Your commercial news round-up: mortgage rates, Hurricane Ian, Musk and Twitter, HSBC, Kim Kardashian, Deliveroo

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As the cost-of-living crisis continues to add pressure to UK households and businesses, there’s lots of information and updates to digest. This commercial news round-up touches on some of the issues brought about as a result of the cost-of-living crisis, as well as developments in other areas that we think you might also want to keep on your radar.

• Following Chancellor Kwasi Kwarteng’s “mini-budget” announcement, leading British banks, including Barclays, NatWest and Nationwide, have upped interest on new mortgage deals to almost 6%. On Monday, the average rate on two-year fixed deals increased from 4.74% (on 23 September) to 5.75% (on Monday 3 October), according to Moneyfacts – this rate is now at its highest since December 2008 (5.8%). The executives from these leading banks are due to meet with the chancellor where he’s expected to quiz lenders on their plans.

Meanwhile, earlier this week the chancellor confirmed that the government has reversed plans to scrap the 45p rate of tax currently charged to the wealthiest 1% of earners. 

• Last week Hurricane Ian wreaked havoc across Florida and the Carolinas with insurance companies now facing bills of nearly £50 billion. This projection, forecast by risk modelling firm Verisk, includes estimated wind, storm surge, and inland flood losses as a result of the storm’s landfall in both states. That said, the estimate range doesn’t include factors such as potential impacts of litigation or social inflation. As the death toll rose to above 80 at the end of last weekend, around 628,285 homes and businesses still had no power in Florida heading into Monday.

• There’s been lots of uncertainty surrounding the Twitter and Elon Musk deal but earlier today Reuters reported that Musk and Twitter could soon reach an agreement to end their ongoing litigation. Earlier this week Musk proposed to the social media network that he would change course and act in accordance with his April agreement to purchase the company for $54.20 per share if Twitter dropped its litigation against the billionaire. As a result, Musk’s deposition in court, scheduled for Thursday, has been postponed, however negotiations are ongoing. Chancellor Kathleen McCormick, the judge on Delaware’s Court of Chancery, also wrote: "The parties have not filed a stipulation to stay this action, nor has any party moved for a stay. I, therefore, continue to press on toward our trial set to begin on Oct. 17, 2022.”

• HSBC is considering selling the Canadian arm of its business and is working with bankers at JP Morgan to identify potential buyers, as part of a strategic review. The sale could see the banking giant raise billions, and comes alongside pressure from the bank’s largest shareholder, insurer Ping An, which has been lobbying for some time for the London-based bank to split its Asian and western operations. While in the early stages of its strategic review, HSBC is looking to restructure its global network to focus on Asia and other growth regions.

• Kim Kardashian has agreed to pay the Securities and Exchange Commission (SEC) $1.26 million to settle charges she faced for failing to disclose that she was being paid to promote a crypto asset via her Instagram page. EthereumMax had paid the social media influencer and entrepreneur $250,000 to post about crypto security tokens in June 2021. Despite Kardashian’s post featuring the hashtag “#ad”, the SEC said that her failure to disclose the payment was a violation of federal securities law. Chair of the SEC Gary Gensler commented on the Securities Act: “Part of that law said that if you tout a stock you have to disclose if you’re getting paid.”

• New Oxford St has become home to Deliveroo’s first brick-and-mortar grocery store, where shoppers can order groceries through digital kiosks, via the Deliveroo app for collection or home delivery. The Deliveroo HOP shop will be open from 8am to 11pm and features a range of 1,750 products, including budget items and premium ones. Eric French, the delivery service’s chief operating officer said he hopes the new store will welcome “commuters, local residents, visitors and day-trippers”.

Check the News every Thursday for this weekly commercial news round-up.

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