Digital Barriers Share News (DGB)

LONDON (Alliance News) - Royal Bank of Scotland Group and Standard Chartered both confirmed changes at the top Thursday, with London-based American investment banker Bill Winters set to take the helm at Standard Chartered and former City regulator Howard Davies confirmed as the incoming chair of RBS.

Standard Chartered's current Chief Executive Peter Sands is making a long-expected exit after more than eight years in the job, with the bank's chairman, John Peace, to follow him out of the door in 2016 after seven years. Sands was credited with steering the bank virtually unscathed through the financial crisis, but has recently come in for criticism after a 10-year run of profit growth came to an end.

Winters is the former co-chief executive of JPMorgan Chase & Co's investment bank, which he left in 2009 having successfully continued to build the business with the integration of Bear Stearns during the financial crisis. He's been linked with top banking jobs ever since, but it has taken until now for him to find the right role. The handover will take place in June.

Davies, meanwhile, had been widely tipped to succeed Philip Hampton as chairman of RBS when Hampton leaves for GlaxoSmithKline. The former chairman of the Financial Services Authority, who is stepping down as chairman of life insurer Phoenix Group, is also currently chairman of the Airports Commission, which is set to make a recommendation on expanding the UK's airport capacity in southeast England, a thorny political issue. Davies will join RBS' board at the end of June and become chairman on September 1.

He'll be chairing a very different bank. RBS revealed that it no longer plans to operate a standalone global investment bank, as pressure from poor returns, increasingly strict regulations and operating losses saw the division weigh on group operating results in 2014.

RBS had already planned to turn the corporate and institutional banking division into a business focused on clients primarily in the UK and Western Europe, and the bank's annual earnings statement for 2014 detailed plans to intensify the restructuring, with the aim of going "further, faster" in reshaping parts of that business.

Although the corporate and institutional bank's operating loss of GBP892 million in 2014 was an improvement on the GBP2.88 billion operating loss reported for 2013, it was the only one of the group's customer business divisions to report an operating loss in 2014. The group's personal and small business division reported an operating profit of GBP2.06 billion, while commercial and private banking reported an operating profit of GBP1.44 billion.

The group swung to an operating profit of GBP3.50 billion in 2014, compared with an operating loss of GBP7.50 billion in 2013, aided by impairment releases in its Ulster Bank and RBS Capital Resolution, although an array of costs from writedowns, restructuring, and litigation and conduct issues meant that RBS reported a GBP3.47 billion net loss in 2014, albeit an improvement on the GBP9.0 billion net loss reported in 2013. The results were hurt by a GBP3.99 billion fair value writedown on Citizens, the US bank that RBS is selling off.

"This is a plan for a smaller, more focused, but ultimately more valuable bank with the vast majority of its assets in the UK, and for RBS marks the end of the standalone global investment bank model," Chief Executive Ross McEwan said.

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Markets: London stock indices are hovering around flat amid another busy day of UK company reporting, while the second reading of UK fourth quarter GDP came in line with expectations.

Wall Street is set for a higher start, with stock futures indicating that the DJIA and S&P 500 will open up 0.1% and the Nasdaq 100 up 0.2%.

FTSE 100: flat at 6,934.66
FTSE 250: up 0.1% at 17,196.41
AIM ALL-SHARE: up 0.3% at 711.79
GBP-USD: down at 1.5498
EUR-USD: down at 1.1319
GOLD: up at USD1,216.93 an ounce
OIL (Brent): down at USD61.74 a barrel
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Top Corporate News
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Anglo-Dutch publisher Reed Elsevier announced plans to combine its UK and Dutch parent companies in an effort to simplify its corporate structure and "increase transparency" for shareholders, as it posted a rise in adjusted pretax profit for 2014. The company is transferring ownership of all of its businesses and its two listed parent companies Reed Elsevier PLC and Reed Elsevier NV into a new single group entity, named RELX Group PLC, although it will not change its brand or name for customer-facing products and business units. Reed Elsevier proposed a full-year dividend of 26.0 pence for 2014, up from 24.60 pence a year before.
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British American Tobacco reported a drop in 2014 profit in both current currency rates and at constant rates, while revenue grew at constant exchange rates, but was hit at the reported rate by the strength of sterling. The tobacco giant reported a pretax profit of GBP4.85 billion for 2014, down 16% at currency exchange rates, from GBP5.80 billion in 2013, after the group said it was hit by a non-tobacco litigation charge and adverse exchange movements on a translational and transactional level. The group declared a 4% increase in its total dividend per share for the year of 148.1 pence.
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CRH reported strong growth in operating profit for 2014, as a recovery in its US markets gained momentum and markets in Europe stabilised, and it predicted a strong 2015 as it looks to take advantage of falling commodity prices and further improvements in its markets. The Irish building materials company said it swung to a pretax profit of EUR761 million in 2014, compared with a loss of GBP215 million in 2013 when it had booked a EUR755 million impairment charge related to a review of its asset portfolio. Despite the return to earnings and margin growth, the company decided to keep its dividend for the year unchanged at EUR62.5 cents.
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Capita reported a strong increase in profit and revenue for 2014, driven by new contract wins and acquisitions, and said it had got off to an "excellent start in 2015, with new contract wins almost double the level they were this time last year. The outsourcing company reported a pretax profit of GBP292.4 million for 2014, up from GBP215.0 million in 2013, as revenue rose to GBP4.38 billion, from GBP3.90 billion. Its closely-watched pretax profit excluding exceptional items rose 13% to GBP535.7 million, from GBP475.0 million. It raised its total dividend for the year by 10% to 29.2 pence, from 26.5p in 2013.
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RSA Insurance Group marked a swing to pretax profit in its last financial year by resuming dividend payments, which had been put on hold as part of a broad restructuring aimed at getting the insurer back on track. RSA, which was hit by an accounting scandal in its Ireland operations in 2013, said it made a GBP60 million statutory pretax profit in 2014, compared with a GBP203 million pretax loss in the prior year. RSA said it will pay a 2 pence final dividend.
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Domino's Pizza Group said strong profit and revenue performance in its last financial year, driven by its UK business and successful meal-deal bundles, prompted a more than 10% increase in its dividend for the year, while it highlighted a confident outlook for the year ahead. The pizza delivery company said it served up more than 75 million pizzas during 2014. It declared a 10% increase in its total dividend for the year to 17.50 pence per share, as it reported a pretax profit of GBP53.8 million for the year to December 28, up from GBP21.6 million a year earlier.
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Shares in energy consultancy RPS Group rose after the company reported a rise in pretax profit in 2014 on the back of higher revenue and fee income and hiked its dividend payout. RPS shares were up 1.5% to 244.5 pence, one of the best performers in the FTSE 250, after the company said its pretax profit for the year to the end of December was GBP46.3 million, up from GBP43.6 million last year. Revenue rose to GBP572.1 million from GBP567.6 million in 2013, tracking a rise in fee income to GBP505 million from GBP492.1 million.
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Ladbrokes reported a hefty drop in its pretax profit for 2014, as shop closure costs and impairment charges more than offset revenue growth during the year, while the company said it is confident in its business outlook for 2015, as it plans to expand internationally, close more betting shops, improve its online offer, and bolster its competitive position. The betting company reported a statutory pretax profit of GBP37.7 million for 2014, down from GBP67.6 million in 2013. Revenue during 2014 grew by 4.5% on a statutory basis to GBP1.17 billion from GBP1.12 billion.
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Kitchens and joinery products company Howden Joinery Group's shares rose after the company reported higher pretax profit for 2014 on the back of strong revenue growth, and it hiked its dividend and launched a GBP70 million share buyback. FTSE 250-listed Howden reported a pretax profit of GBP188.8 million for the 52 weeks to December 27, up from GBP135 million a year earlier, as revenue rose to GBP1.09 billion, from GBP956.5 million.
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National Express Group reported higher pretax profit for 2014, even though the strong pound offset higher revenue and passenger numbers across its divisions, and it signalled a switch in strategy towards using more cash flow for investments, particularly in North America, rather than debt reduction. The company, reported a pretax profit of GBP66.5 million for 2014, up from GBP64.4 million in 2013, largely due to lower finance costs.
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Playtech reported a rise in adjusted profit for 2014 on the back of higher revenue, even as its pretax profit fell owing to a one-off gain made last year, and the group hiked its dividend as it said its strong performance has continued in early 2015. The gaming technology company said its adjusted pretax profit for the year to the end of December was EUR194.1 million, up from EUR151 million a year earlier. Its actual pretax profit fell to EUR143.6 million, down from EUR491.3 million owing to the EUR340.1 million gain it made last year from the sale of its investment in William Hill Online to William Hill. Revenue for the year was up 24% to EUR457 million.
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Derwent London reported higher profit, net asset value and total returns for 2014, and said it was confident about its markets in 2015 and beyond as the London property boom shows no sign of slowing. The property company reported an EPRA pretax profit of GBP62.3 million for 2014, up from GBP57.8 million in 2013, while its EPRA net asset value rose to 2,908 pence, from 2,264p. Its total return including dividends rose to 30.1%, from 21.9% in 2013. It said it would pay a final dividend of 28.00p for the year, bringing the total dividend to 39.65p, an 8.6% increase on 2013.
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Synthomer reported a fall in pretax profit on the back of lower sales in 2014 but raised its dividend payout by 30% as the group claimed it had performed well within challenging markets. Synthomer said its pretax profit for the year to the end of December was GBP86 million, down from GBP90.1 million last year. Its total sales for the year fell to GBP990.5 million, from GBP1.05 billion last year. The group said a positive first half in Europe was offset by weaker demand in the second half, though said it saw a year-on-year improvement in unit margins.
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Colt Group said its performance in 2014 "did not deliver what we set out to achieve", as it swung to a pretax loss mostly due to restructuring costs, but said it is starting 2015 with "reasonable momentum and focused organisation." The company posted a pretax loss of EUR23.1 million, compared with a pretax profit of EUR42.4 million in 2013, as revenue declined to EUR1.50 billion from EUR1.58 billion and it posted exceptional costs of EUR46.1 million.
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Premier Oil joined peers in the sector by slashing its planned expenditure and reporting large writedowns due to the slide in oil prices, and the company also suspended its full-year dividend payment for the same reason as it looks to preserve its balance sheet. The sector has been rapidly scaling back investment plans in the wake of the slide in oil prices, and Premier Oil is no exception. Premier said it has budgeted for "significant cost reductions" in 2015 by making savings in operating costs, reduced general and administrative spend, and the re-phasing of capital expenditure.
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Electra Private Equity said it has noted activist investor Sherborne Investors's statements late Wednesday renewing its efforts to influence matters at Electra, and confirmed its chairman has received a letter requesting a meeting. Electra Chairman Roger Yates has agreed to a meeting with Edward Bramson of Sherborne, although a date for this meeting has yet to be set.
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AIM Movers
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Lighthouse Group shares are up after it reported strong growth in operating earnings due mainly to cost cutting, confirmed its return to paying a dividend after a two-year hiatus, and gave a positive outlook thanks partly to workplace pension rule changes. Wentworth Resources is also up after it swung back to a profit as it reversed a previous impairment ahead of the start of production and free cash flow in 2015. Redde is another gainer after it more than doubled its profit in the first half of its financial year, on the back of strong revenue growth, prompting a near 20% increase in its interim dividend. Digital Barriers shares are down by a fifth after it warned it will post a wider-than-expected loss for the year to end-March 2015 after two contract awards were delayed, although it still expects to post a narrowed loss compared with the GBP12.0 million pretax loss it posted in the previous year.
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Other Top Economics And General
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The UK economy expanded as estimated in the fourth quarter, the second estimates published by the Office for National Statistics revealed. Gross domestic product grew 0.5% sequentially in the fourth quarter, in line with the estimate released on January 27. The rate of growth eased from 0.7% in the third quarter. In the fourth quarter, GDP was up 2.7% from last year, unrevised from the previous estimate. In 2014 as a whole, GDP advanced 2.6% from the prior year. The full-year growth figure was also left unrevised.
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The European Central Bank is ready to once again accept Greek government bonds as collateral for loans if the country proceeds with bailout-related reforms, ECB chief Mario Draghi said. Up until three weeks ago, Greece had enjoyed an ECB waiver that allowed its bonds to be accepted as collateral for loans even though they fell short of rating requirements. The central bank ended that exemption on February 11, amid uncertainty over whether Greece would continue with its bailout programme and associated reform requirements. The move forced Greek banks to turn to the ECB's more expensive emergency liquidity assistance. "The ECB had no choice other than lifting the waiver," Draghi said on Wednesday evening in a debate at the European Parliament, noting that a bailout programme has to be in place for the exemption to be granted.
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The ECB's quantitative easing will support economic activity and help to take inflation back towards the target of below, but close to, 2% over the medium term, Draghi told the European Parliament. "As in the case of the existing purchases of private sector securities, the purchases of public securities have a high transmission potential to the real economy," Draghi said. "We have already seen some positive effects of our measures." Financial conditions in money and bond markets throughout the currency bloc have eased further. Moreover, lending rates to households as well as firms decreased considerably and loan dynamics continued to recover, Draghi added.
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Germany's jobless rate remained unchanged at a record low in February, the Federal Labor Agency reported. The jobless rate came in at seasonally adjusted 6.5% in February, the same rate as seen in January and line with economists' expectations. The number of people out of work fell by 20,000, while economists forecast a decrease of 10,000. The labor market statistics from Destatis also showed that the jobless rate fell slightly to adjusted 4.7% in January from 4.8% in December.
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German consumer confidence is set to rise to its highest level since October 2001 as consumer optimism turned stronger underpinned by upward trend in economic expectations, data from a survey by market research group GfK showed.
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The number of unemployed people in France decreased over the previous month in January, data from the labour ministry showed. The number of people claiming unemployment benefits fell by 19,100 over the previous month to 3.48 million in January. This marked the first decline since August.
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US communications regulators are expected to vote Thursday for rules that would categorize the internet as a public utility, preventing internet providers from charging some websites for faster service or slowing or blocking others. The five members of the Federal Communications Commission are to vote on the proposal at a public meeting in Washington. It is widely expected to pass on party lines, with two Democratic commissioners joining Democratic FCC chairman Tom Wheeler to approve against opposition from two Republican commissioners, according to the New York Times.
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Afternoon Watchlist (all times in GMT)

13:30 US Consumer Price Index
13:30 US Durable Goods Orders
13:30 US Jobless Claims
14:00 US Housing Price Index
15:30 US EIA Natural Gas Storage change
16:00 US Kansas Fed manufacturing activity
18:00 US Fed's Lockhart speech
23:30 Japan National Consumer Price Index
23:30 Japan Overall Household Spending
23:30 Japan Unemployment Rate
23:50 Japan Industrial Production
23:50 Japan Retail Trade
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Friday's Key UK Corporate Events

UBM - Full Year Results
Berendsen - Full Year Results
International Consolidated Airlines Group - Full Year Results
Lloyds Banking Group - Full Year Results
Old Mutual - Full Year Results
Pearson - Half Year Results
Pan African Resources - Full Year Results
IMI - Full Year Results
William Hill - Full Year Results
INTU Properties - Full Year Results
Rightmove - Full Year Results
Waterman Group - Half Year Results
Harvey Nash Group - Trading Update
Ricardo - Half Year Results
Restaurant Group - Full Year Results
Rentokil Initial - Full Year Results
Mysale Group - Full Year Results
Spectris - Full Year Results
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Friday's Key Economic Events (all times in GMT)

00:05 UK Gfk Consumer Confidence
04:00 Japan Vehicle Production
05:00 US FOMC Member Mester speech
05:00 Japan Housing Start
05:00 Japan Construction Orders
07:00 Germany Import Price Index
07:45 France Consumer Spending
07:45 France Producer Prices
09:30 UK Index of Services
10:00 Italy Consumer Price Index
13:00 Germany Consumer Price Index -0.50%
13:30 US Gross Domestic Product
14:45 US Chicago Purchasing Managers' Index
15:00 US Pending Home Sales
15:00 US Reuters/Michigan Consumer Sentiment Index
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