Martin Vander Weyer

This column has long been a fan of the concept of ‘challenger banks’ offering alternatives for personal and small business customers who were mistreated or underserved by the big banks before and after the 2008 crash. Most challengers were internet-based, but Metro Bank — founded in 2010 by US entrepreneur Vernon Hill, whose early career was spent developing sites for McDonald’s — was different. Its model was predicated on an expensive chain of bricks-and--mortar branches (referred to as ‘stores’, open seven days a week, and with 200 planned by 2020) at a time when the likes of NatWest and HSBC were withdrawing from the high street as fast as they could.

Sainsbury’s chief executive Mike Coupe faces a fight for his job after the Competition and Markets Authority ruled against his proposed £12 billion merger with Asda that would have created a supermarket giant bigger than Tesco and supposedly better equipped to face down the discounters Aldi and Lidl. The CMA said the deal would have harmed competition and pushed up prices, ignoring Coupe’s claims to the contrary. Investors were also unconvinced, having endured limp profits and a downward–drifting share price during Coupe’s five-year tenure.

It’s not much comfort, if you like pubs, that the rate at which they’re closing across the UK has fallen from 138 per month for the past several years to 76 per month in 2018; small consolation too that this is partly the result of a rare example of government policy working — in the form of business-rate reliefs designed to help pubs survive as hubs of community life. But the truth is that having lost more than 11,000 of them since the turn of the century, we’ve also largely lost the habit of spending our spare cash in them.

If you know my personal history with Barclays, you may be wondering whether I’m for or against Edward Bramson. To recap, I’m a former second-generation employee of the bank as well as the custodian of a family shareholding that’s never likely to be sold — and nowadays, rather miraculously given everything that’s happened to me and the bank since I left 27 years ago, a recipient of its pension largesse. Bramson, by contrast, is a Johnny-come-lately: a New York-based ‘activist investor’ whose firm Sherborne has become Barclays’ third largest shareholder by building a 5.5 per cent stake, and who is seeking a seat on the bank’s board at next week’s annual meeting.

‘Virgin trains could be gone from the UK in November,’ blogged Sir Richard Branson from his billionaire hideaway after the Department for Transport barred Stagecoach, Virgin’s 49 per cent joint-venture partner, from bidding for new passenger rail franchises. This followed a row over Stagecoach’s reluctance to help fill a £6 billion black hole in the Railways Pension Scheme – and affects Stagecoach’s bids for the East Midlands and South Eastern franchises as well as the renewal of Virgin’s West Coast Main Line service. Branson is always a sore loser on the rare occasions the dice don’t roll his way, but I doubt many travellers will mourn the passing of his trains.

I invited you to suggest smaller companies that are ‘potential world-beaters’ for the next layer of stocks in our UK Optimist Fund portfolio — and your wide-ranging responses gave rise to one big question. What are we really good at these days? We certainly have strengths in bioscience, where your picks included Angle (blood analysis technology to identify cancer cells), Avacta (artificial proteins that stimulate auto-immune systems), BioVentrix (devices to treat heart failure), and ReNeuron (stem cell research). We’re a leader in financial technology, in which the venture capital fund Augmentum Fintech looks promising.

How big is Brexodus — the flight of business and people from the City of London in parallel with our exit from the EU? I observed recently that squealing from the Square Mile has been minimal compared to sectors that make and move physical goods — suggesting that banks, insurers and investment houses have quietly completed all the necessary rejigging of domiciles and compliance that will permit them to carry on making money willy-nilly. There’s been plenty of paddling beneath the City surface. A report by the New Financial thinktank ‘identified 275 firms in the UK that have moved or are moving some of their business, staff, assets or legal entities from the UK to the EU’.

It never works to take two unhappy companies and blend them into a bigger pile of misery. That’s the way it looks at the investment giant Standard Life Aberdeen, known to some as ‘Staberdeen’, where Aberdeen Asset Management founder Martin Gilbert seems to have just lost a power struggle with his former co-chief executive Keith Skeoch from the Standard Life side. And that’s certainly the way in Frankfurt, where Deutsche Bank and Commerzbank are being shoved together by pressure to create what German finance minister Olaf Scholz foresees as a national champion that would be the second largest lender in the eurozone (after BNP Paribas of France) and impregnable to foreign takeover.