UK banks to trial living wills
A small selection of UK banks will this year start trials of so-called "living wills" which have been encouraged by the Financial Services Authority (FSA) in the event of a collapse of a banking institution. In simple terms these so-called living wills will allow regulators to come in and have ready made plans to wind down the operation, exposing every nook and cranny and investment operation in a short space of time.
One of the problems we saw when the credit crunch began was the fact that many banks and many financial institutions had in fact acquired sliced and diced investment products which were indirectly connected to various banking institutions. Once one of the major components of the investment chain collapsed the whole system began to fall like a pack of cards and ultimately investments which had been worth billions upon billions of pounds became worthless overnight.
This stricter regulatory environment in the UK, and around the world, should at least reduce the chances of one major financial collapse dragging down the whole sector although how detailed and how useful these plans will be remains to be seen. The FSA has been very proactive on this particular front and the trial, which begins this year, will offer an interesting look into the UK banking sector.
Share this..
Related stories
Budget Headlines : Pensioners savings allowance up to £10,000
Pensioners savings allowance up to £10,000...
Read MoreRoyal Bank of Scotland refuses credit cards to noncustomers
Royal Bank of Scotland, and its NatWest subsidiary, has today revealed that it will not consider any credit card arrangements with individuals who are not customers of the bank or its many subsidiaries. This is a situation which was first brought to our attention when HSBC announced a similar strategy earlier this year and effectively restricts access to finance for many people in the UK.
<...
Has inflation peaked?
After hitting a recent high of just over 5% the central rate of inflation in UK looks set to fall markedly after reaching a 16 year high. This more than any other factor should allow the Bank of England to reduce interest rates later this week, something which many investment markets have already factored in to the situation. This is not a time for the bank to be overly cautious and there is a nee...
Read MoreWill Stagecoach save National Express?
The potential Stagecoach and National Express merger took an unexpected turn this morning with news that Stagecoach effectively ruled itself out of a bid in September and is, under takeover and merger rules, unable to make an offer for the company for six months. The only potential route around this restriction is if Stagecoach is invited by the management of National Express to put together some...
Read MoreUK new car sales collapse
The Society of Motor Manufacturers and Traders (SMMT) has announced that new car sales have fallen by 23% over the last 12 months in the UK. The decline in new car sales is the largest since the early 1990s although the situation looks set to get worse before finally recovering in line with the UK economy. Those who read the press will have seen a number of buying one car and get one free offers w...
Read More