Browse content similar to 05/07/2016. Check below for episodes and series from the same categories and more!
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Now for the latest financial news with Aaron And World Business | :00:00. | :00:08. | |
-- here is everything you need to know about the world of finance. | :00:09. | :00:13. | |
The British government sits down with the UK's biggest lenders | :00:14. | :00:19. | |
And all of this while Italy's government gets set to break EU | :00:20. | :00:27. | |
rules and use taxpayer money to prop up its own banks. | :00:28. | :00:37. | |
Indian efforts to stop people stuffing cash under their mattress - | :00:38. | :00:44. | |
we look at the difficulty in spreading banking in remote areas. | :00:45. | :00:55. | |
Good morning, Britain. Hello, world. This right here is a fascinating and | :00:56. | :00:59. | |
exciting snapshot of the latest in the world of business and money - | :01:00. | :01:03. | |
stuff that matters. Let's start with global markets. | :01:04. | :01:06. | |
They now less rattled by the UK's decision to leave | :01:07. | :01:08. | |
the European Union, all eyes are now focussing on the banking sector. | :01:09. | :01:15. | |
If we look across over to the continent. | :01:16. | :01:18. | |
Italian banks share price have hit record lows over concerns the main | :01:19. | :01:21. | |
banks will be under pressure to boost their capital reserves | :01:22. | :01:23. | |
Also today, UK Chancellor George Osborne is expected to meet heads | :01:24. | :01:38. | |
of major banks in Britain to discuss how the country should respond | :01:39. | :01:41. | |
to the decision to leave the European Union. | :01:42. | :01:46. | |
OK, let's get more from all of this, or on all of this. | :01:47. | :01:49. | |
With me is Peter Hahn, Professor of Banking | :01:50. | :01:51. | |
at the London Institute of Banking and Finance. | :01:52. | :01:53. | |
A fairly face to us all. It is great to have you on the programme. Thanks | :01:54. | :01:59. | |
for in at this time! Let's play a little game. You are the Chancellor. | :02:00. | :02:04. | |
I've given you that provision. You are George Osborne. I am the banks. | :02:05. | :02:16. | |
What are you going to say to me? It is called jaw moving. Everybody's | :02:17. | :02:20. | |
jaw moves a lot but it is really saying don't panic, carry on, don't | :02:21. | :02:25. | |
get us into a spiral of withdrawing credit to exaggerate the | :02:26. | :02:31. | |
recessionary environment, but banks will make their own decisions, | :02:32. | :02:33. | |
assessing the risks, which are changing. And unfortunately, it's | :02:34. | :02:38. | |
just more uncertainty, as mentioned earlier. Can the banks have that | :02:39. | :02:45. | |
control? They're gonna say to George Osborne, especially after some | :02:46. | :02:49. | |
drinks at this meeting, who are you kidding, how can we hold the title | :02:50. | :02:53. | |
of being the financial hub of the world, let's be frank, certainly of | :02:54. | :02:59. | |
Europe, if we're not in Europe? Well, there are two things going on. | :03:00. | :03:03. | |
One is what is the future of the industry? Its access to Europe. The | :03:04. | :03:08. | |
other side is recessionary Britain. Will we go into recession? Do they | :03:09. | :03:14. | |
continue to dance credit? We've got an environment where we are changing | :03:15. | :03:22. | |
government. -- credit. We are changing these laws. We don't know | :03:23. | :03:26. | |
where this will be, this relationship, creating uncertainty | :03:27. | :03:30. | |
about investment, people will be uncertain about jobs and banks will | :03:31. | :03:35. | |
have to take caution on lending. They withdraw lending, all of a | :03:36. | :03:38. | |
sudden confidence goes and you can almost create their recession | :03:39. | :03:41. | |
without having to... Switching gears to Italy now. That would be and I | :03:42. | :03:48. | |
think, wouldn't it? What's wrong with Italian banks? The | :03:49. | :03:53. | |
old-fashioned story, lots of bad loans. Lots of bad loans, and their | :03:54. | :03:59. | |
regulator, a European regulator, said they had to get rid of them. | :04:00. | :04:04. | |
Sell them off, write them off, get rid of them, which forces Italian | :04:05. | :04:08. | |
banks to take losses. Who is going to take the loss, will it be | :04:09. | :04:17. | |
shareholders? Yes, and it could be bondholders. In Italy, bondholders | :04:18. | :04:22. | |
are often also depositors. So, we're looking at the losses potentially on | :04:23. | :04:27. | |
these loans affecting the normal deposit. Just briefly, I've got to | :04:28. | :04:32. | |
wrap up and are not listening to them, there is a problem because it | :04:33. | :04:36. | |
seems the government, the Prime Minister, wants to step in and use | :04:37. | :04:40. | |
taxpayer money, talking about debtholders, that will really annoy | :04:41. | :04:44. | |
the Germans and Brussels. They are saying it is against the rules. | :04:45. | :04:48. | |
There is a simple rule in Europe, you've got to have a percent losses | :04:49. | :04:57. | |
-- 8% losses on your existing ballot sheet -- balance sheet before | :04:58. | :05:02. | |
getting government assistance. That will violate the European rules and | :05:03. | :05:08. | |
they've just been set up. Unfortunately the problem is Italian | :05:09. | :05:12. | |
banks didn't have enough institutional bondholders that were | :05:13. | :05:17. | |
assumed for whom the rules were created. It sounds complicated. We | :05:18. | :05:23. | |
appreciate it, thank you very much my friend. Let's talk about | :05:24. | :05:24. | |
Bangladesh's huge garment industry is reeling after Friday's deadly | :05:25. | :05:29. | |
Islamist attack, in which 20 people were killed. | :05:30. | :05:34. | |
And foreign clothing companies are reviewing their investments. | :05:35. | :05:36. | |
Uniqlo, which is based in Japan, says it's suspending | :05:37. | :05:38. | |
all but essential travel to the country. | :05:39. | :05:40. | |
Rico Hizon in our Singapore bureau has more. | :05:41. | :05:46. | |
It is great to see you. Hey, this is the last thing Bangladesh needs, | :05:47. | :05:57. | |
certainly its economy. This garment industry is pretty much the | :05:58. | :05:59. | |
majority, isn't it, on how the country in? It is the | :06:00. | :06:06. | |
bread-and-butter of the economy, Aaron, and the south Asian economy | :06:07. | :06:11. | |
is now feeling the fallout from this terror attack on Friday. And apart | :06:12. | :06:16. | |
from Uniqlo you have other companies like Mitsubishi motors reportedly | :06:17. | :06:21. | |
advising workers to avoid travelling to the country this month. You have | :06:22. | :06:27. | |
some 240 Japanese firms operating in the country. And Uniqlo has told its | :06:28. | :06:32. | |
staff to stay at home. As you mentioned, it is a major production | :06:33. | :06:37. | |
centre for retailers, including the likes of Marks Spencer and Dap and | :06:38. | :06:43. | |
analysts are warning that other brands could consider shifting out | :06:44. | :06:45. | |
production from Bangladesh into other less unsettled, more peaceful | :06:46. | :06:53. | |
countries like Cambodia and Sri Lanka -- Gap. Some figures onto how | :06:54. | :06:58. | |
important this is to the company - it is the second biggest supplier of | :06:59. | :07:03. | |
clothes behind China. The garment industry is worth around $26 | :07:04. | :07:06. | |
billion, or ?20 billion, and accounts for around 80% of the | :07:07. | :07:11. | |
exports in the country and millions of jobs. Let's hope these major | :07:12. | :07:15. | |
multinational retailers don't leave. What's important right now for | :07:16. | :07:20. | |
Bangladesh is security and peace and order. Indeed. Nicely said. We will | :07:21. | :07:28. | |
talk to you soon, mate. Thank you. Stating kind of in the Asian region. | :07:29. | :07:36. | |
India is the second most populated country on the planet and fewer than | :07:37. | :07:40. | |
half have a bank account. That is something the government wants to | :07:41. | :07:48. | |
change. Setting up simple banking services is proving difficult. Our | :07:49. | :07:55. | |
correspondent reports. A typical bank branch in a typical Indian | :07:56. | :07:58. | |
village but while it is quite basic at least these villages have a bank. | :07:59. | :08:04. | |
More than 800 million people live in India's countryside and many don't | :08:05. | :08:07. | |
have anywhere nearby to put their cash -- villagers. So, little wonder | :08:08. | :08:10. | |
many don't have bank accounts at all. So, how to change that? Firms | :08:11. | :08:17. | |
are being given the chance to open simple banks where customers can | :08:18. | :08:21. | |
save and withdraw money or pay bills but not get loans or have credit | :08:22. | :08:25. | |
cards. Instead of building traditional branches like these they | :08:26. | :08:29. | |
will reach people through kiosks and mobile phones, which should help | :08:30. | :08:35. | |
people get into the system. It is not going to plan. 11 non- finance | :08:36. | :08:39. | |
specialist companies have been given licence to run these banks but | :08:40. | :08:40. | |
already three have pulled out. All have decided that the scheme | :08:41. | :08:54. | |
doesn't make business sense. That's frustrating for firms like Pay Point | :08:55. | :09:03. | |
India whose application was rejected. It says the criteria was | :09:04. | :09:09. | |
too narrow. There are companies involved in financial inclusion | :09:10. | :09:12. | |
project that should have been part of this. The companies which were | :09:13. | :09:17. | |
granted licence, they lacked customer understanding. The only | :09:18. | :09:20. | |
difference between people who didn't get it and people who were offered | :09:21. | :09:27. | |
is network vis-a-vis net worth. The reserve bank of India has defended | :09:28. | :09:31. | |
the selection. He said he was unhappy with companies dropping out. | :09:32. | :09:37. | |
We gave out licenses to anybody we thought had the appropriate | :09:38. | :09:43. | |
qualifications to run a payment bank. Therefore when you go forward, | :09:44. | :09:47. | |
do a proper assessment, don't just go for a licence because it is a | :09:48. | :09:52. | |
valuable property to have, but instead to the due diligence on your | :09:53. | :09:57. | |
own and when you apply it should be with the intent of fully carrying it | :09:58. | :10:02. | |
out. Barring more upsets the first payment bank will launch in August | :10:03. | :10:05. | |
with the rest opening over the next year but it will take time to gauge | :10:06. | :10:09. | |
if India's ambition of financial inclusion is on the right path. OK, | :10:10. | :10:16. | |
I've got to leave you with this. Talking about the legendary | :10:17. | :10:25. | |
competitive ETA. This man ate down 70 hotdogs in ten minutes on Monday, | :10:26. | :10:34. | |
reclaiming his crown at the Nathan's Hotdog Eating Contest, marking a | :10:35. | :10:39. | |
return to form. Last year he saw his winning streak Rogan by Matt" mega | :10:40. | :10:50. | |
toad". I am not making it up. And this woman chew down 38.5 hotdogs. | :10:51. | :10:53. | |
Don't forget you can get in touch with me and some | :10:54. | :10:56. | |
I will be back with Adnan to take a look at the papers, tata. | :10:57. | :11:06. | |
Thousands of pupils in England could be affected by a teachers | :11:07. | :11:09. |