London takes the lead as credit and bank fraud rises 14%
by Gill Montia
Story link: London takes the lead as credit and bank fraud rises 14%
CIFAS, the UK’s Fraud Prevention Service, has published new research showing that London and the South-East are the country’s key hotspots for fraudulent applications across all product sectors.
The organisation recorded 104,548 confirmed cases of fraud from January to July 2008, a 14% rise on a year earlier.
Bank account and credit card fraud topped the list [...]
Lenders argue for extension of Special Liquidity Scheme
by Gill Montia
Story link: Lenders argue for extension of Special Liquidity Scheme
The SLS has provided regular injections of cash and an agreement whereby banks are able to use a range of assets as security, including securitised bonds backed by mortgages, and credit card debt.
However, Libor (the rate at which banks lend to each other) and money market swap rates, which determine the level of interest on [...]
Base rate held at 5%
by Gill Montia
Story link: Base rate held at 5%
The Bank of England’s Monetary Policy Committee has voted in favour of keeping the base rate at 5% in July.
The decision came as no surprise to economists, most of whom have been expecting the status quo to be maintained.
Inflation rose to 3.3% in June, well above the Government’s 2% target, and the Committee has the [...]
Money Advice Trust launches new information hub
by Gill Montia
Story link: Money Advice Trust launches new information hub
The Money Advice Trust (MAT), a charity that exists to increase the quality and availability of free, independent money advice, has launched a new online information hub.
The website aims to be the most authoritative source of data relating to debt, credit and money advice in the UK.
According to MAT, the move has been welcomed by [...]
BoE Governor reluctant to raise base rate
by Gill Montia
Story link: BoE Governor reluctant to raise base rate
The Governor of the Bank of England, Mervyn King, has indicated that he is reluctant to raise the base rate in an effort to maintain the Government’s inflation target of 2%.
Addressing the House of Commons Treasury Committee, Mr King spoke about the balancing act of addressing inflationary pressures while remaining mindful of the dangers of [...]
Lenders entice young into unaffordable debt
by Gill Montia
Story link: Lenders entice young into unaffordable debt
YouthNet, the charity that focuses on issues affecting young people, has completed a survey in which over two-thirds of respondents claimed they had been encouraged to take up debt they did not want or could not afford.
Around 68% of the 16 to 24 year-olds questioned had been encouraged to take out credit, the majority being [...]
Base rate rise threatened as inflation hits 3.3%
by Gill Montia
Story link: Base rate rise threatened as inflation hits 3.3%
The news that inflation rose to 3.3% in May has raised fears that the Bank of England will be forced to increase the base rate above its current level of 5%.
The figure for inflation, which is based on the Consumer Prices Index, is at its highest since 1997 and the 0.3% rise on April was [...]
BBA completes Libor review
by Gill Montia
Story link: BBA completes Libor review
The British Bankers’ Association (BBA) is introducing some changes to the way in which the London Interbank Offered Rate (Libor) is set.
Since the onset of the credit crisis Libor, which defines the rates at which banks lend to one another, has remained high despite cuts in the Bank of England’s base rate.
Some economists have been [...]
Base rate unmoved by rising inflation and contracting services sector
by Gill Montia
Story link: Base rate unmoved by rising inflation and contracting services sector
As the Bank of England’s Monetary Policy Committee begins its monthly review of the base rate, analysts are overwhelmingly pessimistic about the likelihood of a cut.
In a poll conducted by Reuters, 69 of the 71 experts questioned said they expected the base rate to remain its current level of 5%, in June.
Consumers and businesses [...]
Banks report sharp rise in deposits
by Gill Montia
Story link: Banks report sharp rise in deposits
Latest figures from the British Bankers’ Association (BBA) show a sharp rise in deposits during April.
UK consumers invested a record £5.8 billion in personal bank accounts during the month, up from £2.8 billion in March and well ahead of the six month average of £2.4 billion.
The credit crisis has left banks keen to attract money [...]
ECB President offers little hope on interest rates
by Gill Montia
Story link: ECB President offers little hope on interest rates
Hopes for a cut in the base rate later this year look to be fading as the president of the European Central Bank (ECB), Jean Claude Trichet, issues a warning that the European economies have yet to face the worst consequences of the credit crisis.
Speaking last week at the annual conference of the International Capital [...]
Middle-classes flock for debt advice
by Gill Montia
Story link: Middle-classes flock for debt advice
Transact, the national forum that represents organisations working to promote financial inclusion, has reported a sharp rise in requests for advice in traditionally well-off areas of the country.
The organisation represents over 1,200 debt advice centres and while its member bodies are experiencing a rise in demand for debt advice across all regions of the UK, [...]
Libor rises to 5.84% on gloomy inflation report
by Gill Montia
Story link: Libor rises to 5.84% on gloomy inflation report
The publication of the Bank of England’s gloomy quarterly Inflation Report earlier this week was followed by an unexpected rise in Libor yesterday.
Three month Libor (the rate at which banks lend to each other) rose from 5.70% to 5.84%, in response to the news that inflation is now running at 3% and a June cut [...]
Nationwide raises Flex account overdraft rate
by Gill Montia
Story link: Nationwide raises Flex account overdraft rate
From the 1st June, Nationwide is raising the overdraft interest rate for its four million Flex account customers by 3%, to 12.45%.
The building society is also reducing the interest paid on credit balances from a maximum of 3.75%, to 3.5% while extending the limit for customers who qualify for its best credit-balance interest rates from [...]
Modest rise in insolvencies
by Gill Montia
Story link: Modest rise in insolvencies
The first three months of the year saw a modest rise in the number of people declared insolvent in England and Wales.
The Insolvency Service has reported that the figure increased 1.7%, to 25,264, compared with the previous three months. However, numbers are 13.2% down on the first quarter of 2007.
Of those declared insolvent, 15,651 opted for [...]
ANZ and National raise mortgage rates
by Richard Kilner
Story link: ANZ and National raise mortgage rates
New Zealand’s ANZ and National Bank have both increased mortgage rates, with variable rates rising by 25 basis points.
The rise takes the rate up to 10.95%, and comes despite no corresponding rate change by the Reserve Bank.
It is not the first time that the two banks have increased mortgage rates without a shift from New [...]
Lenient bankruptcy legislation blamed in credit crisis
by Gill Montia
Story link: Lenient bankruptcy legislation blamed in credit crisis
The National Institute of Economic and Social Research (NIESR) is calling for changes in bankruptcy laws in the UK and US because it believes their less than draconian powers are partly responsible for the credit crisis.
UK bankruptcy law was reformed in 2004, since when bankrupts can be discharged after one year rather than three.
The institute [...]
BoE reminds banks to lend as credit crisis wanes
by Gill Montia
Story link: BoE reminds banks to lend as credit crisis wanes
The Bank of England is reminding the UK banking sector that its job description includes lending money and that failure to adopt a less cautious approach to lending could damage the economy.
In its Financial Stability Report published today, the central bank challenges some predictions of the damage that could be done by the US sub-prime [...]
Application fraud rises as credit crisis bites
by Gill Montia
Story link: Application fraud rises as credit crisis bites
Cifas, the UK’s fraud protection body, has reported a rise in the number of fraud cases reported by its 270 member organisations, in the first three months of the year.
The figure increased 10% on the same period of 2007, to 52,286.
During the quarter, cases of lying on application forms rose by 13%, to 21,780. The [...]
Bank of Canada reduces rates
by Richard Kilner
Story link: Bank of Canada reduces rates
Yesterday the Bank of Canada lowered interest rates by 50 basis points, as had been widely predicted.
The rate now stands at 3%.
In addition, the central bank reduced its growth forecast for this year from 1.8% to 1.4%.
However it has said it believes growth will increase to 2.4% in 2009.
The decline in expected growth this year [...]
