The downturn in the property market is forcing 60,000 homeowners a month into negative equity. According to the credit rating agency, Standard & Poor’s, research suggests that 335,000 homes will be worth less than their mortgages by the end of October, a rise of 260,000 over four months. If the trend continues, the number of [...]
Credit Action is claiming that Northern Rock’s level of repossessions is twice that of its rivals. The debt charity is calling on the Treasury to intervene and insist that the nationalised lender responds more sympathetically to borrowers who fall behind with their mortgage repayments. It would like the bank to introduce mortgage payment holidays to [...]
Nationalised bank Northern Rock has had to withdraw some of its savings deals after a flurry of deposits has put it close to breaching state ownership rules. Since it was nationalised in February, Newcastle-based Northern Rock has been offering some of the best savings rates, making it highly attractive for concerned savers to put their [...]
The Government’s own advisers, Goldman Sachs, have warned that taxpayers could lose up to £1.28 billion due to the nationalisation of crisis-torn Northern Rock. Northern Rock was nationalised in February after the Government rejected takeover bids from the board of Northern Rock and a consortium led by Sir Richard Branson’s Virgin Group. A judicial review [...]
Northern Rock, which was nationalised earlier this year after the Government rejected takeover bids from the board of Northern Rock and a consortium led by Sir Richard Branson’s Virgin Group, has posted bigger than expected losses of £585.4 million for the first half of 2008. The crisis-torn lender said the majority of the losses arose [...]
Northern Rock has announced that it is to cut fewer jobs than originally anticipated as part of its ongoing cost-cutting measures. The nationalised bank has said it now plans to make 1,300 people redundant compared with original plans to axe 2,000 jobs. The lender said 500 staff will leave voluntarily. The crisis-torn bank was hit [...]
Former vice chairman of Barclays, Gary Hoffman, has been named as Northern Rock’s new chief executive. Newcastle-based Northern Rock will pay Mr Hoffman almost £2 million over two years to manage the crisis-torn bank. Mr Hoffman’s basic salary is £700,000 plus three separate payments of £400,000 in compensation for the loss of his participation in [...]
Chancellor of the Exchequer, Alistair Darling, has announced new measures to protect savers who lose money as a result of a bank getting into financial difficulty. The Government has also asked the Financial Services Authority to consult on increasing the current threshold for compensation from £35,000 to £50,000. Any changes will come into effect in [...]
Mortgage customers of Northern Rock who are seeing their fixed-rate mortgages run out are facing huge increases because they are trapped on expensive rates with the crisis-torn lender. The business plan for the nationalised bank saw attractive rates scrapped in an attempt to put-off new customers and encourage existing ones to re-mortgage with another lender. [...]
A new deal has been reached between Northern Rock and Lloyds TSB, whereby Lloyds TSB will offer mortgages to Northern Rock customers when their deal with the lender expires. Lloyds will cherry-pick Northern Rock customers and send them letters when their current fixed-rate term is nearing the expiry date. The bank said the standard application [...]
An internal memo at Northern Rock has unveiled that the crisis-torn bank is expecting to see a vast increase in the amount of customers struggling to pay off their mortgage over the next 12 months. As a result, the bank is proposing to more than double the number of people who work in its debt [...]
Northern Rock chairman, Ron Sandler, has warned that sharp house price falls could delay its plans to repay the billions of pounds it owes the Bank of England. Mr Sandler said if house prices were to decline 5%, 10% or 15%, that would seriously impede fulfilling the plan and added I can’t give you a [...]
Ron Sandler, who was appointed by the Government to revive Northern Rock, said solid progress has been made against the business plan. The Bank of England loan facilities are reducing and the balance sheet is contracting as a result of planned mortgage redemptions, added Mr Sandler. Mr Sandler’s strategy is to reduce the mortgage book. [...]
Shareholders of crisis-torn Northern Rock have commenced legal proceedings against the Government to claim compensation for nationalising the bank as they believed it was still a viable company. The UK Shareholders Association (UKSA) has submitted an application for judicial review which questions the terms under which the bank was nationalised, which will leave its 15,000 [...]
Crisis-torn Northern Rock, which was taken into public ownership on February 22, has commenced talks with staff over plans to axe 2,000 jobs. Northern Rock said the company will now commence the formal 90-day consultation period with Unite and other employee representatives, with the inaugural meetings planned for May 1, 2008. The likely start date [...]
The Government took Northern Rock into public ownership on February 22 and shareholders were believed not to be in favour of the nationalisation and have since been threatening legal action. The UK Shareholder’s Association (UKSA) (acting on behalf of the Northern Rock’s shareholders) believes that the UK Government confiscated the shares even though there was [...]
Despite calls by the Government for mortgage lenders to pass on interest rate cuts to borrowers, nationalised Northern Rock still has not passed on last week’s interest rate cut. The crisis-torn bank said its standard variable rate (SVR) is still under review after Chancellor Alistair Darling said lenders should do more to help homeowners. A [...]
The European Commission have launched an investigation into the Government’s multi-billion pound survival plan for crisis-torn bank Northern Rock. The investigation is expected to run for several months and will study the rescue plan proposed by chairman Ron Sandler earlier this week. It will also determine whether the special support complies with the European Union’s [...]
Northern Rock revealed yesterday that it would not break even for 3 years but pledged to repay its £24 billion state loan. Furthermore, the crisis-torn bank has confirmed it will cut costs by 20% and make 2,000 job cuts. The bank said it is in talks with workers’ unions and is in the process of [...]
Crisis-torn Northern Rock is set to reveal huge write-downs when it announces its 2007 results later today, months later than originally planned. Interest payments to the Bank of England and provisions against its mortgage book wiped out its profits last year. Back in September, Northern Rock said it was on target to make profits of [...]
Phone fraudsters stealing bank card pins
Fraudsters using a phone scam to trick bank card holders into revealing their pin numbers stole £750,000 in the first four months of this year. This is the same amount stolen through this scam in the whole of last year. The fraudster telephones a bank customer, often someone elderly or vulnerable, telling them that their [...]
FSA rules out ban on interest-only mortgages
Speculation that the Financial Services Authority would ban interest-only mortgages as part of its Mortgage Market Review has proved to be unfounded. However, lenders will be required to monitor the performance of the investment product taken out by the customer to repay the mortgage at the end of its term. Investments are performing poorly because [...]
Bank of England may end free in-credit banking
A director of the Bank of England has warned that official intervention could be considered to end the ‘dangerous myth of free in-credit banking’. Andrew Bailey has already spoken out against free banking in relation to the mis-selling of financial products. In a speech made available to media, he reiterated his concern, saying that it [...]
Bank of England votes against more economic stimulus
The Bank of England voted against a further round of quantitative easing, at its latest Monetary Policy Committee (MPC) meeting. Just one member, David Miles, voted for further asset purchase to encourage growth in the UK economy, while the other eight members voted to keep the Bank’s quantitative easing programme steady at £325bn. The minutes [...]
Catalogue debt growing says helpline
Calls from people concerned about their debts with mail order catalogues accounted for more than 12 per cent of all calls received by National Debtline last year, compared with just 8 per cent in 2007. More people were concerned about catalogue debt than about payday loans, mortgage or rent, according to the Money Advice Trust [...]
Homeserve faces mis-selling investigation
HomeServe, which provides emergency insurance cover and domestic repairs to households in the UK, is to be investigated by the Financial Services Authority (FSA). Issues over the possible mis-selling of household emergency policies were uncovered last October during an internal review at the Walsall-based company. Homeserve’s call centre staff were found to be selling ‘Complete [...]
OFT warns Wonga over debt collection methods
Payday loan company Wonga used aggressive and misleading methods to collect debts from customers, the Office of Fair Trading (OFT) has found. Wonga sent letter and emails to certain customers suggesting they had committed fraud and threatening to report them to the police if they did not act in the way Wonga suggested. The company [...]
NS&I re-launches investment account
National Savings & Investments (NS&I) has re-launched its Investment Account at a higher interest rate than it previously offered. The account now offers 0.75 per cent before tax, compared with between 0.2 and 0.3 per cent previously, depending on the account balance. Deposits and withdrawals on the account can no longer be made at Post [...]
Rightmove reports property downsizing trend
Two in five property owners planning to sell in the next year are planning to ‘trade down’, compared with one in four who plan to ‘trade up’. A survey by property website Rightmove found that moving to a smaller home is the main reason for moving in nine out of the ten regions in the [...]
More people failing to save for retirement
The proportion of people with no pension savings has grown from 20 per cent to 22 per cent over the past year, according to Scottish Widows’ latest survey. The pension provider surveyed 5,200 adults in the UK, aged 30 or over, and earning at least £10,000 a year, for its annual review of pensions. Ian [...]
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