According to Thomas Huertas, the banking director at the U.K.’s Financial Services Authority, London’s role as the European Union (EU) equivalent to Hong Kong as a self-regulating financial center, is drawing to a close.

The group of 27 European states that comprise the EU plans to centralize oversight of markets in the wake of the global financial crisis, with proposals for new regulators for the banking, securities and insurance industries, Huertas said. Evidence of a continental European sway away from London was provided by recent statements from Michel Prada, former chairman of French market regulator "the Autorite des Marches Financiers", who said that while continental Europeans “admire the City,” the also felt high levels of jealousy and irritation towards it.

About 10 percent of jobs in Britain’s financial services industry could be cut, equivalent to over 110,000 jobs. An official from one of the UK’s leading union Unite has announced estimates that 38,000 jobs had gone this year at banks and other financial firms it represents and that was set to rise substantially.

The financial services industry employs between 1.1 million and 1.3 million people. Part-nationalised banks Royal Bank of Scotland and Lloyds Banking Group have cut thousands of jobs, and planned restructurings at the two banks are likely to affect about 25,000 employees,

Dubai World began negotiations to restructure about $26 billion in debt and said the remainder of its $59 billion of liabilities is on “a stable financial footing. Dubai World began talks with banks; easing concern a delay in debt payments will hurt U.K. lenders.

Chelsea Building Society has confirmed it is in advanced merger discussions with its Bradford-based larger rival Yorkshire Building Society.

It said the talks are part of a detailed review of its activities, financial position and corporate structure, which includes looking at the benefits of a possible merger. However the group, which is the UK’s fourth largest building society, stressed that it remained well-funded and had strong liquidity. Yorkshire Building Society is already the UK’s second biggest society, and a tie-up with the Chelsea would create an organization with more than £35 billion of assets, 178 branches and 2.7 million members. Cheltenham-based Chelsea said the merger would boost its capital position by around £100 million. Both the societies said the deal would only go ahead if it produced mutual benefits.

According to a survey of leading UK mortgage lenders, Home owners are choosing to make bigger repayments on home loans instead of increasing spending. This news, whilst pleasing to most, will come as a blow to attempts to drive economic recovery through consumer demand. A rising household saving rate means the Bank of England must instead look to exports to fuel growth. A spokesman for the Lloyds banking group which includes Bank of Scotland, Cheltenham and Gloucester, Birmingham Midshires, Lloyds TSB and Halifax, confirmed that the percentage of customers making regular overpayment on their mortgages has doubled compared to last year. With the average monthly overpayment within the group being around £350 pounds.

BSkyB has been named as Britain’s most admired company by City experts. The media giant, owner of Sky News is the youngest company ever to win Management Today’s top award.

Tesco came in at number two, with its chief executive Sir Terry Leahy retaining his most admired leader crown. BSkyB topped its sector in every one of the nine criteria decided upon and rated by industry peers and City analysts as well as winning the ‘quality of goods and services’, ‘quality of marketing’ and ‘capacity to innovate’ overall awards.

Online retail sales are expected to rise 14 percent to £5 billion this month, According to a recent study, almost three quarters of Britons will do more than half of their Christmas shopping on the Internet,.

A leading industry body specialising in global e-retail, forecast that Monday, December 7 would be the busiest online shopping day this year, with spending reaching £350 million. The survey also states that around 90 percent of consumers plan to buy at least some of their Christmas presents online this year.

The pound retreated strongly against the dollar and the Euro whilst rising against the Yen.

• Pound/US dollar 1.6528
• Pound/Euro 1.10975
• Pound/Japanese Yen 145.6191
• Pound/Swiss Franc 1.6537

The FTSE 100 has rebounded 51 percent from its low on March 3 amid government stimulus programs and record low- interest rates. The gauge fell 3.3 percent from Nov. 25 till the end of trading Thursday as Dubai World’s move to delay debt payments risked triggering the biggest sovereign default since 2001. The FTSE 100 closed on Thursday on 5313.00.

According to a recent survey, the US private sector job cuts narrowed in November for the eighth consecutive month, with less than 170,000 jobs being lost last month, 26,000 fewer than in October. The US services sector shed 81,000 jobs in November, up slightly on October, with fewer jobs being lost in the manufacturing sector. According to a spokesman for the Obama administration, since the beginning of the £473 billion jobs stimulus package, passed in February, it has saved or created more than one million jobs across the US. According to the latest US Labour Department figures, the unemployment rate in the US rose to 10.2% in October, and its highest rate since April 1983. Since the recession began in the US in December 2007, the number of unemployed has risen by 8.2 million, while the jobless rate has risen from 4.9%.

The Dow Jones index closed down 86.53 points, on 10,366.15 points, while the NASDAQ remained steady on 2173.14.

Bank of America has announced plans to repay the £27 billion US government bailout it received during the credit crisis of 2008 as well as after the purchase of Merrill Lynch earlier this year.

The move is designed to allow Bank of America to free itself from government restrictions, including executive pay limits that were a stipulation of granting the funds. The bank reported a $1 billion net loss for the three months from July to September, worse than had been expected, especially when compared to a net profit of around £2 billion in the previous quarter and around £1 billion in the same period of 2008.

financial

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Tags: Autorite des Marches Financiers, Bank, Bank of America, Bank of England, Banking, Birmingham Midshires, British Economy, British Pound, BskyB, Chelsea, Chelsea Building Society, Cheltenham and Gloucester, Currency, Dow Jones, Dubai World, Economics, Economy, Financial News, Financial Services Authority, FTSE, Halifax, Lloyds Banking Group, Lloyds TSB, Michel Prada, Money, Money Markets, NASDAQ, Recession, Royal Bank of Scotland, Sir Terry Leahy, Stock Markets, Stocks and shares, Tesco, Thomas Huertas, UK Banks, UK Economy, UK government, UK Recession, Yorkshire Building Society

Savers with large amounts of cash on deposit should take action now to protect their money as the credit crunch threatens to sink more banks.

The Financial Services Compensation Scheme (FSCS) underwrites a £35,000 per person per bank repayment guarantee in the event of a crisis.

On the face of it, the FSCS pays out if savers have up to £35,000 squirreled away in a savings account – but rules for receiving compensation are not as straightforward as they seem.

Reading the small print reveals the rules actually say that if a saver has up to £35,000 on deposit in any number of accounts at the same bank, only the first £35,000 of the total amount is protected

Those at particular risk are savers with personal, partnership and business accounts with the same banking groups

FSCS is triggered if a bank, building society or credit union cannot settle or is unlikely to settle claims from savers – providing the institution is authorised under a banking licence in the UK.

The problem is many banks are groups operating on one licence, and although savers may feel their money is safe, they are at real risk of losing a lot of money if the banking group collapses.

In the current dog-eat-dog world of banking, a saver may unwittingly have cash outside FSCS due to a take-over or merger, even though they may know about the scheme’s shortcomings and have already taken action to protect their cash.

Here’s a list of the main banks and financial institution groups that operate under umbrella licenses:

· LloydsTSB, The AA, Bank of Scotland, Halifax, Birmingham Midshires, Intelligent Finance, Saga, Cheltenham and Gloucester

· Nationwide, Cheshire and Derbyshire Building Societies

· Barclays and the Woolwich

· Royal Bank of Scotland and Direct Line

· Clydesdale and Yorkshire Bank

· The Post Office and Bank of Ireland

· Co-op and Smile

· Abbey, Cahoot, Alliance and Leicester and Bradford and Bingley savings accounts

Under FSCS rules, if you have more than £35,000 in a single name or joint names in any of these groups, then disperse the money straight away in to sums of less than £35,000 at banks and building societies operating under separate licenses.

Most other big players like HSBC hold individual banking licenses.

Keep an eye on any cash you may have with the Alliance and Leicester – the Abbey recently swallowed the bank and at the moment they are trading on separate licenses, but this may change at short notice.

The FSCS raises money for compensation from a levy paid by member financial institutions.

Chancellor Alistair Darling has hinted that the £35,000 FSCS limit may go up to £50,000 in the near future.

Banks outside the UK

By law, overseas financial institutions should request Financial Services Authority permission before they open for business in the UK.

Many of these firms are not covered by the FSCS and savers should carefully check the firm’s terms and conditions before depositing money, however good the deal may seem.

The Post Office bank looks a good safe bet for savers as trading is under the same licence as the Bank of Ireland. The Irish government has recently announced all Irish banks are covered by a 100% compensation guarantee.

For all the best deals on Current bank account, Business bank accounts, Savings and Mortgage deals visit the number one Independent Bank Compassion site Bank—Accounts

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Tags: Abbey, Alliance and Leicester, Bank of Ireland, Bank of Scotland, Barclays, Birmingham Midshires, Bradford and Bingley, Cahoot, Cheltenham and Gloucester, Cheshire, Clydesdale, Co-op, Derbyshire Building Societies, Direct Line, Halifax, Intelligent Finance, LloydsTSB, Nationwide, Recession, Royal Bank of Scotland, Saga, Savings, savings accounts, Smile, The AA, The Post Office, the Woolwich, Yorkshire Bank