BANKING & INSURANCEScots economy 'grinding to halt' The Scottish economy is "grinding to a halt" as the effect of the credit crunch takes hold, according to an assessment from Lloyds TSB (
BBC). The bank's Business Monitor said the country had been affected by slowing output and increasing costs. It added this had led to some of the poorest business results the monitor had ever recorded. Overall turnover for Scottish firms was also predicted to drop by 28% in the next six months. The bank said this was a "sharp drop" from the 1% of the previous quarter and the 21% of the same quarter in 2007.
Ratings agency downgrades Ukio BankasVLADIMIR Romanov's Ukio Bankas has been downgraded by an international ratings agency, which warned that the Lithuanian financial institution had been exposed to lending in high- risk markets (
Scotsman). Standard and Poor's revised its outlook on the Hearts owner's Ukio Bankas from "stable" to "negative", saying the bank was exposed to high credit risk after doubling the value of its loans in the past 18 months. The news came as the football club claimed staff would receive their unpaid wages by tomorrow – a week after they were due. Accounts for Ukio Banko Investicine Grupe (UBIG) – the investment vehicle behind Hearts – reveal that the firm, which was spun out of the main banking group about six years ago, reported a gross loss of LTL8.4 million (£1.9m) for the six months to the end of June.
Read all today's banking news from scotsman.comECONOMYTax concern forces firms to think of offshore moveMORE than one in ten Scottish companies has considered moving off-shore in order to reduce corporation tax, a new survey has revealed (
Scotsman). And the poll of medium-to-large companies north of the Border showed that 4 per cent of firms based in Scotland have already moved their operations to cut down on the amount of tax they pay. A number of UK firms recently announced plans to relocate to avoid UK taxes. Engineering company Charter and investment manager Henderson Group said they were to move to Ireland, while last month, Regus, the world's biggest office rental company, said it had decided to reincorporate in Jersey and move its HQ and tax residence to Luxembourg. The survey revealed that nearly half of the 45 Scottish businesses polled think UK corporation tax is an inefficient system and should be replaced altogether – while more than two-thirds believe the tax needs to be reformed in order to increase incentives to invest in the UK.
Read all today's economics news from scotsman.comINDUSTRYShares in Axeon plummet after profits warningShares in Axeon Holdings plunged 27% following a profits warning from the Dundee-based producer of advanced battery systems, which said demand had been dampened by the downturn in the European construction sector (
Herald). Announcing that first-half losses widened following an increase in research and development spending, Axeon said the outlook was for a "reduced loss" in the second half of the year, instead of a profit. The company has been gaining ground in markets such as automotive, where growing concern about the environmental damage caused by burning fossil fuels has stimulated interest in its lithium-ion battery systems. However, gains on this front have been offset by problems in the construction industry, to which Axeon increased its exposure as a result of the £7.4m cash-and-shares acquisition of Switzerland's AG Ritsma last year.
Robertson axes 40 construction jobs as housing slump bitesBUILDING firm Robertson Group has laid off more than 40 workers as a result of the housing downturn – and warned yesterday that it could not rule out further redundancies (
Scotsman). The Elgin-based group, which yesterday reported a 30 per cent rise in turnover to £247.4 million in the year to November 2007, said it had been forced to lay off workers in response to a "terrible" climate for housebuilders.
Read all today's industry news from scotsman.comMEDIA & LEISUREFry takes on top job at Johnston PressJohn Fry, the Archant chief executive who sold Johnston Press a portfolio of Scottish weekly papers last year, is to follow them by taking on the top job at the Edinburgh publisher (
Herald). He is to succeed Tim Bowdler as chief executive of the group, whose titles include The Scotsman and Yorkshire Post, following four years running privately-owned Archant, best known for its regional titles Eastern Daily Press and East Anglian Daily Times. The confirmation of the move boosted Johnston Press shares which rose 5.6% to close at 37.5p. Fry oversaw the sale of eight papers to Johnston Press, including paid-for weekly titles Ellon Times & East Gordon Advertiser, the Buchan Observer and the Fraserburgh Herald in an £11.2m deal in January 2007, before the advertising market plummeted.
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