West Bromwich building society under more pressure
Rightly or wrongly the West Bromwich building society is this evening under extreme pressure after a credit rating downgrade by Fitch and news that the Financial Services Authority is looking to further stress test a number of potentially vulnerable building societies in the UK. As we covered in one of our earlier post, the West Bromwich building society has been at the centre of significant rumours over the last few weeks, since denied by the society, regarding its finances and potential liabilities.
While new rumours persist in the market it has to be said that so far there has been no official confirmation of any significant issues as far as the company's balance sheet goes and no warnings from the Financial Services Authority. Whether the FSA is looking at a potential rescue package in the background or in fact the company is "clean" remains to be seen but these rumours will just not go away and are starting to impact on some of the smaller UK building societies.
As we have mentioned on a number of occasions, rumours kill confidence and confidence has a massive impact in areas such as the financial sector. Once you lose the confidence of your customers it can be very hard to win this back as so many companies have seen in the past.
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