Posts Tagged ‘money’
The building society has been slapped with a £4.1 million fine, for being shits to customers facing financial difficulties.
The findings were found after a City regulator noticed that call handlers at Yorkshire had failed to implement the right payment solutions, making it even worse for customers having a struggle.
The building society has agreed to refund all mortgage arrears fees, plus associated interest, charged to customers since January 2009.
This redress scheme, announced in February, is currently under way and about 33,900 customers will be repaid a total of £8.4m.
Those customers with an existing mortgage will have their loan credited, while former customers will be sent a cheque. Cor! A cheque. How modern. A Yorkshire spokesman named anonymous, reckons that all affected customers will be refunded by the end of 2014.
The Financial Conduct Authority (FCA) had said that while Yorkshire viewed repossession as a last resort, it failed to recognise that delays in reaching long-term payment solutions meant that some customers incurred increased fees and interest.
These failures happened between October 2011 and July 2012 as is the company’s second fine for being devious arses.
The regulator noticed that in 64 out of 87 cases reviewed, showed that the consumer was treated shoddily.
Tracey McDermott, director of enforcement and financial crime at the FCA, said: “Customers in financial difficulty need to be treated fairly and sensitively. Firms must ensure that they are taking into account the particular circumstances affecting customers who find themselves in difficulty. Firms need to be dealing with these customers proactively, without delays, in order to ensure they are not losing out.
“By allowing cases to drift without agreement, Yorkshire’s actions meant that customers in vulnerable circumstances risked falling into further financial difficulty.”
Chris Pilling, chief executive of Yorkshire Building Society, apologised to customers using the ‘inflatable school’ joke as an apology. “We are very sorry for letting them down,” he said.
This is Yorkshire’s second fine in 2014. In June the FCA issued a £1.4m fine for exaggerating the returns that investors could expect from stock-market-linked bonds.
Fortunately none of them are UK banks. PHEW.
The 24 banks now have nine months to get their act together or face being shut down. The review was based on the banks’ financial health at the end of 2013.
Ten have already taken steps to bolster their balance sheets in the meantime. All the remaining 14 banks are in the eurozone. The health check was carried out on 123 EU banks by the EBA to determine whether they could handle another financial crisis.
The list of 14 includes four Italian banks, two Greek banks, two Belgian banks and two Slovenian banks.
The worst offender was Italian bank Monte dei Paschi, which showed a capital shortfall of €2.1bn. Bloody Nora. Admittedly banks are in a better place than they were in 2011, when the last stress test was taken. Although various analysts question the validity of these tests as they failed to spot the collapses in Ireland and Belgian bank Dexia.
But now that’s all changed, as the profits that banks are allowed to make through a future financial crisis are capped. Net income is slashed by 20% and there is greater transparency around how the data is used, giving more certainty to investors.
Also, the introduction of the Asset Quality Review looks at banks’ loans and their governments debts, which has lead to a more sturdy assessment.
The banks that still need to raise capital:
Austria: Oesterreichische Volksbanken
Belgium: AXA Bank Europe, Dexia
Cyprus: Hellenic Bank Public Company
Greece: Eurobank Ergasias, National Bank of Greece
Republic of Ireland: Permanent TSB
Italy: Banca Carige, Monte dei Paschi, Banca Popolare di Milano, Banca Popolare di Vicenza
Portugal: Banco Comercial Portugues
Slovenia: Nova Kreditna Banka Maribor, Nova Ljubljanska Banka
Earlier this week, Lloyds decided that they could downsize by getting rid of 9,000 jobs, which is a tenth of their entire staff. They also plan to get rid of a number of branches, which is becoming a common attitude in the finance world as customers rely less on having to actually stand in a branch and talk to humans.
Other banks in the UK have closed in excess of 350 branches in 2014, which leaves just over 9,000 in total according to figures from the Campaign for Community Banking Services. Barclays are hoping to close around 1,600 branches and cut 19,000 jobs while Royal Bank of Scotland is also ditching tens of thousands of jobs.
According to the British Bankers Association, footfall has fallen 10% year-on-year, while at the same time, the number of transactions being completed online has doubled.
Of course, banks need to start saving money somewhere after many of them have been slapped silly with fines for misselling and the like.
“If we don’t change the fundamentals and improve for our customers then our business will be eaten away,” said RBS chief exec Ross McEwan. “That might be through greater competition, increased scrutiny from regulators, or through intensifying innovation, or a combination of all of these.”
There’s growth in new banks that adopt a digital method, such as Atom Bank and Metro Bank, which are branchless. The banking world is weighing up the threat of new currencies too, such as Bitcoin. These new companies have much lower overheads than trad. arr. banks. And of course, Apple have just launched their own payment service, which is yet another challenge to the banks dominance in finance.
In addition to all this, the UK competition regulator is launching a full inquiry into the banking sector in a bid to create more competition for the old guard.
It goes without saying that some branches are needed, especially for older customers, but consultancy reports have predicted that, in 10 years time, the UK could easily be served by as little as 500 physical branches as everyone migrates to online services. Bad news for bank robbers who will have to ditch the notion of putting tights on their heads and pointing guns at people – they’re going to have to start getting computer savvy, and fast.
Those beloved banks of ours aren’t making as much money as they’d like, so they’re saying that they’re going to have to cut everyone’s pay. This is according to a senior regulator at the Bank of England.
Sir Jon Cunliffe, the central bank’s deputy governor for financial stability, said that it’s all well and good that shareholders have suffered since the financial crash, but salaries and bonuses are still far too high.
He said: “It is noticeable that, since the crisis, for the industry as a whole, employees have received a larger share of a smaller pie relative to shareholders. In the new world, pay bills may well have further to adjust.”
Cunliffe said that in the decade before the crash, profits attributable to shareholders were around 75% of total pay at UK banks and 60% for global banks. “Since the crisis that picture has changed markedly,” he added. Shareholders in global banks get 25% of total pay now.
“Across the big UK banks in 2013, the fraction had fallen to just 2% – i.e. to 2 pence per pound paid to staff,” said Cunliffe. He added that it is “unlikely that we will see or want to see again” the kind of returns that were being made before the crisis, with respect to the tougher rules brought in to make banks safer.
“It is important, in seeking to restore returns, that banks and investors do not think in terms of back to the future” he added; “with less leverage and more liquidity in banks, required returns ought generally to be lower than prior to the crisis. Trying to offset that by taking excessive risk or evading regulation will not, I think, be tolerated in the new world.”
All in all, we can expect that this will be passed on to the customer because, when banks want to find more money, overdraft charges and the like will suddenly start working against customers.
Sounds good doesn’t it?
Pensions minister, Steve Webb said he wants to help those tied to poor-value annuities: ”I know many people who have locked into an annuity are feeling rather bitter that they came just the wrong side of the line.”
“It’s been gnawing away at me and I want to say to those affected: I know how you feel. If it were possible for people who would rather have a capital sum than a regular income, in principle I would like to be able to help, and this is something the next government should have a look at.”
The government have pledged that, as of next April, savers who are about to retire will be given full discretion as to how they use the funds from their pension. If you’re over 55, you will be allowed to treat your pension like a normal bank account. Don’t spend it all at once though eh?
However, there’s a problem with those who have already bought annuities because they’ll be excluded from this rule as it stands. Webb continued: “If we accept the annuity market was broken, we also must accept it was so 10 years ago.”
The thing here is that Webb’s views haven’t turned into proper policies yet, so if you’re a codger, don’t get out the celebratory vodka just yet.
There’s also talk of policing the pension sector to ensure that savers get a fair deal and that something needs to be done about the high charges that chip away at funds during retirement.
Ever get the feeling that the government might ‘fix’ all this by simply putting the retirement age up to 230, so no-one has to worry about it?
The state of the world’s financial markets suggests that a break is about to happen at any point! We’re doomed!
The Bank of International Settlements said that suspiciously low levels of volatility in the markets seen this year, suggest a lack of liquidity that could trip up investors who assume they can dispense of assets when a sell-off begins.
These remarks follow as the FTSE 100 index suffered another day of losses, dropping 2.8% and mirroring falls across Europe. Guy Debelle of BIS said global investors were buying assets on the misguided presumption of liquidity that does not exist and that in a possible sell-off, volatility and price movements “will be exacerbated by the reduced capacity and inventory of market makers”.
Despite the world issues flying around causing markets to wobble, the BIS observed that volatility in fixed income, equity and foreign exchange markets has fallen to historically low levels.
Debelle, who is also an executive at Australia’s Reserve Bank, said: “While there is more forward guidance from central banks in place than in the past, investors do not have to believe it. I find it somewhat surprising that the market (in aggregate at least) is willing to accept the central banks at their word and not think so much for themselves”.
Referencing the US bond crash of 1994, Debelle warned that exits in the present bonds market could be even more violent in future with “a fair chance that volatility will feed on itself”.
It’s all somewhat worrying isn’t it?
In his speech, Debelle also referred to tightened regulation in the sector introduced in the wake of the financial crisis, adding: “Regulatory changes have, as intended, increased the cost of market-making, and hence shifted some liquidity risk to end investors. There have also been some strategic decisions taken by institutions and internal constraints have been imposed which have reduced capacity”.
Industry body the British Bankers Association (BBA) has teamed up with the police to launch a campaign which they hope will raise the public’s awareness on all things fraud, looking at the most common scams that will happen online or down the phone.
Based on the results of a YouGov poll, the BBA said that eight million people are vulnerable to voice phishing scams, four million may transfer money to fraudsters, three million could potentially carry out “test transactions” and 1.7 million would hand their bank cards to couriers on their doorstep if they had a convincing form of ID.
Best not to answer the phone or door to anyone, ever.
Anthony Browne, chief executive of the BBA, said: “Being defrauded is a devastating experience for anyone which is why we are launching this campaign. The more people know about fraud, the less likely they are to become victims.”
“Our Know Fraud, No Fraud campaign will help you spot some of the tactics used by scammers. Your bank would never send someone to your home to collect your cash or ask you to transfer funds to a new account.”
So, for your records to be printed out and stapled to grandma’s forehead as a reminder to her and everyone else, here’s the BBA’s List of Things That Your Bank Will Never Ask For.
- Ask for your full PIN number or any online banking password over the phone or via email
- Send someone to your home to collect cash, bank cards or anything else
- Ask you to email or text personal or banking information
- Send an email with a link to a page that asks you to enter your online banking log-in details
- Ask you to authorise the transfer of funds to a new account or hand over cash
- Call to advise you to buy diamonds or land or other commodities
- Ask you to carry out a test transaction online
An unusually warm September was blamed on all this, even though they would’ve blamed it on wet weather if that was around. Basically, people don’t know why we’re not shopping as much as we used to. Maybe its because we’re skint?
The British Retail Consortium said that the year-on-year drop in consumer spending was the most pronounced since December 2008, but said that there is some comfort to be taken from the fact that spending on big-ticket items such as furniture continued to be strong.
Helen Dickinson, the director general of the British Retail Consortium, said: “In September, we saw the lowest retail sales figures since December 2008, excluding Easter distortions. This can be attributed to a number of factors including the continuing decline in food sales.”
“Furthermore, there was exceptionally low demand for items such as boots and coats, resulting in the lowest fashion sales performance since April 2012. However, demand for big-ticket items continues to be strong, with furniture outperforming all other categories.”
David McCorquodale, head of retail at KPMG, said: “After a bumper summer, this is a disappointing outcome for retailers and has undoubtedly reversed some of the sales gains made in August. However, if temperatures drop to a more seasonal level this cooler weather will quickly turn around retailers’ fortunes and help them to sell their autumn-winter ranges.”
“The grocers had another challenging month, with further price cuts and promotions announced by most. With a rebasing of margins in the grocery sector throughout the year, this final quarter will see sales go to those who are most focused on their customers.”
Nevertheless, Asda, Sainsbury’s, Spar, Shop Direct and House of Fraser have all teamed up with Zapp, whose app will allow users to pay for goods and services using just their smartphone and a mobile banking app.
You’ll be able to pick up your shopping as usual, but at the till, you’ll press a button that will indicate they are paying by Zapp.
Once they’ve logged into their banking app, and selected the desired account they want to pay for it with, a six-digit code will appear on the phone.
Payment for a low-value amount of shopping can be made simply by waving the phone all airy fairy over a reader without authentication being needed.
A chief executive of Zapp, named Peter Keenan reckons these partnerships “means millions of consumers will be able to shop at tens of thousands of merchants up and down the UK at launch”.
Anglian Water, Bristol and Wessex Water and Sutton and East Surrey Water have also signed up for the scheme, meaning some people could be able to pay bills via their mobile.
Water bills! Paid for by phone! This is bucket list stuff.
The 25% state-owned bank is looking at sacking off employees in the mortgage processing and new account divisions as it goes full steam with its digitisation strategy.
It’s all part of a plan, as ever, spread over three years of what employees will be left, will be upgraded and fully cybernised.
The company has only caused 30,000 job losses since the financial crisis. Bless.
This is all very well, but it’s not much joy for bank customers stuck at in the back end of nowhere with no bank for a thousand miles or something. But them banks claim they are forced to close branches due falling numbers of customers visiting as more people use online banking.
NatWest, part of State-owned Royal Bank of Scotland, is also set to shut at least 27 branches across Britain over the next four months – of which 25 are the only ones left in that community.
We take another step close to Futurama.
If you think we collectively drink a lot of wine and beer, it’s nothing compared to how much we spend on drugs and prostitutes.
This is the first time the ONS have included narcotics and sex workers into their calculations of Gross Domestic Product in order to ensure “comparability in measuring Gross National Income across EU countries.”
So here’s the kicker: In 2013, Brits spent £11bn on wine and beer, while spending £12.3bn on prostitutes and illegal drugs.
The figure for the procurement of sex workers in £4.3bn alone, with the rest disappearing up noses and the like. Drugs are split into crack cocaine, powder cocaine, amphetamines, ecstasy and imported and home produced cannabis, worth £6.7bn a year according to the ONS.
So the real story is this: British people spend over £23bn on having a really fun time.
We might as well kill ourselves right now because the company who print the money for the Bank of England are in all kinds of trouble. We’re clearly going to have to resort to trading in turnips and song, or even worse, Dogecoin.
Shares are tumbling (by 26% no less) thanks to De La Rue issuing a profits warning. Presumably, they’re not allowed to just print a load of tenners off and sort the whole thing out.
De La Rue make banknotes for loads of countries, as well as being the folks who print the UK’s biometric passports. They’ve said that trading conditions had “deteriorated” and their profits for this year are now expected to be £20m lower than last year.
We’re clearly doomed and there’s no conceivable outcome where we’ll have any money. We’re finished. We’re entering a Mad Max style Dystopian nightmare, complete with Tina Turner theme song.
De La Rue have said that prices and margins for their printing services and secure paper used for banknotes were lower and that the rates of growth in new business had been slower than expected. To kick them while they’re crying on the floor, they were chosen to print Bank of England notes for the next decade, but the value of the contract is going to be lower than they first assumed.
The company said that they expect “the current difficult market conditions” to continue into the next financial year. WE’RE DOOMED! OH GOD WE’RE SO DONE FOR!
De La Rue’s operating profits last year were £89.3m instead of the forecast £90m.
“While disappointing to announce this trading update De La Rue, as the market leading banknote printer, remains a strong, profitable and cash generative business. We will continue to pursue efficiency gains, invest in the business and in R&D for the future,” said De La Rue chairman Philip Rogerson.
Perhaps we overreacted. Oh well. Normal service resumes.
Things are getting shaken-up in the world of car insurance. Does it mean cheaper car insurance for all? Of course it doesn’t. Did you have glue for your breakfast this morning because that’s a stupid thing to think.
Basically, the Competition and Markets Authority (CMA from now on) have said that exclusive pricing deals between motor insurers and price comparison websites need to be banned. Basically, because of these deals, insurers are being denied the chance to make their products available for cheaper, elsewhere.
The CMA also noted that consumers need better information on no-claims bonus protection insurance.
This review came about after the Office of Fair Trading asked the CMA to get stuck into the motor insurance market, and after a year of weighing things up, this is what the CMA have come up with.
They say that, because of the deals being struck between insurers and price comparison websites, it is pushing the price of premiums up across the board.
“They certainly help motorists look for the best deal, but we want to see an end to clauses which restrict an insurer’s ability to price its products differently on different online channels,” said CMA deputy panel chairman Alasdair Smith.
The CMA also tossed some work to the Financial Conduct Authority who should be examining how insurers tell consumers about add-on products to car insurance policies and the like.
“The way motor insurance-related add-on products are sold makes it hard for consumers to obtain the best value,” Smith added, with no-claims bonus protection being a particular concern: ”We are requiring insurers to provide much better information.”
Alas, the CMA said that they weren’t able to work a way around the problem of high car hire and repair charges for drivers who were not at fault in an accident.
Fixing that, they say, would require a “fundamental change in the law”.
Everyone enjoys it when Tesco make a pig’s ear of something. They’re too big for their boots, so even if these cock-ups don’t necessarily mean that they’re in trouble, we should take every opportunity to mock them when it presents itself.
And so, Britain’s biggest supermarket have overestimated their profits by £250m, like the massive idiots they are.
They were talking about their expected profit for the half year, and invented a whole load of money ”due to the accelerated recognition of commercial income and delayed accrual of costs”.
“On the basis of preliminary investigations into the UK food business, the Board believes that the guidance issued on 29 August 2014 for the Group profits for the six months to 23 August 2014 was overstated by an estimated £250m. Some of this impact includes in-year timing differences. Work is ongoing to establish the extent of these issues and what impact they will have on the full year,” the company said in a statement.
The stupid gits.
Tesco have gone off crying to Deloitte and asked them to undertake an independent and comprehensive review of this balls-up, as well as consulting Freshfields, their external legal advisers.
Once they get this sorted, they will provide a further update of their interim results, which will now be shared with the world on the 23rd October 2014.
We can only hope that even more money goes missing, because we’re petty and cruel.
Tesco have gone and suspended four executives, including its UK managing director, after their overegging of profits and have launched an investigation, which will be undertaken by Deloitte.
As a result of this debacle, the company’s shares fell 10%. ”We have uncovered a serious issue and responded accordingly,” said Tesco chief executive Dave Lewis.
Lewis said “a number of people” had been suspended from duty, and one of those is UK managing director Chris Bush, according to the BBC.
Lewis added that he expects Tesco “to operate with integrity and transparency” and that they ”will take decisive action as the results of the investigation become clear.”