Lloyds Share News (LLOY)

On Tuesday evening the Co-op decided on a revamp of its governance structure to a two-tier system. There will be one group resembling the top of a public company which will in turn report to a more traditional Co-op-style board of members. The change will be voted on May 17th by the group's regional boards and independent societies. That follows the resignation of its reform-minded Chief Executive, which branded the company as ungovernable. He will be replaced by former Morrison Finance Director Richard Pennycook, The Times says. Just as the house buying season is due to begin and millions of Britons are deciding where to invest this year's Isa savings, Bank Governor Carney told a parliamentary committee that interest rates may rise six-fold by 2017. In parallel, mortgage rates may increase to 6%. That means homebuyers will have to analyse whether they would still be able to afford their loans when borrowing costs increase. That is exactly what the Bank is doing now, carrying out more research into just how many people are "most vulnerable" to higher rates, The Daily Telegraph reports. The world's largest non-bank foreign exchange business, Travelex, is considering a stockmarket flotation. Over the last year the company saw underlying profits rise by no less than 21% thanks to the rise of the middle classes in markets such as China and India and growing international travel. Helping that trend along is the increasing use of smartphones to obtain cash before trips. No indication was given regarding the possible timing of the initial public offering or on whether a sale of the group might be an alternative option, writes The Daily Express. Responding to renewed criticism from the Treasury Select Committee that the Bank of England's governance was "opaque, complex and byzantine" Governor Carney announced that the central bank will soon announce a strategic review of its governance systems. That comes as he was forced to admit that allegations of rigging in foreign exchange markets could prove to be a bigger scandal than the manipulation of LIBOR. The aim of the above reforms is to reinforce compliance and make staff more accountable. Carney will also create the post of a fourth deputy governor, The Guardian writes. A damning report from the Office of Fair Trading (OFT) says that there may be competition concerns in the market for alternative funding to small and medium-sized enterprises (SMEs). The OFT report says that banks may be hindering SMEs access to such lenders. The soon-to-be-created Competition and Markets Authority will decide by autumn if there is a need for a full investigation into this segment of the market, according to The Times. Lloyds' decision to water down pension benefits for about 35,000 employees - a third of its staff - by £1bn has sparked their ire. That amounts to a cut to their lifetime pensions of about £29,000 in terms of today's money. In exchange, they have been offered a payment of 3% of their pensionable pay, on average that works out to about £880 for each member of staff. As well, the cap on pensionable pay has been reduced from 2% to 0%, The Times says. AB