Has the FSA gone too far regarding bank stress tests?
As we covered in one of our earlier articles, the Financial Services Authority (FSA) has issued a new set of guidelines regarding bank stress tests which will effectively force each and every financial institution in the UK to identify its own potential weaknesses. This is a rather bizarre way in which to protect the UK economy because all the regulators are doing is highlighting weak companies and making them susceptible to potential takeovers, mergers or limited financial backing.
If a company is forced identify a potential weakness in its own business model, then what is there to stop a predator approaching the company's shareholders and claiming that they could run the company better than its current board of directors. There are no industries in the world which force companies to do the homework of their potential predators and competitors and weaken their own reputation and financial strength in the eyes of investors. So why has the FSA decided to act now?
Even though the idea of "reverse stress tests" does appear to have some merit in the current economic climate it is absolutely crazy to ask a company to research its own weaknesses and then publish these for public consumption.
Cadbury investor could bail out at 820p a share
Unofficially it is believed that at least one of Cadbury's top-10 institutional shareholders would consider an offer in the region of £8.20 a share for the UK chocolate maker. This comes just hours after Cadbury issued a relatively upbeat trading statement although on reflection some analysts are concerned that the upbeat statement may just be a little shy of what is required to beat off the pote...Read More
Cutting the fat from the last UK boom time
If there is one employment sector in the UK which appears to have benefited more than most it has to be public services. We have seen over 500,000 jobs created over the last decade with a substantial increase in pension liabilities one of the more worrying aspects of the growth. However, a number of experts are now wondering why it has taken the recession for the government to announce a significa...Read More
The FSA issues new corporate governance guidelines
The FSA has today issued a raft of new guidelines with regards to the financial services industry and remuneration packages which have come under severe criticism of late. In what many see as purely a public relations stunt, and something which will never actually reach the market, the FSA is suggesting increasing the fixed salary component of future remuneration packages and linking bonuses to pr...Read More
Will Lord Mandelson extend the car scrappage scheme?
As expected, Lord Mandelson will come under greater and greater pressure to extend the UK government's car scrappage scheme which encourages older vehicles to be scrapped in exchange for discounts of up to £2000 on new and more efficient vehicles. As we have covered on numerous occasions, the government's multi-million pound offer has been taken up by many car owners up and down the country and l...Read More
Are we seeing a return of strikes to the UK economy?
As news filters through of a potential 48 hour strike on the London tube next month, calls have been made by the RMT union for direct talks with Boris Johnson the Mayor of London. It is believed the dispute relates to a pay agreement which effectively sees the real salary of members fall over the next five years. As a consequence, Bob Crow, the general secretary of the RMT union, is looking at way...Read More