the things that gets me out of bed in to the time."

Johnson contradicts
Miliband on 50p tax
POLITICS the tax should be reviewed nearer ting to maintain the 50p tax “in
▲

BY MARTIN WILLIAMS the election. the cut and thrust” of a leadership

SHADOW chancellor Alan Johnson
has denied clashing with Ed
Miliband over the 50p tax rate,
amid criticism that the Labour
Party is divided.
Party leader Miliband has said he
plans to keep the tax rate for high-
er earners after the next general
election.
But Johnson yesterday said that
Speaking on The Andrew Marr
Show, he said: “What me and Ed
agree on is that we need a 50p tax
rate now, we’ll need it at the next
general election, but we’ll look at it
closer to the time.”
Earlier this month Johnson
admitted there were “very big” dif-
ferences between him and the
Labour leader.
He accused Miliband of commit-
election, and has suggested that
Labour could scrap the policy.
But a spokesman for Mr
Miliband has said the party was
committed to the tax rate “for the
forseeable future”.
Michael Fallon, deputy chair-
man of the Conservative party,
said: “Until [Miliband] stops dither-
ing... he won’t get people to take an
interest in Labour.”

Breastfeeding rooms to Minimum new

drink prices to
be required in the office curb bingeing
POLITICS our society doesn’t always make it
▲
▲

BY MATTHEW WEST
BUSINESS leaders have reacted with
dismay at proposals that will allow
working mothers to bring their
babies to work and expect employers
to provide private breastfeeding
rooms, to be put forward by the gov-
ernment tomorrow.
Health secretary, Andrew Lansley,
said over the weekend that he
intended to introduce the proposals
earlier than required by the
European Pregnant Workers direc-
tive, and is planning to launch a
pilot scheme including hundreds of
businesses in the next few months.
“Breastfeeding is one of the best
ways to give babies good health, but
easy for new mums to do it,” he said.
“If we can make it easier, more
mums would breastfeed and they
might do it for longer.”
But Stephen Alambritis,
spokesman for the Federation of
Small Businesses, said firms were
struggling to cope with continual
new additions to employment legis-
lation.
“Each one in itself is reasonable
and justifiable, but together, year on
year, the cumulative impact is the
cost of a job,” he said.
“At a time when the private sector
is expected to pick up the job losses
in the public sector, now is not the
time to be introducing a raft of
employment regulations.”
POLITICS
BRITISH supermarkets will be
banned from selling alcohol
below a national minimum price,
under government plans to crack
down on binge-drinking.
The new rules, announced yes-
terday, would prohibit shops
from selling alcohol as a “loss
leader” to entice customers.
But health groups say the sug-
gested minimums – £2 for a bot-
tle of wine, £10.50 for a litre of
spirits and £9.20 for 20 beers – are
set too low.
Home Secretary Theresa May
will unveil the plans in a new
Police and Social Responsibility
Bill.
 26 News
EU financial services must compete globally
MONDAY COMMENT
STUART FRASER
I
N January 2011, Hungary will take
up the presidency of the European
Union and no doubt next year’s
agenda will be a full one.
In addition to key legislative propos-
als covering areas such as short selling
and over-the-counter (OTC) derivatives,
Punch plans to clear debt
▲
HOSPITALITY
BY MATTHEW WEST
PUNCH Taverns is considering a
range of options as part of massive
restructuring plans designed to bat-
tle its £3.1bn debt.
The pub chain is believed to be con-
sidering hiving off a portion of its
loans and freeholds, a debt-for-equity
swap or more pub sales, according to
sources who said “all options were on
the table”.
the Hungarian presidency will also
oversee the setting up of the new
European regulatory framework and
the agencies designed to enforce it.
Indeed, during the next 12 to 18
months, decisions taken at a European
level will impact upon not only the
standing of the EU but also the stand-
ing of each of the 27 individual mem-
ber states in the years to come.
That is why, alongside the Lord
Mayor of the City of London, Michael
Bear, I recently visited Hungary to offer
our support and to learn what the
Hungarian government’s priorities are
for the six months when it will hold
the presidency.
With every single member state in
the EU having been hit hard by the
A more radical plan to hand over
6,000 pubs, which Punch owns but
leases to independent landlords, to
its bondholders is also being consid-
ered.
New chief executive Ian Dyson is
said to want to concentrate on the
800 pubs that Punch directly man-
ages and has appointed Goldman
Sachs and Blackstone to help the
group prepare for a restructure.
Were Punch to spin off its leased
pub network it would eliminate most
global financial crisis, promoting
financial services may not seem like a
top priority, especially in countries
where this is not yet a key industry.
And yet, if we are to achieve our
shared agenda of generating growth
and creating jobs, support for the EU-
wide financial services industry is
absolutely key, especially with funds so
scarce in the public sector.
In spite of the political pressures,
the UK government has recognised
that without a globally competitive
financial services industry the road to
economic recovery will be longer,
harder and fraught with danger. EU
policy makers must do the same.
So while proposals covering highly
specialised, innovative products such
of its debt almost immediately.
ANALYSIS l Punch Taverns
95 p
85
75 59.10
26 Nov
65
55
6 Sep 24 Sep 14 Oct 3 Nov
as OTC derivatives might not seem rel-
evant to European countries with less
developed financial services indus-
tries, they are in fact inextricably
linked to their future prosperity.
Without them, other sectors will
struggle to generate the growth need-
ed if the EU and its 27 member states
are to take their rightful place in the
new, post-crisis world order.
Of course the City understands, and
indeed welcomes, proposals to intro-
duce greater stability and to reduce
excessive risk-taking, but any new
rules must be proportionate. They will
need to be underpinned by a full and
proper consultation process, compre-
hensive impact assessments and due
consideration of the cumulative
Radical plan is necessary
FEW sectors clawed their way out of
the financial crisis with a worse
hangover than the pub industry.
Years of debt-fuelled expansion left
the sector massively over-geared. At
Friday’s close, Punch was worth just
£380m while its debt pile is a stag-
gering £3.1bn.
Now that finance director Phil
Dutton has left the business, boss
Ian Dyson has the space to think
outside of the box.
Selling off the 6,000 or so pubs
23 Nov
CITYA.M. 29 NOVEMBER 2010
impacts these reforms may have.
We should avoid taking unilateral
actions out of step with the global
agenda, no matter how politically
expedient they may seem. It is impor-
tant to raise funds but short term ben-
efits must be balanced against
long-term growth.
Many sectors within the financial
services industry are highly mobile
and it is no good creating a level play-
ing field within the EU if we can not
compete in the global marketplace.
The City of London is acutely aware
of this and, following my trip to
Hungary, I hope the Hungarian gov-
ernment is as well.
Stuart Fraser is the policy chairman at the
City of London Corporation
that Punch leases to landlords is
exactly the kind of radical move he
should be considering.
However, the situation at Punch
remains volatile, especially as the
austerity measures have yet to sink
in. Dyson needs to do more to prove
himself before we can rate these
shares as a “buy”.
BOTTOMLINE
Analysis by David Crow
 Markets&Investment 27

London’s Top 250

Company Name Closing Price Price Change 52wk high 52wk low Company Name Closing Price Price Change 52wk high 52wk low Company Name Closing Price Price Change 52wk high 52wk low Name Closing Price Price Change 52wk high 52wk low
(p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p)Company (p) (p) (p) (p)
3i Group 307.5 -3 326 250 Cobham 198.75 1.25 276 195.75 Jardine Lloyd 575 -4 600 421.5 Rolls-Royce Group 616.5 -2 654.5 473.5
3i Infrastructure 117.5 0 118.5 97 Colt Telecom 126.5 2.5 142.5 109 John Wood Group 481 -0.25 487 285 Rotork 1623 2 1895 1105
A.B. Foods 1083 0 1107 797 Compass Group 555 7 567.5 425 Johnson Matthey 1872 -20 1973 1446 Royal Bank of Scot 38.75 -2.25 58 28.5
Aberdeen Asset.Man. 181.5 -0.75 190 112.75 Cookson Group 570.5 6 607 367.5 JPM Flem.Emerg Mkt. 599 -7.5 618 450.5 RSA Insurance Grp 121 -2.25 136.5 114.75
Admiral Group 1576 7 1693 1061 Croda International 1460 -12 1521 744.5 Jupiter Fund Man 289.5 -4.5 306 180.25 SABMiller 2113.5 -1.5 2157 1650
Aegis Group 136 0.5 136 103.5 Daily Mail & Gen 549 4.5 567.5 404 Kazakhmys 1430 -37 1630 965 Sage Group 259.75 2.25 285 213.25
Afren 129.75 -0.5 134 79 Davis Service 399.5 0.5 435 360.25 Kesa Electricals 170 -0.75 170.75 99.25 Sainsbury (J) 367 1.75 395 313
African Barrick Gold 511 -10 670 511 Debenhams 74 1 84.25 53 Kingfisher 244.5 -5 250 198.5 Schroders 1676 8 1676 1116
Aggreko 1500 -3 1685 736.5 Derwent London 1447 -5 1605 1208 Ladbrokes 125.75 -0.25 162.75 125 Schroders NV 1325 5 1325 929.5
Alliance Trust 354.75 1 361.25 293.5 Dexion Abs 141 1 148 131.25 Lancashire 625 0 647 422.25 Scot.& Sth. Energy 1148 -8 1198 1010
Amec 1125 -3 1154 733.5 Diageo 1179 -1 1193 1000 Land Securities 647.5 -7 696.5 545 Scottish Mortgage 652.5 1.5 683 475
Amlin 375.75 -0.25 433 357.25 Dixons Retail 26.25 -0.25 38 23.75 Legal & General 96 -1 106.25 69.75 SEGRO 284.5 -5.75 352 250.25
Anglo American 2904.5 -81 3055 2254 Domino’s Pizza 532 -4 536 280.75 Lloyds Banking Grp 61.75 -2.75 77.5 46.5 Serco Group 561 2 651 494.25
Antofagasta 1325 -52 1472 761 Drax Group 370.75 -4 444 326.25 Logica 119.75 -1.5 148 101.75 Severn Trent 1468 11 1468 1010
Aquarius Platinum 329 -3 458 227 DS Smith 187.25 -0.25 187.5 104 London Stock Ex. 778 -17.5 795.5 544 Shaftesbury 442.75 -0.25 460 349.25
ARM Holdings 398.5 4.5 414.5 154.75 Dunelm 507.5 -2.5 510 325.25 Lonmin 1718 -17 2157 1355 Shire 1567 13 1567 1159
Ashmore Group 358.5 -3.5 383.75 218 easyJet 443 -1.5 496.5 341.5 Man Group 269.75 -9.75 328.5 202 SIG 115 -2.25 137.75 90.75
Ashtead Group 131 0.5 135 66.25 Edin.Inv.Tst. 429 -3 464.25 351.5 Marks & Spencer 385.5 1.5 427.5 323.5 Smith & Nephew 594.5 9 696.5 537.5
AstraZeneca 3073 24.5 3385 2717 Electrocomponents 267.5 -1.5 269.5 161.75 Meggitt 337.25 1.75 337.25 239.25 Smiths Group 1175 4 1285 952.5
Atkins (WS) 715.5 1 792.5 556.5 Enquest 130 0 137.5 89.25 Melrose 298 8 304.25 162 Soco International 348.25 -6.25 484.25 292
Autonomy 1341 50 1975 1271 Essar Energy 510 8 548 383 Mercantile Inv Tst 996.5 -8.5 1028 822.5 Spectris 1180 -7 1222 663.5
Aveva Group 1526 -8 1575 942.5 Eurasian Nat Res 909.5 -5 1266 818 Michael Page 484 2 503.5 335.25 Spirax-Sarco 1827 -13 1870 1072
Aviva 369.75 -9.5 423.5 294.25 Euromoney Inst. 708 4.5 708 393 Micro Focus 333.75 -2.75 546.5 276 Spirent 147 -1.5 156 92
Babcock International 527.5 -5.5 635 492.75 Experian Group 751 0 751 572 Millennium & Cop. 521 -4 570 342 Sports Direct 131 -2 152.75 92.25
BAE Systems 340 5 388.75 294.75 Ferrexpo 369 -2 396 179.5 Misys 293 -1.5 298.25 200.5 St James’s Place 248 -2.5 292 204.25
Balfour Beatty 279.5 6.5 303 229.75 FirstGroup 368.75 0 426 336 Mitchells & Butlers 353.5 -1.5 356 247.5 Stagecoach Group 199.75 -0.25 224 144.5
Barclays 259.75 -8.5 383.25 255.25 For.&Col.Inv.Tst 293.25 -1 299.75 251.5 Mitie Group 207.5 0.75 241 188.75 Standard Chartered 1757.5 -35 1950 1351.75
Barratt Development 74.5 0 142 71 Fresnillo 1442 -27 1469 669.5 Mondi 486 -7.25 557.5 321.5 Standard Life 214 -2.5 236 173
BBA Aviation 196.5 1.5 217.25 152 G4S 240.25 -1.5 283.5 240.25 Monks Inv.tst. 338.25 -1.25 349.25 265.5 Supergroup 1533 38 1533 535
Bellway 539.5 14.5 826 511 Genesis E.m.f. 521 -6 540.5 385 Morgan Crucible 244.75 1 254 145.5 TalkTalk 155 0.75 155 108.5
Berkeley Grp Hldgs 832 9 897 742 GKN 193.5 0.25 193.75 102 Morrison (Wm) 278 4 306.25 257.5 Talvivaara Mining 530.5 -8.5 581 342.5
BG Group 1207 -8 1296 984 GlaxoSmithKline 1260.5 17.5 1339.5 1095 Murray Int.Tst 907 -3.5 936 720 Tate & Lyle 518 -4 531.5 388.75
BHP Billiton 2315 -38 2469 1684.5 Great Portland Est. 338 -1.75 364 268 National Express 225 -2.75 259.5 165.5 Taylor Wimpey 24.75 -0.25 44 22.25
BlackRock Mining 710 -10 737.5 492 Greene King 454.25 3.75 468.25 376.25 National Grid 576 -1.5 613.25 484.25 Telecity Group 471.5 27.5 532.5 333.5
BlueBay 482 -0.25 489.25 258 Halfords Group 417.5 -3.75 550 372.75 Next 2076 -21 2344 1817 Templeton Emrg. 642.5 -8 685 471.5
BlueCrest AllBlue 174 0 174.5 152 Halma 337 -0.5 343 223 Northumbrian Water 338 -4 361.5 252.75 Tesco 430 0.75 454.5 377.5
Booker Group 55.25 0 56 38.75 Hammerson 407 1 434.5 336.25 Ocado Group 151 6 167 123.5 Thomas Cook Group 193.75 3.25 272 171.75
Travis Perkins 842.5 -4 912 664.5
BP 436 -1.5 655.5 303 Hargreaves Lansdown 493.75 -7.75 501.5 265.25 Old Mutual 127 -1 145.25 97.25
TUI Travel 214.75 2.5 308.5 190
Brit Insurance 1035 -1 1045 720 Hays 112.25 1.75 123.5 88.5 PartyGaming 233.25 -3.75 334.5 206
Tullett Prebon 357 3 417.25 262
British Airways 272 -3.5 286 184.25 Henderson Group 122.25 -2.25 151.75 112.75 Pearson 953 -1.5 1051 829
Tullow Oil 1182 -13 1369 991.5
British Amer.Tob 2394 5.5 2464.5 1847 Heritage Oil 378.75 0.5 581 296.75 Pennon Group 639 5.5 639 483
UK Commercial Prop 74.75 -1.25 85 72.75
British Empire Tst 481 -4 495 394 Hikma 770 3.5 804.5 486 Persimmon 359.5 1 507.5 336.5
Ultra Electronics 1638 5 1895 1241
British Land 490 -2 520 418.25 Hiscox 347.25 -1 370 300 Petrofac 1477 10 1540 876.5
Unilever 1837 -6 2015 1688
Britvic 499.25 -4.25 518 373 Hochschild Mining 561.5 -2.5 580.5 234 Petropavlovsk 1058 -16 1365 852 United Utilities 608 -1.5 628.5 476.75
Brown (N.) Group 289 3 301 206.5 Home Retail Group 205.25 0 310.75 203 Phoenix Group Hldgs 643 -15 758 557.5 Utd Business Media 634 -12.5 682.5 409.75
BSkyB 720.5 -0.5 729 524.5 Homeserve 437.75 -2.25 487.5 312 Premier Farnell 286.5 -0.25 296.75 153.25 Vedanta 2075 -68 2934 1839
BT Group 174.25 7.25 174.25 110 HSBC Holdings 651 -5 740.5 596.25 Premier Oil 1885 4 1890 1017 Victrex 1225 -18 1338 779
Bunzl 723 7.5 777 616.5 Hunting 623.5 3 658.5 439.5 Provident Financial 847.5 2.5 974 728.5 Vodafone Group 165.25 0 175 129.5
Burberry Group 1040 -4 1050 564 ICAP 476 8 494 294 Prudential 577 -11 653 487.5 Weir Group 1756 49 1756 669
C&W Comms 46 1 63.75 44.75 IG Group 491.5 -0.75 553 316.5 PZ Cussons 382.5 0.25 403 234.75 Wellstream Holdings 732 -3 789 436
C&W Worlwide 63.75 1.75 100 60.5 Imagination Tech 340 -3 441.75 210 QinetiQ Group 116 0.25 167 96.75 WH Smith 475.25 0 537.5 398.25
Cairn Energy 395 1.25 493.25 303.5 IMI 874 5.5 874 491.75 Randgold Res 6070 -15 6655 4209 Whitbread 1743 -7 1797 1266
Caledonia Inv. 1782 -19 1827 1511 Imperial Tobacco 1955 22 2154 1753 RDS ‘A’ 1989.5 0 2100.5 1624 William Hill 155.5 -0.25 216.5 155.5
Capita Group 670 -3 826 656.5 Inchcape 338 1 357 237 RDS ‘B’ 1963.5 -2 2064.5 1554 Witan Inv Trust 478.75 -3 490.5 410
Capital & Counties 149.5 -0.25 157 100 Informa 412 -2.5 448 277.5 Reckitt Benckiser 3501 -3 3655 3037 WOLSELEY 1781 19 1817 1160
Capital Shop Centre 401 20 401.5 301 Inmarsat 676.5 4.5 821 606.5 Reed Elsevier 525.5 -0.5 563 454.5 WPP Group 725 -3 755 568
Carillion 346.25 6.25 357 273 InterContinental Htl 1163 -4 1225 840 Regus 76 -1.25 120 66 Xstrata 1332 -19 1419 845.75
Carnival 2628 -16 2920 2037 Intermediate Cap.Grp 325.5 -3.5 351 240.5 Renishaw 1136 -23 1235 500
Catlin Group 336 -2.5 393 307 International Pers Fin 304.5 -5.5 332 183.25 Rentokil Initial 90.5 0 138.5 89.25
Centamin Egypt 185.75 -0.5 197 106.75 International Power 416.75 -0.75 436.75 277 Resolution 225 -3 349 225 London Top 250 by markeT capiTaLisaTion
Centrica 316 -8.25 346 254.5 Intertek Group 1850 -3 1959 1150 Rexam 312 -3.5 346.75 272.5 powered by
Charter 700 -0.5 848.5 567 Invensys 326.75 -0.75 349 230.25 Rightmove 750 -1 810 464
Chemring Group 2939 35 3663 2598 Investec 512 -1 562 413.25 Rio Tinto 4179 -90.5 4454 2812
Close Brothers 807.5 -13 821.5 664 ITV 67.75 -0.5 72 48.25 RIT Capital Partners 1171 4 1210 944.5 www.digitallook.com

Bumpy ride likely because of EU debt and Korea

North Korea look set to continue. to gauge the outcome of early holiday ANALYSIS l FTSE 5,668.70
MARK ONTHE For today’s open, GFT is expecting
the FTSE 100 index to open 11 points
shopping, as well as figures for real
earnings, consumer confidence, auto 5,800
26 Nov

MARKETS off from Friday’s close, at 5658. The

German DAX 30 is expected to open
12 points lower, at 6837 and the
sales and monthly chain store sales.
Towards the end of the week atten-
tion will turn to Friday’s US employ-
5,600

French CAC 40 seven points lower at ment report. Consensus is for an 5,400
3722. increase of 138,000 to non-farm pay-
The economic diary for the week rolls, with the unemployment rate
5,200
ahead includes money supply figures remaining at 9.6 per cent. The market
and PMI surveys, out of the UK. From will be looking for early clues on this 6 Sep 24 Sep 12 Oct 3 Nov 23 Nov
the Eurozone there are updates on number from the ADP Employment
consumer sentiment, unemploy- report due for release on Wednesday. ANALYSIS l DAX
ment, PPI and retail sales. The Mark Outten is a senior dealer for GFT 6,848.98
7,000 26 Nov
European Central Bank is due to meet Global Markets UK Ltd
6,800
on Thursday. Of particular interest
MARK OUTTEN will be any comments by Jean-Claude
Trichet on a reduction in the amount
6,600

6,400
or duration of emergency funding for

I
NVESTORS are likely to be in for struggling European banks. 6,200
another bumpy ride this week, as The market will look for continued 6,000
the European sovereign debt crisis improvement in the US economic
and military aggression from outlook, where there will be a chance 23 Aug 10 Sep 30 Sep 22 Oct 9 Nov

THE WALL STREET WEEK AHEAD

the S&P has fallen 3.1 per cent after another sign of a turnaround in hir- increasingly bullish view of the US us, and I think sales are going to sur-

T
HERE is no sign that investors’
headaches from Europe are
going away, but early indica-
tions of strong holiday spending
and an improving labour market
could soothe Wall Street this week.
Fears that Europe’s debt crisis
could spiral out of control have
pushed stocks off two-year highs hit
earlier this month. Since 5 November,
running up 17 per cent over the two
months before that. At Friday’s close,
the S&P 500 was down 0.9 per cent for
the week, almost matching the Dow’s
one per cent drop.
However, those fears have been
countered by signs of a gathering
recovery in the labour market at
home. The government’s non-farm
payrolls report on Friday is set to be
ing that could boost stocks through
the end of the year.
Anecdotal evidence suggests holi-
day shopping got off to a good start.
The S&P retail index rose more than
five per cent in the run up to “Black
Friday”, the day after Thanksgiving,
when Americans traditionally take
shopping malls by storm.
Retail stocks’ gains are a sign of an
consumer after a string of stronger
indicators on jobs, sentiment and
spending.
“The consumer is more confident
and they are spending a bit more
money, and I think retail as a whole is
perking up,” said Gary Bradshaw,
portfolio manager at Hodges Capital
Management in Dallas, adding that
retail stocks “look relatively cheap to
prise to the upside”.
Friday’s payrolls report is expected
to show the economy added 140,000
jobs in November, according to econo-
mists. If that forecast is met, the jobs
data will fit a pattern of growing
strength in the labour market.
Government payrolls data showed
that in October companies hired at
their fastest pace since April.
 28 Investment | Spread Betting
There’s more pain
and selling to come
for banking stocks
Only day traders should think
about going long on European
financials, writes Jessica Mead
E
ACH time that European banks
have taken a step towards recovery
since autumn 2008, it seemed that
they suffered another a setback.
Whether it was revelations of bad debts,
government bailouts, exposure to indebt-
ed sovereigns or tighter regulation, it has
been hard for their share prices to make
sustained headway.
The second bout of the Eurozone sover-
eign debt crisis, this time with Ireland at
the centre of the markets’ attention, has
been no exception. Statistics about each
European bank’s exposure to Ireland (and
Spain and Italy and Greece) have been
wheeled out again.
Like temperatures across Europe,
banks’ share prices have plummeted. The
Stoxx Europe 600 Banks index has fallen
steadily since early August and it has
dropped some 9 per cent since 4
November.
RBS has plummeted some 17 per cent
since 4 November while Societe Generale
has sunk 15.82 per cent over the same
time frame. Even Standard Chartered, a
bank with minimal European presence,
has seen its share price fall by 10.36 per
cent.
EXTREMELY OVERSOLD
Evolution Securities’ banking analyst
Arturo de Frias last week reiterated his
view that the sector “looks extremely
cheap, and also very oversold recently”.
The sector is currently trading on 7.9
times 2012 earnings and returns are
expected to improve in 2010 and again in
2011 and 2012, de Frias added.
But does that mean spread betters
should be looking to buy at these levels?
Not if you are taking a short-term direc-
tional view, at any rate. “I am not saying
that this is the bottom: acute sovereign
AMPLIFY
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CITYA.M. 29 NOVEMBER 2010
fears can become extreme sovereign fears
before we reach the bottom,” de Frias
says.
Angus Campbell, head of sales at
Capital Spreads, agrees, saying: “I would-
n’t want to say they are a buying opportu-
nity until the European situation has
completely resolved itself. Banking shares
are going to remain under pressure for
There’s no shifting the the time being.”
dark clouds over the However, he adds that although
European banks Barclays is exposed to Spain to the tune
of £35bn, there appears to be a bit of a
Picture: GETTY buying opportunity materialising in the
stock. Barclays is currently trading at
260p and Campbell points out that there
is a clear support level in place at 250p,
which should reduce the downside risk
of the trade. However, if you do choose to
go long on Barclays, remember to place
your stop loss just below this support
level because if it falls lower from there,
then that’s it.
But spread betters looking to profit
from sharp intra-day moves will be
pleased to hear that these periodic
episodes of extreme volatility for the
banks are unlikely to disappear any time
soon. Day traders with nerves of steel
should look to be nimble and jump in
and out of relief rallies.
Just don’t make the mistake of dashing
for cheap stocks purely because they’re
cheap – sometimes they deserve to be the
price they are.
ANALYSIS l Performance of the Stoxx Europe 600 Banks sector
over the past month
210.0
210.19
207.5
205.0
202.5
200.0
197.5
195.0
Source: Stoxx 191.18
192.5
15 Nov 10 16 17 18 19 22 23 24 25 26
OPEN AN ACCOUNT WITH GFT
AND WE’LL MATCH
5% OF YOUR DEPOSIT.*
Offer ends 31 December.
Get started now at gftuk.com.
CITYA.M. 29
18 OCTOBER
NOVEMBER2010
2010
SPREAD BET
GURU
JOSHUA
RAYMOND
MARKET
STRATEGIST
josh@cityindex.com
Q.
Dear Josh, is the Christmas rally a
myth?
A.
Historically at least, a Christmas rally
is by no means a myth. The last 10
years have seen the FTSE 100 rally
nine times in the month of December, with an
average rally of 3 per cent. The only year
where the index actually fell was in 2002,
when it suffered a drop of 5.5 per cent.
There can be several reasons as to why
equities have proved bullish over the
Christmas period. Of course, the most obvi-
ous one could be that all traders are in a fes-
When the torrent
turns into a trickle
As the Christmas holidays get
closer, watch out for tumbling
liquidity, writes Daniel Knowles
T
HANKSGIVING might not make
much of an impact on most British
households, but for those trading
on the financial markets, it will
certainly have been noticeable. As mil-
lions of Americans take leave from work
to eat turkey, drink, shop and nurse their
hangovers, the number actually still trad-
ing shares drops off heavily.
But it isn’t only Thanksgiving itself –
which fell on Thursday – that is quiet. As
David Buik, of BGC Partners, observed,
today is “unlikely to be anything but a
session of wholesale indifference in New
York”. With Thanksgiving begins a period
of relative inactivity – one which lasts
into early January. Liquidity is cut off,
and bid-ask spreads widen on most
stocks, especially those of smaller firms,
while volatility increases and price move-
ments get less predictable.
As a result, prices at Christmas are gen-
erally thought to be less informative than
normal, and indeed, last year seems evi-
dence enough of that. The FTSE 100 hit a
15 month high of 5,538 over Christmas
2009, before falling all the way back to
5,100 by early February 2010.
So what should spread betters do to
avoid getting caught? Well, as Manoj
Ladwa, senior trader at ETX Capital,
tive mood and this can continue into the
workplace and affect one’s attitude towards
the stock market. Bonus season also begins
and some traders could ultimately be looking
to invest part of their bonus into the stock
market, which increases demand. A final rea-
son could be that traders are anticipating
fund managers re-entering the markets in the
New Year to set up their portfolios. This could
also induce a market rally.
Q.
Dear Josh, why does the Irish
bailout affect the FTSE?
A.
In truth, the FTSE 100 has been one
index in Europe that has been least
affected by the effects of the Irish
bailout. Since the bailout was confirmed, the
FTSE 100 has fallen around 3 per cent, while
the Spanish Ibex has fallen 8 per cent.
Much of the downward pressure on the Will Santa come again financial territories. For example, the Spanish
FTSE 100 has been related to potential expo- this Christmas?
sures to Irish debt by UK-listed banks. In the
same period, the UK banking sector has fallen Picture: GETTY Spain will also struggle to meet its debt obli-
5.5 per cent, underperforming the FTSE 100
index and hitting a new four-month low in
the process.
But with a majority of companies listed on
the FTSE 100 relying on growth beyond both
the UK and Irish shores, the negative effect
has not been felt as hard here as in other
The financial markets
freeze up at
Christmas
Picture: ALAMY
explains, during periods of low volume:
“You don’t really want to see prices go up
suddenly”. “Sustainable price increases
usually happen when volume is high –
institutional investors lead in buying and
create momentum, then retail investors
follow”. Conversely, when volume is low –
and especially during the holidays, when
many institutional investors aren’t trad-
ing, “it doesn’t take much to lift a few
offers”, and so prices can see sudden
spikes which will later disappear.
To take account of higher volatility,
traders should consider widening their
stop losses so as to avoid getting stopped
too easily out of a profitable trade, since
prices may fall quite unexpectedly before
recovering. They should also limit their
trades in smaller firms, which are more
likely to suffer from reduced liquidity.
Alastair McCaig, head of investment
management at WorldSpreads, cites
Vodafone as the ideal sort of company to
trade over Christmas, while AIM stocks,
or small mining companies, are typically
likely to get a lot less liquid, and so are
best avoided. McCaig advises spread bet-
ters to “pick FTSE 100 companies and
probably stick to the top 40 to 60” while
the holiday lasts.
He also offers some alternative advice,
however. McCaig says that more of his
clients call him up over Christmas “just
to chat socially and escape the family”
rather than to actually ask for advice.
Perhaps the best way to deal with low vol-
umes at Christmas is to take a break and
actually start spending your profits,
rather than trying to increase them.
Investment | Spread Betting
Ibex has suffered much more than the rest of
Europe because investors are concerned that
gations.
The sovereign debt situation has had
severe consequences for the strength of the
euro, which fell as much as 7.5 per cent
against the dollar in a little over three weeks,
trading below $1.32 last week. The fear is
that the current €440bn European Financial
THE TIPSTER
WALL STREET IS
BACK ON THE UP
T
HE US is back in play now
that the Thanksgiving holi-
day is over. The Dow Jones
index has been dragged
lower by weak European indices,
but American investors usually
don’t like being led astray by other
indices. Monday could well bring a
renewed bout of bullishness.
Capital Spreads quotes 11,075-
11,077 for the Wall Street index
(the Dow Jones).
And American consumers are
feeling a little more optimistic
too. With December approaching,
early figures from the US indicate
that consumers might be about
to start spending again. It would
seem a perfect time then to buy
the world’s biggest retailer, Wal-
Mart. Capital CFDs quotes a
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29
Stability Facility, along with contributions
from the IMF and EU, may come up short in
propping up debt-laden Eurozone states. If
problems continue to domino throughout the
rest of the so-called PIGS nations (Portugal,
Ireland, Greece, Spain) then this fund may
well require additional capital injections.
Learn more about the markets and
spread betting with Josh at his free City
Index seminars.
price of $53.65-$53.72 on Wal-
Mart.
November has seen some big
swings in both directions for blue
chip shares but with the end
result of very little change for the
FTSE 100 so far. However, the
telecoms business BT Group has
put in a stellar performance over
recent weeks. Last Friday the
share price hit its highest level
since September 2008 on news
of the sale of some of its stake in
an Indian software company. The
company also announced strong
quarterly figures earlier this
month and it has all helped turn
around investor sentiment. With
the latest surge pulling in
momentum traders, it could still
have further to run. IG Index
offers a spread on BT of 174.50p-
174.94p.
With inflation in Germany
higher than expected, German
consumers might be about to
finally start spending. One good
pick might be Deutsche
Telekom. WorldSpreads quotes a
spread of €9.964-€9.984.
Daniel Knowles
Account Value % Difference
£218,520.13 2085
£184,977.18 1750
£176,220.08 1662
£141,629.94 1316
£127,267.12 1173
£124,286.21 1143
£91,979.05 820
£88,629.21 786
£54,069.00 441
£48,097.25 381
 Lifestyle
30 CITYA.M. 29 NOVEMBER 2010

| Travel

Culture, sand
and sun: a day
in Oman just
isn’t enough
With a 24-hour travel, like in the good old days.
The heat in Muscat is a knock-out: it
stopover in Muscat, envelops you and races down your throat.
Luckily we’d booked a car and before we
Rowena Carr-Allinson knew it, we were ensconced in air-condi-
tioned comfort. Our driver, who cut a dash-
finds too-short bliss in ing figure in his traditional Omani
dish-dash robe and sharp sunglasses, obvi-
ously had a penchant for rock ballads. And
a true slice of Arabia so, exhausted, we watched the scenery
flash by to Bryan Adams. Without a doubt,
the best part of travelling is the surreal

M
USCAT in the Sultanate of Oman moments in familiar places in unfamiliar
is set on the edge of rough desert circumstances.
landscapes overlooking sparkling Speeding through the vast ochre coun-
emerald seas. Today it’s a sought- tryside dotted with white blocky buildings
after holiday spot for those in search of and the odd blue minaret, all blanketed in
pristine diving waters, year-round sun- a hot wobbly haze, we eventually reach the
shine and an authentic Arabian experi- Sultan’s Al Alam Palace. A vision in
ence. Nothing like its glitzy neighbour, turquoise mosaic and gold leaf – hidden
Dubai. behind impressive black gates
It’s my third visit in a adorned with the Sultan’s
decade and is something coat of arms bearing a tra-
of a pilgrimage. Muscat ditional Omani dagger,
will always hold a spe- it was built in 1972,
cial place in my and apparently has a
heart as it’s the bowling alley in
place my husband the basement.
chose to spring a The Sultan between the azure sea and the jagged with gold mosaic flooring and flamingos.
surprise proposal Qaboos bin Said toast-coloured mountains. The resort is The room, overlooking the beach, is
on me, one knee Al Said, or the made up of three properties, including Al sumptuous. Rich damson silks, marble
in the sand, on king, as his peo- Waha (the oasis), geared towards families, and latticed mahogany panels set off the
our tenth ple refer to him, Al Bandar (the town), with several bars and gold and bronze colour scheme. The per-
anniversary – appears to be restaurants, a glorious beach, giant swim- fect place for a much-needed power nap.
although neither incredibly popular. ming pools and a lazy river, and the It’s frustrating, but our 24-hour stopover
of us noted the date From our last visit smartest of the three properties, Al Husn means we have to be very selective. We
at the time. Trust we hear he reinvests (the castle) where, rumour has it, Kate could laze in the sun, go diving, dolphin
me, “Waity-Katy” has- a substantial part of Moss and Tom Cruise have stayed (separate- watching or hit the zen Chi spa, but we
n’t done too badly. his oil income back into ly). plump for a memory lane “best of” dash
It was a sleepless flight the country, which The six-star plush palace sits high on the with a stop at Qantab beach, a visit to the
on Oman Air, but on the explains the happy Omanis cliff side and oozes luxury. The all-Arabian souk and a drink at the Chedi.
upside, it’s been a long time since I and sleek infrastructure including golden décor is pure opulence, especially Qantab, just a couple of miles from the
felt so nicely treated in economy, making giant roundabouts featuring huge golden the vast lobby’s water features, complete hotel, has a beautiful tourist-free beach. It’s
the most of the socket for my laptop, try- coffee pots, dolphins and other assorted Friday so it’s busy with families out play-
ing to figure out the Wifi and watching
the odd movie. What most impressed me
national icons.
We’re soon in the perfectly manicured The sleek infrastructure includes giant ing cricket, swimming fully clothed and
picnicking. We’re the only Europeans
though, was the great service from the
smiling stewardesses in their lovely, glam-
wonderland that is the Shangri La Barr Al
Jissah resort. Whitewashed buildings sit roundabouts with huge golden coffee there and get a few inquisitive stares.
Sitting a while, under the sun, we take it
orous veiled pillbox style hats. Elegant air beyond a row of palm trees, wedged
pots, dolphins and other national icons all in, sipping a Seven Up from a can with
the old fashioned ring-pull. It’s lovely to be

TRAVEL NOTES | by Zoe Strimpel

Family Christmas in Gleneagles
Don’t miss this offer at Scotland’s most romantic hotel. Highlights include
skating lessons taken by former Olympic coaches, fireworks on Christmas
Eve and sumptuous food. A children’s activity programme, surprise visits
from the elves on Christmas Eve and of course Santa Claus himself on
Christmas Day. Prices from £3,085 for three nights. www.gleneagles.com
New York’s hottest chef opens new oyster bar
April Bloomfield, chef of New York’s first gastropub the Spotted Pig, is
known as a lesson in how to come from somewhere else and make New
York love you. Well, the flame-headed chef from Birmingham has just
opened the John Dory Oyster Bar at the Ace Hotel and, true to form it’s
taken New York by storm. 20 West 29th Street, www.thejohndory.com.
Celebrating at Miami’s Setai
Palm Beach’s super glam Setai has launched three tasty packages in cele-
bration of its fifth anniversary: Ladies’ Escape, Gentleman’s Retreat, and
Celebrate at The Setai. The first is a chic shopping affair for pre-nuptial cele-
brations; the second is the equivalent for the boys, and the third is just pure
luxury and romance. From $585 per night. www.setai.com/celebration
CITYA.M. 29 NOVEMBER 2010 CHINESE GLAMOUR AT 31
THE NEW HAKKASAN
REVIEWED IN TOMORROW’S
LIFESTYLE SECTION

Left: a traditional
view of the harbour
with Omani fisher-
men. Below: a room
at the Shangri La.

Pictures: GETTY

Above: the cove
where the the
Shangri La lies.
Above right: the La
Sultanah restaurant.
Our 24-hour stopover means we have to
be selective. We could go diving or dolphin
watching but we plump for Qantab beach
back, and see it’s not changed.
Next is the Muttrah souq, the perfect
place to pick up a souvenir or two. A maze
of tiny winding streets, the heat, hustle
and bustle and exotic aromas are dizzying.
It’s a sea of black and white. Women are
swathed in black abayas, while men wear
white dish-dash robes and embroidered
Krum hats. Small enough not to get lost in,
it’s worth venturing off the main drag for
better prices and more authentic experi-
ence. Haggling is part of the fun.
Shopkeepers are extremely friendly and a
smile and joke goes a long way. As does
reverse psychology. The best buys include
spices like saffron, kohl makeup, silver
charms and the aromatic frankincense
which, to me, has become synonymous
with this country.
Another Muscat must is a visit to the
Chedi. The all-white Moorish architecture
and killer attention to detail make it one of
the region’s most luxurious hotels. Each
piece of furniture, each bit of greenery is
pristine. The glamorous restaurant with its
crystal chandeliers over food stations
encased in glass is a mouth-watering
odyssey – from sushi to patisserie.
The desserts look especially
scrumptious today, from colour-
ful rainbow layered cakes to
delicious looking maca-
roons, but for now we’ll
stick to a quick drink on
the terrace, despite the
still stifling heat at sun-
down.
For dinner, the idea is
to push the boat out.
Literally. Well, almost. La
Sultanah, one of
Muscat’s finest restau-
rants is a kick back to the
glory days of cruising. Set
up in a chic ocean liner
style with 30s inspired
décor and views over the bay
below, it feels plush and ele-
gant. Details like the metallic
banisters and swirling carpets in
greys and blues only add to the
ambiance, never mind the menu which
“sails to a different city” every night stop-
ping in Sydney, New Orleans or Tokyo.
I go local with braised Omani kingfish
with a red pepper confit, while my hus-
band travels to Japan with a sampling
menu of tuna tartar, tender beef terriyaki
and miso soup in cute china coffee cups.
The food is just as good as the staff, who
are grinning from ear to ear.
To really
m a k e
the
most of our jetlag, we head out into
Muscat to explore the nightlife.
Apparently the Park Inn’s rooftop bar is
hot but shut due to a recent typhoon, so
we head to the new Zouk at the Crowne
Plaza. It’s a cosmopolitan crowd, and the
décor is Miami cutting-edge cool. The girls
have left their abayas behind, and it’s hard
to compute the no PDA rule. Just like in
London, smokers congregate outside,
groups of lads queue in hope, and the
wealthiest hang by their white Porsches to
impress the ladies.
Twenty-four hours is just long enough to
whet the appetite, and convince us we’ll
have to come back and “do” Oman prop-
erly. On our Omani wish-list is a visit
to the Musandam peninsula up
North, a trip to Salalah, the capital
of the Frankincense trade with a
few days in the desert and more of
those Omani breakfast pancakes.
Although Oman is moving for-
ward, it’s a relief to see that they
are going about it in a very dif-
ferent way to their neighbours.
Unspoiled and traditional, this is
one Arabian enclave keen to pro-
tect its heritage and take it slowly.
A wise choice.
Oman Air is the only airline to offer
daily direct flights from London
Heathrow to Muscat, with prices starting
from £317 return, including all taxes. Book
at omanair.com 08444 822309. Tel: (968) 2477
6666, www.shangri-la.com See www.shangri-
la.com for the Shangri La Barr Al Jissah Resort’s
numerous packages and offers.

HOTEL REVIEW

Ensconced at aloft Brussels Shuman Jessica Mead

URBAN cool is what aloft says it set out to
achieve with Brussels Schuman, its first
hotel in Western Europe. It very nearly
manages it. It’s aimed at young profession-
als who are after laidback accommodation
with no frills.
There’s no restaurant but there is a café
that provides breakfast. Staff also insist on
replacing hello with aloha – a little grating
after a while.
The room was large and ultra-modern. The
bed was so comfortable I almost ignored
my alarm. For those needing to work, the
large desk was ideal and it had plenty of
sockets. Every room comes with free wifi.
For business travellers, there’s plenty of
space to hang up suits.
The 42-inch flat screen television was a
veritable entertainment centre – you could
plug in your iPod and watch channels in
languages you had never heard of.
At night the cocktail bar goes for live
music and DJ sessions, which you can’t
hear from your room if you want a quiet
night. But during the day, it becomes a sit-
ting area with comfy sofas, a pool table
and even a shares ticker. Sadly it feels a lit-
tle too much like a university student union
rather than a hotel bar – businessmen in
suits look and feel incongruous, whatever
their age – and you have a niggling suspi-
cion that the bright decor will feel dated
very quickly.
It’s well located for the European institu-
tions, the rooms are smart and it’s cheap.
For those in their 20s and 30s, it’s ideal.
Rooms at aloft Brussels Schuman start at
€89 a night without breakfast. Tel: +32 2
800 08 88 or see www.aloftbrussels.com.
32 Lifestyle | Fashion
FOLDED-SEQUIN SILK
ORGANZA DRESS, ADAM
This dress is pure Christmas sparkle. You’ll
light up the room and the tulip shape is spot
on. £1,305, www.netaporter.com
Time for festive frocks
Have fun with your
party dress, says
Zoe Strimpel
C
HRISTMAS party season attracts its
share of Grinch-like moaners. But
let’s face it: a chance to roll out one
fun frock after the next is good fun.
Regarding the phrase “fun frock” – feel
free to substitute “fun” with “glamorous”
or “hot” or “lovely”. Anyway, the point is
that you have to have a party wardrobe
you’re proud of. But what should it look
like?
Kara Iland, fashion maven and founder
of super-cool private fashion boutique
Rous Iland (a favourite with City ladies),
says: “The look this season is very much
covered-up chic. We’re expecting snow so
not too much skin on display. Lace is a
great way to cover up, still allowing a hint
of flesh in an elegant way.” Full-length,
says Iland, is a good way to go, so long as
it’s elegant and figure-hugging – one-
shoulder is always a winner. “And
sparkles are prevalent every Christmas –
a 1920s art deco style is a good option.”
Don’t forget edgy accessories either.
A CHANCE TO DRESS UP: NOW
THAT’S WORTH CELEBRATING
Sarah
Hollamby
Style
Counsel
INGLENOOK DRESS, BELLE
AND BUNTY
A wonderful shot of vintage glamour and
the high waist will flatter curvy women.
£225, www.belleandbunty.co.uk
MORGAN DRESS, IRWIN &
JORDAN
Right on trend with lace and a modest but
very sexy glamour. A real workhorse.
£435, www.irwinandjordan.com
W
OMEN come into their own during
Christmas party season – it’s a non-
stop party and that means a non-
stop fashion parade. There’s
something about wearing a frock that makes
you feel good, in the mood, flirty and pretty.
Dressing up, especially at Christmas, gives
you that sense of occasion and makes you feel
“Christmassy”. Wearing a frock is a liberating
experience, it says “I’m a woman and I know
how to enjoy myself”. You only have to slip on
a dress and you’re transformed from mother
OLEG PRINTED SILK
CHIFFON DRESS, JASON WU
Stunning party frock that says girly fun on
one hand and subtle maturity on the other.
£3,000, www.netaporter.com
IRAH SHIFT DRESS,
COAST
Right on with that glamorous covered-up
chic, this dress has plenty of dazzle and you-
can rewear it. £95, www.partydresses.org.uk
to vamp, from work girl to debutante, from
shygirl to showgirl, and it feels good.
Life these days is so underdressed, so
casual, so underwhelming. Now is the time
for you to shine. Cast this year’s troubles
aside and have some fun. This year more
than any I can remember, frocks rock. There
are long slender maxi dresses from French
Connection, vintage 50s glamour styles,
slinky Lanvin must-haves from H&M, posh
frocks, flirty frocks and ubiquitous LBDs (lit-
tle black dresses). Complete the experience
with sexy undies, glossy lips and more than a
waft of perfume, and before you’ve even left
home you’ll be floating on air.
If you’ve forgotten how to wear a dress,
and your legs have been hidden for weeks,
get them out this Christmas. Choose a frock
that fits you well, and flatters your best
bits, in a colour that’s going to take you
CITYA.M. 29 NOVEMBER 2010
RED BOW TWIST DRESS,
TOP SHOP
If red is the new black (and it sort of is
around Christmas), this beauty hits the nail
on the head. £165, www.topshop.com
FASHION NIBS | ZOE STRIMPEL
TANYA SARNE SAMPLE SALE
Ghost founder and fashionista’s favourite
Tanya Sarne is holding a not-to-be-missed
sample sale of her new superluxe, super-
green brand Handwritten. Sarne developed
the Handwritten production process over 20
years – the result merges her signature tex-
tile techniques and design. Expect gorgeous
biodegradable silks and knitwear.
3-5 Dec, 11am-7pm at 1-3 Middle Row, W10
5AT. www.handwrittenuk.com
ASPINAL OPENS FIRST SHOP
Everyone’s favourite leather goods brand has
opened a shop all of its own. The luxurious
emporium sells everything you’ll find in its
West End, Westfield and Canary Wharf out-
lets – and more, including full personalisation
services. 25 Brook Street, W1K 4HB,
aspinaloflondon.com.
SAVILE ROW COMES TO THE CITY
Row classic Richard James is offering a spe-
cial sale shop in the City of limited edition
pieces at cut-down prices. Suits from £375.
Until 10 Dec, Mon-Fri, 10am-7pm. Unit 3 & 4,
Western Courtyard, 10 Devonshire Square,
EC2M 4YP. www.richardjames.co.uk
anywhere. The key is to find “that dress”
that you know you look fabulous in, and
makes you feel like dancing.
SEQUINS AND VINTAGE ARE IN
In terms of trend, anything sequinny is
always a good bet and those of you
that love vintage are in luck – gowns
with that retro twist; long, clingy
dresses with frills and elegant folds
are great for glamour. If you’re feeling
more conservative, my advice is
always to take an elegant, understat-
ed dress and jazz it up with acces-
sories – gorgeous big cuffs, a long
gem-laden necklace, or fabulous chande-
lier earrings. Enjoy.
Sara Hollamby is a business image con-
sultant at Working Voices. Email her at
sara sarahollamby@blueyonder.co.uk.
CITYA.M. 29 NOVEMBER 2010 Lifestyle | TV& Games 33

BBC1 BBC2 ITV1 CHANNEL4 CHANNEL5 TV PICK

TERRESTRIAL
6pm BBC News
6.30pm BBC London News
7pm The One Show
7.30pm Damilola’s
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8.30pm Fifa’s Dirty Secrets:
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9pm CHOICE Accused
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10.25pm Regional News
10.35pm A Question of Sport
11.05pm Freddie Flintoff: Ashes
Warrior 11.45pm The Graham
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12.40am Sign Zone: The Apprentice
1.40am MasterChef: Professionals
2.10am Story of Science – Power,
Proof and Passion 3.10am Secret
Iraq 4.10am-6am BBC News
6pm Eggheads
6.30pm Strictly Come Dancing
– It Takes Two.
7pm Johnny Kingdom’s Year
with the Bird.
7.30pm A Newsnight Special
8pm University Challenge
8.30pm Miranda: Things look
up for Miranda’s love life.
9pm Ian Hislop’s Age of the Do-
Gooders: New series. The
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individuals to society.
10pm CHOICE The Trip.
10.30pm Newsnight: Weather
11.20pm Donald Trump: All-
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12.20am BBC News
4.10am-6am Close
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10pm ITV News at Ten
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10.35pm Real Crime with Mark
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11.35pm Robson Green’s Wild
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12.30am The Zone; ITV News
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2.30am UEFA Champions League
Weekly 3am The Jeremy Kyle Show
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6pm The Simpsons 6pm Home and Away
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7pm Channel 4 News 7pm Five News at 7
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8pm Dispatches: The Kids Five News Update
Britain Doesn’t Want 8pm CHOICE The Gadget
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10pm Chris Moyles’ Quiz Night 9pm Extreme Fishing with
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11pm Peep Show Panama, Central America. ACCUSED
11.30pm The Lazarus Effect 10pm FILM Hard to Kill: BBC1, 9PM
A woman resorts to desperate
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Show: N.E.R.D Steven Seagal. 1990. measures in her bid to discover how
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Studio 60 on the Sunset Strip Files 4.45am House Doctor 5.10am
4.20am-6.35am FILM Princess Michaela’s Wild Challenge 5.35am-
Mononoke: 1997. 6am Michaela’s Wild Challenge

SKY SPORTS 1 2am-5am Live WWE: Late 3am Charmed 4.40am Brian 3.35am Rick & Steve: The 4.40am Unsolved History
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7pm Sky Sports News at Seven
7.30pm Live Spanish Football
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Round-Up 11.30pm Premier
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Monday Night Football 4am
FIFA Futbol Mundial 4.30am
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7pm Sailing 7.30pm Live
Monday Night Football 10pm
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11pm Show Jumping 12am Test
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Premier League Review
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6.30pm Live FIFA Women’s
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Champions Club 11.30pm
Eurogoals 12am-12.15am
Eurogoals: One to One
ESPN
6.00pm Talk of the Terrace
7pm Live FA Cup Football:
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Exposed: Madonna 5.30am-
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BBC THREE
7pm Merlin 7.45pm Doctor
Who 8.30pm Freak Like Me
9pm The World’s Strictest
Parents 10pm EastEnders
10.30pm How Not to Live Your
Life 11pm Family Guy 11.45pm
The World’s Strictest Parents
12.45am Freak Like Me 1.15am
How Not to Live Your Life
1.45am Mad About the House
2.45am Love Me, Love My Face
3.45am The Real Hustle on
Holiday 4.15am-5.15am Mad
About the House
E4
7pm Hollyoaks 7.30pm Friends
9pm Scrubs 10pm The IT
Crowd 10.30pm The IT Crowd
11pm Pete Versus Life 11.35pm
Misfits 12.40am Scrubs
1.35am Pete Versus Life 2am
Misfits 2.55am What About
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Accidentally on Purpose
4.45am-6am Switched DISCOVERY HOME &
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HISTORY 7pm A Baby Story 8pm 10 THE TRIP
7pm How the Earth Was Made Years Younger 9pm Chopper BBC2, 10PM
8pm America: The Story of the Rescue 9.30pm A&E: Outback Steve and Rob visit the world-famous
US 9pm Pawn Stars 10pm
10pm Mystery ER 11pm Malham limestone pavement, before
American Pickers 11pm
Trauma Unit 12am Chopper eating at the Yorke Arms. Comedy,
Decoding the Past 12am
America: The Story of the US
Rescue 12.30am A&E: Outback starring Steve Coogan and Rob Brydon.
1am Mystery ER 2am Trauma
1am Pawn Stars 2am Unit 3am 10 Years Younger
Tunnellers 3am Eat Like a King 4am Baby Days 5am-6am
4am-5am Ancient Discoveries Portland Babies
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1am Bear Grylls 2am Industrial 2.40am Oops TV 3.30am Lost The presenters take part in a
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COFFEE BREAK
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk

QUICK CROSSWORD
   

SUDOKU KAKURO
16 35 13 11 15 7 32 
11 15
14 
17 27
Place the numbers from 1 to 9 in each empty cell so that each 28  
row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 33 13
15
from 1 to 9 to solve this tricky Sudoku puzzle. adds up to the total in the box 9 14 4
  
above or to the left of it. 30 9
You can only use the digits 1-9 8 21  
    and you must not use the
12
24   
same digit twice in a block. 25 17 18 34
   The same digit may occur 39 7  
10

  more than once in a row or
column, but it must be in a
11
19
8
10
10

6 15
   separate block.
16 
29 28
  20 17


   ACROSS DOWN
1 Stroke tenderly (6) 1 Applauds (5)
  
   WORDWHEEL C L
6 Floating aimlessly (6)
7 Forever (6)
2 Substance covering the
crown of a tooth (6)
Using only the letters in the Wordwheel, you have 3 Framework that holds
    8 Hurry (6)
ten minutes to find as many words as possible,
A U 10 Mixture of rain
the panes of a window
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters C and snow (5)
in the frame (4)
4 Number written as XVI
LAST ISSUE’S or more, all must contain the central letter and
letters can only be used once in every word. There
L E 13 Droplet (7) in Roman numerals (7)
16 Hinged lifting tool (5)
SOLUTIONS KAKURO is at least one nine-letter word in the wheel.
T A 18 Relating to the
5 Rise to one’s feet (5)
9 Lie adjacent to
QUICK CROSSWORD 1 4 3 5 2 7 9 8
stars (6) another (4)

6 8 % 8 5 % % '
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2 1 7 4 3 2 1          English composer
+ 8 $ % 2 $ 5 '
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% 5 , $ 5 ' . 6 3 7 5 1 8 9 4 2
        
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2
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$
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2 ) ) 5 2 $ ' : '          22 Involuntary 17 Move furtively (5)
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1 3 8 3 1 6 5 2          19 Young, unmarried
/ $ < ( 5 6
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1 / , 6
1
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was SAFEGUARD          from the nose (6)
woman (4)
 34 Sport CITYA.M. 29 NOVEMBER 2010

Results
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▲

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preferred line-up.
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“[Australia’s] Robbie Deans is one of stopped in their
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rugby. They are an outstanding ful Springbok side
J`e^c\j=`eXc1I=\[\i\iJn` YkIEX[XcJgX -$**$--$(% win over Australia ear- team,” he said.
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England and Johnson in a way that I haven’t seen England ACTION IMAGES
SPORTS EDITOR FRANK DALLERES have turned a corner play in a long, long time. Everything
email sport@cityam.com they tried went well.”

Late Lennon strike adds more

weight to Harry’s title claims
that you can write off and go, Modric’s forceful run, deep into the
TOTTENHAM 2 ‘They’re going nowhere, are they?’
“Even if you’re one down, we’re
Liverpool penalty area, and subse-
quent cross forced Skrtel into sliding
always going to make plenty of in at the near post, ahead of the wait-
LIVERPOOL 1 opportunities and it’s a case of stick-
ing them away.
ing Peter Crouch, and the unfortu-
nate Slovakia defender only
“I just feel we’ve got a belief in succeeded in stabbing into his own
there that we can come from net.
▲

FOOTBALL
BY JAMES GOLDMAN behind.” Liverpool thought they should
In truth, as Arsenal did last week, have had a penalty when Benoit
TOTTENHAM boss Harry Redknapp Liverpool let their hosts off the hook, Assou-Ekotto felled Dirk Kuyt, but it
warned his side’s title rivals to write squandering several chances, most was Spurs who grabbed an injury-
his charges off at their peril as Aaron notably through Maxi Rodriguez, time winner when Lennon collected
Lennon’s injury-time goal put the after defender Martin Skrtel’s impro- Peter Crouch’s flick, darted inside
seal on another comeback victory. vised finish with the outside of his Paul Konchesky and fired past Pepe
After last weekend’s historic derby right foot put the Merseysiders into a Reina.
win over Arsenal, Redknapp suggest- 42nd minute lead. “When we missed the penalty I’ve
ed Spurs were capable of mounting a Van der Vaart had earlier limped got to be honest, I thought ‘Maybe
serious title challenge. off with a hamstring niggle, while it’s not our day today’. But we kept
And after overturning a half-time Kaboul was also replaced before the going,” added Redknapp. “We had
deficit and overcoming injuries to break by Sebastien Bassong. Another lots of good chances and, in the end,
Younes Kaboul and Rafael van der substitute, Jermain Defoe, dragged a I felt we deserved the win.”
Vaart, Spurs certainly provided penalty wide early in the second-half Redknapp revealed Van der Vaart’s
enough evidence yesterday to sup- as it looked like being a frustrating injury “did not look good” but long-
port their manager’s optimism. afternoon for the home faithful. term absentee Michael Dawson is set
Redknapp said: “We’re not a team But five minutes later Luka for a friendly appearance tomorrow. Lennon secured another dramatic Spurs win with a late goal Picture: ACTION IMAGES
CITYA.M. 29 NOVEMBER 2010
Positions
now nailed
down, says
Johnson
ENGLAND manager Martin
Johnson insists every member of
his team has come out of a gru-
elling autumn campaign a better
player. And he believes they will
go from strength to strength as
they gear up for an assault on the
World Cup next year.
“There is a huge amount of
potential in this team and they
will only get better. Individually
every player has come out of this
series better,” Johnson (below) said
yesterday, in the wake of
Saturday’s loss to South Africa.
“We wanted to build a team, to
have guys who could nail down a
shirt and have the ability and char-
acter to stay there and the tough-
ness to be the best player in the
country week in and week out.
Lots of these guys have started
every game now. They are the
England players in that position.
You want that continuity.”
November saw England
largely fare well against the
might of the southern hemi-
sphere sides, and Johnson
believes his team are clos-
ing in on those at the
very top.
“The All Blacks
are ahead as No1 in
the world,” he
added. “South
Africa are up
there with the
Aussies. A few
other teams are
chasing them down
and I think the field is
coming together.”
Wenger: It’s easier
to sort home form
▲
FOOTBALL
BY JAMES GOLDMAN
ARSENAL manager Arsene Wenger
believes his side’s patchy home form
won’t be a barrier to them challeng-
ing for the Premier League title.
The Gunners moved to the top of
the table, albeit for just a few
hours, on Saturday following
another impressive win on
the road, this time 4-2 at Aston
Villa.
Arsenal have amassed 17
points away from home this
term, comfortably the
best in the division, but
have been beaten on
their own patch by
Spurs, Newcastle and
West Brom.
But Wenger (right)
is certain his players
will find the solution
to their home sickness
and denied they are suf-
Gutsy Cook repays selectors’ faith
ASHES COMMENT
ANDY LLOYD
O
UR cricket columnist, former
England batsman and
Warwickshire chairman Andy
Lloyd, has been poring over all
the Ashes action. Here he dissects
what he’s learned from the play so far.
THROW IN THE TOWEL
England have shown they have terrif-
ic resolve. For the first three days they
didn’t play badly but things did not
go their way; they didn’t do them-
selves justice. Australia looked to be
in a strong position, and certainly
won’t have a better chance to win a
Test this Ashes.
But the tourists’ heads didn’t drop.
They refused to throw in the towel.
And one of the reasons is because
they believe that they are better than
the Aussies. If you take away Peter
Siddle’s hat-trick, I think their bowl-
ing attack is woefully short. I can’t see
that changing much and it will be a
worry for them throughout the
series.
METTLE
Coming into the first Test everyone
was a little dubious about Alastair
Cook’s place in the side. I thought he
was the right man to start the series
but I wasn’t 100 per cent sure
whether he would deliver and still be
in the side come the third match. But
on day four Cook showed real mettle.
We knew he was a lad of character
and he showed it with the bat. That
188-run stand with Andrew Strauss
silenced the doubters and ensured
Cook will keep his place for the dura-
tion of the series. That means
Jonathan Trott won’t have to be
moved up the order and gives
England stability, which can only be a
good thing.
fering from a mental block when
they play at Emirates Stadium.
He said: “The fact we have away
wins, but are not winning so much at
home, I feel it is a coincidence. I don’t
believe we have a mental problem in
terms of playing at home.
“I would prefer to have the problem
this way around rather than the
other way around.
“It is good to know you can win
away and, at some stage at home,
you know you will get things
right. There is no fear about play-
ing at home.
“Maybe we want to be
a bit more urgent at
home. Maybe we feel at
the start a bit too confi-
dent.
“I think there is a lot
more to come out of
this team. It was a very
strong performance
against a dangerous
Villa team.”
Alastair Cook showed his quality in England’s second innings Picture: ACTION IMAGES
PUNISH
Just as Cook answered his detractors,
so did Mike Hussey for Australia with
his first innings knock of 195. His per-
formance was one of few positives for
the home side from the first four
US PGA champion Kaymer ended the season as Europe’s No1
Kaymer completes dream year
by finishing as Europe’s top man
GOLF
▲
GERMANY’S Martin Kaymer has
become the European Tour’s
youngest No1 since Ronan Rafferty 21
years ago, securing top spot in the
money list during his final round at
the Dubai World Championship.
Kaymer’s closest rival, his Ryder
Cup teammate Graeme McDowell,
applied some late pressure with a
final round 68, but missed out on the
top three finish he required to usurp
the US PGA champion.
days. Hussey proved his worth by pun-
ishing some mediocre England bowl-
ing. Graeme Swann and the seamers
bowled short and Hussey took advan-
tage. They tried not to let Swann set-
tle and succeeded.
Picture: GETTY
Kaymer said: “Last year gave me the
belief that I could win the Race to
Dubai. I didn’t expect to win a major
but I did that. A lot of things have
happened in this my fifth year on the
tour and I think it will take a few
weeks to realise what has happened.”
The tournament itself was won by
Sweden’s Robert Karlsson, who edged
out England’s Ian Poulter in a dra-
matic play-off. Poulter was docked a
shot on the second extra hole after he
dropped his ball on his marker, leav-
ing Karlsson to win it.
Sport 35
THE ALL-ROUNDER |
CONDITIONS, STATS AND BANTER
WEATHER FORECAST
HIGH 280
LOW
Bright sunshine
200
PITCH
Cracks in the surface, but thankful-
ly no cracks in England’s opening
partnership. Both attacks will hope
to find more bowler friendly sur-
face in Adelaide later this week.
STAT OF THE DAY
Andrew Strauss’s century was his
first in Tests in Australia and his
19th overall. The captain became
the seventh England player in Test
history to make three figures after
a duck in the first-innings. Strauss
combined with Cook for the highest
English partnership for any wicket
at the Gabba of 188, eclipsing the
previous best of 160 between
Graeme Hick and Graham Thorpe in
1994.
FIGHTING TALK
“For years Shane Warne has been
the only difference between the
sides. They haven’t got him now oth-
erwise it would have been a differ-
ent story.” Former England star
Darren Gough conveniently forgets
about Glenn McGrath, Adam
Gilchrist and the Waugh brothers,
but we get his the drift.
“Would like to see us put a bit of
pressure on the Aussies. Let
Swanny at them.” Andrew Flintoff,
the skipper who led England to a 5-
0 defeat Down Under four years
ago, tells us what he’d do.
“Ricky Ponting was a bit jumpy, he
tried to do too many things at once
and didn’t let his bowlers settle.”
Former Aussie skipper Ian Chappell
isn’t impressed by Ponting’s leader-
ship. Music to an Englishman’s ears.
SPORT | IN BRIEF
Froch targets a big name
BOXING: Britain’s Karl Froch is targeting
the likes of Glen Johnson and Andre
Ward after reclaiming the WBC super-
middleweight title following a unani-
mous points victory over Arthur
Abraham in Helsinki. Froch said: “I can’t
just defend my title against bum of the
month. I have to get in there and fight
Glen Johnson and Andre Ward, a top
American and Olympic gold medallist.”
Panorama ‘won’t harm bid’
FOOTBALL: Culture Secretary Jeremy
Hunt has been assured by FIFA dele-
gates that England’s 2018 World Cup
bid will not be adversely affected by
tonight’s Panorama programme. Bid
leader Andy Anson accused the BBC of
being “unpatriotic” for broadcasting an
investigation into FIFA three days
before the vote to decide the 2018
hosts. “The FIFA delegates I have spo-
ken to have assured me the bid will be
judged on its strength alone,” said Hunt.
Quins too strong for Leeds
RUGBY UNION: Harlequins ended a run
of three games without a win with a
resounding 51-18 home victory against
relegation candidates Leeds. Nick Evans
orchestrated the victory, scoring one of
his side’s seven tries and ending the
match with a 23-point haul.
 Sport
36 CITYA.M. 29 NOVEMBER 2010

“MARTIN JOHNSON IS
GETTING IT RIGHT”
ENGLAND BOSS GETS
THUMBS-UP FROM
WOODWARD: P34

Drogba had an
effort chalked
off as Chelsea
slipped up
again

Carlo calls on Picture: GETTY

stars as Blues
lose top spot
April last season, are not staring
NEWCASTLE 1 down at the rest of the top flight
following the weekend’s play.
Chelsea’s slump has coincided
CHELSEA 1 with injuries to stalwarts Terry
and Lampard but Ancelotti hopes
to have them both available by the
time Everton visit Stamford Bridge
▲

FOOTBALL
BY FRANK DALLERES
CHELSEA manager Carlo Ancelotti
is preparing to fast-track John
Terry and Frank Lampard back
into action after seeing his side
lose top spot in the Premier League
for the first time since April.
The Blues’ dire run of league
form continued yesterday at
Newcastle, where they needed a
Salomon Kalou equaliser to claim
a point after gifting Andy Carroll
the opener with a defensive
howler. It means they have taken
just four points from a possible 15
and, for the first time since 24
on Saturday.
“Next week they will start to
train with the team,” he said. “We
have a week to control their condi-
tion and I hope both will be able
to play against Everton. They are
very important players, not just
technically, but because they have
personality and character, and at
the moment we need to have that
kind of player at our disposal.”
Ancelotti’s need for Terry to
return is even greater because cen-
tre-back Alex is set to fly home to
Brazil today for surgery on a long-
standing knee problem. And he
will depart on a sour note, having

Ancelotti has seen

handed Newcastle the lead when
his backpass proved too strong for
slight deflection off defender
Steven Taylor. The Ivory Coast for-
top spot to Manchester United will
prompt his flagging team to show TOP FOUR
Petr Cech, and Carroll beat the ward missed a golden chance to fortitude. “It is important,” the TEAM PLD W D L F A PTS
his side take just four goalkeeper to the loose ball before win the game in the closing stages, Italian said. “At the moment, it is Man Utd 15 8 7 0 35 16 31
points from their last scoring from an acute angle. but found the side netting with the not so easy and we have to show Chelsea 15 9 2 4 29 10 29
five Premier League Kalou levelled on the stroke of goal at his mercy, while Didier our character. It will be a good
Arsenal 15 9 2 4 32 17 29
fixtures half-time, cutting in from the left Drogba had an effort disallowed. motivation to do better.”
to shoot low past Tim Krul via a Ancelotti hopes the jolt of losing SPURS IN LAST-GASP WIN: P34 Man City 15 7 5 3 20 12 26

United to host Liverpool in Federer clinches London

title against tired Nadal
heavyweight third round tie grand slams in 2010 but yesterday
▲

TENNIS
failed to pick up the one major title
still in the competition, and it is HIGHLIGHTS | THIRD ROUND DRAW SWISS ace Roger Federer won the sea- still to elude him.
▲

FOOTBALL
BY JAMES GOLDMAN
MANCHESTER UNITED will host
Liverpool in the glamour third round
tie of this season’s FA Cup.
The Premier League leaders take on
the seven-times winners in the only
all Premier League tie of the round.
Meanwhile, United’s splinter club,
FC United of Manchester, will face last
season’s beaten finalists Portsmouth
if they win their replay at home to
Brighton.
Luton, Crawley, Droylsden and
Dover are the other non-League teams
Luton who could land the most lucra-
tive tie with a trip to Tottenham on
offer if they win their replay against
Charlton.
Dover will hope to knock out a
third League team, after victories over
Gillingham and Aldershot, when they
travel to Huddersfield and Crawley
will host Derby if they beat Swindon.
Droylsden, of the Blue Square Bet
North, face League One Leyton Orient
tonight with a trip to Norwich the
prize for the winner.
Holders Chelsea entertain Ipswich,
while Arsenal will host Leeds United.
Manchester United v Liverpool
Brighton/FC United v Portsmouth
Huddersfield v Dover Athletic
Crawley/Swindon v Derby County
Arsenal v Leeds United
Stevenage v Newcastle United
Chelsea v Ipswich Town
Tottenham Hotspur v Charlton/Luton
Norwich City v Droylsden/Leyton Orient
Crawley/Swindon v Derby County
Blackburn Rovers v QPR
Bolton Wanderers v York City
son ending ATP Tour Finals time for a
record equalling fifth time at the
expense of his great rival Rafael
Nadal.
Federer overcame the world No1 in
three sets to draw level with Pete
Sampras and Ivan Lendl, and claim
his first victory in this tournament
since it moved to London’s 02 Arena.
The Swiss star will also head home
more than £1m richer after going
through the week undefeated, while
1,500 ranking points are a start in his
bid to wrest back the No1 spot from
Nadal, who won three successive
“It’s fantastic. I’m really thrilled
the way I played all week. To win a
fifth time is obviously amazing, for
the third time in a different place,”
said Federer after a 6-3 3-6 6-1 win.
“I’m really happy the way I was
able to finish the season. Oviously
beating Rafa in the final makes it
extra special because of the year he
had.”
A magnanimous Nadal said:
“Roger played unbelievable through-
out the whole week. It was a fantastic
year for me, probably the most emo-
tional of my career.”
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