Latest Banking News

October 13, 2008

Lloyds revises HBOS takeover offer

by Kay Murchie
The terms of Lloyds TSB’s takeover for Halifax owner, HBOS, have been revised. HBOS shareholders will now receive 0.605 shares for each HBOS share they own, revised from the original offer last month of 0.833. The news comes as the Government announces a £37 billion rescue plan, which will see £20 billion injected into Royal Bank of Scotland (RBS) and a further £17 ...

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Iceland stock exchange remains closed

by Kay Murchie
Iceland had a disastrous week last week after the nationalisation of the country’s three largest banks. On Thursday, it announced that trading had been suspended on the OMX Nordic Exchange in a bid to prevent further crises. It was expected that the stock exchange would reopen today but it remains closed due to ‘unusual market conditions‘. Meanwhile, talks between Britain and Iceland ...

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Shares recover as £37bn rescue plan revealed

by Kay Murchie
Shares on the FTSE 100 index have risen this morning on the news that the UK Government is to pump £37 billion into three of the country’s largest banks. Under the terms of the deal, banks have agreed to scrap executive bonuses for the current year and future bonuses will be paid in the form of shares. In addition, banks will ...

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October 12, 2008

Talks in Britain and Iceland begin over frozen assets

by Kay Murchie
Talks between Britain and Iceland have begun with regard to the British deposits frozen in Iceland’s banks. The talks commenced after Treasury officials headed to Reykjavik late last week to discuss its banking crisis and the affect on UK savers and councils with money in its banks. Britain's Local Government Association estimated 108 British local authorities have £750 million ...

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October 10, 2008

UK Banks: the worst is yet to come

by Brian Turner
UK banks such as RBS, HBOS, Barclays and Lloyds have had it bad - share prices have plunged wiping billions from their company values, and commercial markets have frozen up leaving them in need of government help to remain afloat. During the drama of the financial crisis, everyone seems to have forgotten about the ongoing case relating to unfair ...

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Frosty relations between Iceland and UK

by Kay Murchie
Prime Minister Gordon Brown said yesterday that the UK may freeze the assets of Icelandic companies after he branded Iceland’s failure to guarantee British savings in its failed banks as ’unacceptable and illegal‘. The two countries are battling over who should compensate British savers whose money is in Icelandic amid the collapse of the country’s banking system. Iceland has had a disastrous ...

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Dow Jones plummets, Asian stocks follow suit

by Kay Murchie
Yesterday, the continued uncertainty in the markets resulted in the Dow Jones index falling 678.9 points to 8579.2, its biggest percentage drop since October 1987. Today, stock markets in Asia followed suit after Tokyo’s Nikkei-225 index shed 9.6% and saw its biggest fall in a single session since Black Monday in October 1987. At the end of trading on Friday, Tokyo ...

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October 9, 2008

Shares recover after rate cut news sinks in

by Kay Murchie
Yesterday, several central banks including the Bank of England, the European Central Bank (ECB) and the US Federal Reserve announced they were to cut interest rates by half a percentage point in an attempt to boost the economy. However, the markets failed to respond to the news after London’s FTSE 100 closed down 5.18%, France's Cac 40 was 6.3% lower, ...

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Do pray for us Mr Darling

by Gill Montia
As yesterday morning's speaker on BBC Radio 4's "Thought for the Day" urged a bleary-eyed nation to consider in its prayers the plight of bankers, whose lives may be torn apart by the credit crisis, and bear in mind their efforts in support of charity, a new day of financial turmoil was about to break. Initial reports of a £50 billion rescue ...

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Iceland’s woes continue with Government seizure of Kaupthing

by Kay Murchie
Kaupthing, Iceland's largest bank, is the latest to be hit by the financial market turmoil after it has been seized by the country’s Government. The country’s Financial Supervisory Authority said the move was done to protect its domestic banking system. However, it added that all domestic deposits at the bank were fully guaranteed. It was arranged by the Government yesterday ...

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October 8, 2008

UK Icesave savers will get their money back

by Kay Murchie
Yesterday, it was warned that British savers of internet bank Icesave, an arm of Landsbanki, may struggle to claim their money. Earlier this week, the Icelandic Financial Supervisory Authority announced that the country's Government had seized control of Landsbanki, which owns Icesave. However, today Chancellor Alistair Darling has guaranteed that UK savers will get their money back. A spokesperson for the ...

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Markets fail to respond to shock interest rate announcement

by Kay Murchie
The Bank of England announced its decision on interest rates a day early today following another eventful week on the financial markets. The Bank of England cut rates by half a percentage point from 5% to 4.5%, the last time this occurred was in September 2001. Rates have remained at 5% since April in a bid to curb inflation. Co-ordinated ...

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£50bn rescue plan for UK banks at taxpayer’s expense

by Kay Murchie
Details of a £50 billion rescue package have been unveiled by the UK Government, which will see Britain’s top High Street banks part-nationalised in an attempt to prevent further crises in the financial sector. Eight of the UK's largest banks and building societies that have confirmed will take part in the plan are Abbey, Barclays, HBOS, HSBC, Lloyds TSB, ...

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October 7, 2008

Record fine for A&L for mis-selling PPI

by Kay Murchie
The Financial Services Authority (FSA) has given Alliance & Leicester (A&L) a record fine of £7 million for mis-selling payment protection insurance (PPI). The FSA found that the bank had trained its staff to put pressure on customers who questioned the inclusion of optional PPI in a loan. During the period January 2005 to December 2007, A&L sold around 210,000 ...

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Icesave savers may have to claim compensation

by Kay Murchie
British savers of internet bank Icesave, an arm of Landsbanki, have been warned that they may struggle to claim their money. Earlier today, the Icelandic Financial Supervisory Authority announced that the country's Government had seized control of Landsbanki, which owns Icesave. At the moment, Icesave is not allowing customers to withdraw money out of their accounts or to put in deposits ...

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Fears over the future of RBS after shares take a battering

by Kay Murchie
The turmoil in the stock markets continues this morning after shares in Royal Bank of Scotland (RBS) plummeted by over 35% to below the £1 mark. The bank is now worth just £16 billion, compared to £75 billion a year ago. RBS shares plunged to 95p, the lowest point since the recession of the early 1990s. Speculation is ...

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Banking Crisis: Which are the Safest UK Banks?

by Brian Turner
We've seen Northern Rock and Bradford & Bingley collapse, the Cheshire and Derbyshire Building Societies rescued, and even Halifax Bank of Scotland required a bail-out from Lloyds TSB. Turmoil in the world's markets mean that credit around the globe has literally frozen up, and banks face the very real possibility of a systemic meltdown of the financial system. Consumers are ...

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Iceland’s Landsbanki nationalised

by Brian Turner
Iceland's Financial Supervisory Authority said today that it had taken control of Landsbanki Islands hf, the country's second-largest lender. The Landsbanki Guernsey offshare bank has gone into administration this morning, amid continuing turmoil surrounding Icelandic banks. Meanwhile customers of Icesave, another arm of Landsbanki, have been unable to withdraw cash in their accounts today. Icelandic banks are currently under enormous pressure to recapitalise by ...

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October 6, 2008

Kaupthing Edge and Icesave FCSC deposit protection guide

by Brian Turner
With the dramatic threat to the Icelandic banking system, a lot of UK savers with Icelandic Kaupthing Edge and Icesave are now looking at how their savings will be protected. Kaupthing Edge Kaupthing Edge customers can be assured that the company operates as a UK bank, and therefore is subject to the Financial Services Compensation Scheme (FCSC) which now protects customer savings ...

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Santander: White Knight or What?

by Gill Montia
A crisis might be a time for action rather than questions but with the scale of the problems facing the UK banking sector escalating, one particular question regularly bubbles to the surface. Is Grupo Santander any more likely to emerge from the credit crisis in sound shape than some of its failing European rivals? Santander became a household name in the UK when it ...

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