Companies in the news ... and how they were assessed
Barclays: so long, SFO?
Has the Barclays eagle finally landed on better times? For shareholders keen to see an end to the bank’s legal difficulties, there was good news this week, said Oliver Gill in City AM. Barclays “celebrated a significant victory” over the Serious Fraud Office (SFO) after the Crown Court threw out fraud charges relating to an £11.8bn emergency cash call, which was largely bankrolled by Qatar, made at the height of the 2008 financial crisis. The SFO had alleged that the deal, which saved Barclays from a government bailout, had been oiled by a £2.2bn loan made to Qatari investors: that it was essentially lending to buy shares in itself, which is unlawful. The case was seen by many City analysts as the bank’s “most challenging legacy issue” now that CEO Jes Staley’s whistleblowing fiasco, and US claims of toxic mortgage mis-selling, have been settled. But Barclays isn’t out of the woods yet, said Iain Withers in The Daily Telegraph. The SFO may bring new charges, this time in the High Court; while several regulatory probes and a $1bn civil suit brought by financier Amanda Staveley are still ongoing. Perhaps most significantly, “the battle is only just beginning” for four senior execs, including former CEO John Varley, who could face jail if convicted of fraud charges. “A potentially explosive trial is on the cards for next January, even if Barclays the company isn’t in the dock.”
Kushner/at&t/novartis: down in the swamp
Qatari cash is still a handy commodity in times of trouble. And it’s proving useful for President Trump’s son-in-law, said Eliza Relman on Business Insider. Having come close to grief after its “reckless” $1.8bn purchase of a 41-storey tower in Manhattan, Kushner Companies – the real estate firm owned by Ivanka Trump’s husband Jared Kushner and his father, Charles – is reportedly close to securing a bailout from Brookfield Properties, an investment house with close links to the Qatari government. If the deal is finalised, it will raise new concerns about Jared Kushner’s “potential conflicts of interest”. Despite losing his “top-secret security clearance” in February, he remains a “White House lead on Middle East policy”. The deal also coincides with reports that the president’s personal lawyer, Michael Cohen, “solicited $1m” from the Qatari government in late 2016 “for access and insight” into the Trump administration. Earlier this month, AT&T and Swiss pharma Novartis confirmed that they too had paid Cohen ($600,000 and $1.2m respectively) for similar insights, said the FT. “Trump came to office vowing to drain the swamp.” In fact, it is “enjoying something of a golden age”.
Ryanair: the profits of disharmony
“Ryanair cancelled thousands of flights last year” and generated “an above-average level of bad publicity, even by its own standards”, said Nils Pratley in The Guardian. “The financial effect of the disharmony? Roughly zero”: the airline’s after-tax profits rose 10% to s1.45bn for the full year. Despite Ryanair’s “resilience”, CEO Michael O’leary said he was on the “pessimistic side of cautious” about this year because of rising fuel and salary costs. But his version of pessimism “doesn’t look so awful”: profits are still expected to arrive at between s1.25bn to s1.35bn. Indeed, arguably “the most eyecatching development” in this week’s statement was the famously gouging Ryanair’s new habit of referring to passengers as “guests”. Maybe another of O’leary’s “little jokes”.