Lebedev Found Guilty Over TV Chat Show Brawl

Media magnate Alexander Lebedev has been found guilty of battery over a brawl on a TV chat show in his native Russia.

The financial backer of Britain's Independent and Evening Standard newspapers was sentenced by a court in Moscow to 150 hours of community service, avoiding a prison term.

He had claimed the case against him was politically motivated, depicting the trial as President Vladimir Putin's revenge on him for criticising the government.

Last week, the opposition surprisingly dropped the main charge against Lebedev, of "hooliganism motivated by political hatred", which carried the threat of several years in prison.

Instead, they asked for his movements to be restricted for 21 months and for him to be banned from large public gatherings.

Alexander Lebedev has been convicted of assault over the TV punch up

Speaking after sentencing, Lebedev's lawyer, Genry Reznik, said his client was "ashamed" of the verdict, which his team would appeal.

Lebedev, a former London-based KGB agent, punched property tycoon Sergei Polonsky on a Russian political chat show in September 2011, knocking him to the floor.

He claimed he was protecting himself and that the subsequent charge of hooliganism was disproportionate. 

Last week, Mr Polonsky called for Lebedev - who is estimated to be worth more than £700m - to be forgiven.

Lebedev is rare among oligarchs in speaking out against the Kremlin since the imprisonment of oil tycoon Mikhail Khodorkovsky, who was arrested in 2003 after falling out with Mr Putin. Khodorkovsky's Yukos oil company was broken up and sold off, mainly into state hands.

Lebedev, who co-owns a campaigning Russian newspaper critical of Putin, also portrayed the case as part of a broader crackdown on the opposition since the former KGB spy returned to the presidency in May 2011 following protests.

Mr Polonsky spent three months in jail in Cambodia this year for allegedly attacking the crew of a boat after a dispute erupted during a New Year's Eve outing.

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Banks To Unleash Ad Blitz In Switching War

Britain's biggest banks are preparing to unleash an advertising blitz costing tens of millions of pounds in an attempt to protect their market share as new rules are introduced to encourage speedier account transfers between rivals.

Sky News has learnt that the big five high street banks - Barclays, HSBC, Lloyds Banking Group, Royal Bank of Scotland and Santander UK - have booked huge volumes of media space during the late summer as they brace for a new seven-day current account-switching system.

The Government and the industry have agreed a mid-September launch for the initiative, which ministers hope will accelerate switching levels to the benefit of new entrants such as Metro Bank.

All of the big five are preparing to spend significant sums on marketing in September, with one advertising executive estimating that they could fork out as much as £20m in that month alone.

Lloyds is understood to be planning a major outlay on continuing to position its Halifax subsidiary as a "challenger" bank, while Santander UK is expected to spend a large sum on its 1-2-3 current account offer.

RBS, which is 81% owned by British taxpayers, is thought to be preparing a major campaign focused on customer service improvements.

"You can't book advertising space anywhere," the head of one major UK retail bank said.

"It's all gone already."

The disclosure that the major banks are preparing mass advertising campaigns in the run-up to the deadline will stoke fears that the dominant players will simply use their greater financial firepower to continue to shut out smaller banks.

Between them, the five largest lenders account for an overwhelming share of the current account market, with last month's report by the Parliamentary Commission on Banking Standards criticising the industry's treatment of customers and the speed with which the Government has imposed change upon it.

The technology required to support the new switching system has cost approximately £750m.

If it is not judged to be successful, the commission recommended that a full account portability model be considered, which banks have warned privately would cost many billions of pounds.

New entrants to the retail banking market have been buoyed by moves to ease onerous capital and liquidity requirements set by the industry regulator, but they have warned that these will be insufficient to trigger a genuine shift in the competitive landscape.

Sky News understands that the big banks have been operating a "buddy system", which pairs rival banks to help test systems' readiness ahead of the September deadline.

A working group overseen by the Payments Council, the body which oversees payment systems, has been supervising the changes for months.

Insiders at some of the big banks have, though, privately expressed concerns about the readiness of their competitors to meet the deadline.

RBS alone has around 500 staff working on the project, many of whom are contract employees.

"The industry is only going to be as strong as the weakest link on this," said one banker last month.

Concerns about the banks' readiness has been exacerbated by their poor track record at implementing and maintaining sophisticated IT systems in recent years.

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China's ICBC Bank Now Bigger Than US Giants

A Chinese bank has been ranked as the world's largest, overtaking two American finance giants.

Industrial and Commercial Bank of China (ICBC) leapfrogged the US banks to top the global ranking of banks with the most capital.

The shock ranking has highlighted the growing size and importance of Chinese lenders.

ICBC topped The Banker magazine's annual list of the top 1,000 banks for the first time.

The magazine relegated the Bank of America to third from first, while JPMorgan Chase remained in second slot.

China's ICBC was ranked third last year by the magazine, which is owned by the Financial Times.

The rankings are based on Tier 1 capital as a measure of a bank's ability to lend on a large scale and endure shocks.

ICBC has for some time ranked as the top bank by market value.

Britain's HSBC, which gains much of its earnings from Asia, was fourth in The Banker's list, with China Construction Bank (CCB) ranked fifth.

China had four banks in the top 10 and 96 in the Top 1,000.

Its top four lenders - ICBC, CCB, Bank of China and Agricultural Bank of China - filled the top positions for profit in 2012.

ICBC's $49bn (£32bn) profit put it top of the profit table for a third successive year.

Total profit for the biggest 1,000 banks is now back close to levels achieved before the 2007/09 financial crisis, but the regional share has shifted significantly,

The Banker said that in 2006 European banks accounted for 46% of global profits and 58% of assets, but last year that had dropped to less than 2% of profits and 43% of assets.

Asia's banks have lifted their share of profits to 56% from 19% in the same time and increased their share of assets to 35% from 22%.

Spain's Bankia posted the biggest loss last year at £21bn , with six of the 10 biggest losses coming from Spain, the magazine estimated.

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RBS Plots £500m Debt Collector Float

By Mark Kleinman, City Editor

One of Britain's biggest debt collectors is targeting a £500m stock market flotation that would loosen its ownership by the state-backed Royal Bank of Scotland (RBS).

Sky News has learnt that Arrow Global, which is based in Manchester and has nearly four million customer accounts, is being groomed for a public listing that could take place as early as this year.

Arrow Group chairman Sir George Mathewson

Investment banks including Goldman Sachs, Canaccord Genuity and Lazard are understood to have been lined up to work on a flotation, although people close to RBS's Special Opportunities Fund, which is the owner of Arrow Global, said no final decision had been taken about the move.

Last year, RBS held detailed talks about a merger of Arrow Global with Lowell, another debt collection agency, but the discussions faltered over the owners' valuations of the two companies.

The RBS Special Opportunities Fund is a private equity vehicle managed by the bank but in which it has only a minority stake. People close to RBS have suggested that a sale of Arrow Global would be "reputationally helpful" given the controversy that stalks debt collection businesses.

News of RBS's plans to float the company emerged on the same day that another contentious segment of the financial services sector, the payday lending industry, came under fire at a Government-organised summit.

Arrow Group, which negotiated a new £110m debt facility last year, claims to be "committed to facilitating positive outcomes, and strongly believes that what is good for the customer is also good for business".

The company is run by Tom Drury, former chief executive of Shanks, the waste management group.

Its chairman is Sir George Mathewson, the former chief executive and chairman of RBS, who has been a prominent figure in the debate about the reshaping of Britain's banks.

Arrow Global's asset portfolio consists of consumer and commercial credit including credit card, personal loan, retail, motor, mortgage, telecommunication and utility receivables. More than 80 per cent of Arrow Global's assets are in the UK with the remainder in continental Europe.

The business buys outstanding consumer debt at a discount from lenders who have written it off, then collects it. The average individual debt under its management is £3,000.

Arrow Global made £19m in profit in the first quarter of the year and now has more than £8.5bn under management.

RBS declined to comment on its plans.

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Orangina Owners Reunite For £1bn Ribena Tilt

By Mark Kleinman, City Editor

The former owners of Orangina have reunited for a £1bn-plus tilt at Lucozade and Ribena, two of the biggest brands in Britain's beverages market.

Sky News understands that Blackstone and Lion Capital, two private equity firms, have joined forces to submit a formal offer for the two soft drinks, which have been put up for sale by GlaxoSmithKline, the FTSE-100 pharmaceuticals manufacturer.

Blackstone and Lion, which have hired bankers at Rothschild to advise on their bid, have enjoyed previous success in the sector.

In 2005, they acquired the European beverages division of Cadbury-Schweppes, selling it four years later to Suntory, the Japanese food and drink producer, for roughly £1.5bn.

Suntory, which is one of the world's largest soft drinks producers, is one of the rival bidders to Blackstone and Lion in the current auction.

Other buyout firms, such as Bain Capital, CVC Capital Partners, KKR and Onex, a Canadian fund, are among those also considering offers.

The auction of Lucozade and Ribena comes at a time of potential change in the UK soft drinks market.

Britvic and AG Barr, which makes Irn-Bru, recently saw their merger approved by competition authorities.

However, there is scepticism about whether the deal will ultimately happen because of the shifts in the relative shifts in the value of the two companies since it was conceived.

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Cameron In Kazakhstan For Trade Mission

David Cameron will hold talks with Kazakhstan's President Nursultan Nazarbayev today as part of a controversial trade mission to the country.

The official visit, the first by a serving British premier, is aimed at building strong business links and deals worth £700m to UK firms are set to be signed.

But Mr Cameron has been forced to reject assertions he was putting economic ties with the mineral-rich nation ahead of concerns over human rights abuses.

The Prime Minister insisted that "Britain always stands up for human rights wherever we are in the world" and said the allegations would be raised in the talks.

He said: "We will raise all the issues including human rights. That's part of our dialogue and I'll be signing a strategic partnership with Kazakhstan.

David Cameron recently met with Pakistan's PM Nawaz Sharif

"We need for Britain to get out there and win. We need our businesses to win.

"We need that growth and investment. Countries like Kazakhstan are rapidly growing and one day will be among the top 10 producers."

Campaign group Human Rights Watch have claimed there is a "serious and deteriorating" situation in Kazakhstan.

This includes "credible allegations of torture, the imprisonment of government critics, tight controls over the media and freedom of expression and association, limits on religious freedom, and continuing violations of workers' rights".

Amnesty International UK's head of policy and government affairs Allan Hogarth said: "Kazakhstan might be knee-deep in oil and gas wealth, but David Cameron shouldn't let lucrative energy deals prevent him from raising human rights during his trip."

The Prime Minister is leading a 30 strong business delegation to the country as he seeks to open a new chapter in the relationship with Kazakhstan.

Downing Street has acknowledged Mr Cameron is playing "catch-up" because other Western leaders have already visited the country.

Kazakhstan is experiencing rapid growth due to its vast oil and mineral reserves.

The Government believes British firms could secure contracts in Kazakhstan worth up to £85bn over the coming years.

Mr Cameron and Mr Nazarbayev began talks last night during a two hour flight on the presidential jet.

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Facebook To Remove Adverts From Adult Pages

Facebook will stop advertisements appearing on pages containing sexual or violent content after a number of companies suspended their campaigns.

Marks and Spencer and BSkyB, the parent company of Sky News, were among those to pull their adverts from the social networking site because of concerns about placement.

It led Facebook to announce a tightening of its review process, preventing promotions from appearing on pages and groups which contain offensive content.

"Our goal is to both preserve the freedoms of sharing on Facebook but also protect people and brands from certain types of content," a spokesman said in a blog post.

"We know that marketers work hard to promote their brands and we take their objectives seriously.

"While we already have rigorous review and removal policies for content against our terms, we recognise we need to do more to prevent situations where ads are displayed alongside controversial pages and groups."

In the first three months of the year, 85% of Facebook's revenue came from advertising - up 43% on the same quarter in 2012.

Advertisers paid a total of $1.25bn (£820m) to promote their products and services to the website's reported 665 million daily active users.

The company is paid around 3% more per advert than it was 12 months ago.

Facebook said its advertising review process will be manual at first but an automated system is expected to launch within weeks.

The spokesman added: "Like any digital platform, we're not going to be perfect but we will be much better.

"We'll continue to work aggressively on this issue with advertisers.

"We're confident the immediate steps we're taking will result in a significantly improved approach to preventing these instances from occurring, and we're committed to making this process work for everyone who uses Facebook."

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Crown Post Office Staff Stage Strike Action

By Emma Birchley, East of England Correspondent

Post Office workers have gone on strike over plans to close 70 state-owned branches and a dispute over pay.

The closing Crown branches - which are currently directly managed by Post Office Ltd - would be franchised and put within retailers such as WH Smith, which has already happened in some towns.

Debbie Spiteri, who works at the Dagenham branch in Essex, has been employed by the Post Office for 32 years and said she thought she had a job for life.

"I thought I would be here until I retired in my 60s, but now it looks like I may be made redundant, looking for another job and at my age I didn't want to be doing that," she said.

"I feel sorry for the local people. A lot are elderly and if they have to go somewhere else, they won't. They won't go into a shop to do their business because to them they want the personal touch."

The Post Office insists staff will be transferred to a new employer or offered voluntary redundancy, but the Communication Workers Union predicts 800 jobs will be lost.

Roger Gale, general manager of the Post Office's Crown and WH Smith network, said the changes are needed.

"It's absolutely not a programme of closing post offices," he said.

"We want to retain post office services on the high street but we have to do it in a way that doesn't lose tax-payers' money.

"What we're trying to do is get the Crown Network to a point where it breaks even. It currently loses £37m a year of tax-payers' money and what we're trying to do is to remove that loss."

The 373 Crown offices, which are usually the larger ones, represent just 3% of the total post office network.

But the CWU says its staff deal with a fifth of all customers and handle 40% of financial transactions involving things like banking and credit cards.

Clive Tickner, the CWU's representative for the Dagenham area, questions the timing as the Post Office launches its new current account.

"Ironically, if they close down Crown offices there will be less outlets to transact the current account so I'm very, very concerned that they are eroding away at the Post Office so that there will be nothing left in a few years' time," he said.

There is also concern about the impact on the high street.

Deborah Satchell works at Heathway Dry Cleaners in Dagenham.

She said: "It will affect the local shops because people will go elsewhere to do what they have got to do and it will take the business away from the local community."

The strikes are the seventh round of action in the current dispute and will only affect the Crown branches.

Staff are also calling for a pay rise of 3.5% for 2012/13 and a further rise this financial year, but the Post Office says that is not possible when it is making losses.

Instead, it is offering a series of cash payments totalling up to £3,400 before April 2015.

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Gold Tarnish Worsens Amid Commodity Sell-Off

Gold has traded near to its lowest level in almost three years and is on track for its worst quarterly performance since at least 1968.

London early trading saw gold sit at $1,206 but by 1.45pm it dropped to $1191.99.

The hit to the precious metal comes amid continued worries that the United States will wind down its stimulus, puncturing confidence in the metal as an inflation hedge.

The price had earlier dropped to $1,180.50 in Asian trading - which was the lowest level since August 3, 2010.

Other key commodities have been hammered over the past three months by concerns that the era of cheap US central bank money is coming to an end.

Oil has also been heading for its weakest quarter in a year but in early afternoon trading Brent Crude was 0.21% up.

Copper, which is essential for both electronic gadgets and construction wiring, looks at its deepest quarterly loss in nearly two years.

The fears have hit gold prices the hardest as funds ditched the metal and physical buyers sat out the rout as bets grew prices could decline further.

"From July onwards, commodity prices should remain softer for two key reasons," Vishnu Varathan, market economist at Mizuho Corporate Bank, said.

"One is while timing may be variable, the impetus is for the US to reduce stimulus not increase it."

"There are bright spots in the US economy which is a reason for reducing stimulus.

"I don't think global growth factors have broadened enough for us to see the kind of synchronised upturn in growth with China, eurozone and the rest following in a very convincing way."

The price of bullion has fallen by as much as 15% since last week after Federal Reserve chairman Ben Bernanke signalled the central bank may reduce its $85bn (£50bn) monthly bond purchases later this year.

He added that the programme may be ended altogether by mid-2014, if the economy improves as expected.

For the quarter, gold is down by nearly 25%, its sharpest quarterly drop on record, based on Reuters data that dates back to 1968.

That puts it on course for its first annual fall after a 12-year rally.

Meanwhile copper is heading for its steepest quarterly drop since July-September 2011, which has come under pressure by concerns over slower growth in top consumer China.

Three-month copper on the London Metal Exchange was steady at $6,730 a tonne, but was down almost 11% for the quarter, its third quarterly loss in a row.

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Starbucks Losses Hit £30m In Last Tax Year

By Pete Norman, Sky News Online

Starbucks UK reported a net annual loss of more than £30m for the 12 months to September 30, according to newly released documents.

Accounts filed with Companies House show that Starbucks Coffee (UK) Ltd reported a total turnover of £413.39m in 2011-12, compared to £397.7m in 2010-11.

Gross profit was £70.5m, however after administrative losses of £98.2m - including royalty and licensing fees of £26.48m - the loss for the 2011-12 tax year amounted to £30.4m, the company said.

The net loss in the tax year 2010-11 was £32.8m. In 2009-10 the loss after tax of £34.2m, while in 2008-9 it was £52m and in 2007-8 the loss was £46m.

The directors of the company took home a combined £1.08m for the year ending September 30, up from £590,319 in the previous year.

The figure for directors includes shares that have vested in the period. No director shares were vested in financial year 2010-11 (FY11).

A Starbucks spokesman told Sky News: "All full and part-time employees of Starbucks receive shares as part of their pay.

"Over half of the remuneration provided to our directors last year comprised vested equity shares."

He added: "The reason for the increase is that the directors took the decision to sell some of their vested shares in FY12.

"These shares could have been granted at any point during the directors' tenure with the company, and can be sold once vested."

In real terms, it means salaries for the three directors have risen by around  10%.

The accounts show that the highest paid director of the company received a total package of £708,019, including £116,560 in relocation benefits.

The top director's pay was increased 90% from the previous year, when it amounted to £372,440

Starbucks was grilled by MPs last October over why the company had paid no UK corporation tax for three years, despite total sales of £1.2bn in the period.

It confirmed that the company had only made a UK profit once in the 14 years it had been trading in the country.

The subsequent public furore led to Mr Engskov telling Sky News, in December, that the company decided to "take action".

It announced that the UK firm would pay HM Revenue and Customs (HMRC) £20m over two years but critics slammed it as a gift and not a legal requirement.

Starbucks recently paid its first 'instalment' of £5m to HMRC for the financial year 2012-13, after it said it would make "certain deductions" relating to royalties paid to other arms of the multinational.

It intends to pay another £5m before September 30 and another £10m in the 2013-14 tax year.

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