:00:00. > :00:08.Now for the latest financial news with Aaron And World Business
:00:09. > :00:13.-- here is everything you need to know about the world of finance.
:00:14. > :00:19.The British government sits down with the UK's biggest lenders
:00:20. > :00:27.And all of this while Italy's government gets set to break EU
:00:28. > :00:37.rules and use taxpayer money to prop up its own banks.
:00:38. > :00:44.Indian efforts to stop people stuffing cash under their mattress -
:00:45. > :00:55.we look at the difficulty in spreading banking in remote areas.
:00:56. > :00:59.Good morning, Britain. Hello, world. This right here is a fascinating and
:01:00. > :01:03.exciting snapshot of the latest in the world of business and money -
:01:04. > :01:06.stuff that matters. Let's start with global markets.
:01:07. > :01:08.They now less rattled by the UK's decision to leave
:01:09. > :01:15.the European Union, all eyes are now focussing on the banking sector.
:01:16. > :01:18.If we look across over to the continent.
:01:19. > :01:21.Italian banks share price have hit record lows over concerns the main
:01:22. > :01:23.banks will be under pressure to boost their capital reserves
:01:24. > :01:38.Also today, UK Chancellor George Osborne is expected to meet heads
:01:39. > :01:41.of major banks in Britain to discuss how the country should respond
:01:42. > :01:46.to the decision to leave the European Union.
:01:47. > :01:49.OK, let's get more from all of this, or on all of this.
:01:50. > :01:51.With me is Peter Hahn, Professor of Banking
:01:52. > :01:53.at the London Institute of Banking and Finance.
:01:54. > :01:59.A fairly face to us all. It is great to have you on the programme. Thanks
:02:00. > :02:04.for in at this time! Let's play a little game. You are the Chancellor.
:02:05. > :02:16.I've given you that provision. You are George Osborne. I am the banks.
:02:17. > :02:20.What are you going to say to me? It is called jaw moving. Everybody's
:02:21. > :02:25.jaw moves a lot but it is really saying don't panic, carry on, don't
:02:26. > :02:31.get us into a spiral of withdrawing credit to exaggerate the
:02:32. > :02:33.recessionary environment, but banks will make their own decisions,
:02:34. > :02:38.assessing the risks, which are changing. And unfortunately, it's
:02:39. > :02:45.just more uncertainty, as mentioned earlier. Can the banks have that
:02:46. > :02:49.control? They're gonna say to George Osborne, especially after some
:02:50. > :02:53.drinks at this meeting, who are you kidding, how can we hold the title
:02:54. > :02:59.of being the financial hub of the world, let's be frank, certainly of
:03:00. > :03:03.Europe, if we're not in Europe? Well, there are two things going on.
:03:04. > :03:08.One is what is the future of the industry? Its access to Europe. The
:03:09. > :03:14.other side is recessionary Britain. Will we go into recession? Do they
:03:15. > :03:22.continue to dance credit? We've got an environment where we are changing
:03:23. > :03:26.government. -- credit. We are changing these laws. We don't know
:03:27. > :03:30.where this will be, this relationship, creating uncertainty
:03:31. > :03:35.about investment, people will be uncertain about jobs and banks will
:03:36. > :03:38.have to take caution on lending. They withdraw lending, all of a
:03:39. > :03:41.sudden confidence goes and you can almost create their recession
:03:42. > :03:48.without having to... Switching gears to Italy now. That would be and I
:03:49. > :03:53.think, wouldn't it? What's wrong with Italian banks? The
:03:54. > :03:59.old-fashioned story, lots of bad loans. Lots of bad loans, and their
:04:00. > :04:04.regulator, a European regulator, said they had to get rid of them.
:04:05. > :04:08.Sell them off, write them off, get rid of them, which forces Italian
:04:09. > :04:17.banks to take losses. Who is going to take the loss, will it be
:04:18. > :04:22.shareholders? Yes, and it could be bondholders. In Italy, bondholders
:04:23. > :04:27.are often also depositors. So, we're looking at the losses potentially on
:04:28. > :04:32.these loans affecting the normal deposit. Just briefly, I've got to
:04:33. > :04:36.wrap up and are not listening to them, there is a problem because it
:04:37. > :04:40.seems the government, the Prime Minister, wants to step in and use
:04:41. > :04:44.taxpayer money, talking about debtholders, that will really annoy
:04:45. > :04:48.the Germans and Brussels. They are saying it is against the rules.
:04:49. > :04:57.There is a simple rule in Europe, you've got to have a percent losses
:04:58. > :05:02.-- 8% losses on your existing ballot sheet -- balance sheet before
:05:03. > :05:08.getting government assistance. That will violate the European rules and
:05:09. > :05:12.they've just been set up. Unfortunately the problem is Italian
:05:13. > :05:17.banks didn't have enough institutional bondholders that were
:05:18. > :05:23.assumed for whom the rules were created. It sounds complicated. We
:05:24. > :05:24.appreciate it, thank you very much my friend. Let's talk about
:05:25. > :05:29.Bangladesh's huge garment industry is reeling after Friday's deadly
:05:30. > :05:34.Islamist attack, in which 20 people were killed.
:05:35. > :05:36.And foreign clothing companies are reviewing their investments.
:05:37. > :05:38.Uniqlo, which is based in Japan, says it's suspending
:05:39. > :05:40.all but essential travel to the country.
:05:41. > :05:46.Rico Hizon in our Singapore bureau has more.
:05:47. > :05:57.It is great to see you. Hey, this is the last thing Bangladesh needs,
:05:58. > :05:59.certainly its economy. This garment industry is pretty much the
:06:00. > :06:06.majority, isn't it, on how the country in? It is the
:06:07. > :06:11.bread-and-butter of the economy, Aaron, and the south Asian economy
:06:12. > :06:16.is now feeling the fallout from this terror attack on Friday. And apart
:06:17. > :06:21.from Uniqlo you have other companies like Mitsubishi motors reportedly
:06:22. > :06:27.advising workers to avoid travelling to the country this month. You have
:06:28. > :06:32.some 240 Japanese firms operating in the country. And Uniqlo has told its
:06:33. > :06:37.staff to stay at home. As you mentioned, it is a major production
:06:38. > :06:43.centre for retailers, including the likes of Marks Spencer and Dap and
:06:44. > :06:45.analysts are warning that other brands could consider shifting out
:06:46. > :06:53.production from Bangladesh into other less unsettled, more peaceful
:06:54. > :06:58.countries like Cambodia and Sri Lanka -- Gap. Some figures onto how
:06:59. > :07:03.important this is to the company - it is the second biggest supplier of
:07:04. > :07:06.clothes behind China. The garment industry is worth around $26
:07:07. > :07:11.billion, or ?20 billion, and accounts for around 80% of the
:07:12. > :07:15.exports in the country and millions of jobs. Let's hope these major
:07:16. > :07:20.multinational retailers don't leave. What's important right now for
:07:21. > :07:28.Bangladesh is security and peace and order. Indeed. Nicely said. We will
:07:29. > :07:36.talk to you soon, mate. Thank you. Stating kind of in the Asian region.
:07:37. > :07:40.India is the second most populated country on the planet and fewer than
:07:41. > :07:48.half have a bank account. That is something the government wants to
:07:49. > :07:55.change. Setting up simple banking services is proving difficult. Our
:07:56. > :07:58.correspondent reports. A typical bank branch in a typical Indian
:07:59. > :08:04.village but while it is quite basic at least these villages have a bank.
:08:05. > :08:07.More than 800 million people live in India's countryside and many don't
:08:08. > :08:10.have anywhere nearby to put their cash -- villagers. So, little wonder
:08:11. > :08:17.many don't have bank accounts at all. So, how to change that? Firms
:08:18. > :08:21.are being given the chance to open simple banks where customers can
:08:22. > :08:25.save and withdraw money or pay bills but not get loans or have credit
:08:26. > :08:29.cards. Instead of building traditional branches like these they
:08:30. > :08:35.will reach people through kiosks and mobile phones, which should help
:08:36. > :08:39.people get into the system. It is not going to plan. 11 non- finance
:08:40. > :08:40.specialist companies have been given licence to run these banks but
:08:41. > :08:54.already three have pulled out. All have decided that the scheme
:08:55. > :09:03.doesn't make business sense. That's frustrating for firms like Pay Point
:09:04. > :09:09.India whose application was rejected. It says the criteria was
:09:10. > :09:12.too narrow. There are companies involved in financial inclusion
:09:13. > :09:17.project that should have been part of this. The companies which were
:09:18. > :09:20.granted licence, they lacked customer understanding. The only
:09:21. > :09:27.difference between people who didn't get it and people who were offered
:09:28. > :09:31.is network vis-a-vis net worth. The reserve bank of India has defended
:09:32. > :09:37.the selection. He said he was unhappy with companies dropping out.
:09:38. > :09:43.We gave out licenses to anybody we thought had the appropriate
:09:44. > :09:47.qualifications to run a payment bank. Therefore when you go forward,
:09:48. > :09:52.do a proper assessment, don't just go for a licence because it is a
:09:53. > :09:57.valuable property to have, but instead to the due diligence on your
:09:58. > :10:02.own and when you apply it should be with the intent of fully carrying it
:10:03. > :10:05.out. Barring more upsets the first payment bank will launch in August
:10:06. > :10:09.with the rest opening over the next year but it will take time to gauge
:10:10. > :10:16.if India's ambition of financial inclusion is on the right path. OK,
:10:17. > :10:25.I've got to leave you with this. Talking about the legendary
:10:26. > :10:34.competitive ETA. This man ate down 70 hotdogs in ten minutes on Monday,
:10:35. > :10:39.reclaiming his crown at the Nathan's Hotdog Eating Contest, marking a
:10:40. > :10:50.return to form. Last year he saw his winning streak Rogan by Matt" mega
:10:51. > :10:53.toad". I am not making it up. And this woman chew down 38.5 hotdogs.
:10:54. > :10:56.Don't forget you can get in touch with me and some
:10:57. > :11:06.I will be back with Adnan to take a look at the papers, tata.
:11:07. > :11:09.Thousands of pupils in England could be affected by a teachers