Inside Business News

Merrill Lynch's accommodation to advertise mortgage derivatives with a face amount of $30bn for beneath than $7bn has aloft fears of added write-downs to appear beyond the afflicted cyberbanking sector.

And as investors debated whether the blaze auction marks the basal of the acclaim crisis, there was affirmation bygone that US abode prices are continuing to fall, added abbreviation the amount of the accessory that underlies hundreds of billions of dollars of these derivatives.

Wall Street has so far absent added than $400bn on investments in alleged collateralised debt obligations (CDOs) and the final account will not become bright until the apartment bazaar stabilises. However, Merrill's auction does put a accepted bazaar amount on balance that accept not been alteration easily aback the acclaim crisis began.

At 22 cents on the dollar, that is a lower amount even than abounding had feared. Sceptics aswell acicular out that Merrill had lent the buyer, the clandestine disinterestedness close Lone Star, 75 per cent of the money to do the deal.

Meredith Whitney, the bearish cyberbanking analyst at Oppenheimer & Co, alleged Merrill's auction a "c ... Read more »

BP fabricated almanac profits of $13.4bn (£6.8bn) in the aboriginal bisected of the year, reigniting calls for a asset tax on activity companies to advice account the appulse of ascent prices on the beneath well-off.

The world's additional better oil aggregation saw profits acceleration by 23 per cent compared with the aboriginal six months of 2007, and acceleration by 6 per cent to $6.9bn for the additional division alone.

But admitting analyst-beating figures, and a annual allotment up by 29 per cent, it is not all apparent sailing for BP. "We are all operating in absorbing times," Tony Hayward, the arch executive, said yesterday.

"The world's abridgement is abrasion and the all-around political bearings is delicate. The oil amount continues to be top and volatile. Against this background, BP is authoritative abiding progress."

The key aberration is amid the achievement of the upstream analysis and assembly div-ision, and the after adorning and business unit, in the ablaze of oil amount rises that accept jumped by about 35 per cent in the endure three months and topped $144 per butt at the end of June.

Upstream the business is strong, with p ... Read more »

British Airways and Iberia, the Spanish banderole carrier, are captivation talks they achievement will advance to a accord afore the end of the year, the two airlines said yesterday.

A accord amid the two companies, whose boards accept both already accustomed the accord talks, would actualize the world's third better airline and is aswell acceptable to bang alpha a new annular of accord in the all-around airline industry.

BA, which has had code-sharing agreements with Iberia for 10 years, already owns 13.15 per cent of Iberia, and the Spanish airline said bygone it has taken a 2.99 per cent absolute shareholding in its partner. Iberia aswell now owns affairs for aberration that accord it acknowledgment to a added 6.99 per cent of BA's shares.

The British airline advised authoritative a takeover bid for Iberia endure year, as allotment of a bunch fronted by Texas Pacific Group, the US clandestine disinterestedness concern, but eventually afflicted its apperception and disqualified out any added investment in the Spanish company.

Yesterday, however, Willie Walsh, BA's arch executive, said the aerodynamics industry had afflicted significantly. In part-ic ... Read more »

The cyberbanking behemothic Lloyds TSB today said acclaim crisis losses and woes in its allowance business wiped 70 per cent off aboriginal bisected pre-tax profits.

The accumulation appear acting profits of £599 actor adjoin £1.99 billion in the aboriginal bisected of endure year, with a added £585 actor hit from the acclaim agitation and investment writedowns in its allowance arm.

But Lloyds said its basal achievement reflected acceptable "momentum", with adapted profits up 11 per cent to £2.16 billion.

Today's "market dislocation" accident brings the group's absolute acclaim crisis appulse to £972 million, although this is a atom of the writedowns apparent by abounding of its rivals.

The accumulation said achievement was aswell agape by a cogent bead in the amount of investments at its Scottish Widows business, as the animation in banal markets took its toll.

However, Lloyds signalled that it was not yet planning to chase in the footsteps of top 5 cyberbanking counterparts Barclays, HBOS and Royal Bank of Scotland with a multi-billion batter fundraising move.

The group's arch controlling Eric Daniels said the bank's basic position wa ... Read more »

Payments averaging £1,000 are to be offered to one actor policyholders in two of Norwich Union Life's with-profit funds, insurer Aviva said today.

The move to chargeless up surplus assets in the company's activity funds agency about 700,000 humans can apprehend to acquire amid £400 and £1,000 if they acquire the offer, while a added 220,000 will get amid £1,000 and £3,500.

Eligible policyholders will apprentice the akin of their payout afterwards this year, with the transaction acceptable to be fabricated next summer.

Details of the action emerged as Aviva appear a 12 per cent acceleration in half-year operating profits to £1.72 billion.

The bottom-line aftereffect showed losses of £1.27 billion afterwards Aviva accounted for a abridgement in the amount of its assets in the accepted climate.

It said sales in the faster growing markets of North America and Asia Pacific account "the added arduous markets" of Europe, including the UK.

Aviva said it accepted the UK bazaar for activity and pensions to abide "subdued" in the additional bisected of the year, but said it had managed to access its allotment of a crumbling bazaar over the aborigi ... Read more »

In a address continued on assay and abbreviate on solutions, Sir James Crosby has told the Government there is no end in afterimage to the mortgage dearth – and there is actual little ministers can do about it.

Sir James, a above arch controlling of HBOS, said in a letter to the Chancellor, Alistair Darling, that "a curtailment of mortgage fin-ance will abide throughout 2008, 2009 and 2010", and the crisis will "take its toll" on the apartment bazaar and customer spending.

Even in this acting review, Sir James in aftereffect disqualified out any array of accompaniment agreement in the mortgage bazaar on the American model, because "I anticipate it absurd that it would be appropriate to accouterment this century's problems with endure century's solution".

Recent problems affecting the big American mortgage corporations, Fannie Mae and Freddie Mac, accept discredited the idea. But Sir James even caked algid baptize on some of the added bashful options put advanced in his own review, advertence that "I agnosticism whether, on their own, such initiatives will do abundant to access the appeal for mortgage-backed securities".

With no abundant appearance of ... Read more »