Some good news just came out about our Bank of England and UK Lenders, after a long road of troubled waters that had me so disillusioned I left the industry, it seems we MAY be turning a corner.
Capital targets are now in reach for most of the lenders and most hope to see some loosening in regulation to help improve the system and keep the improvements coming steady!
The Governor Mark Carney said during a news conference that things are where they need to be and according to his words in a Wall Street Journal Article “There is no new wave of capital regulation coming.”
The taxpayers, that is, have footed the bill for the bankers during the global crisis and now we are finally seeing these broken banks come back to health. While still a bit speculative of the news, it’s a good sign mates!
There are what they call “stress tests” in the banking world and ours just past the second level.
I find the banking world to still be shaky and with terror strikes having us on heightened alerts there are other ways to make sure you can secure some funds for holiday gifts or travel as we hit that season.
It’s not a great time to pull money out of any investments, so what about payday loans if you can pay them off quickly, I’ve needed to take advantage of these and not risk pulling any money out of a shaky financial market. The news looks promising, but know we have options as I myself look to get to Australia to see relatives on holiday for Christmas!
Keep your chin up investors and we’ll all grow together through these shaky financial times that look to improve, but we always want to err on the side of caution. Best of luck mates!
Until next time…
Bank of England
Paper money commonly known as bank notes has undergone a lot of change over the years. The earliest use of paper as a means of exchange can be traced back to China in 7th Century. Only a thousand years later the practice came to Europe, starting with England.
The forbearer to the actual currency notes was the note given by goldsmiths in exchange for gold deposited with them. The note had the depositors name and a promise to pay the said amount was mentioned. The Bank of England followed and issued notes in return for deposits. This is how the journey of the modern currency note started. Later a special kind of paper was used to print the notes when it became the regular money.
The bank issued the note and the head cashier used to sign it. The practice was stopped with the fully printed note. Now the words” I promise to pay the bearer on demand the sum of…” were followed by a printed signature of the chief cashier. In 1833 the notes were made legal tender for all sums above £5.
The new Polymer Note
Several changes have been made over the following centuries. The latest change is moving from paper to polymer. A thorough research was done regarding the introduction of the plastic bank notes. The decision came to introduce polymer notes in £5 and £10 denominations. The £5 note will feature Sir Winston Churchill and the £10 note Jane Austin. The research showed that polymer notes would be more secured and durable than paper. Also it could have extra features making it difficult to counterfeit.
The world will follow soon. The days of the paper notes are numbered……..
The Bankers form an association and then experiment with economy. Selling mortgage which is not recoverable and giving loans to corporate has led to the economy suffering. The myth of “big do not fall” has been pushed aside. Rather the saying “The bigger you are the harder you fall” holds true for the banking fraternity.
Major banks are getting bail outs, but why? Do millions have to suffer because of a few elites? The times are really dangerous.A few private players are running the economy. If you cast aside the legality factor major banks are doing everything the crime syndicates used to do. Favoritism, nepotism and general carelessness about welfare is driving the economy to nuts.
These big corporations have even taken over the welfare system largely. Major Insurance companies are being controlled by these big daddies of finance.
So what is the way out? As a citizen and a former banker I can give a few suggestions.
- Levy Financial Transaction Tax – It will discourage the banks to lend heavy.
- Put a Cap on Compensation packages – The salary package Cap should stay for longer duration.
- Do not let them grow big – It was the big banks which faltered. So put a limit on the total assets and break down the bigger banks into smaller institution. This will help to keep control and also will increase the number of jobs.
Banks are not the only source of financial support available to us, but they don’t like you to know that. There are other ways to manage your money, savings and loans. I’m not recommending shonky loan brokers like Wonka – there is a reason social groups and now the government want to shut them down. But, consider options like credit unions – credit unions are not widely used in England, however in countries such as Australia they are well-known and offer a great alternative to banking for most people.
Most modern day credit unions come out of a community organisation, such as a church or trade union, where members would by a share for a small amount which would allow them to use the union services. These days the requirements to belong to the particular group no longer exist, any one is able to join and access a range of services similar to a bank, and the credit union is subject to the same strict financial controls. But, the real benefit of a credit union is that as they run as a non-profit organisation they can often offer better terms that the high street bank. Most will offer personal loans and mortgages, so they are definitely worth considering. Read this article for more information.
I read this article with a sense of irony a few weeks ago, Business Secretary Vince Cable urging banks to keep branches open in the high streets. The reason I say irony is this comes from the same government that committed to selling off Royal Mail, and allowing hundreds of local post offices to be shut, post offices that gave local communities much-needed access to services such as banking. I have read that the government has suggested that if banks were to continue retreating from the High Street, Royal Mail would be forced to re-open some offices – there’s the irony!
I can see neither the banks nor the government coming out of this well. The government has just shown that their policies are flawed – pensioners, parents with small children, and the ill are amongst the many who need access to local banking services, often not being able to travel or use online services, and should have a right to this. Saying it is the banks responsibility just does not cut it, the government has withdrawn any other means to access state benefits and pensions than through a bank account, it is the governments responsibility that those most in need are able to access their money.
On the other hand, it also shows that despite their continual claim to the contrary, banks are still putting the making of profits as their number one goal. Customers that rely on local services are often those with the least value in the eyes of the bank, and it is easy for managers to argue the need to meet their shareholder obligations and drive their business forward. But, they are still a service industry that relies on customer goodwill, remove the basics of banking, ie. providing a service to all your customers comes at a price. It’s easy for the average person to believe that these moves have no effect on them, when they can continue to access on-line services and travel to a branch, but what will happen when that situation arises where you are desperate to actually sit face-to-face with a real banker and discuss the biggest decisions you might need to make. You’ll soon see wish that there was still some consideration for real customer needs then.
I returned to the UK fifteen years ago as an adult full of the excitement of embarking on a new life. I had last lived here as a child, and while numerous holidays had led me believe I understood how England worked, I was little prepared for the reality of the basics of establishing myself. I had told myself it would be easy, after all I worked in banking and therefore had a strong financial history, and plenty of resources including family.
The first three priorities for a new resident are simple – housing, phone and internet, and bank account. Unless you are lucky enough to arrive with a job, without these it is impossible to start. I naively assumed it would be simple, after all I was a British citizen, I had the passport that should surely open all the doors. The initial step of housing was simple – family! Next step was the phone and internet, here I hit the first problem, I needed a bank account – skip to the third task.
Having first opened an account as a child, and taking simple steps through to an adult account, credit cards and mortgages, I had no concept how difficult this would be – rather ironic seeing as I was a person who should know! The passport wasn’t enough, my previous financial history was of no use, nor mention of my former banking employers (for they did not operate in the UK). I needed bills showing my current address, impossible when it’s not your home, a true catch 22 situation. Eventually I stumbled upon one bank that was willing to overlook my short falls at a hefty price. I was able to open a premium account that appeared developed for overseas students. I would be locked in for a year, but it was worth it.
From what I have observed since, this is still reality – the opening of the worlds borders are of no concerns to banks unless they can make some money, the only hope is the rise of global banks like HSBC, who have stumbled on this as their USP. With the Uk seeking skilled immigration it seems incredible that in this age we are still building basic obstacles. The increasing concerns over money laundering and identity theft seemed to have spooked most banks into turning away potential customers. Surely there can be a return to the basic accounts we used to operate, that would allow a customer to build a history.