The share price dropped by around 4 per cent from 1508p to close at 1446p after Hargreaves announced it is introducing tiered fees ahead of the ban on cash rebates, effective from April.
From March Hargreaves will start charging savers an annual fee for holding funds and will slash the charges on a range of products.
BoE governor plays down housing bubble threat
According to The Guardian, Mark Carney played down the threat of a UK housing bubble yesterday, telling MPs the housing market was playing catch-up following the downturn.
In giving evidence on November’s financial stability report, Mr Carney told MPs on the Treasury Select Committee that at current levels, rises in house prices and mortgage approvals were not a threat to financial stability.
Carney said approvals and transactions were running at around three quarters of pre-crisis levels, and the bank expected “a continuation of current momentum” in the market in 2014.
Mr Carney added that the bank was monitoring the impact of the government’s Help to Buy scheme, but stressed it was modest in scale compared with the overall market.
Carney opposes “crude” bonus cap
Elsewhere, Mr Carney added his voice to attacks on the EU’s bonus cap by saying it would make it more difficult to reverse payments to underperforming bankers, the Financial Times reports.
Speaking to MPs in the Treasury Select Committee, Mr Carney said Britain had in recent years brought in a “hard touch” regime on bankers’ bonuses and said the BoE’s regulatory arm was preparing to consult on extending the period for which bonuses are deferred.
Asked whether the EU’s decision last year to push through a “crude” bonus cap of 200 per cent of base salary was the wrong approach, Mr Carney told the TSC “absolutely.”
RBS fuels bonus pay row
Royal Bank of Scotland risks fuelling the row over pay as it considers how to follow rivals that have devised ways to avoid the EU bonus cap and maintain their bankers’ multimillion-pound pay cheques, reports the Guardian.
The 81 per cent-taxpayer-owned bank wants to keep pace with rivals such as Barclays and HSBC, which are both planning to hand out new allowances, which are not classed as salary and as a consequence do not get included in the calculations used in the bonus cap.
They have been introduced to ensure bankers do suffer any reduction in pay as a result of the bonus cap being imposed by Brussels.
Former FSA chief could lead church taskforce
Sir Hector Sants, former chief executive at the Financial Services Authority, has been approached by the Archbishop of Canterbury to lead a new financial taskforce, despite resigning from Barclays two months ago due to stress and exhaustion.
The Most Rev Justin Welby has approached Sir Hector to drive payday lenders such as Wonga out of business and create a new way of thinking about finance.
Sir Hector was placed on sick leave in October, as a result of being diagnosed with “exhaustion and stress” and left the bank a month later.
