It came as no big surprise to anybody when the Bank of England (BOE) announced that they will be holding interest rates at their record low of 0.5%, and for the twelfth consecutive month.

The BOE’s decision gained a consensus of approval by UK economists, who pronounced, individually and collectively that rises in the cost of borrowing could set the UK’s fragile economic recovery back into the red.

The announcement that the bank will be standing firm on the amount of money that will be pumped into quantitative easing program (QE) programme was also met with a similar apathy.

BOE governor Mervyn King has long since made clear his opinion on increasing interest rates raising QE quotas, and all the rest of the UK’s financial programs by simply stating that that it was “far too soon” to make any changes to the status quo.

Sterling has now dropped in value for six consecutive trading days, with the bulk of opinion on the Pound’s increasingly weak position being because of speculation that the forthcoming general election is liable to see a hung parliament which translates to a government that will be too weak to mend the UK’s financial problems. Since the beginning of 2010, the pound has dropped by seven percent against the dollar, reaching a ten month low of $1.4783 on March the 2nd. The pound closed on Thursday on $1.5051 while the Euro was stabilising at 1.1078.

Financial Service Institute (FSA) chairman Lord Turner has voiced his opinion that that the size of banks was also not the main reason behind the economic turmoil, and even some of the UK’s smaller financial institutions could have been pronounced equally guilty of “over-exuberant lending” and taking “risky short-term wholesale deposits, Turner explained “Everyone was seduced by the long boom and were often led astray in the past by complicated mathematical rules. The Bank’s regulators were the ones who failed to notice the inherent weakness in that position.”

The FSA chairman also went on to explain that when the time comes to add up the cost of bailing out the financial services industry at the height of the global financial crisis may in the end turn out to be a lot less than first predicted.

“It is quite possible that the total overt costs of the UK’s big bank rescues may not exceed five-ten per cent of GDP," Turner predicted in a recent interview "and perhaps considerably less as indeed was the case in the Swedish banking crisis of the 1990s.” He summed up.

Recent research is pointing to a situation that increasingly adds weight to the theory that the UK’s property rental sector is heading towards a similar model of the mainland European countries of increasingly longer tenancy agreements.

According to one of the UKs largest letting agencies, during the last year and a half, a fairly dramatic increase in demand for rented accommodation has been observed, with potential tenants being especially interested in properties with long term tenure periods.

Reasons given for this new phenomena in property rental appears to be largely causes by increasing difficulties of young families to raise the new and higher deposit levels required to be granted a mortgage, while around a third confessed that they were unsure that the conditions were ripe to put their toe in the still turbulent waters of the UK property market. With almost 40 percent of potential first-time home buyers opting to remain tenants in the meantime, because of the current tough mortgage-lending criteria and 14% of those questioned said they preferred life as a tenant to that of a homeowner.

Home ownership in the UK has fallen by three percent since 2003 with the trend likely to continue. Several of the UK’s leading property management companies now believe that the UK Government now needs to ensure that renting a home offers the stability levels that are currently only afforded to home owners.

British Airways, once again under strike threat have dug in by saying that more than one thousand of the staff have volunteered to work as cabin crew if indeed the threatened strike goes ahead.

As a further back up, BA announced that they also intended to hire no less than 23 fully crewed planes from a leading European owned charter company. The company’s role will be to help run flights from Heathrow Airport should the strike threats eventually materialise.

The Society of Motor Manufacturers and Traders (SMMT) recently announced that new car sales in the UK increased by 26.4% in February compared with the same month in 2009, with the main push in demand coming because of the Government’s scrappage scheme.

Launched in May of last year in an effort to boost the ailing car industry, the £400 million initiative, which allowed owners of cars at least 10 years old would be offered a £2,000 discount off the price of a new vehicle, with half of the grant being provided by the UK Government and the other £1,000 coming from the lucky carmaker. Figures from the SMMT show that almost 20 percent of new car sales in February came a result of the scheme, which is due to be wound up by the end of March.

On the stock market, Barclays Plc’s Asian partner, the China Development Bank announced that they will be reviewing their “ties” with the bank, U.K.’s second-biggest. The announcement caused shares in Barclays to rise one percent, to 333.1 pence.

The U.K.’s third-largest supermarket owner J Sainsbury Plc has announced plans to expand their activities into non-food products. They will be marketing electronics, entertainment and sports equipment among others through their Web site. Despite the excitement, Sainsbury shares 0.2 percent, to close on 335.4 pence.

Michael Page International Plc, the U.K.’s second- largest recruitment company announced a drop in full-year pretax profit of no less than 85 percent to £21.1 million pounds. Despite the reversal, their shares climbed 6 1.7 percent, to close on 395 pence.

The benchmark FTSE 100 Index fell 0.1 percent, to close on Thursday at 5,527.16.

On Wall Street, for the Dow Jones Industrial Average the only way was up, this time rising 47.38 points to close on 10,444.14. The NASDAQ Composite also held its own, rising 11 points to close on 2,292.31.

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Tags: Bank of England, Barclays, BOE, British airways, Dow Jones, Financial Service Institute, FTSE, general election, Heathrow Airport, Interest Rates, Lord Turner, Mervyn King, Michael Page International Plc, NASDAQ, quantitative easing, Sainsbury, SMMT, Society of Motor Manufacturers and Traders, UK government, Wall Street

That would make for very good news if only the Royal Bank of Scotland (RBS) hadn’t succeeded in making a loss of £24.3 billion shortfall in 2008. For 2009 RBS has announced losses for 2009 of just £3.6 billion after losing their struggle to recover billions of pounds of bad loans. Considering that city analysts had expected losses of around five billion, this is not a bad result for the bank whose Chief executive Stephen Hester said had "exceeded all the principal milestones" set for the first year of their turnaround plan.

Hester went on to add that t the group’s core business saw profits rise from £4.4 billion in 2008 to £8.3 billion last year, while bad debt increased to £13.9 billion from £7.7 billion in 2008. On an optimistic note, RBS announced positive signs of a peaking in the number of "toxic loans" being held by the bank, with the fourth quarter looking better for corporate clients.

Hester also revealed that in discussions with the Government about altering its lending commitments to "reflect the economic circumstances" over the next year, that they were very open to increasing its lending levels to

customers. However, strained economic environment still remained a factor that had caused many of the bank’s customers to reduce their borrowings.

As part of its bailout terms, the firm agreed to make an extra £25 billion available to customers in loans with £9 billion being allocated for mortgages and the remaining £16 billion for business lending.

Mr Hester summed up by saying that 2009 was "a year of substantial progress" for the bank.

On the controversial subject of bonuses, Hester requested that RBS should not be singled out and that the financial community as well as the UK public should recognise that that important staff would leave if pay was not competitive. Alistair Darling obviously agrees, because he has cleared the payment of £1.32 billion in bonuses to staff at the bank.

The announcement came just a few days after Stephen Hester opted not to take his £1.6 million bonus, with the CEO apparently still waiting to see if any of his colleagues at the bank will follow suit.

Also subject to change will be Northern Rock’s 100% savings deposit guarantee that is now to be lifted on the 24th May.

From that date, the UK government has decided that their deposits guarantee will no longer apply. The day has obviously been timed to specifically allow, savers exactly 12 weeks to decide what to do about any money that they have on deposit with the north east based building society, As was the case before the Rock began to crumble, savers who still have deposits worth up to £50,000 will be covered by the Financial Services Compensation Scheme. However those holding larger amounts will no longer enjoy the government’s protection. .

The decision may have come as result of complaints by other banks and building societies that the 100% guarantee has given an unfair advantage to the bank, with an increasing large number of deposit holders happy to deposit large amounts there, despite lower interest rates due to the 100% protection.

Leaders of the leading British unions have described a “still fragile” the labour market , despite the fact that recently released figures showed that unemployment surprisingly fell by 7,000 in the quarter to November 2009 to just below 2.5 million. Correspondingly e the number of people claiming jobseeker’s allowance was also around 15,000 lower in December at 1.6 million. However, the union leaders claim, thousands of job losses have only been announced in recent weeks, raising fears that unemployment will start to climb in the flat period that typically occurs in the run-up to a general election.

The TUC said it will be looking for a number of key signs in today’s figures, including a fall of more than 30,000 in unemployment and a reduction in the number of “involuntary” temporary workers. According to the TUC, the number of people taking temporary or part-time jobs because they can’t find permanent work has risen considerably. .

Operating profits at British Gas soared by 58% last year to £595 million, compared with £379 million in 2008. Its parent company Centrica said the figures beat the previous high of £573 million in 2007.

British Gas announced earlier this month it was reducing its gas prices by seven percent.

The U.K.’s second- largest department-store retailer Debenhams Plc, who recently acquired the Denmark based Magasin du Nord retail chain, are considering acquiring similar companies in the future. A spokesman for Debenhams stated that the company would like to become less reliant on the difficult home market. According to the British Retail Consortium Retail sales in the UK rose at the slowest pace in 15 years last month with London-based Debenhams, who operate 142 stores in the UK, obviously feeling the pinch. Until January’s acquisition of the six-store chain for £12.3 million pounds Debenhams’s overseas presence had been restricted to 11 stores in neighboring Ireland and about 50 franchised outlets.

On the foreign exchanges, the pound continued to fall, reaching $1.5266, whilst reaching .1245 against the Euro.

U.K. stocks dropped after a report showed confidence among U.S. consumers fell in February to the lowest level since April 2009. In London, the FTSE 100 dropped 64.69 points to close on 5278.83.

Overall, the FTSE 100 has gained around five percent since early February. as U.K. companies continue to confound the experts and expectations grow that the strengthening global economic recovery will signal further economic growth.

Confidence among U.S. consumers fell more than anticipated in February to the lowest level since April 2009 as the outlook for jobs diminished, a report showed today.

Federal Reserve chairman Ben Bernanke said there was a "nascent economic recovery" in a testimony before Congress.

US stocks jumped more than 1%, led by banks, as some had feared that the cost of borrowing would start rising soon.

Although the US economy is growing, some worries remain about its strength because unemployment remains high, meaning that the "Fed "has begun to gradually undo some of the emergency measures that they had implemented during the financial crisis.

The Dow Jones Industrial Average rose 47 points to close on 10,321.03 while the NASDAQ Composite also recovered by 25 points to close on 2,234.22

Ben Bernanke is taking a very close look at the role of Wall Street firms in helping Greece to cover up the extent of their financial troubles, with Goldman Sachs apparently under closer scrutiny than most.

Bernanke hinted that both the Fed and the US financial watchdog were "looking into a number of questions" related to banks’ arrangements with Greece, whilst stopping short on the question of whether an official inquiry was under way

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Tags: Alistair Darling, Bank, Banking, Ben Bernanke, British Economy, British Gas, British Pound, Centrica, Currency, Debenhams Plc, Dow Jones, Economics, Economy, Employment, Financial News, Financial Services Compensation Scheme, FTSE, Goldman Sachs, jobseeker’s allowance, Magasin du Nord, Money, Money Markets, NASDAQ, Northern Rock, RBS, Recession, Retail, Stephen Hester, Stock Markets, Stocks and shares, TUC, UK Banks, UK Economy, UK government, UK Recession, US economy

The announcements that Royal Bank of Scotland (RBS) and Lloyds Banking Group are to sell off hundreds of branches has added a smile to the face of.

Alistair Darling as well as the European Commission, who had insisted that the banks sell off some of their branches. In a recent statement, the chancellor confirmed his opinion that the sales, were in the "best interest" of the wider UK banking sector.

Lloyds will dispose of more than 600 branches over the next four years, while RBS will sell 318 of their high street outlets. The Spanish banking group, Santander will be allowed to bid for Royal Bank of Scotland’s branches when they are put up for sale. Under competition rules agreed between London and Brussels, Santander will be eligible to bid for some of the branches as the currently hold less than 8 per cent of the UK small business lending market. Meanwhile, Sir Richard Branson is reported to be interested in moving into the world of high street banking as his Virgin Money group has applied to the Financial Services Authority (FSA) for a banking licence.

There are even some contentious rumors around that no less a company than PayPal might find them on the UK high street. Reports have it that PayPal already have an EU banking license, granted to them in May 2007, so why not a place for the outsiders!

Britain’s fourth-biggest supermarket group, WM Morrison have sent a message to their major suppliers that they will be looking for increased support for their increased and more aggressive promotion campaigns, The campaigns are aimed to increase their market share in what has become an increasingly competitive market. Morrison’s move comes as the prices of basic food stuffs begin to drop.

Europe’s biggest low-cost airline Ryanair announced on Monday that it is considering slowing down its rapid expansion program, and instead break with tradition by distributing cash earmarked to buy new aircraft to their shareholders instead. The company raised the possibility of the strategic shift while announcing a 46 per cent rise in second-quarter profits. The company has kept its full-year profit forecast steady, although they expect that figures for the third and fourth quarters will be less than rosy.

Sterling continued to weaken against the dollar, whilst rising slightly against the Euro and holding its own against the rest of the major currencies.

• Pound/US dollar 1.6398
• Pound/Euro 1.1168
• Pound/Japanese Yen 148.3102
• Pound/Swiss Franc 1.6874

The FTSE spent time under the 5,000-point mark on Tuesday with banking stocks taking the biggest toll. At close of trading, the FTSE 100 was seen to be holding its own on 5,037.2.

The FTSE 250 continues to suffer from a consistent run of heavy losses, falling more than 15% of its peal of 10,000 just a few weeks ago. At close of trading yesterday it was sitting on 8,756.68.

Troubled US commercial lender CIT Group, filed for bankruptcy on Sunday after attempts at a restructuring or bail-out failed. In a statement, CIT, who have been a key figure on the American banking scene for more than a century, announced that they had requested that the court quickly confirm its prepackaged bankruptcy plan. The plan, which has broad support from its debt holders, and in particular from Carl Icahn its billionaire investor. Icahn has agreed to provide a $1 billion line of credit, allowing the company to remain confident that they would be able to emerge from bankruptcy by the end of the year.

The US Dow Jones index made some recoveries from the last two days trading; up 61 points to 9,774.1 The NASDAQ were also fairly stable, reaching 2047.46.

The market was taken by surprise by the announcement of a swing to profitability by the auto manufacturing giant Ford. The company posted its first quarterly profit in more than a year, thanks to the implementation of cost-cutting and the government’s “cash-for-clunkers” rebates helped produce earnings of nearly $billion, or 29 cents a share, during the third quarter. Shares in Ford closed up 8.3 per cent at $7.58.

Australia’s economy continues to be the rising star of the global economies, so much so that it central bank has increased its interest rate for the second consecutive month, up a quarter percent to 3.5%. The Australian economy is the only one in the developed world to expand in the first half of 2009, with the continent largely managing to steer clear of recession, only entering into negative growth for the last quarter of 2008. The bank’s confidence was justifiably increased by the release last week of the lowest inflation figures in Australia for 10 years.

The price of gold price hit a fresh record high on Tuesday as India agreed to buy 200 tonnes of bullion from the International Monetary Fund. The move caused traders to speculate that there would be further purchases by the emerging economies. India’s purchase valued at around $6.7 billion, accounts for half of the IMF’s expected disposal of gold and signals a growing appetite among developing countries’ central banks for bullion in the wake of the global economic and financial crisis, coming after China had revealed earlier in the year that it had quietly almost doubled its gold reserves to become the world’s fifth-biggest holder.

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Tags: Alistair Darling, Bank, Banking, British Economy, British Pound, Bullion, Carl Icahn, cash for clunkers, CIT Group, Credit Crunch, Currency, Dow Jones, Economics, Economy, EU banking license, European Commission, Financial News, Financial Services Authority, Ford, FSA, FTSE, Gold, Government, Interest Rates, International Monetary Fund, Lloyds, Lloyds Banking Group, Money, Money Markets, NASDAQ, Paypal, RBS, Recession, Retail, Royal Bank of Scotland, Ryanair, Santander, Savings, Sir Richard Branson, Stock Markets, Stocks and shares, UK banking sector, UK Banks, UK Economy, UK government, UK Recession, Virgin, Virgin Money group, WM Morrison

Chancellor of the Exchequer Alistair Darling now appears likely to give Lloyds the go ahead to test the seriousness of its ambitious £25 billion refinancing plan. Darling’s tacit agreement will be looked upon by city watchers as a definite indication that the chancellor could be prepared to release the bank from its obligations to the government’s toxic asset insurance scheme. It would appear that Darling has concluded that Lloyds’ plan to bring in more private capital is in the public interest. However it would appear that his final decision will only be positive when he is convinced that the market is ready for such a bold initiative. Darling is expected to announce his decision to the Lloyds at the early part of next week. The move will mean that the bank can then begin to appoint underwriters and test the market. Only then will Darling make the final decision and may even withdraw approval for the plan if he concludes the move carries to many risks for the already under siege UK taxpayer.

As expected, the European Union (EU) has approved plans for nationalized bank Northern Rock to be split into two parts, a move that is expected to pave the way for a partial sale of the bank.

One half of the bank, known as the "good" bank, would trade as retail bank holding deposits including some of the Rock’s existing mortgages, as well as lending money to consumers only.

The toxic side of the bank will remain in government hands, whose unenviable task it would be to attempt to salvage as much as the taxpayer’s money tied up there. The chancellor has ruled out the possibility of completing the sale of Northern Rock before the general election, in spite of winning approval from Brussels.

Meanwhile Spanish banking giants Santander continue to clean up on the UK high street. The bank announced that profits during the first nine months of the year for its UK banks have risen by more than a third.

Abbey, Alliance & Leicester and Bradford & Bingley banks, owned by Santander announced a £1.2 billion profit, up 38% from the same period in 2008.

Debt laden bus and rail operator National Express has wound up their discussions with rival Stagecoach regarding a possible merger. Instead they will press ahead with their plans to mount a rights issue to re-finance the company. Yesterday’s announcement follows weeks of speculation over a possible tie-up between the groups that would have created a transport giant with an estimated worth of £1.7 billion.

Oil and gas supply group BG, announced on Wednesday that their post-tax profits for the third quarter had fallen 39 per cent to £474 million from last year’s £777 million. A spokesman for the company said that the fall in gas and oil prices had been partially offset by advance sales of liquefied natural gas at advantageous prices. Although natural gas has rallied since early September, it had not done as well as crude oil during continued signs of economic recovery.

Sterling continued to rise in value yesterday against the dollar, while rising slightly against the Euro.

• Pound/US dollar 1.6393
• Pound/Euro 1.1131
• Pound/Japanese Yen 148.0908
• Pound/Swiss Franc 1.6804

London’s FTSE 100 dropped 2.32% or 120.55 points to close on 5080.42. The FTSE 250 plummeted a further 3.19% percent yesterday, down 291.78 points to close on 8849.50

For the first time in half a year, sales of new homes in the US fell as buyers opted for bargains on existing and foreclosed houses. Unexpectedly new home sales fell by 3.6 per cent from August to September, defying economists’ expectations that they would increase. Compared with a year ago, sales of new homes were down by 7.8 per cent, according to commerce department figures

On Wall Street, the Dow Jones Industrial Average closed down 1.21% after news that the annual rate of US new home sales had fallen unexpectedly in September.

At close of trading Wednesday it had fallen 119.48 points to 9762.69. The NASDAQ Composite index also took a tumble down 56.48 points to 2059.61.

It was announced on Wednesday that new orders for durable goods rebounded in September after slumping the prior month, offering another sign that manufacturing activity is stirring in the US

European shares also fell fairly sharply yesterday, largely due to disappointing company results and negative US economic data.

Norway has become the first European country to raise its interest rates since the beginning of the global financial crisis. The country’s central bank raised the cost of borrowing from 1.25% to 1.5% in a move that was widely expected. A spokesman for the bank stated that the increase was necessary due to increases in inflation and recent unemployment figures that were considerably lower than previously projected.

Oil prices dropped by more than $2 a barrel on Wednesday, as the latest US weekly inventories data continued to show supply outstripping demand. All in all the expected recovery in the dollar weighed on investor sentiment towards the commodities market.

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Tags: Abbey, Alastair Darling, Alliance & Leicester, Bank, Banking, BG, Bradford & Bingley, British Economy, British Pound, Chancellor of the Exchequer, Currency, Current Account, Darling, Dow Jones, Economy, Employment, Financial News, FTSE, gas, llo, Lloyds, Lloyds Banking Group, Money, Money Markets, Mortgage, NASDAQ, National Express, Northern Rock, Oil, Recession, Retail, Santander, Savings, Stagecoach, Stock Markets, Stocks and shares, UK Banks, UK Economy, UK government, UK Recession, Unemployment, Wall Street

The U.K.’s second- biggest bank Barclays Plc have announced that they are to acquire Standard Life Plc’s banking assets for a sum of £226 million pounds, In a move designed to expand their UK based savings and mortgage operations, Barclays will receive a major boost in turnover through Standard Life Bank Plc, who currently hold around £ 5.5 billion in deposits as we’ll as £8.8 billion in mortgages. A spokesman for Barclays announced the bank’s intention to continue to explore opportunities in the U.K. retail long term savings and investments industry, working in conjunction with Standard Life, who are the U.K.’s third-biggest insurer.

The bank is seeking to increase revenue at its consumer and corporate-banking division, whilst reducing their reliance on investment banking. The acquisition follows that of the Portuguese credit-card business of Citibank International Plc made last month. Barclays continue to seek more acquisitions in Europe.

Production of new cars in the UK fell by 16.1 percent for the year in September, making for the smallest decline for 12 months, according to figures issued by the Society of Motor Manufacturers and Traders. 119,616 cars were made in Britain last month, making for an annual total of 694,769, down by 41.2 percent on the same period in 2008. Sales have been boosted by the government’s car scrappage scheme, which allows motorists to trade in cars that are more than 10 years old in return for a 2,000 pound subsidy on a new vehicle.

Oil giant BP has reported third-quarter profits of £2 billion ($4.98 billion) well ahead of analyst’s expectations

BP’s results, boosted by higher than expected cost cuts, was still down by

50% from last year. This is largely due to the fact that oil is currently trading at about $80 a barrel, about half of where it was this time last year. The announcement sent BP’s share price up by almost 4%.

The British Standards Institute (BSI) the national standards body are reportedly deep in the process of developing a voluntary standard of ‘kitemarks’ that will be issued to retail and wholesale financial services firms.

The BSI have been consulting with members of the industry in order to set out a common methodology and good practice standard, which can be implemented alongside existing regulations, with the goal of reducing risks of compliance failures whilst offering greater reassurance to management that regulatory requirements are being met. The British Bankers’ Association (BBA) are apparently offering their whole hearted support for the scheme, with their chief executive quoted as saying that the initiative should improve efficiencies between and amongst compliance teams across the financial service industry .

Sterling continued to rise in value yesterday against the dollar, while falling against the Euro.

• Pound/US dollar 1.6351
• Pound/Euro 1.1043
• Pound/Japanese Yen 149.0922
• Pound/Swiss Franc 1.6709

Shares in the Anglo-Dutch publishing group Reed Elsevier, were very much in demand on Tuesday, rising 3.3 per cent to 473 pence after the market deduced that concerns over the trading performance of, it’s content archive service division, Lexis-Nexis, had been exaggerated.

Banks didn’t have such a good day on the FTSE, especially the partially nationalised ones. Royal Bank of Scotland were down 8.1 per cent to 40.8 pence while Lloyds Banking Group, also fell 6.1 per cent to 83.8 pence. The reason for their downfall was investor fears regarding the disposals that both banks will be obliged to make in order to satisfy European Commission rules on state aid.

The FTSE 100 made a minor recovery on trading Tuesday, up just 9.23 points to close on 5200.97. The FTSE 250 continued to lose value, yesterday down 44.82 points to close on 9141.28.

Fears about future job prospects was stated as the principal reason why US consumer confidence fell unexpectedly in October. The Important Consumer Confidence Index from the Conference Board business organisation slipped to 47.7 in October from a revised 53.4 in September. Analysts were caught unawares by the decrease, with expectations that the index would remain unchanged or might even rise slightly.

On Wall Street, the Dow Jones hiccupped a little into forward gear, up a mere 14.21 points to 9882.18. The NASDAQ Composite index was still dropping yesterday, a further 25.76 points to 2116.09.

According to the European Central Bank, lending to companies operating in the eurozone fell in September at an annual rate of 0.3%, compared with a modest annual growth of 0.1% in August. The fall is a source of concern for the Eurozone countries is it comes when European governments continue to bolster their economies by increased lending at very low, subsidised interest rates.

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Tags: Bank, Banking, Barclays, Barclays Plc, BBA, BP, British Economy, British Pound, British Standards Institute, BSI, car scrappage scheme, Citibank International Plc, Conference Board, corporate-banking, Currency, Dow Jones, Economy, European Central Bank, European government, Financial News, FTSE, Important Consumer Confidence Index, Lloyds Banking Group, Money, Money Markets, NASDAQ, Recession, Reed Elsevier, Royal Bank of Scotland, Society of Motor Manufacturers and Traders, Standard Life Bank Plc, Standard Life Plc, Stocks and shares, The British Bankers’ Association, UK Banks, UK Economy, UK government, UK Recession, Wall Street

Pension funds in the western world have made am almost one trillion pound ($1.5 trillion) recovery in the first half of 2009. Whilst commendable, this figure represents less than a third of what these funds have lost in market value last year. These figures were released by the Organisation for Economic Co-operation and Development (OECD) who have been tracking the progress of pension funds since the outset of the global economic turndown. According to the OECD who is based in Paris, the recovery in pension fund performance has continued through September 30, 2009, on the back of strong equity returns. However it will take some time before the losses that occurred during 2008 are fully recouped. Most pension funds staged a partial recovery in the first half of 2009, generating investment returns of 3.5 percent in nominal terms. Membership of OECD is made up from mostly financially developed industrialized economies

The cost of car insurance appears to be dramatically on the rise, according to a recent survey from the Automobile Association (AA) in the third quarter of 2009, insuring a car rose at its fastest pace in 15 years, driven by a spate of rising personal injury claims and exacerbated by fraud. Statistics issued by the AA show that the average quoted premium for comprehensive motor cover rose 5.6 percent to £821 pounds during the three months to September 30, and by 14 percent from 2008.

As news filters through to the market that Virgin Money has applied for a banking license through the FSA (Financial Services Authority) it now appears more than likely that Virgin Money will make an offer for part or all of the Northern Rock business, with many analysts claiming that an informal agreement has already been struck with the UK government, and all that is required is tie up a few loose ends before the deal can be officially announced. Speculation in banking circles point to the fact that the UK government will need to request a high asking price for Northern Rock. Any sale at a "knock down" price is bound to infuriate taxpayers whose money was used to keep the Rock from sinking. On the other hand, Branson’s company is not liable to pay an inflated price for the bank. This could lead to an impasse that could see the operation stay with the UK government for the foreseeable future. Analysts state that selling Northern Rock would be in the best interests of both the government and UK taxpayers, but only in the medium to longer term. With an election looming, questions remain whether Gordon Brown’s government could allow themselves such a luxury.

Discount retailer, Matalan is reputed to be weighing up a £1.5 billion offer, after a number of companies expressed their interest in acquiring the business which remains privately owned. Among the parties interested are private equity group CVC. Matalan were taken private by John Hargreaves, their founder and controlling more than three years ago with indications having it that Hargreaves is neither interested in entering into an auction to sell his company or at any price.

The employee owned department store chain John Lewis, has seen online sales of its clothing range, take tremendous steps forwards since the company re- launched their updated website last month. With the launch came the release of a wide range of new fashion brands exclusive to the company. A leading executive from John Lewis Direct announced the company’s satisfaction with results achieved till now, that far surpassed their predictions. In general, sales of clothing online from the company were about three times higher than last year.

Mobile phone company Orange are due to begin marketing the iPhone to UK customers in Early November, a move that is bound to mark strong competition with O2 as the Xmas run up gets under way. Orange’s announcement last month that it had become the first UK network breaks O2’s exclusive hold on marketing the iPhone device, caused shock waves in the industry. The iPhone is expected to be launched by Orange on 10 November, just one day after O2’s two-year exclusive contract with Apple ends. Carphone Warehouse, which was the only independent retailer able to stock the iPhone when O2 had it to itself, is also expected to sell the phone on behalf of Orange. The iPhone is seen as the best touchscreen phone in the market, and has won a clutch of industry awards.

In the money markets, Sterling was back on a rise against the leading currencies with the notable exception of the Swiss franc.

• Pound/US dollar 1.6322
• Pound/Euro 1.10979
• Pound/Japanese Yen 150.2587
• Pound/Swiss Franc 1.6629

The FTSE 100 suffered a late reaction to the news that the UK economy was still in recession, falling 50.83 points to close on 5191.74 on Monday. The FTSE 250 was also down by 137.55 points to 9186.10.

The world’s largest construction equipment maker Caterpillar, has announced their intention to permanently cut 2,500 jobs in the US. The news was a contradiction to predictions that economic recovery was on its way for the construction industry in general and Caterpillar in particular, with the company undertaking to reinstate 550 workers that they had previously laid off. During the downturn, Caterpillar has cut about 34,000 jobs globally.

On Wall Street, the Dow Jones also continued to decline, down a further 104.22 points to 9867.96. At the same time, the NASDAQ Composite index appeared to be on a never ending but steady decline, yesterday down a further 12.62 points to close on 2141.85

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Tags: AA, Automobile Association, Bank, Banking, British Economy, British Pound, car insurance, Caterpillar, Currency, CVC, Dow Jones, Economics, Economy, Employment, Financial News, Financial Services Authority, FSA, FTSE, Gordon Brown, iPhone, John Hargreaves, John Lewis, Matalan, Mobile phone, Money, Money Markets, NASDAQ, Northern Rock, O2, OECD, Orange, Organisation for Economic Co-operation and Development, Pensions, Recession, Retail, Stock Markets, UK Banks, UK Economy, UK government, UK Recession, Virgin Money, Wall Street

The Nationwide Building Society Nationwide have recently announced that they are to substantially increase the discount on offer for first-time home buyers that participate in the company’s mortgage reservation scheme with the offer applying to three-, four-, and five-year fixed-rate mortgages in the meantime. In addition, the Nationwide are offering a complementary combined reservation and legal fee option to borrowers who are planning to move home. These offers, as well as similar, have been designed to reduce the initial lay outs involved in acquiring a property. A spokesman for the Nationwide is the world’s largest building society and one of the largest mortgage lenders in the UK predicted that with these measures they have removed some of the barriers that may have prevented people from buying a property.

In a bid to satisfy European authorities, the Royal Bank of Scotland may have no option but to either close down or farm out 312 of its branches operating s in England and Wales under the RBS banner and serving more than one million small businesses. The EU competition commissioner, Neelie Kroes appears to be forcing the RBS ’hand as they EU looks for substantial disposals to compensate for billions of pounds of taxpayer support as well as to finance the bank’s involvement in the UK Treasury’s toxic asset insurance scheme. The bank’s proposals to the EU, which are not liable to involve the company’s NatWest branch network in England and Wales, are thought to be in a well advanced state of negotiation.

The Icelandic government have announced that they have reached a fresh agreement with the UK government over the reimbursing the 400,000 savers who lost money when Icesave owner Landsbanki collapsed, leaving debts of around £3 billion. The original ruling was rejected by the UK and Netherlands governments, meaning a new bill will go before Iceland’s parliament for final agreement some time today.

A number of UK based manufacturers are combining efforts to promote the ‘Buy British’ angle in their marketing campaigns. among them are amusement ride manufacturer Amusement Technical, who, among others, want to take full advantage of the low exchange rate between sterling and the Euro to increase their export activities. A spokesman for the company explained that the low value of Sterling created a considerable opportunity for UK manufacturers competing for business in the Eurozone. The obvious downturn is that products and raw materials imported from the same region will be considerably more expensive.

The pound continued to rise in a volatile week’s trading, climbing 0.4% against the euro and 0.2% versus the dollar.

• Pound/US dollar 1.6303
• Pound/Euro 1.10989
• Pound/Japanese Yen 148.2221
• Pound/Swiss Franc 1.6658

The FTSE 100 fell 32.71 points on 5190.24 on Friday’s trading. The FTSE 250 dropped also shed some of its gains before the weekend, down 58.97 points to close on 9,426.20.

Bank of America have reported net losses of £612 million ($1billion) for the three months from July to September, a figure much worse than analysts predicted. The figure compares with a net profit of $3.2 billion in the second quarter of 2009 and $1.2 billion for the same period of last year. Bank of America is the fourth major US bank to report their third quarter results which are the least impressive so far.

The Dow Jones index took a tumble on Friday’s trading, falling below the 10,000 points mark, achieved during the week’s trading. The index fell 67.03 points to 9995.91 while the Nasdaq Composite index dropped 16.49 points to 2,156.8

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Tags: Amusement Technical, Bank, Bank of America, Banking, British Economy, British Pound, Credit Crunch, Currency, Dow Jones, Economics, Economy, Financial News, FTSE, Global Credit Crisis, Icelandic government, Icesave, Landsbanki, Money, Money Markets, Mortgage, mortgage seekers, NASDAQ, Nationwide, Nationwide Building Society, NatWest, Netherlands government, RBS, Recession, Royal Bank of Scotland, Savings, UK Banks, UK government, UK Recession

Millions of members of the UK community of retirees are looking at the dim prospect of receiving a pension hike of less than ten pounds a month when the new rates kick-in in April 2010 The reason for the minimal increase is that UK inflation on which pension rises are calculated. Is considerably less than the minimum of 2.5%. government pledge to annually increase the state pension.

Instead, recently released figures from the Office for National Statistics show that UK retail prices index registered actually recorded a fall of 1.4% for the year ending September 2008. This means that both state and public sector pensions, both of which are calculated according to September inflation, will reach only the minimum figure of 2.5%.

A spokesman for the charity, Age Concern rushed to state that at £97.65 a week the basic state pension was seriously inadequate to guarantee the UK elderly a reasonable standard of living. Thy went on to insist that the current pension system is in need of urgent reform that will ensure older people can live off their pensions without having to apply for benefit top ups.

A monthly study has shown that living costs for pensioners are rising at a rate much higher than those for younger people, with the elderly spend a disproportionate amount on energy bills and food.

This daunting piece of news for UK retirees is only the latest in a line of unexpected pitfalls they will have to bear. Recent studies have shown that not only are many Britons are dramatically reshaping their retirement plans to match a new reality. A reality that depicts those who were due to retire in the near future, are putting off their retirement for as long as possible as the reality hits home that those who are retiring today will need to live off less than what represents half of the UK national average wage.

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Tags: Age Concern, British Economy, British Pound, Credit Crunch, Debt, Economy, Financial News, Government, Inflation, Interest Rates, Money, Money Management, Office for National Statistics, pensioners, Recession, Retail, retirees, Savings, state pensions, UK Economy, UK elderly, UK government, UK inflation

It seems such a short time ago that people who invested all of their money in the stock market were regarded as being "risqué," and those who kept their money in the bank in short and long term deposit accounts were described as being "sensible". Well that role has certainly been reversed over the last crazy year or so, when the financial world turned upside down for so many.

Nowadays people who still have money on deposit at the bank are regarded as being some form of masochists, and no less than the banks themselves. With interest rates seemingly stuck forever on 0.5%, money left in a bank account is not only gathering dust, it is also paying for the privilege. On the other hand, the FTSE can almost do no wrong. And it has been that way for more than half a year, when the first indications that the global economic downturn might not last forever began to look evident. Sufficient to say that, the FTSE 100 rose by 21% in the third quarter of 2009, and 45% since March the highest percentage rises since the exchange was created in 1983. At current interest levels, investors would have to leave their money in the bank for around 7 years to earn that kind of return on their investment.

Leading economists argue that by trying to jump start the economy, the UK government has damaged national growth for the foreseeable future, with the only way that the situation can be reversed is to put an end to the stimulus passage and increase interest rates. They go on to suggest that as soon as the government does increase interest rates, only then will the stock market boom begin to fizzle out. That will be the time for the smart investor to release their equity exposure and return most if not all their capital to their bank account and earn some reasonable interest. Like the good old days.

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Tags: Bank Account, Banking, British Economy, British Pound, Credit Crunch, Currency, Economic Downturn, Economics, Economy, Financial News, FTSE, Global Credit Crisis, Interest Rates, Investment, Money, Money Management, Recession, Savings, stimulus passage, stock market, Stock Markets, Stocks and shares, UK Banks, UK Banks, UK Economy, UK government, UK Recession

A new deadly computer virus is doing the rounds and this one, which goes by the name of Clampi, is proving to be a headache for literally thousands of on-line banking customers.

The Clampi virus is spreading quickly throughout both the UK and US, and has a particularly invidious way of effecting people’s computers.

The virus, what’s known in the jargon as a Trojan, has been created by hackers intent on stealing people’s personal banking details. It effects people’s computers after they visit certain websites and then sits quietly waiting its chance. Then, once the computer users accesses their personal banking website, it activates, and captures such vital information as login and password details.

Once harnessed, these details are then sent back to the waiting hackers, who using them to commit on-line fraud scams.

The Clampi virus courts some 5,000 financial websites; ones which include British and American banks, but also mortgage lenders, on-line shopping sites, casinos and email service providers.

And although the Clampi virus has been around since 2005, only now is it really beginning to make its presence felt. In the US for example, thousands of dollars of fraudulent transactions are already being blamed on the Trojan.

Computer security experts are warning that the Clampi virus represents a complex threat and one which people should take very seriously indeed. They warn that it is just beginning to seriously target UK banks and there is potential for wave after wave of attacks. But only now are the experts fully aware of its devastating potential.

With the US under attack from the Clampi virus, it is believed that over 1,000 computers in the UK have been penetrated. And those computers running Microsoft Windows based operating systems are especially vulnerable to the Clampi virus.

Computer security experts are urging everyone to be particularly careful of falling victim to the virus. They advise all computer users to be on their guard against links embedded within emails from people not known to them, or likewise unfamiliar emails with attachments; but, also be cautious of social networking sites, instant messages, blogs, or websites that they come across during a surf. Innocent appearing websites are one of the most popular ways that such Trojans are distributed around computer networks. The general rule is, say the boffins, never download anything from any site unless you can completely vouch for its credentials.

What’s more, the experts are warning everyone to not only run a good anti-virus software programme, but also keep it up to date.

For more information on this and other computer viruses, help protecting your computer and staying safe on the web visit http://www.computer-protection.co.uk/

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Tags: anti-virus software, Bank, Banking, Clampi, Clampi Virus, Computer Virus, Current Account, hackers, Microsoft Windows, Money, Money Management, on-line banking, on-line fraud, personal details, Trojan, UK Banks, UK Credit Cards