Cyprus is likely to receive its long-awaited eurozone bailout by the end of March, according to the European Central Bank executive Jörg Asmussen, pictured. Cyprus is hoping to secure a 17.5bn euros (14.8bn pounds) bailout from other European member states, but some German politicians have been hesitant in approving the payment.
“There must be no doubt about this: if Cyprus gets no external help, it will slide into default,” said Mr Asmussen in an interview with Handelsblatt newspaper. He added, however, that the payment could not be a “one-way street”, and the Nicosia government would be required to fulfil tough conditions by scaling down its financial sector and introducing more banking transparency. [The Independent]
The chief executive of Royal Bank of Scotland mounted a dogged defence of his bonus last night, despite mounting criticism over the failures that allowed Libor-rigging to continue for years after he arrived. Stephen Hester insisted that he deserved the £780,000 payout from his long-term incentive package because of the “huge things” he had achieved since arriving at the taxpayer-owned bank in 2008. Sir Philip Hampton, the bank’s chairman, went farther, suggesting that Mr Hester was underpaid by comparison with other global top bankers and adding that the bonus, which comes on top of a £1.1 million salary and £400,000 pension contribution, was “modest”. [The Times]
Heathrow is at loggerheads with the major airlines after proposing to increase landing charges almost 6pc above the rate of inflation from next year. British Airways, Lufthansa and Virgin Atlantic attacked the price increases, which could see landing costs jump from £19.33 per passenger at present to £27.30 by 2018. The changes were announced as part of Heathrow’s business plan for the five-year period between 2014 and 2019. [The Telegraph]
A stand-off between the Treasury and EDF Energy is threatening to scupper the French state-controlled company’s £14 billion nuclear reactor project in Somerset and to wreck Britain’s new-build programme. Talks have broken down over the level of subsidy — provided by levies on consumers’ energy bills — awarded to EDF Energy in return for building Britain’s first reactors for decades. It comes a week after Centrica, the owner of British Gas, decided to pull out of the project, claiming that ballooning costs and lengthening delays made it too risky. [The Times]
The number of property sales rose in January for the fourth straight month, surveyors said, prompting a claim that “the very worst may be over” for the UK housing market. However, the Royal Institution of Chartered Surveyors (Rics) warned that any recovery in the market remains very fragile, with prices continuing to fall in most of the country. It said that 4% more surveyors reported price falls than price rises in January, compared with 1% the month before. The biggest falls were in Yorkshire and the West Midlands. The figures tie in with January’s house price report by Halifax, which said prices fell by 0.2% over the month. [The Guardian]
The yen plunged against the euro and the dollar on Monday after markets interpreted comments by international policy makers as a green light to sell the Japanese currency. The dollar jumped to a high of Y94.42 after Lael Brainard, the top US Treasury official for international affairs, restated US support for monetary stimulus in Japan but warned against competitive devaluation. The sudden movements highlight a volatile atmosphere in foreign exchange markets leading up to a summit of G20 finance ministers, which will be held at the end of the week amid fears of a new round of “currency wars”. “We support the effort to reinvigorate growth and to end deflation in Japan,” said Ms Brainard. [Financial Times]
The software company Autonomy is to be investigated by the UK’s accountancy watchdog over its financial statements in the lead-up to its $11.1bn (£7.1bn) takeover by US giant Hewlett-Packard in 2011. HP wrote off $8.8bn of the purchase price paid for Autonomy last November, of which it said $5bn was “linked to serious accounting improprieties, misrepresentation and disclosure failures”. The Financial Reporting Council (FRC) is investigating Autonomy’s financial reports between January 2009 and June 2011 – audited by Deloitte – after consulting the Institute of Chartered Accountants. The US Department of Justice is already investigating the accounting claims and HP has also asked the Serious Fraud Office to look into the allegations. [The Independent]