Our Weekly Newsletter
Across Instinctif Partners’ Financial Services team, we are always keeping an eye on the key developments taking place across the sector to evaluate their impact on the many businesses we work with. Here we share our picks of the week’s most interesting news, and our expert views.
Post Office says a third of its cash machines will close
The Post Office is to shut 600 ATMs by March 2022, cutting a third of its cash machines. In defence of the move, the Post Office has said that the machines set for closure are little-used and located near other free cash facilities. However, the decision has raised concerns that rural and deprived communities face being having their access to cash cut off. The review was prompted by the Bank of Ireland, the legacy operator of the Post Office’s ATMs, pulling out of the business due to concerns over its future profitability. (From BBC, 26 October 2020)
Financial services remains uncertain over Brexit
A lack of clarity over the future relationship between the EU and the UK has left financial services companies unsure over what the regulatory environment will look like in the UK from 2021. Firms are concerned they may have their permission to sell services inside the single market repealed from next year. Fears over the disruption this would cause to the sector are mounting. Experts warn the scale of revenue the financial services industry generates for the UK economy underlines the importance of avoiding a no-deal Brexit. (From FT Adviser, 22 October 2020)
UK pensions regulator urges trustees to be on guard for employer distress
The UK pensions regulator is to warn trustees of thousands of company final salary-style pension plans to step up their monitoring of signs of employer distress, as concerns over scheme members’ pension pots falling in value from business rescues intensifies. The Pensions Regulator will write to more than 5,500 trustees of defined benefit pension schemes urging them to remain alert for profit warnings and credit downgrades. The initiative comes as new research from EY reveals that in the first nine months of 2020, 61% of listed defined benefit pension scheme sponsors issued a total of 228 profit warnings. (From FT, 27 October 2020)
Young and non-white Britons likelier to lose jobs after furlough
Young and non-white British workers are twice as likely to have lost their job after being furloughed compared with the UK average, shows new research by the Resolution Foundation. Elevated levels of redundancies among these groups are in part the result of their exposure to working in sectors hit hardest by the coronavirus pandemic. Younger and non-white workers represent a significant proportion of retail, leisure and hospitality firms’ workforce. These sectors have struggled to adjust their operations in line with Covid prevention measures, resulting in a contraction in the services they can offer, which has triggered staff layoffs. (From Reuters, 27 October 2020)
12 million Brits will struggle to pay bills, warns City regulator
12 million people in the UK are likely to struggle to pay bills or make debt repayments, the Financial Conduct Authority has warned. Households are experiencing intensified financial strain as a result of the coronavirus pandemic and resulting lockdown measures causing a loss in income and an uptick in job losses. The research suggests those from BAME backgrounds have faced the sharpest income falls, leaving them more exposed to missing debt repayments and future financial distress. The City regulator urged borrowers impacted by the pandemic to seek support from their lenders. (From City AM, 22 October 2020).