RBS reports £3.5bn loss for 2014

26 February 2015 Last updated at 12:09

UK state-owned bank RBS has reported a loss of £3.5bn for 2014, down from a £9bn loss the previous year.

The results were hit by a £4bn writedown on the sale of its US business, Citizens.

The bank's chief executive Ross McEwan confirmed he would not receive a bonus this year.

But RBS will still pay out bonuses from a pool of £421m, which is some 21% smaller than in 2013.

'Fair pay' Continue reading the main story

Mr McEwan defended the size of the bonus pool.

Speaking on the Today programme he described it as "fair pay" and said it was necessary to pay bonuses to attract people to carry out "fairly technical jobs".

The bank is 79%-owned by the British taxpayer after a government-led rescue in 2008.

Chancellor of the Exchequer George Osborne has written a letter to the new chairman of the bank, Howard Davies, saying he expected the bank not to give bonuses to senior executives.

He wrote: "I would also expect that, as in the past, no executive directors or members of the executive committee will receive bonuses, despite improved profitability.

"Given the extraordinary support it has enjoyed in the past from taxpayers, I know you recognise that RBS must remain a backmarker on pay and continue to show responsibility and restraint."

Thursday's results show that after one-off costs are stripped out operating profits were £3.5bn last year, the highest since 2010.

Analysis: Kamal Ahmed, Business Editor

Ross McEwan, when he's waded through the arguments about why bankers are paid lots of money, is running a bank that in many respects is on the road to recovery.

Its core operation is actually making a profit of more than £3bn.

That is for two reasons.

The bank has removed itself from a lot of tricky, low profit investment banking activities in countries where returns were volatile.

And, given its UK focus, it is gaining from the improvement in the economy.

RBS is now focused on providing relatively vanilla services to individuals and businesses in the UK and Western Europe, with a small operation in Asia.

And as the economy grows, those can be pretty lucrative businesses.

More from Kamal: The shrinking bank

Cost cuts

RBS is in the midst of a major reorganisation.

The bank said it had reduced costs by some £1.1bn and will cut another £800m this year.

It is cutting back its corporate and institutional banking network from 38 countries at the end of last year to 13.

It will end investment banking in the Middle East and Africa and "significantly" reduce its presence in Asia and the US, concentrating instead on the UK and western Europe.

RBS said it was building a bank that was "stronger, simpler and better for both customers and shareholders".

However, Britain's biggest union Unite said it was seeking an urgent meeting with RBS for clarification over the impact the restructuring would have on jobs.

"Unite is deeply concerned that the announcement ... of further restructuring will unfairly impact low paid and administration staff" said senior union official Rob MacGregor.

"Already over 30,000 jobs have been cut from across RBS since the bailout in 2008."

Fines and compensation

RBS has put aside £2.2bn to cover "litigation and conducts costs".

These include fines and compensation payments for the mis-selling of payment protection insurance, a massive computer failure, the mis-selling of interest rate products to small businesses and the manipulation of the foreign exchange market.

The bank is also liable to face fines over its involvement in American mortgage products which were at the heart of the US financial crisis.

Shares fall

RBS shares were down 3.6% in late morning trading.

Richard Hunter, Head of Equities at Hargreaves Lansdown Stockbrokers said: "There is little doubt that RBS is making progress.

"Even so, with the finished product still some way off and no dividend to encourage investment in the meantime, the general consensus on the shares as a sell is likely to remain intact for now."

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Savile 'abused 63 people at hospital'

26 February 2015 Last updated at 12:10

Jimmy Savile abused 63 people connected to Stoke Mandeville Hospital, but one formal complaint was ignored, an independent report has found.

It found Savile's reputation as a "sex pest" was an "open secret" among some staff - but allegations probably did not reach managers.

The formal complaint - made in 1977 by a victim's father - should have been reported to police, it added.

A separate report said "elements of the Savile story" could happen again.

Follow the BBC's live coverage here.

The Stoke Mandeville report said the victims, abused from 1968-92, were aged eight to 40.

Health Secretary Jeremy Hunt said people were "too dazzled or too intimidated to confront the evil predator we now know he was".

The report found:

• Savile had "virtually unrestricted access" to clinical areas and patients during the 1970s and 80s
• several sex abuse claims were made against him from 1972-85, to different staff members, but only one was a "formal complaint"
• that complaint by a father "should have led to Savile's suspension from the hospital and a formal police report being made"
• there was probably no "hospital-wide intelligence" on Savile
• information known to junior staff and middle managers was "probably filtered out" before reaching senior managers
• over the past 40 years Stoke Mandeville had employed three doctors who had been "subsequently been convicted of sex crimes against patients"

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Lead investigator Dr Androulla Johnstone said there had been failures in the duty to protect victims

Dr Androulla Johnstone, the report's lead investigator, said the victims were "patients, staff, visitors, volunteers and charity fundraisers" - with almost half aged under 16 and 10 under the age of 12.

"Around one third of his attacks were against patients, just over 90% of the victims were female," she said.

"The sexual abuse ranged from inappropriate touching to rape.

"Savile was an opportunistic predator who could also on occasions show a high degree of pre-meditation when planning attacks on his victims."

Savile met Margaret Thatcher, then prime minister, to discuss the funding of Stoke Mandeville's spinal injuries unit in 1980 - and in the same year was appointed to oversee fundraising and rebuilding of the unit.

Dr Johnstone said supervision of Savile at this time was "absent" and - with "statutory functions… in the hands of a celebrity fundraiser" - government and NHS "lost control" of the project.

The Stoke Mandeville report said the hospital trust had tackled Savile's power and influence there "head on" from 1991, and managed to "diminish his authority" - but it took until 1999 to "resolve the situation".

"This says a great deal about the power of the man and the legacy of the historical permissions that had been given to him," it said.

'Weakness for celebrities'

In another report, also newly published, former barrister and NHS executive Kate Lampard reviewed how Savile could have abused victims at 41 NHS hospitals.

"While it might be tempting to dismiss the Savile case as wholly exceptional, a unique result of the perfect storm of circumstances, the evidence we have gathered indicates that there are many elements of the Savile story that could be repeated in future," the Lampard report said.

"There is always a risk of the abuse, including sexual abuse, of people in hospitals.

"There will always be people who seek to gain undue influence and power within public institutions including in hospitals."

The report said society had a "weakness for celebrities" and hospitals must be aware of the risks.

Mr Hunt said: "Whilst no system can ever be totally secure from a manipulative and deceitful predator like Savile, we learned last year that there were clear failings in the security, culture and processes of many NHS organisations, allowing terrible abuse to continue unchecked over many years.

"What happened was horrific, caused immeasurable and often permanent damage, and betrayed vulnerable people who trusted us to keep them safe. We let them down."

Hattie Llewelyn-Davies, chairwoman of Buckinghamshire Healthcare NHS Trust, said: "On behalf of the NHS organisations that existed at the time and those that exist today, I want to say sorry to all of Jimmy Savile's victims.

"I know how difficult it must have been for you to come forward and tell your stories after such a long time."

She said Stoke Mandeville was now a "very different place" but no "sense of complacency" would be allowed.

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Hattie Llewelyn-Davies apologised to Savile's victims

Liz Dux, of law firm Slater and Gordon, which represents 44 of Savile's victims, said: "It beggars belief that a report which has revealed Savile was widely known as a sex pest at Stoke Mandeville can find no evidence of management responsibility."

She said victims deserved "more accountability".

The latest reports add to a series published last June.

Simultaneously, the Department for Education has published a string of reports by local authorities into allegations of abuse at a number of children's homes and schools.

In a written statement, Children's Minister Edward Timpson said that although the investigations were complete they had been unable to substantiate any of the allegations.

He said: "None of the investigations have been able to reach firm conclusions about whether the alleged abuse took place or not.

"Although many of them say the informant was credible, the lack of corroborating evidence has prevented them from reaching a definitive conclusion."

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'Jihadi John' named as London man

26 February 2015 Last updated at 11:46

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The masked militant first appeared in numerous gruesome videos put out by Islamic State, as Lucy Manning reports

The masked Islamic State militant known as "Jihadi John", who has been pictured in the videos of the beheadings of Western hostages, has been named.

The BBC understands he is Mohammed Emwazi, a Kuwaiti-born British man in his mid-20s from West London, who was known to UK security services.

They chose not to disclose his name earlier for operational reasons.

Emwazi first appeared in a video last August, when he apparently killed the American journalist James Foley.

He was later thought to have been pictured in the videos of the beheadings of US journalist Steven Sotloff, British aid worker David Haines, British taxi driver Alan Henning, and American aid worker Abdul-Rahman Kassig, also known as Peter.

In each of the videos, the militant appeared dressed in a black robe with a black balaclava covering all but his eyes and top of his nose.

Analysis: Dominic Casciani, BBC News

We don't know when the British or the American security services worked out that the masked man in the killing videos was Londoner Mohammed Emwazi.

But we do know that he was a "person of interest" to MI5 going back to at least 2011 because he features in semi-secret court cases relating to extremism overseas and back in the UK.

Nobody in official security circles is going to comment on what they know and why they know it.

Emwazi has been previously described as a member of a network involving at least 13 men from London - and at least two of them were subjected to house arrest control orders or T-Pims. One absconded. The chances of Emwazi ever returning to the UK are vanishingly small.

@BBCDomC

Speaking with a British accent, he taunted and threatened Western powers before holding his knife to the hostages' necks, appearing to start to cutting before the film stops.

Last month, the militant appeared in a video with the Japanese hostages Haruna Yukawa and Kenji Goto, shortly before they were killed.

BBC News special correspondent Lucy Manning says Emwazi is understood to be around 27 years of age.

Friends of Emzawi told the Washington Post that he was raised in a middle class area of West London and studied computer programming at the University of Westminster.

Our correspondent says it is believed he was known to security services in the UK and the US before leaving for Syria and was linked to a man with connections to the jihadist militant group al-Shabab, in Somalia.

The Washington Post said he was believed to have travelled to Syria around 2012 and later joined Islamic State, which has declared the creation of a "caliphate" in the large swathes of Syria and neighbouring Iraq it controls.

British police declined to comment on the reports.

Commander Richard Walton, head of the Metropolitan Police's Counter Terrorism Command, said: "We have previously asked media outlets not to speculate about the details of our investigation on the basis that life is at risk.

"We are not going to confirm the identity of anyone at this stage or give an update on the progress of this live counter-terrorism investigation."

Jihadi John sightings

• August 2014: Video in which US journalist James Foley is beheaded
• September 2014: Video in which US journalist Steve Sotloff is apparently beheaded
• September 2014: Video in which British aid worker David Haines is apparently beheaded
• October 2014: Video in which British aid worker Alan Henning is apparently beheaded
• November 2014: Video in which Emwazi is shown killing a Syrian soldier in a mass beheading, which also shows body of US aid worker, Abdul-Rahman Kassig, also known as Peter Kassig
• January 2015: Video which appears to show the beheading of Japanese hostage Haruna Yukawa
• January 2015: Video which appears to show the beheading of abducted Japanese journalist, Kenji Goto.

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Victoria Cross for Afghan raid hero

26 February 2015 Last updated at 08:21

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L/Cpl Joshua Leakey shares his story with the BBC's Sian Lloyd

A paratrooper who showed "complete disregard" for his own safety during a Taliban attack in Afghanistan has been awarded the Victoria Cross - the highest British military honour.

L/Cpl Joshua Leakey, 27, of the Parachute Regiment, was recognised for his valour during the 2013 attack.

He is the third serviceman - and the first living servicemen - to receive the medal for service in Afghanistan.

L/Cpl Leakey, from Hampshire, said he was "deeply honoured".

He has been recognised with the VC almost 70 years after another member of his family was awarded the same honour.

L/Cpl Leakey's second cousin twice removed, Sergeant Nigel Gray Leakey, was a posthumous recipient of the VC in November 1945, for his actions while fighting in Africa during the Second World War.

'Bullets ricocheting'

He has been awarded the medal for his bravery during an assault on a Taliban stronghold in Helmand province, on 22 August 2013.

Despite coming under enemy fire, L/Cpl Leakey twice came to the aid of a wounded US Marine Corps captain and helped forces regain the initiative after they had been pinned down by fire and surrounded by insurgents.

Analysis By Sian Lloyd, BBC News

The Victoria Cross is the highest award for gallantry in the presence of the enemy and can be given to all ranks of the services and civilians.

Introduced in 1856 by Queen Victoria to honour acts during the Crimean War, it has been awarded 1,356 times. But this is only the 15th time since the end of World War Two.

L/Cpl Leakey is the third British soldier to receive a VC from the conflict in Afghanistan. On the two previous occasions, it was given posthumously - in 2013 to L/Cpl James Ashworth from 1st Battalion Grenadier Guards, and in 2006 to Cpl Bryan Budd of 3 Para.

Until now Pte Johnson Beharry from 1st Battalion the Princess of Wales's Royal Regiment was the only non-posthumous British military recipient since 1965, for two separate acts of gallantry in Iraq.

Each medal is made from the bronze of Russian guns captured at the siege of Sevastopol during the Crimea War, although modern research suggests Chinese guns may have been used at various times.

After dismounting from helicopters, a group of UK and US forces came under attack from around 20 insurgents armed with machine guns and rocket-propelled grenades.

Soldiers from the group became pinned down by fire on the side of the hill and surrounded by insurgents.

L/Cpl Leakey ran to the top of a hill, despite enemy fire, to assess the situation and provided first aid to a wounded US Marine Corps captain.

He then ran back up the hill to reposition a machine gun and began firing at the insurgents, despite bullets "ricocheting" off the machine gun's frame.

Despite the danger, he returned to the injured captain - drawing enemy fire again - to retrieve a second machine gun, before running back to the crest of the hill once more, where he managed to help regain the initiative.

During the battle, 11 insurgents were killed and four were wounded.

L/Cpl Leakey said the only thing he was scared of during the fire fight was "letting my cap badge down".

'Best position'

"You don't really think what could happen to yourself, you think 'how is what I'm doing now going to improve the situation?'," he said.

"It's part of the very nature of being in the Army, and especially the Parachute Regiment, that we have to adapt to situations you don't expect to happen."

He told the BBC: "In that particular incident I was in the best position to do that. If it had been any of my mates they would be in this position now."

"I don't look at it about being about me in particular, I look at this as representing everyone from my unit, from my battalion, who was involved in the campaign in Afghanistan," he added.

In a statement, his parents said they were "hugely proud" of their son.

"As Josh's parents we are so thankful to God that he survived that day - along with many other occasions during his three operational tours in Afghanistan.

"Our hearts go out to so many other parents whose sons and daughters did not survive that long conflict."

L/Cpl Leakey's medal was announced during a ceremony at St James's Palace on Wednesday, before recipients of military awards were welcomed at 10 Downing Street.

L/Cpl Leakey "epitomised valour with his actions on that hillside in Helmand", Prime Minister David Cameron said.

"When you hear how events unfolded and the intensity of enemy fire, it is difficult to imagine how one wouldn't be frozen to the spot and yet L/Cpl Leakey risked his life to run across that barren hillside not just once, but multiple times, to turn the battle and save the lives of comrades."

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UK net migration rises to 298,000

26 February 2015 Last updated at 12:05

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Immigration minister James Brokenshire: "The ambition remains to see that migration numbers do come down"

Net migration to the UK has risen to 298,000, according to the final set of figures before the election.

The numbers, for the year ending in September 2014, is now well above the level of migration when David Cameron came to power in 2010.

The Tories, who had hoped to get it to below 100,000, said the figures were "disappointing" and blamed a rise in EU migration - and Lib Dem "constraints".

Labour said Mr Cameron's "grand promises" were "now in tatters".

Home Office Minister James Brokenshire said: "We have been blown off course by net migration from within the EU, which has more than doubled since 2010.

"That's why we need to continue to crack down on the abuse of EU free movement and continue our reforms to make our welfare system fairer and less open to abuse.

"We have also been constrained in government by Liberal Democrats who don't have that same aim and focus on reducing net migration."

Employment agencies

He declined to say whether the party would repeat their goal of cutting net migration to the "tens of thousands" at the coming election, instead saying their goal remained getting migration down to long-term sustainable levels.

Labour's shadow home secretary Yvette Cooper told BBC News: "No wonder people don't have trust in the immigration system when they have these kinds of promises being broken."

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Yvette Cooper claims the government's "grand promises" on net migration are now "in tatters"

She said the Conservatives had been wrong to focus on net migration and should have strengthened border controls to tackle illegal immigration, "where enforcement has got worse".

"Theresa May's obsession with the target has led her to target valuable university students, who bring billions into Britain whilst doing nothing to make the labour market fairer for local workers, preventing undercutting by exploitative employers or putting in place proper border controls so we can count people in and out to enforce the rules," she said.

UKIP, which campaigns for Britain to leave the EU and wants an Australian-style work permit system, said the government "should be ashamed of its abject failure to keep control of the constantly rising numbers of those arriving here".

The party's migration spokesman Steven Woolfe MEP said: "Migration is one of the top concerns going into this election and it is clear that UKIP is the only party trusted to deal with it."

'Very embarrassing'

Net migration is the difference between the number of people who come to live in the UK for at least a year and the number who are leaving for at least a year

It peaked at 320,000 in the year to June 2005. At the time of the 2010 election it was 252,000.

The big increase in the latest set of figures was driven by a "statistically significant" rise in immigrants arriving in the UK, according to the Office for National Statistics.

Immigration was up to 624,000 in the year to September from 530,000 in the previous 12 months. About 327,000 people emigrated from the UK in the same period.

The increase was driven by a rise in the number of people coming to the UK for work, with experts suggesting the growing strength of the UK economy and job creation had drawn people in.

Oxford University's Migration Observatory's director Madeleine Sumption said: "If the UK's economic performance compared to the rest of the EU had been poor, then we might well have seen net migration fall, but that has not happened."

Liberal Democrat leader Nick Clegg, whose party opposed the net migration target, said the figures were "very embarrassing for the Conservatives".

"They made a huge fanfare about it and they were warned, warned by me and others privately don't do this it doesn't make any sense," the deputy prime minister told LBC radio.

"They've made a commitment and they have failed spectacularly to deliver it."

'Economic growth'

Some key points from the latest migration figures include:

• A total of 271,000 people came to the UK for work-related reasons, according to the latest figures, up from 217,000 the previous year. Of those, 57% were EU citizens and 25% from outside the EU
• Of those moving to live in the UK for work-related reasons, 62% (167,000) came with a definite job to go to and 38% (104,000) came to look for work
• A total of 37,000 Romanian and Bulgarian citizens moved to the UK in the year, a "statistically significant" increase from 24,000 in the previous 12 months
• The biggest increase in net migration was from outside the EU.
• It was 190,000 in the year ending September 2014, up from 138,000 in the previous year
• Net migration of EU citizens saw an increase to 162,000 from 130,000 the previous year

Measures introduced by the government to reduce net migration include capping visas for skilled non-EU workers and introducing a minimum income threshold of £18,600 for anyone planning to sponsor a non-EU family member, such as a spouse, to come to the UK.

The government has also cracked down on abuses of the student visa system by closing "bogus" colleges.

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Birdman, Redmayne, Moore lead Oscars

23 February 2015 Last updated at 06:20

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Highlights of the 2015 Academy Awards ceremony

British actor Eddie Redmayne has won the best actor Oscar for The Theory of Everything, while Julianne Moore picked up best actress for Still Alice.

Redmayne thanked his "staggering partner in crime", co-star Felicity Jones, and his "ferocious but incredibly kind director James Marsh".

Dark comedy Birdman won best film and best director for Mexican film-maker Alejandro Gonzalez Inarritu.

It also won best cinematography and best original screenplay.

The film sees Michael Keaton play a former movie superhero actor, who hopes to revive his washed-up career by putting on a Broadway play.

See all the updates from the night on our Oscars live page

Moore used her speech to raise awareness for Alzheimer's disease - in Still Alice, she plays a 50-year-old who has early on-set Alzheimer's.

"I'm so happy, I'm thrilled that we were able to shine a light on Alzheimer's disease," she said.

"So many people who have this disease feel marginalised. People who have Alzheimer's disease deserve to be seen so we can find a cure."

Redmayne was honoured for his portrayal of physicist Stephen Hawking, who has motor neurone disease (ALS).

Accepting his award, he thanked the Hawking family, including Jane Hawking on whose book the film is based, and said his award belonged "to all of the people around the world battling ALS".

Continue reading the main story Full Oscars coverage Continue reading the main story

• 1 win out of eight nominations for The Imitation Game

• 1 win out of six nominations for Boyhood

• 1 win out of six nominations for American Sniper

AFP

Richard Linklater's Boyhood won just one award from six nominations - best supporting actress - which went to Patricia Arquette.

Arquette thanked "her Boyhood family" and "every woman who gave birth".

"To every woman... we have fought for everybody else's equal rights. It's our time to have wage equality," she added, to huge applause from the audience.

JK Simmons won best supporting actor for Whiplash, in which he played a strict drumming teacher at a music conservatory.

Whiplash also won the award for best editing and best sound mixing.

The Grand Budapest Hotel picked up best costume design (Milena Canonero), as well as best hair and make-up (British duo Frances Hannon and Mark Coulier). It also won best score and production design.

Hannon thanked absent actor Bill Murray - who has a cameo in the film - for introducing her to director Wes Anderson on the set of his film Rushmore 17 years earlier.

Another British duo, Matt Kirkby and James Lucas, picked up the award for best live short action film, The Phone Call, starring Sally Hawkins and Jim Broadbent.

Alan Turing drama The Imitation Game, starring Benedict Cumberbatch, won best adapted screenplay.

Best foreign language film went to Polish black and white family drama Ida.

John Legend and Common's track Glory, from civil rights drama Selma, won best song.

Legend used his time on stage to deliver a political message, saying: "We live in the most incarcerated country in the world... people are marching with our song... we are with you, march on."

Emmanuel Lubezko's win for best cinematography for Birdman was his second Oscar in as many years - in 2014, he won the same award for his work on Gravity.

Citizenfour, which chronicles one of the biggest intelligence leaks in American history, won best documentary feature.

It shows former National Security Agency contractor Edward Snowden at the very moment he made his sensational revelations detailing extensive internet and phone surveillance by the US government.

Best documentary short was won by Crisis Hotline: Veterans Press 1, about the counsellors who work with military veterans on a 24-hour phone helpline.

Clint Eastwood's Iraq war drama American Sniper won the award for best sound editing.

The 87th Academy Awards took place at Hollywood's 3,300-seat Dolby Theatre.

Performers at this year's ceremony included Lady Gaga - who sang a medley of Sound of Music songs to celebrate the classic film's 50th year - Jennifer Hudson and Anna Kendrick.

Host Neil Patrick Harris kicked off with a song which paid homage to Hollywood's film industry, accompanied by Kendrick and Jack Black.

Birdman and Wes Anderson's quirky comedy The Grand Budapest Hotel began the night with nine nominations each, while The Imitation Game had eight.

Clint Eastwood's true-life Iraq war tale American Sniper and Boyhood had six apiece.

The best picture prize was widely predicted to either go to Birdman or Boyhood - both of which had been named best film at the many ceremonies leading up to Hollywood's biggest night.

The directors of both films did their best on the red carpet to play down any rivalry with Alejandro Gonzalez Inarritu, who eventually won for Birdman, calling the supposed competition "so silly" and Linklater saying he loved Birdman.

"It's a real tribute for two films that aren't traditional stories, crazy stories," said Linklater, who filmed the coming of age movie over 12 years with the same actors.

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HSBC reports sharp fall in profits

23 February 2015 Last updated at 11:13

HSBC has said 2014 was a "challenging year" after reporting a 17% drop in profit to $18.7bn (£12.2bn).

The bank blamed the negative effect of $2.4bn in fines and settlements and UK customer redress for the sharp fall.

The results follow allegations, which emerged earlier this month, that HSBC had helped people evade UK tax using hidden HSBC accounts in Geneva.

HSBC chief executive Stuart Gulliver saw his overall pay for the year fall to £7.6m from £8.03m in 2013.

Continue reading the main story

The lower total reflects a smaller bonus of £3.4m for the year, compared to £5.5m in 2013. Mr Gulliver said the lower bonus reflected "failures" linked to foreign exchange manipulation.

Chairman Douglas Flint's total pay increased to £2.5m from £2.4m for the year, but he did not receive a bonus.

Pressed after the results on whether he should have received a bonus, Mr Gulliver said his bonuses were subject to 100% clawback by the bank for seven years, enabling the bank to demand repayment "if anything turns up later that happened on my watch".

HSBC's shares fell more than 5%, hitting their lowest level for two-and-a-half years, after it reported its fall in profit, which was larger than analysts had expected.

The drop in profitability was driven by $2.4bn in fines and customer compensation costs, largely connected to fines in connection with traders' attempted manipulation of foreign exchange rates and compensation for the mis-selling of payment protection insurance.

The bank has been streamlining its business in an attempt to boost earnings, and Mr Gulliver said it had now closed or sold 77 businesses and lost 50,000 jobs since he took the helm in 2011.

"For all the recent media furore around potential conduct issues, it is the 'underlying' performance which, we believe, should be the greatest cause of investor concern," said Investec analyst Ian Gordon.

Analysis by Kamal Ahmed, BBC business editor

In all the coverage of HSBC's Swiss private banking arm and Stuart Gulliver's banking arrangements (channelled through Switzerland and Panama), it is easy to miss the fact that HSBC has more broadly had a torrid year.

Its return on equity (the key marker of the return a bank is making on the money it invests) has fallen from 9.2% to 7.3%. Its earnings per share are down. Its operating expenses - the amount it costs to run the bank - are up 6.1%.

Fines and "redress" (in the main payments for the mis-selling of payment protection insurance) total £2.4bn. The bank has also raised significant concerns over Europe, saying that reform is "far less risky than going it alone".

No wonder HSBC's share price is down 5% this morning.

On Monday, HSBC reiterated its recent apology for the conduct of its Swiss private bank, saying the historical practices and behaviour were "unacceptable".

The bank said restoration of trust in the industry "remains a significant challenge as further misdeeds are uncovered but it is a challenge we must meet successfully".

"When commentators extrapolate instances of control failure or individual misconduct to question the culture of the firm, it strikes painfully at the heart of our identity," it added.

Mr Gulliver's Swiss bank account

On Sunday, Mr Gulliver himself was dragged into the Swiss tax furore, with HSBC confirming he used a Swiss bank account to hold his bonuses.

The bank was responding to a report in the Guardian that Mr Gulliver has £5m in the account which he controls using a Panamanian company.

HSBC said he opened the account in 1998 when he was living and working in Hong Kong and full tax was paid in Hong Kong on the bonus payments.

On Monday, Mr Gulliver said he had never paid below the highest rate of UK tax on all his earnings since becoming chief executive.

"I'm UK tax resident, Hong Kong domiciled. I've paid full UK tax on the entirety of my worldwide earnings. It's not surprising as a 35-year HSBC veteran that I should be Hong Kong domiciled. I would expect to die abroad, which is a test of domicility," he added.

He said HSBC's computer system in the 1990s let everyone in the bank access the bank accounts of every other member of staff. As a result, he opened a bank account in Switzerland to hide his compensation from prying colleagues. He said he then used a Panamanian company to ensure HSBC staff in Switzerland also could not access his account.

"Really it was to enable me to have confidentiality in my own firm. There was no tax advantage," Mr Gulliver said.

Investigations

The Financial Conduct Authority, HMRC, Swiss prosecutors and MPs on the Treasury Committee are looking into the allegations that HSBC helped people evade UK tax using hidden HSBC accounts in Geneva.

The former director of public prosecutions, Lord Ken Macdonald, has warned that HSBC has left itself open to criminal charges in the UK over the tax-dodging scandal.

The QC said there were strong grounds to investigate the bank for "cheating" HM Revenue and Customs (HMRC).

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Secretly filmed MPs deny wrongdoing

23 February 2015 Last updated at 10:22

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Both MPs deny any wrongdoing, as Robin Brant reports

Former Foreign Secretaries Jack Straw and Sir Malcolm Rifkind say they have broken no rules after being secretly filmed apparently offering their services to a private company for cash.

Reporters for the Daily Telegraph and Channel 4's Dispatches posed as staff of a fake Chinese firm.

Mr Straw said he had fallen into a "very skilful trap" while Sir Malcolm said his comments had been "silly".

The MPs have referred themselves to Parliament's standards watchdog.

Labour leader Ed Miliband has written to Prime Minister calling for a ban on MPs having second jobs.

'Useful access'

It is claimed that Mr Straw was recorded describing how he operated "under the radar" and had used his influence to change EU rules on behalf of a firm which paid him £60,000 a year.

On the subject of payment, Mr Straw is heard saying: "So normally, if I'm doing a speech or something, it's £5,000 a day, that's what I charge."

Sir Malcolm is reported to have claimed he could arrange "useful access" to every British ambassador in the world.

The Conservative MP for Kensington and chairman of Parliament's Intelligence and Security Committee was recorded saying: "I am self-employed - so nobody pays me a salary. I have to earn my income."

He said his usual fee for half a day's work was "somewhere in the region of £5,000 to £8,000".

Analysis

By Robin Brant, BBC political correspondent

Jack Straw and Sir Malcolm Rifkind have both referred themselves to Parliament's commissioner for standards. A full investigation could take months.

But there the similarities end.

Mr Straw has been suspended from the Parliamentary Labour Party at his own request. Ed Miliband is unlikely to feel much sympathy for the retiring MP.

Sir Malcolm is not facing any suspension.

He told me the allegations had no bearing on his very significant role as chairman of the parliamentary committee that oversees the work of MI5 and MI6.

Downing Street has not offered any view on that. A source said it is for the Commons and other members of that committee to decide.

Both men defended themselves on appearances on BBC Radio 4's Today programme on Monday morning.

Sir Malcolm said he had "nothing to be embarrassed about". He said the allegations were "unfounded" and he vowed to fight them "with all my strength".

He said he had never accepted an offer from the fake firm, saying it was a "preliminary" discussion "about what they had mind".

Sir Malcolm is paid £67,000 a year and he said telling the company he was not paid a salary was a "silly thing to say".

"Of course I receive a salary as a Member of Parliament but I was referring to my business interests, from none of which I receive a salary. I receive payment for services I provide," he said.

MPs' second jobs

• MPs are allowed to take on other employment as long as it is declared in accordance with the code of conduct
• They have to register their financial interests, including paid employment outside Parliament
• But they are forbidden from acting as a "paid advocate" - taking payment for speaking in the House, asking a parliamentary question, tabling a motion, introducing a bill or tabling or moving an amendment to a motion or bill or urging colleagues or ministers to do so.
• The government is in the process of setting up a register which would require third-party lobbyists to declare their client lists and meetings with ministers
• Labour has called for a ban on MPs from being paid as directors and consultants

About 200 MPs have business interests, he said, and everything he earns is detailed in the Register of Members' Interests.

Sir Malcolm is due to meet the Conservative chief whip later on Monday. He said he would not stand down as security committee chairman, unless his committee colleagues wanted him to.

"One's got nothing to do with the other," he said. "None of the matters are remotely to do with intelligence or security."

He said he had a letter from Channel 4, accepting he had not offered access to any privileged or secret information.

Mr Straw has suspended himself from the Parliamentary Labour Party, and the party said it was aware of the "disturbing allegations" against him.

The Blackburn MP, who had already announced his intention to stand down in May, said he was "mortified" that he had fallen into the reporters' "trap" but that he had said nothing "improper".

He told Today the language he used had been "not necessarily wrong but could be taken out of context".

Advisory board

During his 36 years as an MP he had been "absolutely scrupulous" about observing the rules, he said, adding that the entire discussion had been around what he would do after leaving Parliament.

He acknowledged he should have postponed the conversation until after 7 May.

Earlier, Mr Straw said he had taken on one consultancy role since his ministerial career ended in 2010, with commodity suppliers, ED&F Man (Holdings) Ltd, saying it was done in accordance with the MPs' Code of Conduct.

Sir Malcolm and Mr Straw both said they had requested copies of the recording transcripts, but that Channel 4 and the Telegraph had not provided them.

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Jack Straw MP: "I have acted with complete probity and integrity throughout my parliamentary career"

Former Prime Minister Tony Blair offered Mr Straw his support, saying he was a "byword for being a hard-working constituency MP and parliamentarian".

Green Party leader Natalie Bennett said her party would "end second jobs for MPs".

The undercover reporters had created a fictitious communications agency called PMR, which they said was based in Hong Kong.

A statement on Channel 4's website said 12 MPs with "significant outside interests" were invited to apply for jobs with PMR, which had "plenty of money" and wanted to hire "influential British politicians to join its advisory board".

"Not all politicians are for hire," the statement added.

"Half of those approached didn't respond. One said he wanted to check us out in Hong Kong so we took it no further. And another said he just wasn't that interested. Of the others, two stood out - Sir Malcolm Rifkind and Jack Straw."

The documentary, called Politicians for Hire, will be broadcast on Channel 4 at 20:00 GMT.

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Syria girl used sister's passport

23 February 2015 Last updated at 11:56

One of the three schoolgirls believed to be heading to Syria to join Islamic State militants flew to Turkey on her older sister's passport, it has been confirmed.

Shamima Begum, 15, used the passport of her 17-year-old sister Aklima to leave the UK on Tuesday.

The other girls are Amira Abase, 15, and Kadiza Sultana, 16. They are pupils at Bethnal Green Academy in London.

UK police officers have gone to Turkey but their role has not been confirmed.

A Scotland Yard said: "Officers are working closely with the Turkish authorities who are providing a great deal of assistance and support to our investigation."

Security services have been criticised after it emerged that - before leaving the UK - Shamima sent a Twitter message to Aqsa Mahmood, who left Glasgow for Syria in 2013 to marry an Islamic State fighter.

According to a lawyer for Ms Mahmood's family, her Twitter account has been "monitored" by police since she left Britain - and he said authorities should have seen Shamima's message and taken action before she and her two friends followed.

'Impressionable'

The girls were all studying for their GCSEs at the east London school, which reopened on Monday after half term.

Dr Muhammad Abdul Bari, from the East London Mosque and a former teacher at Bethnal Green Academy, said all the parents "were shocked".

"Children running away from home or disappearing is every parent's nightmare," he told BBC Breakfast.

He said the girls were "talented and dynamic" but "impressionable" and that they could end up "with the most vile and dangerous group on earth" was "heartbreaking" for the parents.

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Abase Hussen said his daughter had said goodbye to him in a normal way: "There was no sign to suspect her at all"

The message from the school would be one of unity and that every pupil's safety was the priority, he said.

Bob Milton, former Met Police commander, said there was a counter-radicalisation programme at the school and the girls had been spoken to.

"They had satisfied the person that they were no longer at risk but that clearly wasn't the case," he said.

How they left the country was a different matter and the lack of exit control was "shameful", he added.

The girls boarded a Turkish Airlines flight from Gatwick, and would have needed a visa for Turkey and a passport.

Children between seven and 12 years old can travel alone on Turkish Airlines but declaration forms must be filled in at the check-in counters and signed by parents or guardians.

'Think twice'

The Archbishop of Canterbury Justin Welby has spoken about the girls, saying it was a "nightmare situation" for the families.

The archbishop, who was addressing business and church leaders on community cohesion in Birmingham, said: "It's a deception, isn't it - and the families are absolutely devastated by it."

The families of the girls have made appeals for them to come home.

Shamima's sister, Renu Begum, said she hoped her sister had gone to Syria to bring back another girl from Bethnal Green Academy who went there in December.

Ms Begun said Shamima and her friends were "young" and "vulnerable" and if anyone had tried to persuade them to go to Syria it was a "cruel and evil" thing to do.

"We don't want her to do anything stupid - she is a sensible girl," she added.

"We just want her home, we want her safe."

Amira's father, Abase Hussen, said: "The message we have for Amira is to get back home. We miss you. We cannot stop crying. Please think twice. Don't go to Syria."

Holding a teddy bear Amira had given her mother, Mr Hussen added: "Remember how we love you. Your sister and brother cannot stop crying."

In an appeal to Kadiza, her sister Halima Khanom said: "Find the courage in your heart to contact us and let us know that you are safe and you are OK. That is all we ask of you."

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Egypt jails activist for five years

23 February 2015 Last updated at 12:09

An Egyptian court has jailed prominent blogger and pro-democracy activist Alaa Abdel Fattah for five years at his retrial for violating a protest law.

He was previously given a 15-year jail term in the case over his alleged role in a protest in 2013.

Alaa Abdel Fattah gained fame during the 2011 uprising as a campaigner against military trials for civilians.

Al-Jazeera journalists Mohamed Fahmy and Baher Mohamed also appeared in the same court on Monday for their retrial.

The men were freed on bail earlier this month after more than a year behind bars.

The retrial was adjourned after a brief hearing, and they are next due in court on 8 March.

The journalists are accused of spreading false information and of helping the banned Muslim Brotherhood organisation.

Australian Peter Greste, the third journalist in the case, was freed on 1 February and deported to Australia.

Court uproar

Alaa Abdel Fattah was charged under laws that prohibit protests without prior government permission.

He was accused of organising an illegal protest in 2013, and of rioting and assaulting a policeman.

Rights groups say the charges are politically motivated and form part of a broader crackdown on dissent under President Abdul Fattah al-Sisi, a former army chief.

Other defendants on trial with Abdel Fattah received sentences ranging from three to 15 years.

There was uproar in the courtroom after the verdicts, with supporters of the defendants calling for an end to military rule in Egypt.

Defence lawyers said they would appeal against the ruling.

'Sham trial'

Rights groups have also criticised the case against the al-Jazeera journalists, describing it as an assault on press freedom.

At their original trial, Mr Greste and Mr Fahmy were sentenced to seven years in prison. Mr Mohamed received an additional three-year sentence on a separate charge involving possession of weapons.

The defendants denied the charges, describing their trial as a sham.

Their convictions were overturned on 1 January, when the courts ordered a retrial. Exactly one month later, Mr Greste was released and deported to Australia.

Several students have also been held in the same case. The students deny working for al-Jazeera but it is thought that material filmed on their phones was used by the network.

After his retrial was adjourned, Mr Mohamed tweeted that he was concerned for the others still being held.

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