Northern Rock Share Discussion Threads

[diydan] 11/2/2009 11:13

bryan2 - 9 Feb'09 - 09:46 - 1334 of 1336
I could not agree more.

[bryan2] 11/2/2009 08:53

How important is a Banking Qualification when leading a Bank?

In yesterdays meeting of HBOS and RBS with the Parliamentary Treasury Committee great play was made about the importance of a formal Banking Qualification when leading a Bank!
Neither Mervyn King(Governor) or Charles Bean (Deputy Governor) have Banking qualifications.
Could this explain the mess we are in?

[frankiestheone] 10/2/2009 23:20

bolton just lives on his ego and a depressive voice to make things seem even worse

[bryan2] 09/2/2009 09:46

DIYDAN

It is now clear that practically every Bank and Building Society have now been given help from HMG/BOE.
The form of the help, by exchanging illiquid mortgage debt for Gilts(SLS) is exactly the help that Northern Rock needed.
We also note that none of the Banks have been named and shamed.
Peston thinks that the naming and shaming of Northern Rock had nothing to do with the Bank run and the disastrous effect on the share price.
If that was the case then why not name and shame all the other Banks.
The botch up by BoE/HMG and the deliberate leak nearly caused the collapse of the British Banking system.
An effective press gag has stopped the naming of those Banks helped by the SLS.
A great injustice has been forced on Northern Rock, an efficient solvent Bank with good assets.

[diydan] 06/2/2009 14:38

bryan2
From your post above it would appear that all banks in the uk have had BOE funds now so NR were in no way the only bank needing BOE funds?

the so called hair cuts of between 0.17% and 0.22% look very cheap to me. Assuming banks traded in £287B a 0.2% hair cut would have cost them about £600M
yet the assets they traded in appear to have lost £287B - £242B = £45B lost? that is about 15% and hold on what does boe say "Bank warned that if their value continues to fall it would ask for some of the shortfall to be made up."
very nice of them if the value goes down further they will ask for some of the shortfall to be made up.

maybe we should just forget about waiting for compensation ruling and just take this case to europe on the grounds of outright fraud.

[bryan2] 05/2/2009 08:39

Financial Journalists appear before HOC committee.
Giving evidence to the Commons treasury committee on the role of the press in reporting the financial crisis.
The encounter seemed to be more of an old palls get together, than an in depth inquiry into market manipulation, insider dealing and HMG/BoE leaks.

Alex Brummer, City editor and chief financial commentator at the Daily Mail, said journalists were "hyper-sensitive" about the turmoil in global markets and had been careful not to cause any panic among savers and homeowners.

He said: "Here we are in a particularly volatile place – and once [a rumour] appears in a headline, we saw what happens with Northern Rock. The queues spin around the block [outside the bank].

[boffster] 04/2/2009 22:43

How can the government take an equity stake in something which it already "owns" 100% of?

Partial return to former shareholders on the cards?

Nah, don't be stupid. That might be fair and sensible!

[onsider] 04/2/2009 21:40

It gets even better....



I did not cause Rock run - Peston

[ekuuleus] 04/2/2009 19:06

Depression was no slip of the tongue.

[onsider] 04/2/2009 16:55

Pay back bonuses call to bankers

[onsider] 04/2/2009 16:54

I love this.



Pay back bonuses call to bankers

[bryan2] 04/2/2009 09:24

Special Liquidity Scheme

New details of the SLS have just been revealed..........

BoE lent £185bn under SLS

Date: Tuesday 03 Feb 2009

LONDON (ShareCast) - Britain's struggling financial institutions have traded in some £185bn worth of illiquid mortgage assets since last April under the Special Liquidity Scheme, the Bank of England revealed today.

The SLS was set up to ease banks ability to lend by allowing them temporarily to swap these effectively unsaleable assets for UK Treasury Bills.

Thirty-two banks and building societies took part in the scheme, which had been scheduled to run for six months but was extended to 31 January when the scale of the financial crisis affecting the UK financial system became apparent.

The Bank said that these banks and building societies had swapped assets worth some £287bn in exchange for UK Treasury Bills, but their value last Friday, when the scheme closed, was only £242bn.

Institutions can keep the Treasury bills up to three years before they have to exchange them back for the original assets.

Mortgage-backed securities and bonds make up the majority of assets swapped under the scheme and the Bank warned that if their value continues to fall it would ask for some of the shortfall to be made up. That would be in addition to an upfront deduction from their market value called a "haircut".

These costs or "haircuts," which the Bank charges to reflect the risk it is taking on, are 0.17% for 5-10 years securities and 0.22% for those of 10-30 years duration.
..............................
These details show the widespread nature of the liquidity freeze.
Practically every Bank and Building Society had to avail itself of the provisions.
The charges do not seem to be too onerous despite my earlier worries.
What is clear is that had such a scheme been made available to Northern Rock there would never have been a run on Northern Rock.
British Banking would be in a much stronger shape and Northern Rock's staff, customers and shareholders would have been spared totally avoidable losses

[cpl593h] 03/2/2009 21:06

I'll start the sweep at -£28bn

[ekuuleus] 03/2/2009 11:38

Anyone up for a Freedom of Information Request for the valuation the government made before confiscation?

[diydan] 03/2/2009 10:13

bryan2
I am not sure we will ever get the truth about this untill joe public feels the full impact of the credit crunch which in me view they have not yet. However it is on its way maybe in the next 3 months?

Anyway we should get the judges ruling soon?

[bryan2] 02/2/2009 10:28

Gordon Brown at Davos

Gordon Brown said that nobody had anticipated the liquidity crisis.
He said that the problem with the British Banks had been shown to be largely due to the withdrawal of cheap international capital.
He dismissed the idea that the housing bubble in Britain was a major cause of the crisis.
Hold on a minute Gorden this is exactly the opposite of what HMG/BoE was saying back in Oct 2007.
So Northern Rock should have known more than any other Bank on the Planet.
He said Britain was the first country to spot the problem and offer help to the Banks.
The rest of the world look on in awe and carefully copy Britain's lead!
He is completely delusional.
Read the lead posting!
Readers of this thread know that Britain was the last country to act on the liquidity crisis.
One Bank run and near collapse of the British banking system forced some penal ridden "help" to the rest of the British Banks.
Northern Rocks problems were all of its own making BoE/HMG said at the time and then buried their head until the abyss opened even the most stupid of eyes.
Now Northern Rock is a "good bank", no mention of 100B£ black holes.
Until the board of the BoE is replaced and we have an election there seems to be no hope of a speedy end to the crisis.

[cleo1601] 28/1/2009 17:47

the trouble with that suggestion Diydan is that it would have taken a degree of sense and how often do we get that from our leaders?

[bryan2] 28/1/2009 09:32

The BoE/HMG as Bank Managers.

John McFall MP(chairman of Parliamentary Finance Committee)appeared on TV this morning on the plight of companies getting bank loans.
He said that perfectly profitable companies were either not getting loans or were having very harsh terms forced on them by banks because of the liquidity crisis.
Lets look at what HMG/BoE do as the Banker of Banks.
1. Northern Rock a solvent profitable company approached BoE because of liquidity concerns
Reaction - Penal Terms imposed, leak to press causing Bank run,useless "advice" from bankrupt American banks charged to Northern Rock,and finally outright confiscation without compensation.
2. All the other British Banks have now had the benefit of "help" from BoE/HMG.
The result
Bankers/Banks hounded by press leaks from Treasury forcing down share prices
Penal fees imposed,12% Preference Interest charged(costing Banks nearly 17%) large chunks of equity demanded in return for any "help" given.
Then we can see that the BoE/HMG is acting like the worst predatory loan shark outfit.
They seek to benefit from the liquidity freeze while claiming to "help" the British Banks.
If any high street bank behaved in the same way the public would be outraged.

[diydan] 26/1/2009 11:28

Have you noticed none of the other two main parties are saying anything about this U Turn by HMG on NR lending. Oh yes thats because tories and Libs were demanding blood from NR 8 months ago and now they both realise they got it as wrong as HMG and they should have supported the management buy out.

How things would have been so different if NR had been supported with funds and could now say had paid off a lot of it. Would that have maybe have helped settle the markets?

They also need not have paid it back so fast and could therefore have helped fund loans and mortgages and therefore softened the impact of the crunch on the housing market and general economy.

[onsider] 24/1/2009 10:45

Like I said......

[dow] 23/1/2009 15:49

So Northern Rock is to resume normal lending and hire new employees.

Question is at what price will the government swap its debt for equity, one penny a share ?