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.
Is Ofgem strong enough to take on the UK energy companies?
Today's news that Ofgem believes UK energy companies are overcharging customers has received a lukewarm response in many quarters. Consumers and businesses have for many years believed that they were being overcharged by the energy companies who for example moved their prices higher as the price of oil rose yet refuse to reduce them when the price of oil declined. So is Ofgem strong enough to take...Read More
UK fraud costs £600 per member of the population!
Figures revealed by the National Fraud Authority suggest that fraudulent activity in UK is costing each and every person in the country around £600. It is estimated that fraud accounts for £30 billion of losses each and every year with the vast majority coming from tax scams while around £10 billion is lost in the private sector. But how accurate are these figures? Despite the fact that the...Read More
Credit card companies putting customers under pressure?
More and more credit card customers in the UK are now complaining of being "harassed" by their credit card company even though many people are up-to-date with their payments. It would appear that more and more credit card companies are becoming proactive where they feel their customers are entering financial difficulties, even if they are up-to-date with their payment schedules. So what can you do...Read More
Alistair Darling warns G20 about pulling out too early
Alistair Darling has warned his fellow G20 members that the financial stimulus put in place during the depths of the ongoing worldwide recession need to remain for the foreseeable future. Despite the fact that the US, Germany, France and Japan appear to be pulling out of the recession he is concerned that an early end to the fiscal stimulus programme could plunge the world economy back into recess...Read More
UK banks agree to simplify future accounts
The British Bankers Association has confirmed that UK banks have all agreed to abide by simpler accounting methods in the future as a means of comparing like-for-like across the UK financial and banking sector. This comes after severe criticism of UK bank report and accounts, many of which seemed to treat similar assets in a different manner. During these difficult economic times this made it near...Read More