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Banking of changes

I was interested to read Tony Ward’s blog on Mortgage Strategy Online last week about putting the Barclays and Libor fixing scandal into some form of perspective.

Ward stated: “There were rumours abounding about major banks being in difficulties. In this market it must have been tricky for any bank to fix a normal Libor setting for the British Bankers’ Association. To signal that your bank had a worse position than others and therefore had a problem must have been a real cause for concern.

“I could quite understand in fact why it may have been prudent to agree with the Bank of England that a normalised Libor rate should have been quoted and to take out the peaks and troughs of a far from normal market.” In a world that is becoming more sophisticated, we are asking more questions of what we did before.

It seems to me that what was once the norm seldom remains so and the banking sector has being going through violent change 

It seems to me that what was once the norm seldom remains so and the banking sector has being going through violent change. I do not claim to understand the full details of the events but I find it hard to believe that only a few banks acted in this manner over such a short period.

I expect that a few people will lose their jobs, having made small fortunes along the way. Maybe some unfortunates will end up with a criminal conviction and we are sure to see much more regulation. But to what avail? The City has acted as the City has for centuries and mostly its worked, hasn’t it? Perhaps the time has come for a change but in an industry that revolves around making money, won’t it always look greedy or corrupt unless everyone is making money too?

If you regulate too far, you restrict the ability to make money, don’t you? If you do that, will people still do it or look for other ways?


Authorities let the Libor fixing scandal continue

Tony Ward’s blog on Mortgage Strategy Online last week was another excellent piece and put the recent Libor fixing scandal into a sensible perspective.

I would say Bob Diamond, former chief executive of Barclays, did not exactly help his cause at the Treasury select committee by giving the impression of being less than forthcoming.

However, it appears the Government, the Bank of England and the FSA were all aware of the low balling but let it continue.

It is difficult then, subject to further evidence, to conclude anything other than that the authorities condoned low submissions until market conditions improved.

Ray Boulger


Look back with regret but forward with optimism

Barclays’ fine for Libor fixing

is a classic example of how hindsight is a wonderful thing. After the event, passing judgement is easy but in the thick of it, decisions have to be made that may be wrong but are done with the best intentions.

While it may appear a rather radical comparison, look at what went on in Northern Ireland in the 1970s and 1980s.

The situation in NI is now so different and people look back with regret but forward with optimism – we need to do the same with our banking system.

James Baxter


The party’s spoilt but they will get snouts in the trough later

The British Bankers’ Association last week told members that the industry needs “to think long and hard about its collective behaviour” as it cancelled its annual summer party as a result of the growing pressure on the UK banking sector.



Final nail in the coffin for the financial sector

Mark my words, the news last week that Barclays’ chief executive Bob Diamond had quit after the bank was engulfed in Libor fixing and interest rate swap misselling scandals is the final nail in the coffin of the UK financial sector.

Barclays is not the only one at fault, this is how all banks have been operating since the very inception of banking. It’s a closed group, the old school, done on a handshake, it’s corrupt at the very highest level but it works most of the time and has done for years.

Within five to 10 years, the City of London will be over, all the major banks will have relocated to Switzerland, where they will get along with working as they have been without interference from politicians, the public or the media.

All that will be left is the retail banks and building societies. “Good” I hear people say, yes, maybe, but a significant proportion of the UK’s GDP is generated in a single square mile of London.

Name and address supplied


APR must be shown so public can make an informed choice

Pay-day lender last week avoided censure by the Advertising Standards Authority after it received 81 complaints about a recent advert that failed to state the APR for the loan.

Three viewers challenged whether the ad was misleading because it did not state an APR but the ASA judged that it was not necessary for it to. But if the APR was irrelevant, then why are they forced to show it?

Perhaps it’s because every lender offering credit is accountable for their rates and charges so that consumers have the right to make an informed choice and comparison.

Kevin Valla


People need to wise up and learn to read the small print

On the topic of the story about last week and the complaints that were not upheld by the ASA, consumers have the right to make an informed choice and comparison. We as consumers vote with our pockets in the choices we make. Judging by the success of, there clearly is a need for a business like this.

It’s easy to find on’s website the rate that it charges, so clearly it is not trying to hide anything from the consumer. But just because a company is forced to show an APR does not make it relevant. For a short-term loan, which is designed to be held for a period of one month, showing an APR is pointless. The clue here is the word annual.

People need to wise up, educate themselves, learn to read the small print and not expect others to sort out their problems for them.



Why should hard working brokers pay for sins of others?

I was interested to read Mortgage Strategy’s leader in the July 2 magazine, which hit out at George Osborne’s announcement that the Treasury rather than the FSA could pocket the monies generated from the fining of financial firms could be yet another blow to mortgage brokers. As the Association of Mortgage Intermediaries explained, this could lead to further rises to the fees out by mortgage intermediaries if the monies from FSA fines is not used to fund the regulator.

But why should hard-working brokers, many of whom earn a minuscule sum compared with the billions trousered by banks, pay the price for the sins of our biggest financial institutions?

And if the Treasury does successfully end the practice of redirecting money generated from fines to the FSA, it’s high time it got the rising costs of the UK’s failed regulator under control.

Name and address supplied

Negatives abound but there are reasons to be cheerful

There were so many positives in Mortgage Strategy recently, and these included the FSA granting permission for a new lender to join the market, Metro Bank, opening more branches and readying for a float on the stockmarket.

Obviously, these positives are dwarfed by the negatives but even so there is reason to be cheerful.

With the squeeze being felt by many brokers up and down the country, many will need assurances that there is still light at the end of the tunnel and paying FSA fees to keep trading for another 12 months is not throwing good money after bad. Could it be that our patience is going to be rewarded? I sincerely hope so.

Robert Winfield
Chartwell Funding


Cash from fines should go to FSCS to reduce fees

Instead of the money from FSA fines going into the Treasury’s pocket and being used to fund foreign wars most of us don’t want, among other things, could not the money raised from fines go to the FSCS to pay directly for compensation to those affected by financial misdoing?

This would reduce the FSCS fees to those of us in a low-risk sector of the market – so there is admittedly a touch of self-interest in this – and would be seen politically as a fair use of the funds both inside and outside the industry.



Barclays trader should be offered deal to spill the beans

It does not matter whether any affect was had on the Libor rate by Barclays’ manipulation of the figures. The fact that a trader felt they had something to gain and could influence the submission in their favour is corruption.

The person that made the false submission should be the one being questioned and should be offered a deal to spill the beans on everyone else. In the US, whistleblowers get a share of the fines and we should do that here. The Bribery Act makes people think twice over whom they have a sandwich with these days.




Newcastle eases lending into retirement criteria

Newcastle Building Society has relaxed its criteria around lending into retirement and will now allow borrowers’ mortgages to extend beyond age 75 if they can prove they can afford the repayments.

Nationwide reduces fixed mortgage rates

Nationwide has announced that it will be reducing the rates on its range of fixed rate mortgages from July 11. Rate will drop by 0.10% for loans up to 70% LTV, affecting the two, three, four and five year fixed rate mortgages. Nationwide head of group mortgages Tracie Pearce says: “Our range of fixed rate […]

Keep calm and carry on?

We British are known for our stiff upper lip and just getting on with things. It’s part of our quirky cultural behaviour – like forming orderly queues, or saying sorry when it’s not our fault. Many of us just aren’t that great at talking about what’s bothering us. But if someone feels that the stresses […]


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