Post by nickd (Mylegal) on May 10, 2015 21:13:01 GMT
Unsurprisingly, bankers are delighted with Tories winning....
This little piece from Bloomberg makes it all too clear why the world of business is happy to have dodged the bullet....
8th May 2015
By Simon Kennedy, Sam Chambers and Stephen Morris
Bankers emerged as the big corporate winners of the U.K. election as David Cameron’s victory saved them from tougher taxes and regulation even as a referendum on membership of the European Union now looms.
British bank stocks soared, led by Lloyds Banking Group Plc and Barclays Plc, as Cameron’s Conservative party unexpectedly secured a parliamentary majority. Energy producers such as Centrica Plc, betting-shop owners and property companies also had cause to celebrate the defeat of Labour leader Ed Miliband and his more interventionist agenda.
Despite their unpopularity with many voters, finance industry workers have been spared Labour taxes on properties worth more than 2 million pounds ($3.1 million) and bonuses. London-based broker Douglas & Gordon predicted the value of such homes would rise 20 percent over the next 12 months after Cameron’s win, and double in five years.
“The City will no doubt welcome what is expected to be a more business-friendly environment,” said Manny Roman, chief executive officer of Man Group Plc, the world’s largest publicly-traded hedge fund. “A clear outcome and a level of continuity is certainly a positive thing for the U.K. economy.”
Casting a pall is Cameron’s pledge to hold an “in-out” vote on the EU by the end of 2017. The run-up to that referendum alone risks chilling investment and a so-called “Brexit” would jeopardize U.K. Plc’s access to a market of 500 million consumers and the City of London’s status as a global financial hub.
“The City is the major earner for the United Kingdom,” said Saker Nusseibeh, chief executive officer at Hermes Investment Managers, which oversees about $45 billion of assets. “It is a major earner because it’s the financial center of Europe. If there is a Brexit it cannot be the major center of Europe.”
Miliband had vowed to raise a levy on bank balance sheets, while also campaigning to crack down on tax breaks used by hedge funds and private-equity firms. HSBC Holdings Plc has threatened to quit the U.K. because of higher taxes and tougher rules.
“I would suspect that the Tories are now more likely to try to find compromises with banks to remain U.K.-domiciled,” said Guy de Blonay, who manages about $700 million in financial stocks at Jupiter Asset Management Ltd. in London.
For Royal Bank of Scotland Group Plc a “Conservative majority is a game changer,” said Joseph Dickerson, an analyst at Jefferies International Ltd. “It’s 80 percent-owned by the government and they would like to sell shares in the first half of the parliament.”
Shares in Centrica, a power utility, soared more than 7 percent as the industry avoided Labour’s promise to fix household fuel bills.