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This is Business Live from BBC News
with Ben Thompson and Sally Bundock.
Europe's biggest bank scores
a huge hike in profits.
So has HSBC finally put
its troubles behind it?
Live from London, that's our top
story on Tuesday 20th of February.
HSBC has paid a string
of fines for misconduct,
ranging from rigging exchange rates
to money laundering.
Now it's hoping for a fresh
start as it gets ready
for a change of leadership.
Also in the programme...
Britain's Brexit Minister
is about to address business
leaders in Austria -
he says there'll be no Mad Max-style
rush to deregulation
after leaving the EU.
Markets in Europe have started
trading, they are all headed higher
for now. We will talk you through
the winners and losers.
Savile Row is world-renowned
for its razor sharp
suits and classic style.
But in a world of fast fashion
how do the traditional
firms stay relevant?
We'll meet one man
on a mission to do just that.
And, as Uber's boss says flying cabs
will be commercially viable
in five to ten years,
we want to know -
would you hail a flying taxi?
Let us know - use the
Hello and welcome to Business Live.
As usual, it is jam-packed. Let's
Europe's biggest bank HSBC
has reported a big jump
in profits for last year.
But it's mainly because it's been
able to shake-off the huge costs
the company has faced
in restructuring after
a string of problems.
It means there will be a strong base
to build on when the new chief
executive John Flint takes
the reigns from Stuart
Guillver on Wednesday.
The numbers show that HSBC made
a pre-tax profit of $17.2 billion
for the calendar year of 2017.
That's up a massive 141%.
However it's still
HSBC says adjusted pre-tax profit
of $21 billion gives
a better idea of how
the business is performing.
It excludes one-off items
and foreign exchange losses
and was up 11% on a year ago.
The banks desire to focus
more on Asia, including
expanding in China,
is paying off too with 75% of
profits now coming from the region.
With me is Peter Hahn,
a professor of banking
at the London Institute
of Banking and Finance.
Nice to see you. Let's look at the
figures, there is a lot of business.
They are the last from Mr Gulliver.
He has had it up job to try to turn
around the fortunes of the bank?
Yes, and the story started long
before his tenure. In 1998 there was
an emerging markets crisis, 20 years
ago. HSBC to the strategic decision
to really invest in the Americas, in
Europe, not a share. It missed the
point. -- the Americas and Europe,
not Asia. Since 2011 the decision
has been reversed, the bank has gone
back to its roots and found success
back in Hong Kong, Shanghai, it
shows you where the story is
The emerging markets
where the biggest potential returns
are, equally where many of the
biggest risks are. Some would say it
is a risky strategy focusing on some
of these markets, nonetheless one
that will pay dividends if they get
I do not know if it is
more risky. Emerging markets are not
all the same. HSBC, if I invest in
HSBC today I am investing in an Asia
story. Looking where the profits
came from it is almost 90% of their
profits came from Asia. If you
invest in shallow oil today, you are
betting in the long term on the use
of oil and the price of oil over
time. -- if you invest in Shah oil.
If you invest in HSBC, it is an Asia
story with others.
Mr Gulliver said
HSBC is a simpler, stronger and more
secure bank than in 2011. Is that
Yes. They exited perhaps more
than 20 countries during that time,
substantially underperforming in
Brazil. He has beefed up in China
and it has done a lot better. There
is still work to be done. You
mentioned the litigation issues that
came up, it does not seem as many
major ones. Like many other bank
reports I read there are still
several pages of outstanding
litigation faced by HSBC.
to get on but time is tight. Thank
you, Peter, as always.
Let's take a look at some of
the other stories making the news.
Hundreds of Kentucky fried chicken
restaurant in the UK remain closed.
They have been struggling to get
supplies since the delivery contract
with switch. Staff are encouraged to
take holidays but are not being
forced to do that.
An astonishing story.
The world's biggest mining comapny
BHP Billiton says profits were up
25% in the six months
to the end of December.
hit just over $4bn.
Its chief executive says
the Australian firm was helped
by strong commodity prices and saw
returns on its investment
in new technology to
It also increased its
dividend to shareholders.
The boss of Uber, the ride hailing
app, has said he see flying taxis
as being commercially viable in five
to ten years.
Dara Khosrowshahi was speaking
at an investor forum in Tokyo.
Back in November Uber said
it was working with Nasa to develop
the technology but some experts have
questioned whether it
will ever get off the ground.
I see what you did there!
The social media giant Facebook says
it's to send postcards in the US
mail in order to verify the location
of people requesting to buy adverts
for US election candidates.
Yes, snail mail!
The postcard would contain a code
which would be required
to complete the booking.
13 Russians have been charged
with interfering in the 2016
The indictment says they bought
political advertising and set-up
groups on social media
sites including Facebook.
I think that is astonishing that a
technology firm has to resort to
using snail mail, oppose cuts
through the mail.
Sometimes you cannot live without
the oldest tech.
Snail mail to verify someone's
location? All those apps and
technology and kit.
I love a real letter. You would
waste of the -- wait for the
Canada's Prime Minister Justin
Trudeau is on a visit to India.
And, despite speculation that he's
being given the cold shoulder
by the Indian government,
he's set to meet business leaders
in Mumbai in less than an hour.
Suranjana Tewari is in our
business hub in Mumbai.
Good to see you. Tell us a bit more
about his day, who he is meeting
with and how significant this is?
are not expecting any major
announcements from today, but Prime
Minister Justin Trudeau has been
meeting CEOs of prominent Indian
companies like Tata, Mahindra etc.
He will be meeting Indian business
leaders later. Representatives from
around 150 Canadian companies are
here to try to expand their business
all-star joint ventures with Indian
firms. Reminisced Trudeau is
expected to make some announcements
on what he wants Canada to do in
India, business and investment wise.
India and Canada already have a
strong trade relationship, around $8
billion worth of bilateral trade,
particularly in the agriculture
sector. Canada imports are lots of
beans and lentils into India. Canada
is a little worried about import
duties that India has put onto
Canada recently, about 40% import
duty. They will look for reassurance
that aren't some investment in
Thank you for
that, an interesting trip for Justin
Trudeau, I am sure.
That show you the financial markets.
Wall Street was closed on Monday and
will reopen today. So this is
Friday's end to a bumper week for
Wall Street. Because these markets
reopen today for the first end this
week there is a bit of treading
water in Europe, to a degree. HSBC
shares down in London when I last
look, I hope they will move on. HSBC
shares in Hong Kong, they were
trading earlier today, down over 3%
after the announcement of their
earnings. We will bring you the
European members a bit later,
hopefully on the screen. For now,
let's talk about Brexit Secretary
David Davis. He is to insist Britain
will not be plunged into what he
describes as a Mad Max style world
after it leaves the European Union.
In a speech to business leaders
in Austria this morning,
Mr Davis will also reject the idea
that Brexit will lead to a "race
to the bottom" in workers' rights
and environmental standards.
Bethany Bell is in Vienna.
Outside the building where this is
all happening very soon, Bethany. It
looks extremely cold where you are.
Tell us a bit about the reception he
will receive, will it be warm or
I think the entrepreneurs will
be gathering in the house of
industry right behind me when they
can get their way through the snow.
They will be listening very hard to
what he has to say. No one wants bad
relations with Britain after Brexit,
but they are very interested to hear
what it is exactly that Britain
wants. People here say there is not
clarity yet. David Davis will say
that he wants to continue to see
close cooperation when it comes to
regulation, that there will not be
this race to the bottom, as he calls
it. He hopes that will ensure
frictionless trade with the EU after
Brexit. There has not been an
official Austrian response so far to
his planche remarks, -- planned
remarks, but one analyst suggested
he will have questions which are if
you want to see things the same, why
are you leaving the EU in the first
Many are asking that
question, and others. Thank you,
Joining us is Trevor Greetham,
head of multi-asset
at Royal London Asset Management.
Good morning. Staying with that
theme, investors will be looking at
this meeting very closely to see
what is discussed, and sterling
particularly, we will see a reaction
What is interesting is the
volatility of sterling, it is quite
high. It is not like it is moving
around very much, but if you want to
protect the portfolio against a
swing one or the other way, the cost
of that is one of the highest since
we have seen since the Brexit
referendum. There is a lot at stake
in deciding the UK position, is it
credible, will we end up in
something similar to the EU or crash
out without any deal?
The impact of
currency movement is quite crucial.
HSBC have said look at this
preferred number, it excludes the
currency movement to give you a
better impression of how companies
It can be mastered in the
UK, about 70 or 80% of the stock
market is overseas earnings. -- it
can be massive in the UK.
It is a
busy week as far as results are
concerned, less economic data?
Everybody's watching screens, the
stock market. The Dow Jones rose
almost two dozen points in a week
last week, the biggest percentage
increase in it week in five years.
You might be tempted to say that
means we have the all clear and
everything is fine, but the big
moves in stock markets happen when
they are volatile. You could get a
big move down this week easily. The
fundamentals are positive, a tug of
war is going on between strong
earnings, a tax cut in America and
rising interest rates. Interest
rates are low in America, housing
has not slowed down and the big
central banks in Europe are printing
money. It feels like the stock
market bull market has not finished
but we could see short-term
volatility as people get to grips
with this tug-of-war.
Lots of speed
bumps. Seat belts on. Trevor will be
back later to talk this through the
Still to come...
In a world of fast fashion,
is there still space
for traditional tailors?
We meet one of the Savile Row
stalwarts who says it's got
a new lease of life.
You're with Business
Live from BBC News.
Betting firm William Hill has been
hit with a £6.2 million penalty
package for breaching anti-money
laundering and social
Sean Farrington has been
looking at the details,
he's in our Salford newsroom.
What have they been doing?
they been doing? The Gambling
Commission, the regulator looking at
this, has used pretty strong words,
systemic issues. It means it is not
just one or two micro people, this
is the structure of the company not
assisting the anti-money-laundering
practices and executing social
responsibility how they should. One
problem was the gambling commission
found that ten customers were able
to use money found from criminal
proceeds to put through William Hill
accounts, which ended up with
William Hill making £1.2 million in
profit on the back of our cash. So
part of the £6.2 million is to pay
back the £1.2 million, £5 million is
a fine linked to breaching
regulations put in place. Some
extraordinary examples being given
by the Gambling Commission, one of
simply placing more than half £1
million over these accounts over the
period of a year or more.
William Hill having a verbal
conversation at assuming they are
earning more than £300,000, the
customer, thinking they could afford
it. It turned out they earned
£30,000 a year and was stealing from
their employer. So part of these
proceeds could be to reimburse
people who suffered from the
criminal act that took place. The
Gambling Commission told us this
morning this could possibly be a
much wider issue. They do not expect
this to be the last decision they
had to make on this scale when it
comes to the gambling industry and
social responsibility and dealing
Thank you, Sean. Thank
you for the detail on William Hill.
More news on the KFC saga that they
have run out of chicken. A
procurement expert has been speaking
with us. And views from
Intercontinental group, 7% rise in
profits, launching a new brand.
Speaking with the chief Executive,
earlier, he is talking about lots of
new expansion plans,
Intercontinental hotels group
benefited a lot from the tax changes
in the US.
You're watching Business Live,
our top story,
HSBC, Europe's biggest bank,
has seen pre tax profits soar
by 141% to more than $17 billion.
Seventy per cent of that came
from its operations in Asia.
They have called that a pivot to
Only half of new firms in the US
make it through the first five years
of business intact so what's
the secret to a company
becoming a long-term success?
Henry Poole & Co has been
running for centuries.
Setup in 1806 it's been credited
as being the founding tailor
of Savile Row here in London.
One its most famous clients
was Winston Churchill,
who bought his first suit
from the company in 1906.
But it's also a company
with a firm eye on the future,
in 2006 it setup a made to measure
store in Beijing,
to take advantage of
the growing market in Asia.
of prestigious tailoring
business, Henry Poole & Co.
Good morning, you have brought in
all sorts of bits and pieces, we
will talk about these, you have been
around, not you, personally, but you
have been around a while, 1806. And
it is still a family business.
enough to be a family business, very
much credited to generations of
family that have run it and kept it
very much for the next generation,
that is the key element, train
within the house, bring in the next
group of tailors and cutters that
make the company.
Let's wallow in
the history for a little bit, really
amazing, you have brought in this
ledger, it is really heavy, I'm
going to try to show this to the
viewers, basically... This is the
first major book?
1846, he was a
very clever gentleman, his father
was a cloth merchant, but Henry
Poole became a cutter and a bit of a
dandy and a socialite, people like
Prince Bertie and Napoleon, came to
him in 1846...
His measurements are
in here. All handwritten. Plenty in
here. What do these numbers tell us,
not only about the way we have
changed, people getting taller and
wider, but interesting insight into
their lives, when they have been
back a couple of times.
absolutely, it is a little club, the
aspects of business, very much part
of this history line which goes
through the years.
And just to say
as well, the cost of a suit, a sort
of remained the same in terms of
relative to peoples income, looking
at one month 's salary, roughly, to
buy one of your suits.
the situation of choosing fabrics,
we have 4000 fabrics, seasonal,
travel, business, you name it, we
can sell it, then we go through
styling, we go through the fittings
with you, it is all about 70 hours
to make a suit.
It is a classic
suit, normally, because men will
wear these for ten years.
I immediately assumed they
change its shape in that time.
yes, we do alterations.
things in place.
It comes with four
inches of extra fabric, so the
allowance of winter weight and some
weight, if call it that, the
prosperous years, shall we say, that
is what we do, we let it out, and
some people have a two set wardrobe,
one for summer, one for winter.
suits that you make, never
particularly in fashion so they
never go out of fashion, that is the
sign of a classic suit. A lot of
pressure with fast fashion that you
will do something that is
particularly in vogue, but you don't
Complete cycle wheel that
we go through fashion, pendulum
swings between the Pell width,
height of button, these things
always change. -- lapel width.
shoes, they do not look several
wrote to me, they look very modern,
he teamed up with Adidas for this.
bit of fun, one customer is with
Adidas, and... We make a few suits,
named after people, one of them is
the Winston Churchill, but he loved
the fabric so much he said, we
should do something special, we came
up with the idea of a commute issue
and evening shoot...
That is how you
know this was made in Savile row.
evening suit. About £150, but
because they are collectors item,
limited-edition, their value has
trebled. As a business point of
view, good investment.
Quick word on
skills, this is a family business,
so many pressures, fabric is made in
the UK, you make these suits, you do
not send them somewhere else, you
have to retain the skills. How
difficult is it to get people who
can make a good suit?
About 15 years
ago it was very difficult to find
people who would be interested in
the business, with the situation of
skills and craft, a lot of
manufacturers realise they can train
within, within the automotive,
within the jewellery or clothing, if
you train your craft, you have to
train within. Last ten years, very
successful, full programme now, now
the average age is 40 years old.
Absolutely fascinating, thank you
very much for coming in. We could
talk for a long time.
120 of them!
Interesting comparing height and
width, and they come back the second
time and they have got a bit wider!
Richard Branson is in India, let's
see what talking about.
be in a Sayers at the start of any
new industry and they are right to
be naysayers until we have proven
wrong. The outside of it is
gigantic. -- upside. Trains made a
big difference to India in the last
century, I believe that hide the
loop will be a giant step forward
that India needs. It can connect
most of the major cities in India in
well under two hours and the cost of
building it will be private money.
-- hyperloop. The cost to the
passenger of travelling on a Virgin
hyperloop will be competitive with
any high-speed train. We think we
can build it for a lot less then you
can build a high-speed train. And
therefore we should be able to
Richard Branson with
ambitions for virgin hyperloop one.
This story, the new boss of Uber,
relatively new, saying that it is
commercially viable, flying taxes,
five to ten years, would you climb
Probably but I have a bad habit of
ordering a taxi and saying, five
minutes, ten minutes... Will they be
hovering around my rooftop?
viewer says, yes, glad to use one if
safety is guaranteed and cost is
friendly. Sean says the same,
depends upon the safety. Can you
tell me how to hail one, says one.
Chris says, no. Peter says, at a
nonsense. Hot debate going on. What
else is going on? Brexit,
interesting story in the FT,
campaigners to stop Brexit preparing
a six-week advertising blitz.
group partly funded by George Soros,
but also a crowdfunding arrangement,
and he will step up advertising over
the next six weeks, head of the vote
for the customs union and he will
already have people working on Mad
Max and David Davis's head, at Best
for British, I can see this
happening. Key votes are coming up.
The political party launch, Renew,
people focusing on this, we will
hear more and more about it.
tight, really good to see you. Thank
you for explaining the market
movements. Thank you for your
company, we hope you enjoyed the
programme and we will be here