Morning Papers: JP Morgan warned banker on client e-mails

JP Morgan took extraordinary steps to rein in one of its star London dealmakers because of his indiscreet communications more than two years before he was fined £450,000 by the regulator for allegedly leaking inside information, reports the Times.

Ian Hannam received a final written warning after an internal investigation by the bank discovered he had “conducted business communications with third parties in a manner falling below the standard expected”, it emerged in legal proceedings yesterday.

S&P downgrades Barclays, Deutsche and Credit Suisse

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Standard & Poor’s has downgraded Barclays, Deutsche Bank and Credit Suisse, reflecting its doubts about the future of European investment banking, reports the Financial Times.

The rating agency on Tuesday evening simultaneously cut all three banks from A-plus to A, blaming the rising uncertainty around the investment banking model.

Shop prices fall at fastest rate for six years

Prices in June were 0.2pc lower than in the same month last year and flat compared with May, according to the British Retail Consortium’s shop price index, reports the Telegraph.

The decline, the largest since February 2007 and before the onset of the credit crisis, was driven by a 1.9pc year-on-year drop in non-food prices as retailers cut the price of clothing, DIY, and furniture to try to make up for sales lost due to the cold weather earlier in the year.

Bank of England condemns lobbying by banks against new rules

City regulators have brushed aside complaints by Barclays and Nationwide over tough new liquidity rules, saying UK banks would need to put them into effect as soon as possible, years ahead of an international deadline of 2018, reports the Guardian.

The deputy governor of the Bank of England, Paul Tucker, responsible for financial stability, said lobbying against the change by the banks was “completely unacceptable”, and regulators would not be deflected “one iota” from the task.

BP profits threatened by disaster payments

BP’s compensation payouts under the settlement for victims of the 2010 Deepwater Horizon disaster are on course to hit the company’s earnings before the end of the year, unless it is successful in a legal challenge that will be heard in court next week, reports the Financial Times.

The threat of a material impact to profits, which would be likely to start in the fourth quarter, shows the importance to BP of winning its appeal over the interpretation of the settlement.