Turner wants FSA to have more power to protect bank customers

The reputation of banks, and the confidence that consumers have in these financial institutions, has plunged over recent years, since the onset of the global credit crisis in 2007. With this in mind the chairman of the UK’s financial regulator, the Financial Services Authority, has called for the authority to be given greater powers to protect bank customers.

Lord Turner said that the FSA needs greater powers in order to protect consumers. The FSA is now set to launch a discussion paper based on the protection of bank customers. The debate will be centred around how the FSA could help, and what sorts of measures it could take in order to protect customers.

Officials from the FSA said that they want to find ways to take action to protect bank customers earlier on rather than having to wait until a number of complaints have been made before any action is taken. Some of the measures that the FSA is likely to look at will include the banning of some financial products, and a cap on the fees that are being charged on a variety of other financial products.

Lord Turner is set to argue that the FSA, or its replacement agency if it is disbanded, should be given greater powers to give bank customers the protection that they want and need. This comes following a surge in activity at the FSA, which has been cracking down on insider dealings, and has enforced a greater number of fines over the recent years.

Referring to the debate one FSA spokesperson said: “The debate will be about the types of things we do, different product regulation. Rather than waiting until lots of consumers have had to make complaints, can we take action earlier?”

Tags: confidence, agency, financial, cap, hector sants, onset, paper

Desperate customers being shunned by banks

It has been claimed in a recent report that many banks in the UK are turning away many desperate customers who are in need of help with their finances. Read more

Tags: Financial Ombudsman Service, advice agency, previous year, position, bank, agency

Opinions split over housing revival

Over the past few months there has been a turnaround in terms of property prices in the UK, and following a long period of house price falls property prices have been increasing again, albeit at a fairly modest rate. Read more

Tags: house, peak, house price revival, housing market, National Association of Estate Agents, conditions property prices, agency, global economic recovery

Is the Recession Coming to a Close?

According to the G8 ministers at a recent meeting in Italy, the world’s largest economies are starting to become more stable. However, they do warn that there are still risks to be faced. Consumer confidence appears to be on the rise, interest rates are starting to stabilize and the stock market seems to be on the upswing.

In spite of this optimism, a warning comes from the chief of the US Treasury, Tim Geithner. He says it is too early for governments to start bringing an end to their stimulus packages. He advises that they should remain in place until it is clear that the world is starting to recover economically.

The finance minister of the G8 countries met in Lecce, Italy to lay the groundwork for the G8 summit. They concluded that there is still uncertainty in the global market. According to a spokesperson, “Significant risks remain to economic and financial stability.”

There is a great possibility that unemployment numbers could still continue to rise even after stability occurs in the market.

In their joint statement, the ministers agreed that there are signs of hope, saying “We have taken forceful and co-ordinated action to stabilise the financial sector and provide stimulus to restore economic growth and there are signs of stabilisation in our economies.”

Geithner does agree that there are signs of hope, but cautions, “The global economy is still operating well below potential and we still face acute challenges.”

He went on to say, “I don’t think we’re at the point yet where we can say we have a recovery in place.” In his opinion it is way too early to start thinking of moving away from the economic policies that have been put in place to intervene in the banking crisis that occurred in September, 2008.

The Chancellor of the UK, Alastair Darling said that the economic prospects of Britain are still closely linked with those of the other G8 countries. He told the Reuters news agency, “A lot will depend on other countries making progress: on cleaning up their bank balance sheets; volatility in commodity prices, oil for example. So I think there are reasons to be cautious.”

Just two months before this meeting, the heads of the G* governments met in London and agreed to inject billions of dollars into the global economy. Although the finance ministers at the meeting in Italy agreed to start considering the scale back of the economic stimulus packages, Darling points out that it is very unlikely that this will happen at any time in the very near future. One thing we are absolutely clear about is we are not there yet. No-one’s talking about exiting now, this is some way down the track. We’ve still got to work this through,” he said.

Where the economy is headed is anyone’s guess at the present time. Some sectors of the economy are starting to look a lot better than they were several months ago, but at the same time, businesses that were doing well at that point in time are starting to experience difficulties.

Tags: uk economy, g8 summit, agency, opinion, recessions

Don’t pay through the nose to claim back your bank charges

Experts have been urging bank customers to think carefully before allowing charge reclaim companies to deal with reclaiming bank and credit card charges, stating that often the customer ends up paying a huge chunk of the amount reclaimed in fees to the company. Experts state that some customers are being charged hundreds of pounds but all the company does is fill out some forms that the customer could very easily do themselves. Read more

Tags: agency, reclaim bank charge, bank charges, online, pay

Government to crackdown on insurance cover from travel agents

According to a recent report the government in the UK plans to crackdown on travel insurance cover purchased from travel agents in a bid to provide consumers with higher levels of protection when they purchase this insurance.

The government has announced plans to regulate the sector, and this means that travellers could look forward to increased levels of protection when they purchase their travel cover from travel agents.

The government has announced that the Financial Services Authority will now be regulating travel insurance sold alongside holidays by travel agents. Travel agents that plan to sell this type of insurance with holidays will therefore have to make sure that it is designed to fit the needs of customers.

Customers will have to be treated fairly in line with Financial Services Authority regulations when buying these policies, and in the even that the customer of dissatisfied with an aspect of the sale of the policy he or she can go through the Financial Ombudsman Service.

Ed Balls, economic secretary to the Treasury, stated: ‘Evidence shows that companies regulated by the FSA are better at getting consumers to make an informed choice because they are better at explaining the key features and exclusions of the product and guiding the customer through the sales process.’

The crackdown results from complaints from consumers groups with regards to unsuitable and expensive policies being sold to customers in the past – a problem that this move will help to reduce. The new regulations are set to come into force in 2009, although many officials from the travel agents industry are not happy about the move.

The travel agency industry had asked for the opportunity to make changes without these new regulations being put in place, but were not granted this opportunity.

Tom Smith
4th July 2007

Tags: finance, Insurance, price, agency, changes, cover

Buy-to-let investors missing out on best loan deals

Investors looking to take advantage of the growing buy-to-let market are missing out on the best methods to finance their purchases, according to research from Heritable Bank.

Coupled with the hike in rates, this means that investors could be needlessly wasting thousands of pounds on interest.

The study shows that investors spend 60 per cent of ongoing costs on mortgage repayments. But only a quarter of the 186 investors surveyed said that they had put finding the most advantageous financing deal at the top of their priorities.

Chief executive of Heritable Bank, Mark Sismey-Durrant, said: “Property investors often have a real passion for the portfolio of bricks and mortar they have built up, but equally they are in the business to make money.

“That’s why we were surprised to see such a mismatch between the amount of money spent on meeting their mortgage and the amount of time spent ensuring they have the best, most appropriate financial arrangements in place.”

Other significant costs for investors, according to the study, included paying for maintenance work (13 per cent of overall costs), covering management and letting agency fees (ten per cent) and paying legal and accountancy fees (eight per cent). General property investment-related bills took up the final ten per cent of the ongoing costs.

Tags: management, agency, mismatch, finance, time