Monday, May 8, 2017

UK may lose 9,000 bank jobs; Bahrain reserves tumble; Facebook fights fake news

1 UK may lose 9,000 bank jobs (Jill Treanor in The Guardian) Big banks in the City could shift at least 9,000 roles out of the UK as a result of Brexit, according to a tally of job warnings since the EU referendum.

Deutsche Bank is leading the threatened exodus, according to research by Reuters, while the two financial centres making the most gains from London’s loss are Frankfurt and Dublin. Last month Deutsche warned that up to 4,000 UK jobs – nearly half its UK workforce – could move to Frankfurt and other EU centres.

US bank JP Morgan is preparing to move up to 1,000 bankers out of the City to Dublin, Frankfurt and Luxembourg. Goldman Sachs, despite continuing to build a new headquarters in London, has said it would need more people in Madrid, Milan, Paris and other cities in the EU.

The triggering of article 50 by Theresa May in March sparked a wave of announcements, because only two years are permitted for the Brexit negotiations. A report on Monday called for a transition period for banks and other financial firms, in order to adapt their business models to a departure from the EU.

The Bank of England has told financial firms to provide it with details of their Brexit plans by 14 July and to be ready for all possible outcomes, including a hard Brexit. Estimates of the impact of Brexit on financial jobs vary, although the highest is for 232,000 across the entire UK.


2 Bahrain reserves tumble (Gulf News) Bahrain’s foreign-currency reserves tumbled 11 per cent in February, extending a decline that has fuelled speculation that the island kingdom would either tap international bond markets soon or seek financial support from other Gulf Arab monarchies.

Net foreign assets dropped to 645.2 million dinars ($1.7 billion), from the 725.9 million dinars in January, according to central bank data. Overall, they’re down 71 per cent from a peak of 2.24 billion dinars in November 2014.

Bahrain has been more vulnerable to slumping oil prices and regional political instability than richer Gulf Cooperation Council states. The drop in reserves comes nearly a month after the International Monetary Fund warned that Bahrain needs to make significant spending cuts to restore stability to its budget and improve investor confidence.

Bahraini assets, however, have weathered the pressure of the country’s financial troubles, largely because investors expect Saudi Arabia to extend aid if needed. The cost of insuring Bahrain’s debt, measured by credit default swaps, dropped for seven straight months through April, the longest streak since 2012.

Bahraini authorities increased spending in response to the global recession in 2009 and civil unrest two years later as sectarian tensions escalated in the Gulf island nation. When oil prices tumbled, the budget deficit soared, reaching almost 18 per cent of gross domestic product last year. The oil price the government needs to balance its budget remains over $100 a barrel, the highest in the GCC, according to IMF estimates.


3 Facebook fights fake news (BBC) Facebook has broadened its campaign to raise awareness about fake news, by publishing adverts in the UK press. The ads carry a list of 10 things to look out for when deciding if a story is genuine. They include checking the article date and website address, as well as making sure it isn't intended as satire.

Facebook is under fresh political pressure to tackle fake news in the run up to the UK general election. Meanwhile, a BBC Panorama investigation has found the social network played a decisive role in both the US election and Britain's EU referendum last year.

The platform said it had already removed "tens of thousands" of fake Facebook accounts and that systems were now monitoring the repeated posting of the same content or a sharp increase in messaging. Accounts displaying this activity are then flagged, it added. Facebook is also decreasing the ranking of stories that people tend to read but not share.


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