LIVE BUSINESS: Debt reaches £16.6bn; HSBC restructuring; Mulberry says Frasers takeover ‘unsustainable’

Rachel Reeves has been urged to make it easier for small businesses to sell abroad, which could be a nearly £10bn boost for Britain.

Business lobby group Walpole – which represents hundreds of luxury firms including Burberry and Aston Martin – wants an incentive to be introduced to encourage UK companies to export.

Chief executive Helen Brocklebank wrote to the Chancellor this month, saying businesses need help to help with “the costly first years of operating in a new market”.

Mulberry has rejected a second takeover proposal from Mike Ashley’s Frasers Group, dismissing the group’s latest bid as “unsustainable”.

Frasers raised its bid to 150p per Mulberry share on October 11, valuing the luxury brand, best known for its handbags, at £111m.

Mulberry’s largest shareholder, Challice Limited, the vehicle of Singapore-based property tycoon Ong Beng Seng and his wife Christina, which owns 56.4 per cent, said two days later it would not support Frasers’ proposal.

Under UK takeover rules, Frasers, which owns 37 per cent of Mulberry, has until October 28 to make a firm offer or withdraw.

Mulberry shares closed at 125p on Monday.

HSBC has revealed a review of its global structure as new boss Georges Elhedery looks to cut costs and focus on the bank’s core divisions.

The bank said it was merging its commercial and institutional banking operations and creating a new world-class international wealth banking division.

It also simplified the structuring of its scope with the creation of “eastern markets”, incorporating Asia and the Middle East, and “western markets”, comprising the United Kingdom, Europe and the Americas.

HSBC also announced the appointment of Pam Kaur as its new chief financial officer, who joined the bank more than a decade ago.

Elhedery said: ‘The changes we are announcing today will make it easier for our colleagues to serve our customers and drive the future success of the Group. The new structure will result in a simpler, more dynamic and agile organization as we focus on executing our strategic priorities, which remain unchanged.

‘Our local UK and Hong Kong markets, along with our corporate and institutional banking, as well as our wealth and Premier banking businesses, are HSBC’s key strengths.

‘By making these changes, we will be able to better focus on increasing leadership and market share in those companies that have a clear competitive advantage and the greatest opportunities for growth.

“This is how we will accelerate our plans to execute our strategy, unlock the bank’s full potential and ensure our talented colleagues can thrive and deliver the best products and service excellence to our customers.”

Lindsay James, Investment Strategist at Quilter Investors:

‘The UK’s finances are on edge as public sector net debt, excluding public sector banks, was estimated at 98.5 per cent of GDP at the end of September 2024.

‘This is an increase of 4 percent compared to the same period last year. The last time similar levels were seen was in the 1960s, when the incumbent Labor Chancellor was finally forced to adopt a policy of tax increases and spending cuts.

‘Although Rachel Reeves has promised that the UK will not see a return to austerity, a series of tax rises in one form or another are all but guaranteed in next week’s budget.

‘The Chancellor has warned the UK public that there is a huge fiscal ‘black hole’ to fill and has repeatedly indicated that difficult decisions will be necessary.

‘The Labor government will want to avoid a repeat of the negative financial market reactions of recent years to tax cuts and unfunded spending plans, so the Chancellor will need to be transparent in announcing any changes and their expected costs.

‘The mood has been gloomy in the run-up to the budget and, although it remains to be seen how the market will react to any announcement, there are still some positives for the UK economy.

‘For the first time in more than three years, inflation is now well below the Bank of England’s 2% target. The economy finally grew in August after two months of stagnation, and although higher interest rates have begun to take their toll on the labor market, there are still signs of progress.

“With all this considered, the Bank of England is expected to continue on its ‘slow and steady’ path with the possibility of another 0.25% cut at its next policy meeting, which could help lift consumer confidence.” consumer and provide a much-needed boost to the economy.’

UK government borrowing reached £16.6 billion last month, well above the Office for Budget Responsibility’s projections of £15.1 billion and marking the third-highest borrowing figure on record. for September.

However, the reading was below the City’s forecast of £17.5bn for the month.