Barclays deal raises regulatory concerns - papers 21st March

The two parties to the negotiations in what will be Europe's biggest cross-border deal were forced to reveal their early thinking on the structure of the group by the Dutch regulators yesterday.

The combined group will be incorporated in the UK as a plc with a primary listing on the London Stock Exchange and a secondary listing in Amsterdam and it will have a boardroom structure familiar to British investors with a single chairman and chief executive.

The FSA was quick to respond to the suggestion the combined group would be "lead" regulated by the Dutch Central Bank, meaning Dutch rules would overrule those of another jurisdiction in which the bank operates.

The FSA said it had requested further information from both parties and added: "Before this information has been received and assessed, no decision can be reached about the appropriate regulatory arrangements.”

The outcome may have implications for retail customers of Barclays and clarity will be needed on whether they would be covered by deposit schemes that pay out in the unlikely event banks go bust, says the paper.

RECORD MORTGAGE lending figures were achieved in February, according to latest figures from the Council of Mortgage Lenders (CML) and the Building Societies Association (BSA), reports the Scotsman.

The CML reported gross mortgage lending had its highest February ever at £24.6bn. Although lending was down by 7% on the £26.6bn recorded in January, it is up by 9% on the £22.5bn of lending in February last year.

Michael Coogan, CML director general, said: "This is the highest February lending figure on record, and reflects the continuing strength of the market and the strong desire of many people to get a foot on the property ladder or move house. Recent speculation about whether or not interest rates will go up seems to have had little impact upon lending levels and we still expect gross lending to reach around £360bn this year."

Meanwhile, the BSA revealed building society gross advances hit £4.2bn last month, compared with £3.2bn at the same time last year. However, savings were down, with net receipts to cash ISAs held with building societies amounting to £123 million last month, compared with net receipts of £129m in February 2006.

AND THE FINANCIAL Services Authority has fined a former Citigroup analyst for leaking research to fund managers ahead of publication, says the Daily Telegraph.

Roberto Casoni had to pay £52,500 - the largest fine for an individual since former GLG hedge fund manager Philippe Jabre was ordered to pay £750,000 last year for violating market conduct and non-deliberate market abuse.

Casoni, who no longer works for Citigroup, headed the Italian small mid-cap research team and in January 2006 he began an internal approval process to begin coverage of Banca Intalease.

However, he disclosed details of his valuation methodology, recommendation and target price - even telling a fund manager client the likely date the note would be published.

Although he had no intention of manipulating Banca Intalease's share price, the FSA ruled that by making such disclosures he "failed to observe proper standards of market conduct".

If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Emily Perryman on 020 7034 2680 or email [email protected].

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