Despite revealing yesterday that HSBC wrote off an unprecedented £3.25bn for bad debts in 2003 – most of which was on Household’s riskier loan book – investors did not react with panic. At the height of the row between companies and investors about “fat-cat” pay last year, Sir John was forced to defend the decision to grant William Aldinger, the chief executive of Household, a deal which could see him receive $37m over three years – plus free dental care for life for him and his wife. There was also astonishment that HSBC would risk damaging its brand by attaching itself to a business which was being sued in several states for allegedly subjecting some customers to a life of debt because of rates of repayment that were so high.The deal has not been without its embarrassments for HSBC. Pearson has recruited a manager from Avon, the direct-to-home cosmetics business, to run the initiative, which will be launched in the US.

It means that $1.2m of her pension pot will be invested in Pearson shares at last night’s closing share price of 617.5p.Ms Scardino said: “It shows I have great confidence in the future It’s just the best deal around at the moment It’s a third of my pension so it was a big decision for me. The Financial Times crashed to a loss of £32m last year and the pink newspaper is expected to stay in the red this year, its owner Pearson said yesterday.
However, Pearson ruled out a sale of the FT as it reported group-wide profits of £410m for 2003, up £11m.Separately, Marjorie Scardino, the group chief executive, underlined her faith in the company by announcing that she would convert a third of her pension pot into Pearson shares. Pearson revealed it will invest about $3m in “new channels” to sell books to new customers, including Penguin TV, which will commission non-fiction and children’s programmes based on books published by Penguin and Dorling Kindersley, another of the group’s brands.Part of the initiative will include selling books direct to consumers’ homes, in the way that Tupperware or cosmetics are marketed through”parties” in the home.This will involve bespokeeditions of DK books aimed at younger children or families, which will be marketed by a network of agents. The remainder of the company comprisesa large educational publishing business and a consumer publishing arm. “I’m going to be here for as long as I have fresh ideas,” Ms Scardino said.The FT provides just £200m of Pearson’s £4bn annual revenues. I am a long-term holder of the stock.”She has been chief executive for more than seven years and shows no sign of wanting to give up the role.

Steve Horley, Tiscali’s general manager access and voice, said: “We’re glad BT realises that people want cheaper broadband. But you still pay £20 less a year with Tiscali for 512kbps and no download cap.”Separately, the cable company Telewest yesterday announced it was launching a 256kbps internet access service in the spring for £17.99 a month.Chad Raube, the director of internet services at Telewest Broadband, said: “We’re expecting demand from people who have previously considered broadband a big leap from dial-up and now getting on to the first rung of the broadband ladder will become a no-brainer.”The first 5,000 people signing up to the Telewest service through the pre-registration site will be offered free installation and their first month free.. The Broadband Basic package runs at a speed of up to 512 kilobits per second – or about 10 times faster than a standard dial-up connection. Users will be restricted, however, in how much they can use the service.”The Basic package provides a simple-to-use, low-cost entry level service but with the equivalent speed of our other broadband products,” Mr Ingram said. “Now for just a few pounds more than a dial-up service, customers can enjoy the benefits of surfing and e-mail at 10 times the speed whilst freeing up their phone line to make and receive calls.”The Italian service provider Tiscali hit back at BT’s move yesterday, pointing out that its own service did not contain any hidden set-up or equipment charges. It now has just more than 2 million broadband users, with half of these accessing the internet through other providers such as Freeserve.Duncan Ingram, the managing director of BT Openworld, said: “BT Broadband Basic is just the first initiative in our future broadband strategy. An increase in pension contributions also cost the group £17m.The group was further hit by the downturn in the civil aerospace market, with both Airbus and Boeing delivering fewer commercial aircraft, and Mr Smith said he did not expect a pick-up until 2006.Despite what it described as “challenging markets”, the group demonstrated its confidence in the outlook by lifting the dividend for the year by 2.7 per cent to 11.6p..

In the coming weeks we will be announcing a whole host of portfolio developments and enhancements which will be key in helping BT hit its 5 million connections target during 2006.” BT will announce a raft of new measures in broadband on 11 March when it will also give an update on how it has progressed so far. BT Stepped up its broadband campaign yesterday by launching a cheaper high-speed internet service aimed at those customers upgrading from narrowband for the first time.
Its so-called Broadband Basic package will cost £19.99 a month although users will also be charged a one-off fee of £80 to cover set-up costs and the price of the modem.The company, which is targeting new areas such as broadband as it faces increased competition in its traditional market of telephone voice calls, wants to achieve a target of 5 million broadband users by 2006. GKN said it automotive division, which accounts for just under half of all sales, had been affected by the decline in car markets in the US, Europe and Japan. Mr Smith said the UK would not be very heavily affected by the jobs transfer because of the low numbers now employed here.UK workers have been hit by the trend for companies to shift factories to exploit cheaper wages, with groups such as Raleigh and Dyson shutting plants here and setting up in Eastern Europe or Asia.Together with further restructuring of GKN’s US sinter metals division, also announced yesterday, the company expects cost savings to reach £60m by 2007.News of the jobs transfer came as GKN reported an 8 per cent decline in pre-tax profits to £246m on sales up 3 per cent to £4.6bn.