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VBproblem | Will Alliance and Leicester be the next bank to go? The IFA said today it is "monitoring" it along with B&B. |
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Bored House-husband
 |
Can everyone who keeps saying "people are just panicking, these banks are fundamentally solvent and good businesses" get a grip?!
Northern Rock has been in talks with the government about its impending collapse for nearly two months, the stock market has known since March (look at the bl**dy share price charts). Lloyds TSB refused to touch it and so did everyone else when they got to peek over the hole in its Chernobyl-roof and saw what a China-syndrome disaster it is.
Barclays "merger" with a Dutch Bank is in reality just a bail-out organized by the government because it's bust too, but here the Govt managed to cover it up in time (except from the people of Plymouth who lost their eagle).
The self-certificating 'banks' like A&L and Brad & Bingley are toast and things at NRock must be dire beyond belief for the Govt to allow images of a 1930s style run to haunt the world's screens.
Looks like Gordon Brown might not be such a financial genius after all eh? |
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claimbankchargesback
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There are no problems with these banks!
If it hadn't been for the mass panic by the general public, and them withdrawing all their savings, then Northern Rock would be fine today! As it is its not going to collapse, but has now been weakened and likely to get taken over.
Just because a bank takes a loan from the Bank of England it does not mean its in crisis.
What people don't understand is that these massive loans are part of standard banking practice and have been going on for years with one bank borrowing from another. The only difference is that because the banks are tightening their buckles, they are no longer lending each other money. As a result the banks have to borrow from the Bank of England instead.
The Bank of England would not have lent Northern Rock money if they were near collapse, as they wouldn't get the money back. The fact that they did lend the money shows that they believe that Northern Rock has a future and could continue.
Ironically the situation has become a self fulfilling prophecy. The public (mistakenly) believe that Northern Rock would collapse, because of the media hype, and because they withdraw all their money it has actually caused a big weakness in Northern Rocks position. If no one had over reacted then it would be business as usual.
For more details about the current situation, have a look at the question and answers section on my website. |
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kritster74
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Wow, not A & L as well - better withdraw my £1,000,000 savings from there then |
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DAVE P
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It just goes to prove just how little we trust the people in power. It's their own fault,,,they've told so many lies in the past.When they say a bank is ok nobody believes them. |
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Mark J
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in the current times of panic who knows...... if people panic they will create a run on the bank.. any bank. all it takes is a few ill informed people to demand their savings right now and create a bit of media interest and soon you have a full fledged panic.
there is no fundamental reason why Northern Rock has collapsed apart form people panicking. Its solvent its got a good loan book..it hasn't loaned irresponsibly, unlike some of the US lenders and a few British lenders. Those US lenders current problems are caused by mortgages offered to people who really shouldn't have a mortgage, often they have bought a house purely on the back of an expectation that prices will always go up.. Some of these loans are being called NINJA loans.. because they were sold to / bought by people with No Income, No Job and no Assets.
its problems are solely down to liquidity.... in as much it funded a large part of its loan book based on borrowings from banks rather that depositors.
In any event all depositors are guaranteed 90% of their savings are secure upto £35,000.
It doesn't matter if the bank is Northern Rock or Barclays or whoever.. no bank has enough cash in its tills to meet all its account holders deposits. Had the Bank of England phrased its message as saying there was no problem and it would provide as much cash as required then the run should have been killed immediately.
so its down to the herd instinct and the stupidity of people..... if they want to start a run on Alliance & Leicester they probably can.. but I suspect that the BoE will be far more aggressive in defending A&L after the seemingly unjustified collapse of Northern Rock |
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jeff hall
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probably - yes.
It borrowed money in much the same way as Northern Rock.
Its share price crash is an early warning of the trouble it is in.
Get you money out of it now before its too late. |
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nick
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hope not iv got an account there lol |
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polumbo
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keel haul them all |
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