The Banking and Payments Federation's annual conference is taking place in Dublin today. Attendees at the conference will hear that the banking industry is facing significant and disruptive change in the light of technological and social developments. New non-bank players have entered the space and are driving innovation and customer expectations.
Steve Pateman, executive director and head of UK banking with Spanish banking giant Santander, is one of the speakers at today's conference. He says that banks are facing a dilemma as they are not technological companies but are providers of financial services, while at the same time their customers are accessing financial services - particularly payments - using mobile technology. The challenge for banks is to decide whether to partner with a technology firm who can help the bank get into that space or do they try and build the required technology themselves.
Mr Pateman says that companies like Apple have a clear view of what parts of the banking industry they are interested in such as payment services. The provision of credit and especially long term credit like mortgages is not an area the tech firms want to get into at this point in time, he adds. The banker predicts that over a period of time consumers will end up with a "hub" around which they will do a lot of banking activity and which will allow access to preferred providers. He says he has no doubt that people will be able to pay for things using their mobile phones pretty much in every place in which they shop.
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MORNING BRIEFS - Insurer FBD Holdings has issued its second profit warning within six months in its interim management statement and now expects to make an operating loss for the year. It under-provided for a number of claims related to accidents which occurred in 2011 and 2012. FBD said that factors such as the deterioration in claimants' medical conditions or an increase in the probability of liability have contributed to the costs of those claims being significantly higher than provided for at the time. FBD said there is no reason to believe the €13m charge it is taking is systemic or will recur in the future. In addition, the company said it is dealing with a small number of very large accident and liability claims which have significantly increased its claims costs over the third quarter of this year. The insurer said that despite all this, its reserves are well in excess of regulatory minimums and are more than adequate to meet customers' claims at all times.
*** After a strong first-half in Europe, building materials company CRH saw sales fall over the three months to the end of September according to its interim management statement to the stock exchange this morning. The company said it is still seeing strong growth in the US, where economic recovery is driving construction demand. For the year-to-date CRH's like-for-like sales, excluding the impact of acquisitions and disposals, are up 4%. It expects earnings for the full year to be 10% ahead of last year.
*** Chinese internet company Alibaba has said that spending on its online marketplaces in China went past the $2 billion mark in one hour on what is known as Singles' Day. Singles' Day, effectively the anti-Valentine's Day is so-called because of all the ones in the date (11-11). It is the biggest online shopping day of the year driven by discounts offered by retailers. Overall spending is expected to pass the $6 billion mark.
*** Inequality is becoming more pronounced as the economies of the world's richest nations return to growth once more.
In a report ahead of the G20 meeting in Brisbane, Oxfam has said the wealth of the G20 nations has increased by $17 trillion since December. One third of that newly created wealth, however, has accrued to the richest 1% of their population. Oxfam Australia head Helen Szoke also urged the G20 countries to do more to clamp down on tax avoidance by multinational companies which, she said, costs poorer nations $100 billion a year in lost revenue.
*** Oil tycoon Harold Hamm has been ordered to pay his ex-wife just under $1 billion in what will rank as one of the largest ever divorce settlements. The founder and chief executive of Continental Oil must pay Sue Ann Hamm $320m by the end of the year followed by monthly instalments of at least $7m making for a total settlement of $995.5m. Hamm's stake in Continental is worth some $14 billion. In a statement to Forbes magazine divorce lawyer Seymour Reisman said Sue Ann Hamm was "shafted" and that a spouse of 26 years should have been entitled to between 25% and 30% of the marital assets as opposed to the 7% she is to receive.
