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.
Fat cats in the city avoid pension tax
The UK government recently announced a number of changes to the pension system which would effectively see an increase in taxation for large value contributions to pension schemes which many thought would hit the high earners in the City. However a report by the Guardian has today confirmed that a significant number of top earning directors in the UK opted to receive their pension fund contributi...Read More
Is this the end of the free market?
Many experts believe that the events of the last 18 months could herald the end of the free market in the UK finance sector. Never before has one sector been proven to be so instrumental in the direction of an economy as the UK financial sector over the last few months. No future government in UK can really afford to give one area of the UK economy so much power and we could see the end of the fre...Read More
UK Banks May Swap £90 Billion Of Debt With The BoE
Even though the £50 billion gamble which the UK government announced recently created something of a stir in the debt markets, we are hearing news that the figure of £50 billion may actually be increased to nearer £90 billion. It seems that the banks are climbing over each other to swap their more risky investments for government guaranteed debt in order to shore up their balance sheets. Wh...Read More
Budget Headlines : Investment into offshore windfarms
Investment into offshore windfarms...Read More
Is this the end of the road for Woolworths?
It has today been announced that all 813 Woolworths stores will start a closing down sale tomorrow with little prospect of the group being taken over as a going concern. The move has been announced by the administrators of the group after seemingly failing to find an appropriate buyer willing to take on the business and the associated liabilities. This brings to an end over 50 years of business on...Read More