Government attacks UK shareholders for inactivity
The UK government has today come out fighting as the blame game begins with regards to high-risk companies in the UK which have brought the economy down. The government has suggested that the various institutional shareholder associations in the UK have failed to monitor and react to boardroom decisions which in hindsight were high risk and potentially fatal to many companies.
However, a number of shareholder associations have today suggested that the government was the one which took its eye off the ball and let many UK banks expand into markets in which they had little or no experience and increase their overseas exposure at a time when margins were under pressure and risky transactions seemed very much to be the norm.
There is no doubt there is potentially blame on both sides but for the UK government, and by association UK regulators, to blame shareholders for not responding to activities and actions taken by directors is a new twist to the bitter saga. Slowly but surely the UK government continues to alienate itself from UK private shareholders and UK institutional investors. Whether this will come back to haunt the UK government in due course, when they require extra funding to plug any future budget deficits remains to be seen.
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