RBS Confirms £1.2bn Loss After PPI Hit

RBS has confirmed it made a loss before tax of £1.2bn in the third quarter, compared with a profit of £2bn for the same period last year.

As revealed by Sky's City Editor, the bank has set aside a further £400m for the mis-selling of payment protection insurance, meaning the scandal has cost it £1.7bn to date.

This provision took the total compensation bill for Britain's four largest lenders past the £10bn mark.

The 82% taxpayer-owned bank also said it had taken a further hit of £50m to cover costs relating to the summer's massive IT failure - which saw many RBS, NatWest and Ulster Bank customers locked out of their accounts.

It takes its bill for the meltdown to £175m.

The bank also expects to face "material fines" in relation to how Libor and other interest rates were set, it added.

RBS is under investigation by US and UK authorities over the rate-rigging scandal and is expected to be one of the next banks to settle after Barclays was fined £290m in June.

"The group expects to enter into negotiations to settle some of these investigations in the near term and believes the probable outcome is that it will incur financial penalties," RBS said.

It added that it had dismissed "a number of employees for misconduct" after investigations into rate setting.

But the group's core banking operations - if the mis-selling and IT charges are stripped out - performed well, with operating profit for the three months reaching £1bn.

A decline in charges on bad debt helped boost performance at the bank, which said its restructuring would be complete in the next 18 months.

As part of this plan, the number of employees was down by 9,900 from a year earlier, resulting in a 5% fall in staff costs compared to the previous quarter.

The bank described the collapse of the sale of 316 branches to Santander as "disappointing".

As a condition of RBS' state bailout, the European Union ordered it to offload the branches by the end of next year. RBS said it did not expect this to change and so had restarted efforts to sell them.

The group's chief executive, Stephen Hester, said it now needed to focus on improving its reputation.

"The extraordinary challenges which RBS faced following the financial crisis are being worked through successfully," he said in a statement.

"The five year restructuring plan is now in its later stages with important work still to do, including an emphasis on dealing with reputational issues now that the bank's safety and soundness has advanced so well."

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Car Insurance Cost Fall 'Will Not Last'

Car insurance premiums are said to have gone into reverse gear by £360 (13.6%) for young drivers - but there are concerns costs could rise dramatically after next month's EU gender ruling.

Insurance comparison site Confused.com has advised 17 to 20-year-old drivers to take advantage of "today's preferential rates" but warned them to avoid 2013's predicted price hikes by "shopping around".

Average comprehensive car insurance prices now stand at £757 as of this year's third quarter, compared to £843 for last year's third quarter - a significant year-on-year fall of £87 (10.3%).

Car insurance prices actually fell for all age groups, particularly young female drivers, but predictions from the Treasury indicate that young female drivers could see rises of up to 24% after the EU gender ruling becomes law on December 12.

After this date women and men cannot be priced differently for insurance meaning women will no longer directly benefit from being statistically less risky drivers as far as insurers are concerned.

This predicted insurance price rise could affect female drivers throughout various age groups, according to the Treasury data.

Sharon Flaherty, editor of Confused.com, told Sky News: "At the moment women pay less than men and statistically this is because on average they are less of a risk on the roads than young male drivers.

"However the bad news is that on December 21 the law change will mean that men and women have to be judged as exactly the same on the roads.

"Women will effectively be charged more because statistically they will no longer be allowed to be rated as safer on the roads."

Women aged 26-30 years are forecast an 18% price hike once the gender directive takes effect. Female drivers aged 31-35 are expected to suffer a 10% price rise.

Smaller price rises are expected for women aged 36-40 who are predicted to experience a 3% rise, and 41 to 45-year-old female drivers are only expected to receive a 1% price rise for their future car insurance policies.

Women on average saw their premiums shrink by 11.7% over all in the third quarter.

For spouses of either gender the average premium cost for a joint insurance policy is a lot less than average costs for solo drivers.

Male drivers insured plus spouse are quoted on average £432, compared to £907 as insured only driver, for women it costs an average of £787 for insured only driver cover, but just £418 for women who have a spouse on their policy.

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Taxpayer-Backed RBS Hit By £400m PPI Bill

By Mark Kleinman, City Editor

Royal Bank of Scotland (RBS) will tomorrow set aside another £400m for the mis-selling of payment protection insurance, taking the total compensation bill for Britain's big four lenders through the £10bn mark.

I have learned that the £400m charge will be included in RBS's third-quarter results, which are otherwise expected to demonstrate the bank's continued progress towards standalone financial health.

It will, nonetheless, be the PPI provision that will dominate RBS's trading update as the spate of bank mis-selling scandals continues to cast a financial and reputational pall across the industry.

With HSBC expected to report a more modest PPI provision for the third quarter of 2012 next Monday, it will mean that:

- The two major taxpayer-backed lenders have now set aside £7bn between them since the scandal emerged following Lloyds' additional £1bn hit today.

- The third-quarter PPI bill for the big four UK banks will come in not far short of £2.5bn.

- The quartet of lenders which dominate high street banking (Barclays, HSBC, Lloyds and RBS) have now been forced to allocate £10.04bn for PPI mis-selling, with HSBC likely to add in the region of a further £150m next week. Lloyds, which had by far the largest market share, has been hit by a £5.3bn bill; Barclays' exposure is £2bn; RBS's has reached £1.7bn; and HSBC's will be approximately £1.2bn.

- Factoring in the £731m charge taken last year by Santander UK, the fifth-biggest UK lender, will take the aggregate bill so far to almost £11bn (which excludes provisions made by building societies and other smaller lenders).

Bank executives expect the pace of PPI claims to slow down in the coming months, although Lloyds chief executive Antonio Horta-Osorio said today that it was unlikely to be able to provide an estimated final bill for the bank until around the time of its full-year results in February.

Analysts and bankers now believe the total compensation charge will reach as high as £15bn, fuelled in part by the costs associated with hundreds of thousands of bogus and duplicate claims.

PPI will not be the only financial hit disclosed by RBS tomorrow. It will make a further provision of tens of millions of pounds related to the IT breakdown earlier this year which crippled millions of customer accounts.

The bank, which is 82 per cent-owned by the taxpayer, will not make a provision tomorrow for the mis-selling of interest rate swap products to small business customers because a pilot programme being run with the City regulator to discover the extent of customer redress is not yet complete.

RBS is also facing a significant penalty for Libor manipulation, but this will not be quantified for some time yet.

The bank declined to comment.

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Lloyds Sets Aside A Further £1bn For PPI

Lloyds Banking Group has set aside a further £1bn to cover costs relating to the mis-selling of payment protection insurance (PPI) - taking its total bill to £5.3bn.

The announcement came as the 40% taxpayer-owned bank said it made a pre-tax statutory loss of £583m in the nine months to the end of September.

This compares with a £3.8bn loss over the same period last year.

If the cost of PPI is stripped from the results, the group's underlying profit hit £1.9bn for the three quarters - compared with 2011's £768m.

Lloyds had already set aside £4.3bn to repay customers wrongly sold the insurance - much more than its rivals because it had the biggest share of the PPI market.

It said it had paid out 70% of its provision by the end of September, and that the volume of claims had fallen to £250m in the last three months. 

The bank's chief executive, Antonio Horta-Osorio, said the "ultimate cost" of the PPI scandal was "going to be huge" - and the bank would not know the full extent of the damage until at least March next year.

Mr Horta-Osorio, who has been charged with turning around the bank following its 2008 bailout, said it is making good progress with its cost-cutting.

Lloyds' bad debts are expected to fall to this year to around £6bn - some £1.2bn less than it expected at the start of 2012.

"We have made further significant progress this quarter, improving underlying performance in a challenging environment, while continuing to deliver returns above the cost of equity in the core business and strengthen our already robust balance sheet." Mr Horta-Osorio said.

On a conference call following the results, he insisted retail banking in the UK was competitive, and stressed that Lloyds was continuing to boost its lending to small and medium-sized businesses and provide mortgages to first buyers.

The group's share price rose 3.6% in early trading. 

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JP Morgan UK Staff Hit By Offshore Tax Demand

JP Morgan workers have been ordered to pay tax - or face legal action - over allegations the firm transferred salary payments offshore, Sky News has learned.

HM Revenue and Customs (HMRC) deemed the money as "disguised remuneration" and not retirement benefits as claimed.

Workers and executives have been told they must agree to pay up to 40% backdated income tax, 1% National Insurance contributions and interest accrued by December 7.

JP Morgan Chase and Co has agreed to pay 12.8% NI contributions for those who accept the settlement terms.

Those who do not agree to the terms face the threat of legal action from by the Tax Office.

Sky News understands the money since classified as earnings by HMRC was transferred to Jersey from 1998, with most transferred from the 2005/6 tax year onwards.

The specified amount paid by individuals to the Tax Office to avoid litigation will be determined ultimately by how many agree to the settlement terms on offer. The investment bank employs thousands of people in the UK.

The Tax Office has offered settlements to numerous trust beneficiaries

In a letter to the head of JP Morgan's tax department dated September 10, HMRC said: "As you are aware, the Government put in place legislation in 2011 to put beyond doubt the tax treatment of employee benefit trust arrangements.

"In addition, HMRC continues to robustly challenge the taxation treatment of such arrangements under previous legislation.

It adds: "In this context and where we are unable to agree a settlement HMRC will continue to formally progress its enquiries into the taxation treatment of the trusts."

Last year HMRC contacted more than 2,000 employers and offered settlements over disputed employee benefit trusts (EBTs).

Earlier this year action was taken by HMRC against UBS and Deutsche Bank over EBTs, which contested the Tax Office claims.

HMRC has estimated that up to £1.7bn of tax and NI contributions were at stake in EBTs, including the "dependent fund" plans operated by JP Morgan.

The investment bank's staff who were part of the employee benefit trusts of 1998, 2006, 2007 and 2008 and the 2010 executive retirement plan are affected by the HMRC action.

The ruling impacts both current and former UK-based staff, whether or not they are British citizens or foreign nationals.

The employees' Jersey tax haven funds have been managed by subsidiaries of the Royal Bank of Canada (RBC), which describe the island as "tax neutral".

RBC's wealth management section actively promotes the benefits of using the island for affluent individuals.

"The chief preoccupation of most ultra high net worth families is wealth preservation," RBC explains on its website.

"Only by structuring their affairs legitimately and with the advice of professionals, including lawyers, accountants, trust and tax experts, private clients will be able to protect their assets."

RBC Europe Ltd has offered JP Morgan workers collaterised bridging loans of more than £250,000 to fund the Tax Office demand.

Jersey is described as "tax neutral" by fund manager RBC

JP Morgan's private bank has also offered financing arrangements for those who need more than £300,000, or mortgage arrangements in excess of £1m, to facilitate the settlement payments.

Helplines have been set up for workers in regard of the Tax Office offer by JP Morgan, RBC and advisers KPMG.

JP Morgan still disputes the offshore payments as being salary but has agreed to the settlement to avoid litigation under the recently enacted Disguised Remuneration legislation.

A JP Morgan spokesman told Sky News: "Our employee trust has always been transparent to HMRC, and its independent trustee has consistently paid taxes in accordance with UK tax law.

"In addition to taxes paid by the trust, JP Morgan has paid, on average, more than £1bn of corporation and payroll taxes to HMRC annually over the past decade."

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Superstorm Sandy Could Cost The US $45bn

Superstorm Sandy, which ripped through the east coast of the US, could cost around $45bn (£27.9bn), according to the latest estimate.

The figure, from professional services firm PwC, allows for a rise in original estimations as the full scale of damage becomes clear.

"There is clearly the potential for initial estimates to rise as we saw with Hurricane Katrina and Hurricane Irene which underestimated the scale and level of damage caused," Mohammad Khan, insurance partner, PwC said.

An earlier estimate by forecasting company IHS Global Insight said the storm would cause about $20bn (£12.4bn) in damage and between $10bn (£ 6.2bn) and $30bn (£18.6bn) in lost business.

While risk consultants AIR Worldwide estimated losses up to $15bn (£9.3bn).

Mr Khan added that interruptions to business will make up a significant part of the overall losses - with Hurricane Katrina these claims made up approximately 20% of the overall insurance claims.

Damage on the New Jersey coastline

"Whether this is applicable to Sandy depends on the swiftness of recovery of the subway and other transports links which would be a good proxy for the recovery of New York in general," he said.

Businesses have been hit by a host of problems caused by the storm, including the flooding of the New York subway system which suffered the worst damage in its 108-year history.

New York mayor Michael Bloomberg said it could be four or five days before the subway is running again.

The city's financial district was also flooded by torrents of rainwater - leading to the closure of Wall Street on both Monday and Tuesday.

They reopened on Wednesday, with mayor Bloomberg ringing the bell at the New York Stock Exchange.

A road in North Carolina buckles following the storm

Dr Jeffrey Gedmin, from the Legatum Institute think-tank in London, told Sky News the problem with the recovery was that the storm had hit one of America's most populous and economically active regions.

"We're talking about 60 million people, nearly the population of the UK," he said.

"Post-Sandy projections have US economic output now reduced by at least $25bn for the last quarter of 2012.

"For an economy that has been creeping along with two per cent growth, that's troubling.

"America has fiscal housekeeping to do. Sandy has just made the job harder."

At the height of the storm, more than 8 million homes and businesses lost electricity - nearly a quarter of which were in New York.

Power company Consolidated Edison said it would be four days before its customers in Manhattan and Brooklyn would have power again, and it could take a week to restore outages in other New York districts.

But there was some good news from the region's airports - John F. Kennedy International in New York and Newark Liberty International said they planned to reopen with limited service on Wednesday.

Almost 19,000 flights have been cancelled since Sunday, according to flight tracking service FlightAware.com, and New York's LaGuardia Airport is still flooded and remained closed.

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Star Wars Given New Hope In £2.5bn Disney Deal

Disney has agreed a deal to buy Lucasfilm from its founder George Lucas and says it will make a new series of Star Wars movies.

The US entertainment giant, which already owns brands such as Pixar, Marvel, ESPN and ABC, announced it is paying $4.05bn (£2.52bn) for the production company.

It also confirmed it is making Star Wars Episode 7, which is scheduled to be released in 2015.

Disney said the project would be the first in a new series of Star Wars films, with Disney chief executive Bob Iger revealing the plan is to release a new movie every two to three years.

The last Star Wars picture was Revenge Of The Sith in 2005, and Lucas has in the past suggested there were no plans for any more.

The deal also includes the rights to the Indiana Jones franchise, although Disney did not reveal if it planned to revive the films featuring the action hero, played by Harrison Ford.

Kathleen Kennedy, the current co-chairman of Lucasfilm, will become its president and report to Walt Disney Studios chairman Alan Horn.

The deal could also spell a return for Harrison Ford's Indiana Jones

Lucas, who created the Star Wars fictional universe and with it one of the most lucrative box office draws of all time, will be creative consultant on the new films.

After the deal was announced he said: "It's now time for me to pass Star Wars on to a new generation of filmmakers.

"I've always believed that Star Wars could live beyond me and I thought it was important to set up the transition during my lifetime."

Lucas will become the second-largest individual holder of Disney shares, with a 2.2% stake.

Disney will pay about half the purchase price in cash and issue about 40 million shares to complete the deal.

Chief financial officer Jay Rasulo, in prepared remarks, said the deal would lower Disney's earnings per share by a low single-digits percentage in 2013 and 2014.

He also said Disney would repurchase all of the issued shares on the open market within the next two years, on top of planned buybacks.

The deal marks the third time in less than seven years that Disney has signed a massive deal to take over beloved studios or characters, part of its strategy to acquire brands that can be stretched across TV, movies, theme parks and the internet.

In early 2006, Disney struck a deal to acquire Toy Story creator Pixar, and in the summer of 2009 it bought the comic book powerhouse Marvel Entertainment.

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Heseltine Reveals Radical Local Growth Plan

By Joey Jones, Deputy Political Editor

Former Cabinet minister Lord Heseltine has published a sweeping report aimed at stimulating growth, which is littered with criticism of Government inertia and delay.

The report, entitled No Stone Unturned, was commissioned by the Chancellor more than a year ago, but has been dogged by rumours that senior ministers have become increasingly doubtful about its viability.

Lord Heseltine advocates a major shift of power and money from Whitehall departments to Local Enterprise Partnerships (LEPs), the grassroots business organisations that have replaced Regional Development Agencies under the current Government.

His proposals would result in a massive expansion of LEP finance. Currently each LEP manages a budget running into millions of pounds, but Lord Heseltine suggests they should be empowered to bid for tens of billions of pounds currently administered by central Government.

The report earmarks £49bn of Government funding under the current spending period that would be better spent by LEPs, but suggests the bidding process should only begin in the run-up to the next spending review.

Lord Heseltine is harshly critical of Government departments' unwillingness to change, and argues that the current administration has been guilty of damaging delay in its approach to major projects including re-equipping the aviation network in the southeast of England.

The former president of the Board of Trade admits that many of the ideas contained in his report have been put forward in the past only to be kicked into the long grass.

He argues that there are grounds for optimism in that the current Government will act where others have sat on their hands.

The fact that the Chancellor and Prime Minister were eager for him to take on the job indicates, in his view, their appetite for controversial but productive reform.

Lord Heseltine also points out that some of his proposals "go with the grain" of the Government's localism agenda.

When asked how he would react in a year's time if his report ends up gathering dust like so many before it, Lord Heseltine was philosophical.

"I'll just get on running my garden," he told Sky News. "I've done my bit."

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Royal Mail Delivers 1,000 New Parcel Jobs

Royal Mail is to create 1,000 new jobs as it looks to cash in on the boom in online retailing.

Royal Mail is planning a £75m investment programme in its UK express parcels business as packages become increasingly important to the company against a backdrop of a plunging letter numbers as email takes more of the strain.

In the last reported financial year, its parcels businesses accounted for almost half of the group's revenues, excluding the Post Office, and online retailing is expected to continue increasing as stores place a greater emphasis in their online offerings.

High rents, other cost pressures and low consumer confidence have combined to hurt the high street since the financial crisis, prompting many retailers to invest heavily in online.

As a result, Royal Mail is to open a new parcel processing centre in Chorley in Lancashire next year, two new depots will be opened in Cornwall and Hampshire with a further nine existing depots expanded or moved to larger sites over the next four years.

Royal Mail Group's chief executive Moya Greene said: "Our investment is part of Royal Mail Group's strategy to grow its parcels businesses in the UK and overseas.

"Our strategy is to convert the rise in parcel volumes into profitable growth. That means becoming a much more customer-focused company being run on commercial lines and investing in new, vital technology."

The move was welcomed by the Government.

Mark Hoban, minister for employment, said: "It is great news that 1,000 new jobs will be created across the country as a result of this investment.

"We've now got a record number of people in employment and these jobs will provide welcome opportunities for people who are looking for work."

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Superfast 4G Launched In 10 Cities Across UK

Superfast 4G broadband is made available to millions of consumers in 10 UK cities today, heralding a new era for mobile phone use.

EE, formerly known as Everything Everywhere, is launching its range of 4G products and services in London, Bristol, Birmingham, Cardiff, Leeds, Sheffield, Edinburgh, Glasgow, Liverpool and Manchester.

Offering speeds up to five times faster than 3G, the service will be available on the Apple iPhone 5 and devices from HTC, Samsung, Nokia and Huawei.

It comes as EE's 4G pricing plans faces heavy criticism, with additional charges for customers on certain tariffs if they exceed download allowances.

Long queues are expected at shops across the country as consumers rush to sign up to the new service and get their hands on a 4G device.

EE customers in six more cities - Belfast, Derby, Hull, Newcastle, Nottingham and Southampton - will have access to 4G by the end of the year.

EE is the sole UK provider of 4G until next year

The group then plans to roll out the service to further towns, cities and rural areas next year, with population coverage of 70% and rising to 98% in 2014.

Rival operators including Vodafone, O2 owner Telefonica and Three will be able to launch their own 4G services and products from next spring.

The companies had threatened legal action against communications regulator Ofcom over its 4G auction process, which has allowed EE to be the sole UK provider of the superfast services until next year.

Vodafone launched a '4G phone promise' last week, offering customers the chance to bring an eligible phone into any store and have 70% knocked off their remaining contract, in exchange for taking on a 4G device.

The services will allow uninterrupted access to the web on the go, high definition movies to be downloaded in minutes and TV to be streamed without buffering.

The cheapest EE tariff offers just 500mb worth of downloads each month with customers who want to download more than their allowance forced to pay extra.

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Exclusive: Lords Unite In Newspaper Deal

By Mark Kleinman, City Editor

One of the City's most influential investors is to back an audacious attempt to consolidate Britain's flagging regional newspaper sector by merging the business interests of Lord Rothermere and Baron Iliffe.

I can reveal that Iliffe News & Media, owner of the Cambridge News and Hertfordshire Mercury, and Northcliffe Media, the regionals arm of Daily Mail & General Trust (DMGT), are in advanced talks to pool their assets into a new vehicle spearheaded by David Montgomery, the former editor of the News Of The World.

The deal will create a business with more than £250m of annual revenue and could spark a bidding war in the regional newspaper industry involving Trinity Mirror and Johnston Press, two of the three largest players.

I understand that Crispin Odey, whose hedge fund Odey Asset Management is among the most prominent names in the City, has agreed to support a deal that would combine Iliffe and Northcliffe.

They will be folded into a new vehicle called Local World plc that will be privately-owned. Mr Montgomery will own a stake in it, while Iliffe's parent group, Yattendon, and DMGT will between them own close to 50%.

The deal is also being backed by a syndicate of banks led by Bank of Ireland, HSBC and Lloyds Banking Group, which are on the verge of agreeing new borrowing facilities with the enlarged group.

A spokeswoman for Yattendon said: "I can confirm that Yattendon Group has held preliminary discussions with David Montgomery about becoming founder shareholders in a new local media company.

"We have a shared vision about the long term opportunities for local media but at this stage there is no certainty whether these discussions will lead to a satisfactory conclusion."

DMGT tried to sell Northcliffe in 2005 in a deal that would have valued the business at more than £1bn.

The proposed new transaction will value Northcliffe at little more than 10% of that price-tag, underlining the declining fortunes in the regional newspaper sector in recent years.

The industry has been hit by the waning economy as well as sharp declines in print advertising revenue and soaring print costs.

DMGT has subsequently cut hundreds of jobs at Northcliffe and switched some of its newspapers to digital-only titles to combat the slump.

Yattendon, which owns assets in agriculture, property and marine leisure as well as local media, will not take any cash out of the deal but will roll its entire newspaper investment into the new vehicle.

The group used to own titles including the Birmingham Post and the Coventry Telegraph before selling them.

The deal to create Local World has not yet been formally agreed but could be within weeks. If it does get completed, it would represent a significant step in the long-awaited consolidation of the regionals sector.

Mr Montgomery is likely to use the initial deal to pursue further mergers, potentially with Johnston or Trinity, according to insiders. Reports of his interest in Northcliffe have been circulating for the last few weeks.

A spokesman for DMGT said: "In response to media speculation, DMGT confirms that it is currently in talks regarding the future of Northcliffe Media.

"No deal or transaction has been agreed, but if these talks move to the point where agreement is reached, an announcement will be made to the market."

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Tearful 'Rogue Trader' Tells Of UBS Losses

A trader accused of Britain's biggest fraud was allegedly trying to cover millions of pounds worth of losses incurred during the financial crisis for the bank he called his "family", a court has heard.

Kweku Adoboli, 32, is accused of gambling away £1.4bn while working as a trader for Swiss bank UBS.

At one point, he was at risk of causing the bank losses of $12bn (£7.5bn), jurors at Southwark Crown Court were told.

Adoboli wept as he gave evidence for the first time at his trial, in which he claimed his off-book trades were to cover $40m (£24.9m) annual losses of his portfolio of companies from 2008.

The court heard that by 2007 Adoboli, aged just 27, and more senior trader John Hughes, 25, were in charge of a portfolio of companies with assets of $50bn (£31.1bn).

"Our book was massive. A tiny mistake led to huge losses. We were these two kids trying to make it work," he said.

Mr Adoboli, wearing a dark suit and red tie, denied he was a "gambler" and said his knowledge of UBS's systems did not result in "fraudulent behaviour".

Fighting back tears, he said: "It's hard to find the words to describe the relationship I had with UBS as an organisation. It isn't about a bank. It was about what I thought was my family, considering how much (I) neglected my real friends and family.

"Every single bit of effort I put into that organisation was for the benefit of the bank, the people around me and the book I worked on.

"If I was not so proud to work for UBS, I would never put so much effort trying to convince them that we could achieve something at this bank."

He added: "To find yourself in Wandsworth Prison for nine months because all you did was work so hard for this bank..." before stopping as he broke down in tears.

Mr Adoboli is facing two counts of fraud and four counts of false accounting between October 2008 and September 2011, allegedly gambling away the money on high-risk illegal trades aimed at boosting his annual bonuses and job prospects.

The former public schoolboy worked for UBS's global synthetic equities division, buying and selling exchange traded funds (ETFs), which track different types of stocks, bonds or commodities such as metals.

Ghanaian-born Mr Adoboli enjoyed a rapid rise at UBS after completing an internship while a student at Nottingham University in 2002, the court heard.

Mr Adoboli told the court he feared UBS would not survive $52bn (£32.3bn) losses incurred in 2007-08 as the banking crisis took hold.

He said: "The effect on the organisation was incredible. There were times we thought there was no way the organisation would survive. I grew up with UBS. I felt very loyal to UBS.

"What could we do to help this organisation survive this incredible crisis?"

The trial continues.

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Victory For Man Who Took Cold Caller To Court

A businessman plagued by nuisance phone calls offering compensation for Payment Protection Insurance has secured £220 in an out-of-court settlement.

Richard Herman, 53, was so fed up with the unwanted calls arriving from India, he decided to take matters into his own hands.

He warned the company that, in future, he would invoice them £10 for every minute of his time they used.

When the calls continued he began recording them before finally invoicing the company £195 for their use of his "time, telephone and electricity".

Upon receipt of the invoice the marketing firm acting on behalf of UK-based PPI Claimline Ltd, denied making the calls. When Mr Herman revealed he had recorded evidence, they still refused to pay.

But when Mr Herman filed a claim in the small claims court for the unpaid invoice - plus £25 in costs - the company offered to settle the debt out of court and transferred £220 into his bank account.

Mr Herman filed in the small claims court when his invoice was not paid

Mr Herman said: "I kept being called, as we all do, and I thought the only way for them to stop would be for me to speak to them and say, 'For goodness sake, take me off your list!'

"Then it occurred to me to tell them that if they call again I'll charge for my time. When they continued calling I sent them an invoice for 19.5 minutes."

To encourage others to do the same Mr Herman has set up a website with examples of covering letters and invoices to send to nuisance callers.

Even though the validity of Mr Herman's original invoice was not tested in court, he believes anyone who warns cold-calling companies they will be charged if they call, have a right to invoice them.

"I did business studies at 17 and studied 'offer-and-acceptance' so I knew a verbal contract is just as valid as a written one but harder to prove.

"The recorded calls proved I did tell them I would charge for my time if they called again".

Mr Herman, who works in the telephone industry selling call-recording equipment, said his action was a last resort after asking the Information Commissioner and the Telephone Preference Service for help.

In a statment, PPI Claimline said: "We would like to stress that all our supplier relationships are subject to strict contractual provisions requiring full compliance with all relevant regulations, including those which relate to data protection and the telephone preference service.

"We would like to draw a clear line between the two calls to Mr Herman made on behalf of PPI Claimline and any other calls he received, which were nothing to do with PPI Claimline or its suppliers."

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